June is set to be a busy month for HR professionals with many of the Secure Jobs, Better Pay reforms coming into effect. These reforms see changes to the Fair Work Act 2009 (Cth) ("FW Act") around flexible work arrangements, unpaid parental leave, pay secrecy and enterprise bargaining. Employers should ensure that they are across the June workplace relations reforms and have implemented all necessary changes, including updates to policies, procedures and employment contracts.

Flexible work arrangements

The eligibility criteria for employees who can request a flexible working arrangement ("FWA") has been expanded to include employees who are pregnant and employees who have a member of their immediate family or household experiencing family and domestic violence.

There is also a new process for considering FWA requests which increases an employer's obligations. Notably, employers must genuinely try to find alternative arrangements to accommodate an employee's circumstances before rejecting a FWA, consider the consequences of any refusal and provide a written response setting out:

  • the business grounds for refusing the request;
  • any other alternative arrangements the employer can accommodate; and
  • the Fair Work Commission's (the "FWC") new dispute resolution process.

In circumstances where an employer and employee cannot agree on a solution, the employee can now make an application to the FWC and the FWC has new powers to deal with this dispute.

Unpaid parental leave

Employers also have additional obligations when considering requests for extension to periods of unpaid parental leave. Employers have an obligation to genuinely try to reach an agreement with an employee if they request to extend their unpaid parental leave beyond twelve months and need to consider the consequences of refusing the request.

Employers will be required to provide a written response which includes the reasons for the refusal, an alternative period of extension the employer can accommodate (or if there is no extension period they can accommodate) and information on the FWC's new dispute resolution process.

The FWC has new powers to deal with a dispute about a request to extend unpaid parental leave in circumstances where an employer and employee cannot agree on a solution.

Pay secrecy

Pay secrecy clauses are now prohibited and cannot be included in employment contracts or other written employment agreements. In practice, this means employees are allowed to freely discuss and compare their pay and working conditions if they wish to do so.

Enterprise bargaining

There are many changes coming into effect which will impact the bargaining framework in Australia. The key changes include:

  • Bargaining disputes: the FWC has new methods to deal with a bargaining dispute. One of these methods is an "intractable bargaining determination", which can be issued if the parties have been bargaining for at least nine months and there is no reasonable prospect of reaching an agreement.
  • Enterprise agreement approval: the process to obtain approval for an enterprise agreement has simplified. Moving forward, employers will need to prove that there was "genuine agreement" from all parties on the terms and conditions of the proposed enterprise agreement. The FWC has released their "Statement of Principles on Genuine Agreement" by which employers must be guided (read the statement here).
  • Better off overall test ("BOOT"): the FWC will now conduct a global assessment of the enterprise agreement rather than a prescriptive line-by-line approach. Additionally, the FWC is only required to consider "reasonably foreseeable employees" when applying the BOOT. Significantly, the FWC will have powers to amend a proposed enterprise agreement to address any concerns about the BOOT.

What's next?

While it may feel like these changes are extensive, there are more to come! July will see the new pay increases to the minimum wage and modern award minimum wage introduced, significant changes in relation to sexual harassment will come into effect later in the year and there is a further round of workplace reforms concerning "employee-like" work and casual employment.

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