Navigating Australia’s Third Tranche of Workplace Reforms: Implications for Employers

The Federal Government’s third tranche of workplace relations reforms are on the horizon, following significant amendments to the Fair Work Act 2009 (Cth) in the form of the Secure Jobs, Better Pay and Protecting Worker Entitlements legislation. It is anticipated that the third tranche of legislation will be introduced to Parliament in early September, with a view to having the legislation passed through Parliament by late 2023.

In this article, we explore the key changes surrounding the third tranche of workplace relations reforms, focusing on changes to casual employment, the introduction of Same Job, Same Pay rules and regulation of gig workers.

Changes to Casual Employment

One of the key proposed legislative amendments is to expand the definition of casual employment by reversing previous casual employment reforms and High Court decisions.  It is anticipated that approximately 850,000 casual workers could potentially be affected by the proposed reforms.

The proposed changes were foreshadowed by the Federal Government’s pre-election commitment to introduce a legislative test for determining whether an employee is casual.  Currently, casual employment is assessed based on the offer and acceptance of employment in accordance with section 15A of the Fair Work Act.  For the purposes of section 15A, the subsequent conduct of the parties is irrelevant when considering if a person is a true casual employee.

It is anticipated that the proposed amendments will modify the definition of a casual employee to include consideration of post-contractual conduct to provide a pathway to permanency for a greater number of workers.  It is understood that changes will also include:

  • an ability for casual employees to seek conversion every six months;

  • preservation of the existing casual conversion framework, allowing employers reasonable grounds to refuse an offer or request for conversion; and

  • the new definition will provide for a prospective change of status (however employees moving from casual to permanent employment will not be eligible for backpay). 

The proposed changes have been described as re-creating the uncertainty that existed prior to the introduction of the legislative definition of casual employment by the previous Coalition Government.

Same Job, Same Pay

The premise of Same Job, Same Pay is to ensure that workers performing the same tasks receive equal remuneration regardless of whether they are engaged as an employee or contractor.  Specifically, these reforms aim to cease the practice of employers paying lower rates to labour hire workers as compared to their directly employed counterparts when performing the same job.  

The Same Job, Same Pay changes are proposed to amend the Fair Work Act to introduce:

  • a direct entitlement for labour hire workers to receive at least the same pay as directly engaged employees; and

  • a positive obligation on labour hire providers and host employers to ensure the direct entitlement is paid to the labour hire worker.

The consultation paper released by the Department of Employment and Workplace Relations in April 2023 confirmed that the Same Job, Same Pay provisions are being considered in the context of the following guiding principles:

  • businesses should be able to access labour hire for genuine work surges and short-term needs;

  • labour hire workers should be paid at least the same as directly engaged employees performing the same work;

  • disputes about Same Job, Same Pay obligations and entitlements should be dealt with quickly, economically and fairly in the Fair Work Commission; and

  • targeted anti-avoidance measures are needed to protect Same Job, Same Pay entitlements and ensure long lasting behavioural change.

The proposed changes have been criticised as tying employers in red tape and making it more difficult to hire Australian workers in a time when businesses are crying out for staff.  Further details of the proposed Same Job, Same Pay rules will be known once legislation is introduced to Parliament.

Changes to the Gig Economy

It is anticipated that the proposed changes will empower the Fair Work Commission to set minimum standards for workers in ‘employee like’ forms of work, including the gig economy.  Workplace Relations Minister Tony Burke has described the changes as finding a way of minimum standards for gig workers without changing the method of engagement.  The Minister described gig workers as ‘the sorts of workers for whom the award system was created, and they have now fallen outside it’. 

The consultation paper released by the Government in April 2023 contains the proposed framework for changes to employee like forms of work, including:

  • the Fair Work Commission responding to applications from workers or businesses to make minimum standards for employee like forms of work and making minimum standards of its own accord;

  • a dispute resolution function for the Fair Work Commission to deal with disputes about the application of or arising under minimum standards orders; and

  • a dispute resolution function / options for recourse through the Fair Work Commissions for independent contractors challenging unfair contractual terms or the unfair termination of services contracts.

As employers, it is essential to consider how these changes may impact your workforce and comply with the new regulations to avoid potential legal implications.

We are here to provide guidance and assist you in navigating these reforms effectively. For further advice about the implications of the proposed changes on your specific business operations, please contact:

Jasmine O’Brien
Principal
T +61 3 9611 0149
jobrien@sladen.com.au

Jordan Bauer
Senior Associate
T +61 3 9611 0130
jbauer@sladen.com.au

Matthew Davis
Paralegal
T +61 3 9611 0173
mdavis@sladen.com.au

Jordan Bauer