Insights & News

February 12, 2025

Australia’s industrial relations landscape has undergone a significant transformation, starting with the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth). As the first comprehensive review of these reforms progresses, the question remains: are these changes achieving their intended outcomes?

Key findings from the Secure Jobs, Better Pay Review

On 3 February 2025, the independent Review, led by Professors Mark Bray and Alison Preston, released an interim report featuring 19 draft recommendations. While employee representatives have largely welcomed the reforms, viewing them as a rebalancing of workplace power, the business community has voiced concerns over their operational impacts and long-term economic implications.

The Review Panel identified four key “aspirations” of the Government’s Secure Jobs, Better Pay reforms, focusing on whether these changes are meeting their objectives.

Advancing wages

The reforms, particularly those related to multi-employer bargaining and the better off overall test (BOOT), aim to expand the reach and scope of collective bargaining, thereby increasing wages and improving workers’ financial circumstances.

The Review Panel acknowledges that insufficient time has passed since the amendments came into effect to assess their long-term impact. However, early signs indicate a significant increase in the coverage of collective bargaining. Between September 2022 and September 2024, the number of employees covered by a collective agreement rose by 27%, aligning with the intended outcomes of the amendments.

Multi-employer bargaining provisions are designed to enhance union representation, requiring unions to be involved in proceedings and allowing them to initiate bargaining in certain circumstances, even without proving majority support. Although there have been modest improvements in union coverage, the Review notes that small wage increases prompted by the reforms have not fully offset historical wage stagnation, with a significant gap remaining between real wages and labour productivity.

Employer groups have been critical of the reforms, particularly those that empower unions to secure wage increases. They argue these provisions could lead to more industrial action and increased costs, while unions contend they are crucial for breaking wage stagnation.

Integrating institutions

One of the most significant changes was the abolition of the Australian Building and Construction Commission (ABCC) and the Registered Organisations Commission (ROC), with their functions transferred to the Fair Work Ombudsman (FWO) and Fair Work Commission (FWC). The Review notes that the FWO has taken a more conciliatory approach, resulting in higher wage recoveries in the construction sector. However, employer groups argue that this has weakened enforcement against union misconduct. The Review supports this concern, pointing out that the FWO’s enforcement powers are now less robust than those of the ABCC, particularly with regard to contraventions such as unlawful picketing.

Closing the gender pay gap and improving gender equality

The introduction of paid family and domestic violence leave, pay transparency laws, and adjustments to Equal Remuneration Orders are cited as significant steps toward closing the gender pay gap. The Review Panel suggests these measures are working as intended, although their long-term impact remains to be seen. For instance, the FWC’s ability to issue Equal Remuneration Orders is still largely untested, with only one case heard since the new laws took effect.

The Review also highlights significant wage increases in female-dominated sectors, such as aged care, as a result of the Secure Jobs, Better Pay reforms. However, stakeholders have expressed concerns over the financial burden of work value cases, often funded by union members, many of whom are low-paid. Employers also worry about absorbing wage increases without additional government funding.

Job security

The new restrictions on fixed-term contracts aim to improve job security, but they have created challenges for employers in project-based industries. The Review recommends revisiting these restrictions to provide greater flexibility, offering hope to employers grappling with the current regime.

Draft recommendations: the path forward

The Review presents several draft recommendations to ensure the reforms continue to achieve their goals;

1. Conduct a further review in 2-3 years to assess long-term impacts, particularly on bargaining, job security, and gender equity (Recommendation 1)
2. Strengthen employer guidance to assist in understanding obligations when receiving a written request to bargain, including providing a template written request (Recommendation 5)
3. Amend the mandatory conciliation conference under s 448A of the Fair Work Act 2009 (Cth) (FW Act) to allow discretion if the parties agree (Recommendation 6)
4. Monitor the impact of gender pay equity measures to ensure sustained progress (Various Recommendations)
5. The Australian Government should consider whether it is appropriate to extend the protected attributes in the FW Act to cover menopause, as well as other reproductive health issues (Recommendation 15).
6. Refine fixed-term contract restrictions to balance flexibility with job security (Recommendation 16)
7. Improve enforcement mechanisms by engaging digital job platforms and enhancing FWO resources (Recommendations 18 and 19)

Conclusion: a work in progress

Interested parties now have until 16 February 2025 to respond to the draft report, with a final report expected by the end of March. While the draft report provides some insight into the current industrial relations environment, its findings are limited by the fact that not enough time has passed to fully evaluate the reforms’ effects. That is reflected in the modest nature of the draft recommendations.

The implementation of the Review’s final recommendations will depend on the outcome of the upcoming federal election, to be held by May 2025. Regardless of the outcome, employers should prepare for further reviews before any substantial changes are made to the system.

To keep up with the latest developments across employment, workplace relations and workplace health and safety law, sign up to our e-newsletter, Kingston Reidable by emailing [email protected].

The views expressed in this article are general in nature only and do not constitute legal advice.

Please do not hesitate to contact us if you require specific advice tailored to the needs of your organisation in relation to the implications of these changes for your organisation.

A recent safety case in New Zealand involving the conviction of former Port of Auckland (POA) CEO has set a significant legal precedent for workplace safety and corporate accountability in New Zealand.

This case, the first of its kind against an officer of a large company, underscores the extent of due diligence obligations required under work health and safety legislation and has far-reaching implications for corporate officers even across Australia. This is due to the near-identical provisions between New Zealand’s Health and Safety at Work Act 2015 (HSW Act) and Australian work health and safety legislation.

Background
The former POA CEO, Tony Gibson, was charged by Maritime New Zealand following a fatal workplace accident in which a stevedore was killed at the Port of Auckland. On 30 August 2020, the stevedore was crushed when a shipping container fell due to a twist-lock mechanism failure. He had been working within an exclusion zone in direct violation of POA’s safety policies after being directed to do so by the ship leading hand. The incident highlighted systemic safety failings and led to charges against both POA and Mr Gibson.

POA faced two charges relating to the conduct of the ship leading hand and underlying systemic failures to protect the health and safety of its workers. POA pled guilty to both charges and was convicted accordingly. The case against Mr Gibson focused on whether he had exercised due diligence in ensuring POA’s compliance with its safety obligations as required under section 44 of the HSW Act.

Mr Gibson was charged with a;

1. failure to take reasonable steps to ensure that POA had available for use, and used, appropriate resources and processes to eliminate or minimise risks to health and safety from work carried out as part of the conduct of the business or undertaking, including by having:
   1. clearly documented, effectively implemented, and appropriate exclusion zones around operating cranes
   2. clearly documented, effectively implemented, and appropriate processes for ensuring coordination between lashers and crane operators; and
2. failure to take reasonable steps to verify the provision and use of the resources and processes described above.

Mr Gibson successfully defended himself against charge (a)(ii) above, however was found guilty of the remaining charges.

Mr Gibson’s failings as CEO
The prosecution alleged the following failures regarding Mr Gibson’s requirement to exercise due diligence;

1. Failure to oversee safety strategy implementation: Despite POA having a health and safety strategy, Mr Gibson did not ensure its effective implementation across all levels of the organisation. Mr Gibson also failed to take sufficient steps to ensure existing safety protocols were properly implemented.
2. Inadequate verification processes: Mr Gibson relied on subordinates without ensuring that safety protocols were being effectively executed. There was inadequate auditing, monitoring and reviewing of health and safety systems to verify their effectiveness and address risks.
3. Passive rather than proactive engagement: The court emphasised that due diligence requires an officer to be proactive and systematic in ensuring compliance. Mr Gibson was required to systematically ensure safety compliance through ongoing monitoring, verification and review, rather than simply delegating responsibility with no active oversight.

Legal reasoning and key takeaways
The court set out several key principles regarding an officer’s due diligence duties;

• assessment of due diligence is fact and circumstance-dependent and applies to officers of all levels, regardless of the size of the organisation;
• in the case of large, hierarchical organisations, the duty to exercise due diligence is not limited to governance or directorial oversight functions;
• an officer in a large organisation does not need to be involved in hands-on, day-to-day operations, but cannot simply rely upon others within the organisation either;
• an officer cannot simply delegate health and safety responsibilities without oversight;
• officers must personally acquire and maintain sufficient knowledge to satisfy themselves that the organisation is complying with its work health and safety duties. This includes maintaining sufficient knowledge of the operations of the organisation;
• officers must ensure that, where there exists in the organisation a work health and safety specific role, that person has the necessary skills and experience to properly execute that role. They must also adequately and regularly monitor their performance to ensure that they are properly discharging their functions in ensuring the organisation’s compliance with its duties;
• the officer must ensure that entrenched and adequate systemic processes are put in place to ensure that the organisation complies with its duties. In any large organisation, the existence and adequacy of such systems are key, there cannot simply be a reliance on a paper system;
• effective reporting systems must be in place to ensure health and safety risks are communicated across all levels of the organisation;
• due diligence requires the engagement or arrangement of an effective process of monitoring and review of the organisation’s systems and processes to ensure they are achieving their purpose and relevant safety standards are adhered to;
• a mere reliance on industry standards is not a sufficient defence if the officer’s actions fall below the statutory standard.

Implications for Australia
Given the legislative similarities between the HSW Act and Australian work health and safety legislation, this case may influence how Australian regulators enforce safety obligations for corporate officers, particularly those in larger organisations. Key takeaways include;

1. Increased personal accountability: Officers cannot rely solely on the existence of safety policies; they must ensure that these are actively implemented and effective in practice.
2. Stronger enforcement by regulators: Australian safety regulators may adopt the approach taken in this case when considering charging officers of large corporations, increasing scrutiny on corporate leaders to verify that due diligence requirements are met.
3. Need for proactive compliance: CEOs and senior executives must engage in regular audits, oversight, and verification processes to ensure workplace safety obligations are upheld.
4. Precedent for future prosecutions: This case sets a strong precedent that Australian courts could use to assess due diligence obligations of officers in similar circumstances. Australian regulators may now focus on officers of larger corporations.

Conclusion
The conviction of Mr Gibson serves as a stark reminder that corporate officers have a personal duty to exercise due diligence in workplace safety. This could mark a shift towards holding executives of large companies accountable for systemic failures, reinforcing the need for proactive engagement in health and safety compliance.

For Australian businesses, the decision highlights the necessity of robust governance frameworks and rigorous oversight to prevent similar liability under work health and safety legislation. As safety regulators continue to monitor developments, corporate leaders should satisfy themselves that safety is not just a policy on paper but a fully embedded operational priority.

To keep up with the latest developments across employment, workplace relations and workplace health and safety law, sign up to our e-newsletter, Kingston Reidable by emailing [email protected].

The views expressed in this article are general in nature only and do not constitute legal advice.

Please do not hesitate to contact us if you require specific advice tailored to the needs of your organisation in relation to the implications of these changes for your organisation.

February 7, 2025

As Australia’s largest specialist workplace law firm, we are delighted to announce that Kingston Reid has joined elite global labour law alliance, Ius Laboris, as its exclusive Australian member law firm, connecting Kingston Reid with more than 50 markets around the globe.

Ius Laboris is an alliance of 1,500 lawyers across 56 countries, offering its member’s clients access to expert localised legal and strategic advice across the globe. Ius Laboris is consistently recognised as a leading legal service provider in employment, labour relations, health and safety, global mobility and immigration and related areas of expertise.

Joining Ius Laboris is a significant milestone for our firm. This alliance aligns with our commitment to delivering exceptional legal services and provides our clients with unparalleled access to global top-tier expertise, ensuring comprehensive support in navigating complex employment and labour law challenges. We look forward to collaborating with our international counterparts to address the evolving needs of employers in today’s dynamic legal landscape.

Kingston Reid’s membership of the Ius Laboris global alliance will enable the firm to deepen its service offering to clients, offering:

• Global Reach: access to a network of leading employment law firms worldwide, providing coordinated legal services across multiple jurisdictions.
• Local Expertise: international clients can tap into Kingston Reid’s in-depth knowledge of Australian employment law, and local clients will have the benefit of exclusive insights into legal developments and emerging issues across all jurisdictions in which the alliance operates.
• Comprehensive Services: access to additional tools and legal support services available through Ius Laboris.

For more information about Ius Laboris, please visit iuslaboris.com.

Alice DeBoos
Managing Partner
+61 2 9169 8444
[email protected]

February 4, 2025

Historically feminised industries and occupations, including those in the care sector, have been at the forefront of social, economic and political debate over recent years. In this Insight, we consider some of the landmark decisions which have been handed down in the aged care and early childhood education and care (ECEC) industries – including a recent landmark multi-employer supported bargaining agreement – and how these decisions will impact employers.

The Work Value Case – aged care

The Fair Work Commission’s Work Value Case[1] in the aged care industry was heard over 3 stages. As part of the Fair Work Commission (FWC) stage 3 decision, significant changes to employees’ terms and conditions of employment took effect from 1 January 2025.

The most significant of these changes were those recently made across 3 modern awards, as a result of lengthy proceedings before the FWC involving the Health Services Union and the Australian Nursing and Midwifery Federation. The FWC decisions have brought about changes to:

1. the Aged Care Award 2010 (Aged Care Award);
2. the Nurses Award 2020 (Nurses Award); and
3. the Social, Community, Home Care and Disability Services Industry Award 2010 (SCHADS Award).

A further shake-up of the aged care industry is looming, with the Aged Care Act 1997 (Cth) set to be repealed and replaced by the Aged Care Act 2024 (Cth).

All of these changes have, and will continue to have, wide-reaching implications across the aged care sector and other parts of the care industry.

So, what has changed?

The stages 1 and 2 decisions of the Work Value Case resulted in a 15% wage increase for many aged care workers, which came into effect on 30 June 2023.

The third and final stage decision was handed down on 15 March 2024 which varied the Aged Care Award, Nurses Award and SCHADS Award. These changes largely came into effect on 1 January 2025 and include:

• adding a definition to the Aged Care Award for ‘direct care’ employees to clarify their role in the aged care sector;
• a new classification structure for direct care workers under the Aged Care Award;
• a new classification structure for direct care aged care workers under the SCHADS Award which better aligns with the classification structure for direct care workers under the Aged Care Award;
• updates to the indicative duties and qualifications for general and direct care employees under the Aged Care Award;
• the transfer of nursing assistants working in residential care settings in the aged care industry from coverage under the Nurses Award to coverage under the Aged Care Award; and
• increases to the minimum pay rates for direct and general care workers covered by the Aged Care Award and aged care employees covered by the SCHADS Award.

There will also be a second increase to the minimum rates of pay for some aged care employees on 1 October 2025.

While these changes only apply to select cohorts of employees, the new classification structures should provide some clarity over how employees are classified in the industry.

A new Aged Care Act from 1 July 2025

In addition, the Aged Care Act 1997 (Cth) is set to be repealed and replaced by the Aged Care Act 2024 (Cth) (Aged Care Act), which will bring about further changes to the aged care sector from 1 July 2025.

Under the new Aged Care Act, aged care providers will (among other things):

• need to ensure their actions are guided by the newly introduced Statement of Rights;
• register with the Aged Care Quality and Safety Commission and have any residential care homes approved;
• need to comply with a revised set of provider obligations, including conditions on registration and new financial and prudential standards;
• need to ensure their workforce meets revised worker screening requirements;
• be subject to new statutory duties aimed at protecting the health and safety of individuals to whom the provider is delivering services to; and
• be subject to expanded whistleblower protections intended to ensure that aged care workers, and those in care, their families and carers can raise concerns or report information without fear of unfair treatment or reprisal.

With so many changes in play, it’s important that aged care providers ensure that they are across the amendments and have implemented the necessary changes across their operations.

Landmark ECEC decision – ‘first of its kind’ supported bargaining agreement

As part of the FWC’s gender pay equity research, one of the findings made was that work performed by ECEC employees has been historically undervalued in much the same way as the work of aged care workers.

To that end, a significant decision was handed down by the FWC on 24 January 2025, resulting in 20,000 additional ECEC workers being able to access a 15% pay rise over a two-year period, under a landmark multi-employer supported bargaining agreement. A further 33 employers applied to the FWC to be covered by the ECEC Multi-Employer Agreement 2024-2026 (Agreement), which is underpinned by the Children’s Services Award 2010 and the Educational Services (Teachers) Award 2020.

The supported bargaining agreement is the first of its kind, with now a total of 60 employers covered, making them eligible to apply for the federally-funded Education and Care Worker Retention Payment grant.

The aim of the grant is to attract and retain early childhood education and care workers nationally. It is a requirement of the grant that a workplace have a workplace instrument that applies to its employees. Employers may apply to join the Agreement to satisfy this condition. Importantly, ECEC employers have until 30 September 2026 to apply for the grant.

Key Takeaways

Aged Care employers

In light of the aged care industry changes, it is important that all employers within the sector:

• review worker rates of pay to ensure that they remain complaint with award minimums;
• ensure that employees covered by enterprise agreements which incorporate the awards remain better off overall;
• ensure that employees are correctly classified under the new classification structures;
• provide notice of any classification changes to affected employees;
• bear in mind the impending increases to minimum rates of pay to take effect on 1 October 2025; and
• begin considering the impacts the new Aged Care Act will have on their business and prepare accordingly.

ECEC employers

Employers in the ECEC sector may wish to consider their eligibility for the Education and Care Worker Retention Payment grant and whether they would like to opt-in to the scheme. Meeting the conditions for receipt of the grant may take some time, so ECEC employers should consider these matters as soon as possible, if they haven’t done so already.

[1] Aged Care Work Value Case [2022] FWCFB 200; 319 IR 127; Aged Care Work Value Case [2023] FWCFB 40; Aged Care Work Value Case [2024] FWCFB 150.

To keep up with the latest developments across employment, workplace relations and workplace health and safety law, sign up to our e-newsletter, Kingston Reidable by emailing [email protected].

The views expressed in this article are general in nature only and do not constitute legal advice.

Please do not hesitate to contact us if you require specific advice tailored to the needs of your organisation in relation to the implications of these changes for your organisation.

December 17, 2024

The High Court in Elisha v Vision Australia Ltd  [2024] HCA 50  has overturned a century-old body of case law by determining that the Applicant, Mr Elisha, was entitled to claim psychiatric damage for a breach of his employment contract arising from his former employer’s flawed workplace investigation into his conduct.

In doing so, the High Court found the employment contract between the parties incorporated Vision Australia’s disciplinary policy, which contained promissory terms including, where concerns of a serious nature are alleged, specific procedures, including a formal disciplinary meeting and a letter containing a written outline of allegations.

Background

Mr Elisha commenced employment with Vision Australia in 2006 as an adaptive technology consultant. During a work-related hotel stay, Mr Elisha was involved in an incident in 2015 with hotel staff, where he was accused of engaging in aggressive behaviour (Hotel Misconduct).

On 19 May 2015, Mr Elisha met with his manager who told him there was a “serious” complaint against him and gave him a “stand down letter” that required his attendance at a meeting two days later. The letter stated that the meeting would be conducted in accordance with Vision Australia’s enterprise agreement and disciplinary procedure. The allegations in the stand down letter were confined to the Hotel Misconduct.

At the meeting on 21 May 2015, Mr Elisha denied the Hotel Misconduct.

On 22 May 2015, during a meeting of Vision Australia’s management staff, a recommendation to prefer the hotel proprietor’s account of the incident was accepted and this finding was informed by previous allegations of aggressive behaviour by Mr Elisha, which were not put to him during the 19 May meeting.

Based on those findings, Mr Elisha’s employment was then terminated, and he was subsequently diagnosed with major depressive disorder.

What did the High Court consider?

Incorporation of Policies into the Employment Contract

A key issue was whether Vision Australia’s disciplinary policies were incorporated into Mr Elisha’s employment contract.

The employment contract stated that the employment conditions were to be in accordance with Vision Australia’s policies and procedures and that acceptance of the contract by the employee required him to agree that he would comply with those policies and procedures.

The Court found the inclusion of these terms meant that a reasonable person in the position of the parties would have understood these clauses created contractually binding obligations; and rejected Vision Australia’s claims that these obligations were “one-sided” and merely required Mr Elisha to obey lawful direction from it. The majority stated that it would “‘defy both logic and common sense’ to suggest an employer who was subjecting an employee to disciplinary action according to policies would not similarly be bound by those policies.”

Breach of Contract and Psychiatric Injury

The High Court also considered whether Vision Australia’s procedural failures made it liable for Mr Elisha’s psychiatric injury.

Scope of Duty

A clear distinction was made between what was referred to as a ‘scope of duty’ and the remoteness of damages under contract.  Scope of duty refers to a contractual duty imposed on an employer through terms of an employment contract (such as an obligation to conduct a fair and proper investigation) which is generally not ‘inherently designed to prevent psychological injury’.

In contrast, remoteness of damages is the determination of damages that occurred which was in the reasonable contemplation of the parties at the time of entering a contract.

Remoteness of Damage

The psychiatric injury suffered by Mr Elisha arising from the termination of his employment was found by the Court to not be too remote. Although the Court found damages for psychiatric injury upon entering the employment contract would not have been reasonably contemplated by the parties, the Court found that it was reasonable to expect that Mr Elisha would have been so distressed by the manner in which Vision Australia breached the employment contract and the consequences of the breach for him, that there was a serious possibility that Mr Elisha would suffer serious psychiatric harm.

In coming to this conclusion, the Court declined to follow a decision of the House of Lords in Addis v Gramophone [1909] AC 488, concluding that “over the last century, a great deal of water has passed under the bridge of Addis”.

Negligence and Duty of Care

The Court has previously found that there is no general common law duty of care to provide safe systems of work encompassing the provision of a safe system of investigation and decision making.

As the Court upheld Mr Elisha’s breach of contract claim, the majority found it unnecessary to consider this issue further.

Although the Court did not definitively rule on the negligence claim, it noted the significant challenge in establishing a novel duty of care in the context of disciplinary and termination processes.

Takeaways

The conclusion in this case stemmed from the finding that policies and procedures of Vision Australia were incorporated into Mr Elisha’s contract of employment. In not following the disciplinary procedure contain within those policies and procedures, Vision Australia breached the contract of employment.

This conclusion in itself is not novel.

What the decision makes clear is that there is an ability for an employee who suffers a psychological injury arising from the termination of their employment in a manner inconsistent with the contract of employment to seek damages for that injury.

What arises from the decision is the need to ensure that employment contracts are carefully drafted and do not inadvertently incorporate workplace policies that would impose binding obligations on an employer.

Employers should review their employment contracts in view of this decision.

To keep up with the latest developments across employment, workplace relations and workplace health and safety law, sign up to our e-newsletter, Kingston Reidable by emailing [email protected].

The views expressed in this article are general in nature only and do not constitute legal advice.

Please do not hesitate to contact us if you require specific advice tailored to the needs of your organisation in relation to the implications of these changes for your organisation.