We’ve had a raft of changes in the workplace relations space (see our recent article here ) and there are more changes to come it seems. The Albanese federal government released consultation papers for further reforms to workplace laws that it is considering to introduce in the second half of 2023.
There were 11 proposals for reform which the federal government sought feedback on from stakeholders. The consultation period closed on 12 May 2023.
Moores has prepared a brief overview of the proposed reforms and issues which are still to be addressed. Employers should be on notice about these potential changes..
1. Casual workers
The Fair Work Act 2009 (Cth) (FW Act) defines casual employment – a change introduced after years of uncertainty following common law decisions which applied a multi factor test. The Rossato High Court decision provided decisive authority as well in 2021.
As part of enhanced protections for casual workers, further award reforms have been introduced in recent years to provide casual employees with the right to convert to permanent arrangements.
The government is now considering introducing a legislative test to which would bolster the right of conversion including through considering how post-contractual conduct should be assessed
2. Same Job, Same Pay
In what would be a significant regulatory reform for the labour hire sector, the government is considering more protections for outsourced third party labour, or labour hire, to provide pay parity with direct employees.
Direct employees can be entitled to enhanced wage and related entitlements under a particular enterprise agreement. That instrument does not automatically apply to labour hire resulting in employees performing the same or similar work, side by side, but receiving different wage outcomes because of who their employer is.
Details of the proposed mechanism are still to be decided such as the scope and application, the criteria for ‘same job’ and the calculations for ‘same pay’. The proposals also include the introduction of dispute resolution pathways with the Fair Work Commission (Commission) and enforcement measures.
3. Criminalising wage theft
The previous federal government started the conversation around the criminalisation of wage theft at a federal level. Various political upheavals meant that reforms proposed back in 2019 were shelved indefinitely. It is now back on the agenda. The federal government is considering how to strengthen the compliance and enforcement framework surrounding wage theft.
The major question for consultation was whether to introduce an offence which is knowledge-based or recklessness-based. A knowledge-based offence seeks to cover instances in which an employer knows they are not paying their employee their entitlements. A recklessness-based offence covers instances in which an employer is ‘aware of a substantial risk’ and proceeds to take the risk where it is ‘unjustifiable’.
An increase to the maximum civil penalties for wage theft is also being considered.
4. Gig economy – ‘employee-like’ forms of work
More protections may be on the cards for ‘gig workers’ who are ‘employee-like’.
The term ‘employee-like’ describes workers who have features of employment and do not exhibit all the characteristics of traditional independent contractors. Think rideshare and food delivery service workers.
It is proposed that the Commission be empowered to set minimum standards for these workers. These minimum standards may include:
• minimum rates of pay;
• workplace conditions, such as rest breaks;
• concepts of ‘work’ time and which work activities should attract compensation; and
• timeframes between performing work and receiving payment.
5. Give workers the right to challenge unfair contractual terms
Independent contractors currently have some rights to challenge unfair contract terms but in recognition of some of the practical obstacles in the current legislative framework, there is a proposing to introduce a low-cost jurisdiction within the Commission to provide contractors a clearer pathway to seek recourse.
6. Allow the Commission to set minimum standards to ensure the Road Transport Industry is safe, sustainable and viable
This consultation paper was focused on addressing key issues raised by members of the road transport industry.
7. Provide stronger protections against discrimination, adverse action and harassment
The federal government intends to align the FW Act with federal discrimination law. Some of the proposed amendments include:
• introducing an express prohibition on indirect discrimination;
• clarifying the definition of ‘disability’;
• expressly requiring employers to consider reasonable adjustments when assessing whether employee can perform the inherent requirements of a role;
• adding family and domestic violence as a protected attribute; and
• including discrimination on the basis of a combination of attributes.
8. National labour hire regulation
There is a proposal to introduce a single national labour hire licensing scheme to replace existing state and territory schemes across all industries.
The proposed scheme would require labour hire providers to hold a licence to operate and comply with all eligibility criteria, to promote accountability and transparency, and to protect workers from exploitation.
9. Small business redundancy exemption
Currently, the FW Act provides small businesses (fewer than 15 employees) with an exemption to the obligation to pay redundancy provisions . Whilst the federal government is not proposing to remove the exemption, it is considering making some amendments to protect employees from unintended outcomes, such as employees losing an entitlement when an employer becomes insolvent.
10. Reforms to enterprise bargaining provision to close loopholes
10.1 The Commission issuing model terms for enterprise agreements
There is a proposal to reallocate responsibility for model terms for enterprise agreements from the Minister for Employment and Workplace Relations to the Commission.
10.2 Preserve arrangements for employers already using single interest agreements
Consultation focused on whether additional transition rules are required to preserve employers’ alibility to access the ‘single interest’ bargaining stream after new bargaining changes take effect on 6 June 2023. This relates to a current mechanism for multiple employers to bargaining together for a ‘single interest’. Repeal demerger from registered organisations amalgamations provisions.
There are proposed changes to limit a registered organisation’s (eg. a union) ability to apply for a ballot to withdraw from amalgamation with another organisation. The limitation proposed is the permit such applications where they are made more than 2 but less than 5 years after amalgamation. The rationale for the proposal is to restore the ‘long standing requirements in previous iterations of [the] Act’.
How we can help
Our Workplace Relations Team continues to monitor workplace relations reforms and will provide updates as they come to hand. In the meantime, our team can provide you with guidance to identify key areas of reform which may affect the way your organisation operates and support you to implement the necessary changes.
Contact us
Please contact us for more detailed and tailored help.
Subscribe to our email updates and receive our articles directly in your inbox.