Jobs and Skills Summit: what is it likely to mean for employers?

While there has been a lot of focus and publicity centred on the upcoming Jobs and Skills Summit, the real focus will need to be on the proposals that the government is publicly floating and the reforms that it embraces once the summit has concluded.

At this point, all indicators point towards the government implementing a wide array of changes. The government has been quite explicit in terms of the changes that it wants to make to some aspects of employment regulation. Let's look at what some of those changes are likely to be.

Greater protections and entitlements for casual employees

The Federal Government has made it clear that it wants greater protection for casual employees. This looks like it will include two main changes. The first is amending the Fair Work Act 2009 to narrow the circumstances in which an employee can be properly regarded as a casual employee. The second is limiting the number of consecutive fixed term contracts that an employer can offer for the same role to 24 months' total duration.

Remuneration

The government is looking to take action to reduce the number of situations in which individuals are employed or engaged to perform the same work but are remunerated differently. We expect that the primary focus of this "same job, same pay" approach will be on the disparity in pay based on gender but that steps may also be taken to reduce the difference in remuneration received by labour hire workers compared to directly employed employees.

Underpayment of workers

The underpayment of workers, often referred to as 'wage theft', has been a hot button issue over the past few years. The government is looking into increasing the sanctions that can be imposed against employers who engage in, or are involved in, deliberate underpayment of workers and potentially criminalising such conduct.

Collective bargaining

There has been a consistent emphasis by the government on wanting to re-invigorate collective bargaining as a means for setting employment terms and conditions (through industry-based bargaining or a process which makes it easier for employees at different employers to try to bargain for a single enterprise agreement).

At present it is too difficult to know what this would look like in practice. However, there have been suggestions that the government is considering relaxing some of the legislative restrictions which heavily curtail the ability of employees to take industrial action.

The government is considering amending the Fair Work Act 2009 to prevent (or substantially curtail) the ability of an employer who is engaged in enterprise bargaining from unilaterally applying to the Fair Work Commission to terminate an enterprise agreement, particularly while bargaining for a replacement agreement is on foot. The Minster for Employment recently stated publicly that "on face value, I cannot see how this tactic can possibly be justified".

Workers in the gig economy

The Federal Government seems to favour amending the Fair Work Act 2009 to include greater protections, and possibly introducing some statutory entitlements (such as carers’ leave), for individuals who are not employees but who are engaged in "employment-like" forms of work, with a particular focus on individuals who are engaged in the gig economy.

What does this mean for employers?

For HR and people leaders, the impact of the reforms that the government ultimately implements will depend in large part on the industry in which they are working. For example, in an industry where enterprise bargaining is highly prevalent, the changes may have a significant impact on what enterprise bargaining looks like in future.

However, it will be critical for all HR/people teams, regardless of the industry in which their organisation operates, to have a detailed understanding of:

• the composition of their organisation's workforce (including the proportion of labour hire, casual labour, and employees on fixed and maximum term employment contracts); and
• the level of disparity in remuneration and benefits across the different segments of the workforce (including disparity based on gender).

Having this information to hand will allow HR and people leaders to more readily assess the impact of the Government's proposed reforms and assist senior management to understand the implications – including the financial implications – of those reforms being implemented and how your organisation might respond to such implementation.

In addition, if you are considering bargaining for a new enterprise agreement and/or terminating an existing enterprise agreement, some strategic consideration will need to be given to the timing of those actions and, in particular, whether they should be brought forward.

Dominic Fleeton is a partner in the labour, employment and workplace safety team at K&L Gates

Please note that this article has been prepared for informational purposes only, and is not to be construed as legal advice.