The Federal Government has announced its amendment to the Fair Work Legislation, known as the ‘Closing Loopholes’ No.2 Bill, heralding significant changes for staff and employers in hospitality.
Changes to the legislation passed both Houses in February. They include new laws around intractable bargaining powers, multi-enterprise agreements, casual employment, and the definition of an employee.
The Bill sets out the right of an employee to “disconnect” and refuse to respond to contact from the employer outside regular working hours – unless this would be deemed ‘unreasonable’, which is determined by factors such as: to what extent the employee is renumerated to remain available or perform work, role and level of responsibility, reason for and method of contact, level of disruption and the employee’s personal circumstances.
“Employers will be prohibited from dismissing someone or taking adverse action against an employee who reasonably refuses to respond to out-of-hours contact,” advises Amber Hopkins* – partner at OpenLegal.
“Employers should exercise discretion on what contact is essential and reasonable, as well as consider whether employees should be renumerated in a way that takes these expectations into account.”
What does this mean for business?
Compliance and labour costs for business will increase, and employers will need to consider multi-factor tests, such as:
- What is a casual worker?
- Is a worker an employee or contractor?
- Is a worker an employee-like worker?
- The FWC’s ‘same job, same pay’ order
Hopkins says many businesses will need to reassess their labour hire and contractors given the same pay for same job provision.
In the case of a dispute, either employer or employee can refer the matter to the Fair Work Commission (FWC), where a two-stage conciliation-arbitration approach will be used.
The Closing Loopholes Bill furthers the work of the recent ban on ‘Pay Secrecy Clauses’ that came into effect June 2023, applying to all employment contracts made on or after 7 December 2022.
Under the new law employees are permitted to disclose (or not) their pay and conditions of employment to any other person.
Significantly, this includes their right to ask other employees about their pay and employment T&Cs.
OpenLegal suggests the changes stand to benefit employers by:
- Reducing risk of discrimination claims
- Promoting transparency and fairness in the workplace
- Employees feeling more fairly treated, leading to improved employer-employee relations
- Increasing employee retention
It is anticipated the ban will shift the dynamic of staff remuneration to one of open equality. Employers who attempt to include these clauses into employment contracts risk penalties,
“The key difference now is that employees have right to ask, and the right to share this information,” furthers Hopkins.
*Amber Hopkins, partner at OpenLegal, has been practising as a commercial solicitor for over 16 years, with a special focus on assisting business owners with employment law advice and managing disputes. She will be one of the guest panellists at ClubTIC and PubTIC’s upcoming event: the Seminar of Hospitality Operations (SOHO)
