Future-proof your business: 10 strategies to stay ahead of changes to the Fair Work Act 2009 (Cth)

As a business owner or HR practitioner, staying ahead of the ever-changing landscape of employment law can be daunting. With recent updates to the Fair Work Act 2009 (Cth) (Act) and more changes on the horizon, it's crucial to take proactive measures to ensure compliance.

So what can business to do? Read on below to find Workable Law and IR’s 10 practical tips and strategies we’ve put together to help you stay ahead of the curve.  By implementing these measures, you’ll not only stay compliant, but you could also improve your workplace culture and protect your business from legal risks. So, let’s dive in!

1.       Consider your labour hire / contracting arrangements

“Same Job, Same Pay” is coming. We don’t know yet exactly what form it will take, however if it is similar to the legislative scheme put forward in the private member’s Bill by Prime Minister Albanese when we was the Opposition Leader in 2021 (2021 Bill), it could be expansive and have far-reaching implications for businesses that use both traditional labour hire, and even some forms of sub-contracting arrangements where other business’s workers perform services at your workplace (as is the case with some of the State-based labour hire licensing schemes).  Business would do well to consider the extent to which it engages with labour hire and other outsourced services providers, and how it will manage these contracts if and when it is required to ensure that labour hire workers are provided with the same pay (and conditions) as the direct hired workforce. The 2021 Bill proposed that labour hire workers would be entitled to the same pay and conditions, as well as casual loading, training and job opportunities and amenities as directly hired staff.

 2.       Think about whether you should negotiate single enterprise agreements right now!

Starting from 6 June 2023 (at the latest), the new multi-employer bargaining rules will come into effect. These changes are significant and unions hope they will lead to the rise of industry-level bargaining as the central wage fixing mechanism, where a small number of employers negotiate with the union for terms and conditions that may ultimately apply for the entire industry (including by use of roping in mechanisms). Unions and the ACTU seem to be pushing for this outcome (see here and here). The best way to limit the risk of being drawn into multi-employer deals in the short to medium term for some employers will be to have in-term single enterprise agreements. Therefore, businesses should consider negotiating or renegotiating single enterprise agreements as quickly as possible.

While we’re talking about bargaining, it’s also worth reviewing the Fair Work Commission’s Draft Fair Work (Statement of Principles on Genuine Agreement).

Consider your mitigation strategy if your business (or its competitors) are pulled into multi-employer bargaining. What legal tests will be relevant? Would you rather be at the table than risk getting roped in later to a deal you’ve had no say in?

3.       Update your employment contracts

Have you reviewed your employment contracts to ensure they don’t contain prohibited pay secrecy clauses? Have you dealt with changes to the National Employment Standards (NES), including regarding paid family/domestic violence leave and impending parental leave reform? If not, it’s time to do so. Civil penalties will be able to be imposed on employers who use contacts and other agreements with prohibited pay secrecy terms.

Make sure you are providing new starters with the correct versions of the Fair Work Information Statement and Casual Employment Information Statement as published by the FWO. Watch out for the fixed term contract information statement to come as well.

4.       Update your policies

 While we’re on topic, consider whether your policies and code of conduct need to be updated as well. If you have a remuneration review policy which refers to pay details being confidential this could be problematic. Leave policies should also be updated for reference to paid FDV leave as well.

5.       Get your Super house in order

While the ATO is already able to enforce employer superannuation obligations and your employees (and their representatives) may also have rights under modern awards and enterprise agreements, ensuring compliance with super obligations is about to become even more important as the Government looks to implement its election promise to include an enforceable right to superannuation in the NES. This will likely provide another avenue for employees and unions to bring disputes in relation to unpaid (or alleged) unpaid superannuation disputes with risks of civil penalties under the Act. Now is the time to ensure your business is fully compliant with its superannuation obligations for employees and contractors, and to try and resolve any disputes it may have with the workforce in relation to superannuation, including what payments should be taken into account as OTE etc.

6.       Consider your engagement models

While business may have taken some comfort from the High Court decisions in Jamseck and Personnel Contracting now is a good time to make sure you are using independent contractors and casual employees correctly and not over using those engagement models where it may not be appropriate. Labor has promised to introduce laws providing for minimum conditions for “employee-like” workers and the gig economy and has said they will re—visit the definition of who is a casual employee. We recommend ensuring that:

• Independent contractor agreements are well drafted and your obligations regarding contractors are consistent and complied with (including where superannuation and workers compensation is required); and

• Casual employment contracts are well drafted and used on a genuine “casual” basis.

7.       Revisit how you’re using fixed and maximum term contracts

New restrictions on the use of fixed and maximum term contracts will be enforced starting from 6 December 2023. However, it's crucial now to assess how your business is currently using fixed term engagements and whether there are alternative engagement models that better fit the roles in which you employ these employees in, given the rules on how many rolling contracts can be entered into and the maximum 24 month term that they can be used for.

8.       Don’t be a wage thief

The government plans to introduce wage theft laws at a Federal level (and has said it won’t disturb existing state based wage theft laws). The proposed laws will aim to deter employers from engaging in deliberate or reckless underpayments by increasing the penalties for such offences and making it easier for workers to recover stolen wages. Under the new laws, employers found guilty of wage theft could face criminal charges, including fines and even imprisonment. The government hopes that these tougher penalties will act as a deterrent. As such, there are even more reasons to ensure you understand your minimum legal obligations to employees including under modern awards and enterprise agreements, and ensure you are complying with them in full.  It is also worth noting that penalty units for breaches of the Fair Work Act 2009 also recently increased.

9.       Get more sophisticated in the steps you take to prevent sexual harassment

 A simple anti-discrimination policy that you set and forget once is not going to cut it given the increased scrutiny on workplace sexual harassment and new avenues for redress. As of 6 March 2023, new provisions in the Act have come into effect, prohibiting sexual harassment in connection with work. Alongside this, a new dispute resolution framework has been introduced allowing the FWC to deal with sexual harassment disputes other than by arbitration (in addition to its existing power to make orders to stop sexual harassment). If the FWC is not able to resolve a sexual harassment dispute, the dispute may be taken to Court by a worker or their representative. With these developments, there is likely to be even more increased scrutiny and regulation of sexual harassment in the workplace, particularly given the positive duty to prevent sexual harassment recently introduced in the Sex Discrimination Act 1984 (Cth). It is crucial that employers have a comprehensive prevention plan in place to safeguard their workers against sexual harassment, sex discrimination, and victimisation.  Contact Workable Law & IR for assistance in the preparation or review of your plan.

10.   Train your HR practitioners in advocacy at the FWC

 With more and more avenues to seek FWC assistance with workplace disputes, including in relation to requests for flexible work arrangements, bargaining, increased obligations under the NES and sexual harassment, it is likely that many businesses will find themselves in the FWC more often. Consider whether your HR team and other functional and operational managers would benefit in training on FWC processes and procedures so they can effectively advocate for and defend your business when the need arises.

Thanks for taking the time to read our post on the top 10 things employers can do to stay ahead of changes to workplace laws. We hope you found it both helpful and informative. We are ready to assist you in navigating these changes with ease. So, if you need a hand or have any questions, please feel free to reach out to us! We'd love to hear from you and help you stay on top of the game.