Proposed Fair Work changes and new worker rights and employer responsibilities have the potential to reset the way work is conducted. A legal expert walks HR through some of the recent updates.

The Federal Government is gearing up to make ambitious reforms to the Fair Work Act following recent significant High Court rulings and an eventful Jobs Summit. 

HRM asked Charles Power, Partner and National Practice Chair of the Workplace Relations and Safety Group at Holding Redlich, to unpack some of the most important industrial relations developments that HR should keep an eye on.

1. Fair Work changes

The Federal Government has ambitious plans to change aspects of the Fair Work Act, which could affect labour hire, casual employment and enterprise bargaining.

“One of the key reforms the government is going to introduce is a requirement that organisations supplying labour hire workers match the pay and employment conditions that are afforded to employees of the host employer,” says Power.

“Another proposal emerging from the Jobs Summit last week was a proposal to amend the National Employment Standards to essentially create a universal entitlement of employees to enforce their employer’s compliance with Superannuation Guarantee obligations.” 

Through consultation processes convened by the government, industry groups are also currently considering a change to the laws around multi-employer bargaining.

“[This would] increase the scope for industry-wide agreements about pay and conditions,” says Power. “Unions see this as expanding the scope for enterprise agreements to be reached in sectors where individual employers don’t have the resources to engage in bargaining for enterprise agreements.

“Employer groups are concerned it will lead to industry-wide strikes and the imposition of arrangements on employers that don’t suit their business.”

2. Gig workers and contractors

The recent High Court decisions in Personnel Consulting and Jamsek reset its approach to distinguishing an employee from a contractor; this will have significant implications for labour hire, platform workers and professionals who supply their services as contractors. 

“Prior to these High Court rulings, the approach of the courts in Australia in deciding  the nature of the [working] relationship was one which had regard not only to the contract, but also to the way the contract was performed,” says Power.

“The High Court has now significantly restricted the relevance of that post-contractual conduct when it comes to characterising the legal nature of a work relationship.

“The concern with this decision is that it will allow employers to set the terms and conditions of the relationship at the outset and therefore prevent employee-like contractors from accessing the safety net conditions in the Fair Work Act.”

“A manager’s propensity for bullying is as much a workplace hazard as a loose handrail or a faulty lift.” – Charles Power, Partner, Holding Redlich

The new approach set by the High Court was “reluctantly” applied by a Full Bench of the FWC in August this year in an important decision which found that a Deliveroo delivery rider was an independent contractor, overturning a previous decision which deemed him to be an employee.

“The exclusion of these workers from the Fair Work Act safety net is driving the Government to implement its election proposal to enable gig workers to seek rulings from the Fair Work Commission entitling them to access to a minimum set of working conditions and wages.”

3. Employees making complaints are not always protected by Fair Work Act

In a significant ruling resolving a claim made by an employee against a Big Four bank, the Federal Court has clarified the scope of employment complaint protections, which raises important considerations for employers in managing employee grievances.

“The main implication of this decision is that it sets some boundaries around when an employee has Fair Work Act protections when they voice an objection or complaint about a work issue. This is helpful because there had previously been a lot of different views expressed by Federal Court judges.”

The Federal Court also considered whether it was necessary for employees making complaints to use a formal complaints process in order to receive the protection afforded to them by the Fair Work Act. 

“It now appears to have been settled that [employees] don’t need to have access to a complaints procedure in an enterprise agreement in order to attract this protection. The act of making the complaint is sufficient to attract the protection.”

The nature of the complaint was also put into question, he says.

“However, not all complaints will be protected. The subject matter of the complaint has to be concerned with the employee’s own employment relationship and an entitlement or right arising from the employment contract, award or enterprise agreement. An employee is not protected if they simply complain about management decisions that don’t affect them.”

4. Managing workplace risks to worker mental health

SafeWork Australia and Victoria’s WorkSafe have proposed new regulations regarding employers’ responsibility to be proactive in managing the factors that exacerbate stress and psychological ill-health in the workplace.

“[The regulations] formalise obligations that are generally recognised to exist already. That is, employers need to have as much regard to mental health hazards as they would to hazards that risk physical health,” says Power. 

“A manager’s propensity for bullying is as much a workplace hazard as a loose handrail or a faulty lift.”

It’s expected that employer responsibilities once thought to be a ‘nice-to-have’ are now being embedded into law.

“It will heighten the potential liability of employers under work health and safety laws if they don’t take action to protect and safeguard the mental wellbeing of the people that are working for them. 

“For example, a large organisation with previous instances of bullying behaviour that fails to have a formal system with documented procedures for reporting bullying complaints will be exposed to an investigation and potential prosecution by a safety regulator.”

HR’s takeaways

While many of these changes may take some time to come into effect, HR professionals should be prepared for significant reform in many corners of their business.

“The message here is that industrial relations and employment law flew under the radar a bit during the federal election campaign,” says Power.

“A lot of employers need to appreciate that there will be very far-reaching changes that they’ll need to understand and think about in terms of their own organisations.”

 Want to hear more from Charles Power about the potential Fair Work changes HR needs to be across? AHRI members can sign up for a free webinar exploring these topics in more depth on 15 September at 12:30. Book your spot today.