Happy 2024 to all our members.
As most businesses return to work following the holidays, it is important to be updated with the employment law changes that have taken place in 2023 and will take place in 2024 in order to be compliant at all times.
Snapshot of 2023
2023 saw many changes. Below is a summary of the key changes:
Pay Secrecy
From 7 June 2023, pay secrecy terms cannot be included in employment contracts. This means, employees or future employees can share (or not share) or ask other employees any information about their own or other employees’ pay or working conditions to ascertain the pay. Adverse action cannot be taken out against them for disclosing such information. There can be penalties for including them in the employment contracts.
Note: Pay secrecy terms for contracts entered before 7 December 2022 can still continue to operate, until those contracts are varied. Pay secrecy terms for contracts entered into on or after 7 December 2022 but before 7 June 2023 have no effect anymore and cannot be enforced.
Superannuation
From 1 July 2023, the superannuation guarantee (SG) rate increased to 11%. The new SG rate applies to payments made to workers on or after 1 July 2023. This is in accordance with legislated SG increases of 0.5% that are scheduled each financial year until 2025 when the rate reaches 12%.
Fixed Term Contracts
From 6 December 2023, new rules apply when engaging employees under a fixed term contract. Employers are now prohibited from entering into fixed-term contracts with employees in circumstances where:
- the fixed-term contract has a term of more than two years; or
- the fixed-term contract contains an option to renew for another term, such that the employee may be employed for an overall term that is more than 2 years; or
- the fixed-term contract provides for an option or right to renew or extend the contract more than once.
It is unlawful for parties to enter into a series of consecutive fixed-term contracts, including where the combined terms exceed 2 years, where an employee will be performing the same, or substantially similar work, under the contracts or there is a substantial continuity of the employment relationship between the contracts. Employers that contravene these provisions may be liable for civil penalties.
If an employer enters into an employment contract that is in breach of the prohibition, the term that provides for the contract to end at or on a specific date will have no effect. However, the remainder of the contract will operate unaffected. This could result in an employee becoming entitled to notice of termination of their employment and redundancy pay, and may provide them with protection from unfair dismissal, i.e., such a contract will result in fixed-term employee becoming a permanent employee effectively.
Employers who engage fixed term employees are now required to provide a Fixed Term Contract Information Statement upon commencement before or as soon as practicable after the fixed-term contract is entered into, and the reasons for engaging an employee on a fixed-term contract must be clearly documented, particularly in the case of a second fixed-term contracts. A failure to provide the new statement may expose an employer to civil penalties.
Direction to take Unpaid Annual Leave during Shutdown
From 1 May 2023, directing an employee to take unpaid leave during a shutdown is no longer lawful and instead a new model (rules) has been introduced in 78 Modern Awards
Previously, if a business was having a shut down, for example between Christmas and New Year, an employer could direct an employee to use their annual leave for the duration of the shutdown, and if the employee did not have any annual leave accrued, the employer could lawfully direct them to take leave without pay. This is no longer the case.
The new rules during a business’ annual shutdown require that:
- the employer needs to provide employees with 28 days’ written notice of the shutdown (or a shorter period if agreed between the employer and the majority of relevant employees).
- Where employees commence employment within the 28-day period before a shutdown, the employer must provide them with written notice as soon as reasonably practicable after they are engaged.
- the employer can only direct employees to take paid annual leave during a temporary shutdown.
- the requirement to take annual leave must be reasonable.
- If an employee has no accrued annual leave, they can agree with the employer to
- take annual leave in advance in accordance with their Award/contract;
- use accrued time off; or
- take leave without pay.
Where an employee has agreed to take unpaid leave during a shutdown, payment for the public holidays that fall during that time will depend on:
- any award or agreement provisions that apply
- the circumstances of when the employee agrees to use unpaid leave
- any agreement between employer and employee to be paid for public holidays.
Please note: If an employee has no annual leave and does not wish to take leave without pay or annual leave in advance, the employer will need to pay the employee their normal salary for the shutdown period (or part thereof).
Changes to Unpaid Parental Leave
From 1 July 2023, the Fair Work Act includes greater flexibility for employees taking unpaid parental leave. Employees taking unpaid parental leave can take up to 100 days of their 12 months leave entitlement flexibly during the 24-month period after the birth or placement of their child. This is an increase from the previous 30-day entitlement. Pregnant employees are also able to access their flexible unpaid parental leave up to 6 weeks before the expected date of birth of their child.
Employees are no longer prevented from taking more than 8 weeks of unpaid parental leave at the same time as their spouse or de facto partner (known as concurrent leave). Both parents can take up to 12 months unpaid parental leave at any time within 24 months of their child’s birth or placement. They can also both apply for an extension of up to 12 months beyond the initial 12 month leave amount.
Changes to Paid Parental Leave Scheme
From July 1, 2023, parents who had a child or adopted a child, can apply for up to 20 weeks of leave, subject to eligibility. These changes combine the previous 18 weeks parental leave plus the 2 weeks dad and partner leave to provide a total of 20 weeks for a couple (or a single parent). This removes the primary carer assumption and will allow opportunity to consider the mix and potential concurrency of leave taking by the parents as well as the flexibility of use.
‘Closing the Loopholes’ Bill
From 15 December 2023, the following changes introduced by the Fair Work Legislation Amendment (Closing Loopholes) Act 2023 commenced operation:
- Where a non-small business employer becomes a small business employer due to insolvency, bankruptcy or liquidation, it may still be required to pay its employees redundancy pay.
- New workplace delegates’ rights will be afforded to employees who are appointed or elected to represent members of an employee organisation in the workplace. These delegates are entitled to represent the industrial interests of members, have reasonable communication with members and reasonable access to the workplace. Further protections under the general protections provisions now apply for these delegates.
- New discrimination protections will apply for employees experiencing family and domestic violence. It is now unlawful for employers to take adverse action for reasons that include this new protected attribute.
- Compulsory conciliation conferences in the Fair Work Commission (FWC) will apply for protected action ballot matters. To receive the protection offered by a protected action ballot, the mediation or conciliation conference prior to the action must now be attended by the employee bargaining representatives who applied for the protected action ballot order, the employer and any bargaining representative of the employer.
- Union officials assisting a health and safety representative are no longer required to hold an entry permit.
Employee-authorised Deductions
From 30 December 2023, new rules apply for employee authorised deductions from pay that are:
- either one-off or recurring
- for specific amounts or for amounts that change from time to time.
These are called “employee authorised deductions” and employees need to give their permission in writing. Examples of these deductions include payments to a health fund or union fees. Employers can only make employee authorised deductions where the deductions are mainly for the employee’s benefit. Extra rules about when employee authorised deductions are allowed also apply if they:
- are for an amount that can change from time to time
- directly or indirectly benefit the employer (or someone related to them).
Deductions have to be recorded and kept in an employee’s records. Pay slips also have to say the amount of any deduction, name, or name and number of the fund or account the deduction was paid into. Awards and registered agreements can also allow for deductions from pay to be made in some circumstances.
Changes in 2024
Right to superannuation in the National Employment Standards
From 1 January 2024, the National Employment Standards (NES) includes a right to superannuation contributions. This means that unpaid or underpaid superannuation can be enforced under the Fair Work Act by more employees (as well as by an employee organisation or the Fair Work Ombudsman). Employers already have an obligation to pay superannuation contributions for eligible employees under superannuation guarantee laws. There would be no contravention of the NES provision where an employer has met their obligations under these laws.
Changes to Paid Parental Leave Scheme
From 22 July 2024, eligible parents will be able to apply for up to 22 weeks of leave, instead of current 20 weeks entitlement.
Superannuation
From 1 July 2024, the superannuation guarantee (SG) rate will increase to 11.5%.
Casual employees in the black coal mining industry
From 1 January 2024, the employees in the black coal mining industry are entitled to portable long service leave entitlements that go with them between employers. This is managed by the Coal Mining Industry (Long Service Leave Funding) Corporation (Coal LSL). There are changes to clarify that the amount paid out as part of an employee’s long service leave entitlement must include casual loading (where it applies), and the method for the accrual of long service leave for casual employees.
New Powers of the Fair Work Commission
From 1 July 2024, the FWC will have the power to vary modern awards in respect of a model term for workplace delegates’ rights. Workplace determinations and enterprise agreements made (or approved) after 1 July 2024 must include a delegates’ rights term.
From 1 November 2024, the FWC will have power to make orders with respect to labour hire workers (i.e. Same job, Same pay orders). Once an order of this kind has been made, certain obligations now arise for the host employer. There are exceptions to when an order can be made, including if the order is not fair and reasonable in the circumstances. A dispute about an order can be referred to the FWC. Anti-avoidance provisions apply to these orders.
The BetterHR Advice team is here to assist with any questions relating to the above employment law changes. We wish you a prosperous 2024.
