top of page

Compliance Alert: Changes to employment contracts

Please note: some of this content is time sensitive and may be subject to updates and changes. Read Compliance Checklist for Employers >

By now, all employers should be aware of the recent changes to the Fair Work Act 2009 launched on 6 December 2022 under the Secure Jobs Better Pay Act 2022. To recap this information, please review the following links:

A significant number of the changes made by the Secure Jobs Better Pay Act 2022 require employers to revise their employment contracts or agreements and associated workplace practices. These include:

Limiting the use of fixed-term contracts

Effective 6 December 2023, fixed-term contracts exceeding two years will be prohibited, except for some exceptional circumstances and some modern awards. Employers who regularly engage staff on a series of fixed-term contracts will need to reconsider those practices and take measures to put those staff on continuous contracts.

Expanding the grounds for requesting flexible working arrangements

Effective 6 June 2023, the right to request flexible working arrangements will expand to include employees who are pregnant, and any employee whose requests have been refused will be able to seek arbitration of a dispute by the Fair Work Commission. Employers should review their protocols for considering and responding to requests for flexible working arrangements. Additionally, employers should ensure that their employment contracts clearly outline the nature of the employment, and the essential requirements of the job, so employees have a good understanding of what kinds of flexibility are feasible, and what kinds of requests will quite reasonably be refused.

The end of pay secrecy

Staff can now choose to discuss their pay with other staff. Pay secrecy clauses in existing contracts have no effect as of 7 December 2022, and employers can no longer offer new contracts containing pay secrecy clauses. Employers must update their employment agreements and contract templates immediately to reflect these changes.

In the vein of pay transparency, it is worth noting that on 8 February2023 the Workplace Gender Equality Amendment (Closing the Gender Pay Gap) Bill 2023 was introduced into Parliament. This Bill sets out to publish the gender pay gap of organisations with 100 or more employees. Reporting will commence in 2024, and gender pay gap information will be published on the Workplace Gender Equality Agency (WGEA) website.

Sunsetting of zombie agreements

Effective 6 December 2023, any employment agreements made before the commencement of the Fair Work Act 2009 that are still in operation will automatically end. Zombie agreements include:

  • agreement-based transitional instruments

  • Division 2B state employment agreements

  • enterprise agreements made between 1 July 2009 and 31 December 2009.

Employers who have employees covered by these agreements need to provide those employees with written notification that the agreement will be terminating on 7 December 2023 (unless an application for extension is made to the Commission). The written notice needs to be provided before 7 June 2023 (within 6 months of 7 December 2022).

There are a number of further changes under the Secure Jobs Better Pay Act 2022 that will take effect this year. These relate to:

• Expanding multi-enterprise bargaining provisions

• Expanding the application of the better off overall test (BOOT)

• Simplifying the approval process of employment agreements

• Arbitrating intractable bargaining disputes

• Increasing the cap on small claims

WorkPlacePLUS can help ensure you are meeting your employment obligations. For more information, please contact us today.


News, Resources & Information

bottom of page