3 changes to workplace laws
2023 has brought a new employment and industrial landscape to Australia with the passing of a number of significant, landmark industrial relations laws late last year. These changes are now coming into effect.
In this newsletter we cover three key changes you need to be aware of. Please note that these changes are in the Fair Work Act and therefore only apply to National system employers. If you are a State system employer, these changes have not been adopted in the state system as yet.
New workplace sexual harassment laws
Sexual harassment has an unfortunate long history in Australian workplaces. High profile cases such as the Brittany Higgins case have been well documented in the media. But this is not only a “big end of town” issue. It occurs in every industry and at every level.
The Respect at Work Inquiry report published in 2020 cited these disturbing statistics:
2 in 5 women (39%) experienced sexual harassment at work in the past 5 years
1 in 4 men (26%) experienced sexual harassment at work in the past 5 years
Aboriginal and Torres Strait Islander people were more likely to have experienced workplace sexual harassment than people who are non-Indigenous (53% and 32% respectively).
New laws have been introduced into the Fair Work Act that now prohibit/ban sexual harassment in the workplace. This change came into effect on 6 March 2023 and are designed to provide greater protection to workers from sexual harassment.
The new laws create a positive duty for you as an employer to prevent sexual harassment in the workplace. You can be held liable for sexual harassment committed by an employee.
What you need to do:
To avoid being liable for sexual harassment in the workplace, you will need to demonstrate that you’ve taken every reasonable measure to prevent sexual harassment from occurring in the workplace. Initiatives you should be considering are:
Implementing a comprehensive sexual policy and communicate it widely throughout the workplace
Providing your employees with training/education about what constitutes sexual harassment and how to report it
Ensuring there is clear and visible support for any of your managers in respect of preventing sexual harassment
Ensuring the workplace has a clear procedure for reporting and investigating complaints of sexual harassment
Ensuring complaints are taken seriously and are responded to promptly and effectively
Family and domestic violence leave
On 1 February 2023, changes to Family and Domestic Violence leave started to commence. On announcing these changes, the Prime Minister said that this change means workers no longer need to choose between putting food on the table and their safety.
Previously the entitlement was 5 days of unpaid leave. This is now 10 days of paid leave as per the following rollout schedule:
For employers with 15 or more employees, this entitlement came into effect on 1 February 2023;
For employees with less than 15 employees, the entitlement will come into effect on 1 August 2023.
There is no change to the way the leave operates:
It is applicable to all employees, including casual employees
The leave renews every year on an employee’s anniversary
The leave does not accrue year on year
What you need to do:
To ensure you are complying with these laws, you should consider:
educating and training managers / team leaders on the content of the new laws and how to deal with applications for the leave
reviewing and updating systems, policies and procedures to ensure compliance and to protect the privacy of your employees
communicating these changes to your staff
implementing appropriate record keeping arrangements to track when this leave is taken in a way that protects your employee
Pay secrecy
The government has introduced changes to the Fair Work Act to improve equality and pay equity.
No longer can employers use pay secrecy clauses in employment contracts that prohibit employees speaking with each other about their pay and remuneration packages. The ability to ask other employees about their pay is now a workplace right and you cannot stop your employees talking to each other about their pay packet. However, the right to disclose information about pay is discretionary. This means employees can decide whether or not to disclose. The important message here is that employees now have the right to ask at work.
What you need to do:
Update your employment contract templates to remove anything prohibiting employees talking about their pay
Need help?
If you need help navigating the new rules or want assistance with any of your Human Resources, please contact us on 9841 1200.
Proposed new tax on super fund balances over $3 million
The Government made an announcement on the 28th of February, that in essence will mean paying more tax for anyone with super fund balances over $3 million. Firstly, before you rush out and empty your superfunds, it’s important to acknowledge that the Government’s announcement is a proposal only and there is a long process to go through before its law. It will need to go through the usual parliamentary process and if legislated as proposed, the changes will commence from 1st July 2025.
Proposal in a Nutshell
These measures are only applicable for individuals with super balances greater than $3 million at the end of a financial year, (for the first year of this applying it’s the balance in super at 30th June 2026 that matters initially). Note it is not $3 million per fund or couple, its per person over all of their superannuation funds. That means a couple could still have nearly $6 million in super before being impacted, as long as it’s split evenly between them and neither goes over $3 million. If you do have a balance over $ 3 million here is what you need to know;
A additional 15% tax will be charged on some of the earnings in your super fund (not a straight forward 15%, but call it 15% for now);
The ATO will send the bill to the member personally to pay not their fund; and
The member is allowed to ask their super fund to pay the tax if they want to.
This is for pension and accumulating balances, and it is not indexed.
So what happens next? The Government have advised that the next stage in the process will be targeted consultation on implementation of the proposed measures and that this will take place between now and the May 2023 Federal Budget.
Should we do anything? No, not yet as it is a proposal, not law.
Keep doing what you have always been doing, putting contributions in your fund, taking pensions and making the best investment decisions for your fund and circumstances. Don’t miss out on “current day” benefits such as the downsizer contributions, concessional and non-concessional contributions just because of this announcement. There is also no need to rush out and pull your cash or assets from your super fund, it continues to be one of the most tax effective investment vehicles.
Lincolns will be keeping up to date on the legislation and how it is all going to work. There are some strategies that can be put in place to minimise any potential impact this can have on your superannuation. If you are worried this will impact you, please give us a call and speak to one of our superannuation team.