As of 6 June, a range of the Secure Jobs, Better Pay Bill changes will be coming into effect, including the new multi-enterprise bargaining approach and changes to the handling of requests for flexible work and unpaid parental leave extensions.
From 6 June, the next raft of changes from the Secure Jobs, Better Pay Bill will be in effect. As of this week, employers will need to ensure they’re across their new obligations when it comes to multi-enterprise bargaining, flexible work and unpaid parental leave requests, and communicating the sunsetting of ‘zombie’ agreements with their employees.
This month also marks the introduction of increased powers for the Fair Work Commission (FWC) to intervene and make recommendations when conflict arises between employers and employees on some of the matters outlined above. Here are the details HR professionals need to be across.
Potential fines for including pay secrecy clauses
The exclusion of pay secrecy clauses was effective as of December last year when the Secure Jobs Bill was first announced.
This decision was made in order to add more transparency to pay conversations in a bid to boost gender equality. It also means employees are protected from adverse action if they decide to disclose their salary to others.
However, as of 7 June, the inclusion of pay secrecy clauses included in new employment contracts could now potentially attract penalties. Any such clauses included in old employment contracts will remain in effect until the contract is varied in some way.
According to the Department of Workplace Relations, “Providing the opportunity for employees to understand and gather more information about their remuneration aims to reduce discrimination and narrow the gender pay gap.”
Multi-enterprise bargaining changes
From 6 June 2023, there will be three different types of multi-enterprise agreements: supported bargaining agreements, single interest employer agreements and cooperative workplace agreements.
To help employers to understand the difference, the FWC has created this short video:
1. Supported bargaining stream. Under this stream, the FWC is required to make a Supported Bargaining Authorisation if it’s satisfied that it’s appropriate for the relevant employers and employees to bargain together. This stream will replace the existing low-paid bargaining scheme.
“This is designed to assist organisations with predominantly low-paid employees who don’t necessarily have the resources or the HR capacity to bargain,” Charles Power, Partner and National Practice Chair of the Workplace Relations and Safety Group at Holding Redlich, told HRM in March.
“It’s a multi-enterprise bargaining stream that’s really catering for organisations like childcare and aged care.”
2. Cooperative workplaces bargaining stream. Under this stream, an employer can seek to join with other employers to make a cooperative workplaces agreement. This will replace the current ‘multi-enterprise agreements’ made with the agreement of multiple employers.
“This is only really designed for small businesses. Employers can’t be subjected to industrial action in the making of these agreements. It’s a very new area, and it remains to be seen what – if any – traction it gets,” said Power.
3. Single-interest bargaining stream. This stream was previously available, but the reforms will remove unnecessary barriers to using it. It will allow employee bargaining representatives to initiate the making of multi-employer agreements with groups of employers who share “clearly identifiable common interests”. This stream will only be available to employers with a headcount of 20 employees or more.
The new legislation also includes the removal of “prescriptive and complex” pre-approval processes for enterprise agreements. That also comes into effect this week. You can read about those changes here.
New FWC powers to arbitrate bargaining disputes
The Fair Work Legislation Amendment also includes provisions to empower the FWC to resolve “intractable bargaining disputes” in a bid to speed up resolutions and avoid industrial action taking place.
“If an agreement expired late last year, the Commission could theoretically start arbitrating unresolved issues in July this year – because they can take into account the period prior to the commencement of the legislation in assessing whether or not there were prospects of an agreement being reached,” said Power.
From 6 June, the FWC will be able to make “intractable bargaining declarations” (i.e. decisions about the terms of an enterprise agreement). In order to do this, it first needs to be satisfied that:
- It has dealt with the dispute (e.g. by conciliation) under section 240 of the Act and the applicant participated in the process
- It’s unlikely that the parties will reach an agreement themselves
- The parties have bargained for at least nine months, or at least nine months have elapsed since the nominal expiry date of the previous enterprise agreement.
The FWC will be able to exercise discretion as to whether the negotiation period can be extended or not before it chooses to resolve the matter itself.
According to the Department of Workplace Relations, “These changes support the Commission to assist parties bargaining for a new enterprise agreement to resolve disputes. There continues to be a high bar for access to arbitration for intractable bargaining disputes. However, the changes encourage parties to bargain reasonably and in good faith.”
“Employers can’t be subjected to industrial action in the making of these agreements. It’s a very new area, and it remains to be seen what – if any – traction it gets.” – Charles Power, Partner and National Practice Chair of the Workplace Relations and Safety Group at Holding Redlich
Flexible work and unpaid parental leave requests
As of this week, employers will need to think twice before denying flexible work requests. The FWC will have greater powers to resolve flexible work disputes, such as via conciliation and mediation sessions.
While it’s best practice to offer flexibility to all workers, there is a list of ‘eligible’ workers to whom this legislation applies. That includes employees who are:
- Over 55
- Living with a disability
- Caring for infants or school-aged children
- Carers (within the meaning of the Carer Recognition Act 2010 (Ch))
- Experiencing family and domestic violence, or caring for someone who is
- Pregnant (this is a new addition).
As HRM reported in January this year, instances in which an employer could deny a flexible work request could include situations such as:
- If a change in hours would introduce penalty rates that an employer couldn’t afford
- If the requested hours would cause major disruption to business operations
- If it would introduce capacity/resourcing issues
While every request will need to be assessed on a case-by-case basis, generally, if a business can clearly demonstrate that it has assessed a request and found it was not reasonably feasible due to cost or operational factors, it will have reasonably declined the request as required by the Act.
Right to request unpaid parental leave
Working parents will now have increased rights to request an extension of their unpaid parental leave leave. Employees who opt to take 12 months of unpaid parental leave are eligible to take a further 12 months (unless their partner has also taken 12 months off). This is capped at 24 months.
Employees are obliged to notify their employer of their intention to extend their unpaid leave in writing with at least four weeks’ notice. The employer has 21 days to respond and, should they decide to refuse the request, will need to prove:
- They have given the employee a reasonable opportunity to discuss their request
- There are reasonable business grounds to do so.
The concept of “reasonable grounds” could be slightly fuzzy, considering it would be unique to the employer’s circumstances. However, speaking generally, factors could include:
- The effect on the workplace operations (i.e. cost or productivity challenges)
- Capacity/resourcing issues
- The inability to recruit a replacement
Under the new legislation, the FWC has greater powers to manage disputes about extensions to unpaid parental leave.
According to the Department of Workplace Relations, “These amendments form part of an Australian Government commitment to improve job security and put gender equality at the centre of the workplace relations system.”
It’s worth noting that the paid parental leave scheme is also changing. By 2026, six weeks of leave will have been incrementally added, extending Australia’s scheme to 26 weeks’ paid leave.
Notice of sunsetting zombie agreements due
Employers who operate under agreements made prior to the commencement of the Fair Work Act in 2009 – which are known as ‘zombie agreements’ – can still operate under these agreements until they sunset on 6 December 2023.
However, employers have until 6 June 2023 to give affected employees written notice of this change.
Need more support?
You can see the Fair Work Ombudsman and Fair Work Commission’s resource pages, which contain fact sheets and helpful timelines, as well as the Department of Work Relation’s Secure Jobs, Better Pay resource hub.
What do you want to know more about regarding the 2023 industrial relations changes? Let us know in the comments and we will consider the topic for a future article.
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