This is how we used to speak about our salaries, especially if you had a pay secrecy clause written into your contract. Well, these taboo conversations are about to become a thing of the past, with the recent Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 marking some of the most significant changes to our federal employment law systems since  the commencement of the Fair Work Act (Act) in 2009.

The amending Act gives employees and future employees the right to:

  • share (or not share) information about:
    • their pay
    • their employment terms and conditions that would be needed to work out their pay, such as their hours of work
  • ask other employees (with the same or a different employer) about their:
    • pay
    • employment terms and conditions that would be needed to work out their pay, such as their hours of work.

Employees can’t be forced to give this information to another employee if they don’t want to.

So why is this important?

By removing the pay secrecy clause in new employment contracts in Australia, we are starting to catch up with progress made by other countries. Think the UK, US, Canada and throughout Europe.

The primary driver for the removal of pay secrecy (or to bring in pay transparency) is to continue to bridge the gender pay gap, which currently sits at 22.8% as at November 2022 according to WGEA (GPAQ, Employer Census Data). However, it could deliver positive outcomes for other disadvantaged employees as well.

Ending pay secrecy may also see an end to decisions being made about salaries, which in the past have not had to be justified to employees. Without that justification (ie. transparency), there has been a heightened risk of unconscious bias, favouritism and discrimination, which can affect salary decisions.

All things considered, the new legislation is a positive move that should serve to benefit employees.

Now is the time to be proactive!

As employers, now is the time ensure that you are meeting your obligations and complying with the new legislative amendments. These new rights apply after 7 December 2022.

These workplace rights apply to employees with:

  • employment contracts that were entered into on or after 7 December 2022, or
  • employment contracts entered into before 7 December 2022 where the contract doesn’t include pay secrecy terms that are inconsistent with these rights.

Where a contract entered into before 7 December 2022 has pay secrecy terms that are inconsistent with these rights, and the contract is changed after 7 December 2022, these rights apply after the contract is changed.*

Check your contracts and employee agreements! Are you compliant?

The Interchange Bench will be hosting a series of events for HR leaders over coming months to help inform employers about the Secure Jobs, Better Pay legislation. Register your interest now if you would like to receive an invitation.

What is the Interchange Bench doing?

We have amended all of our employment contracts for our on-hired candidates, and we are providing transparent information to our clients to ensure that if and when these conversations do take place, we are prepared for productive and informative discussion.

Please contact our team or reach out to me via LinkedIn or email to find out more about how to continue to work with your employees and on-hired staff in this ever-changing environment.