Employee surveys, also known as pulse or culture surveys, can often serve as an early warning system for employers. They reveal work health and safety risks that an employer may not otherwise know about before it’s too late. 

Conducted anonymously, and often by an external organisation, these surveys can uncover a range of issues, from physical safety hazards due to inadequate equipment, to intangible hazards like the psychological impact of high workloads or systemic discrimination and bullying.

While a physical safety hazard that is called out in survey results, such as lack of PPE or dangerous plants or equipment, may be quickly and easily mitigated, psychosocial safety hazards can be harder to address. 

This article offers a practical guide for employers on what to do when employee pulse or culture surveys results indicate psychosocial work health and safety risks in their workplace.  

Australian employer obligations around psychosocial risks

Ensuring the safety and wellbeing of employees is a critical priority for employers. The Work Health and Safety Act 2011 (Cth) (WHS Act) and various state and territory laws lay down a robust framework requiring employers (broadly defined in the legislation as “person(s) conducting a business or undertaking”) to ensure a safe working environment for their employees. 

Employers are required to eliminate risks to the health and safety of workers as far as is reasonably practicable. If elimination is not reasonably practicable, employers must minimise those risks as far as is reasonably practicable. 

“Health” is defined as both physical and psychological health, meaning that as part of its primary duty, an employer must manage risks to a worker’s psychological health as far as is reasonably practicable. Some states and territories also now have regulations expressly requiring psychosocial hazards be eliminated or minimised. 

Psychosocial hazards refer to aspects of work and workplace situations that may give rise to a risk of physiological harm caused by the associated stress response. For example: 

• bullying, sexual harassment, and poor workplace relationships 
• high or low job demand and low on-the-job support 
• low job clarity or control, or lack of recognition and reward 
• poor systems of organisational change management, and organisational justice (where policies/decisions are applied unfairly or unequally)
• poor environmental conditions, and remote or isolated work. 

Employers also have obligations under the Sex Discrimination Act 1984 (Cth) and the Fair Work Act 2009 (Cth) to prevent the psychosocial hazards of sexual harassment and bullying from occurring. Employers can also be vicariously or accessorily liable for sexual harassment and bullying occurring. 

Assessing employee surveys to identify hazards 

Employers must scrutinise survey results for indicators of psychosocial risks. 

Some surveys will directly – but anonymously – allow employees to report disrespectful or toxic behaviour, bullying or sexual harassment. Depending on the structure of the survey, this can be through free-text responses, or targeted agree/disagree statements such as, “I have not experienced bullying or harassment at work” or, “I have witnessed or been subject to conduct of a sexual nature in the workplace”. 

Answers which indicate that the workplace is not free of bullying or harassment will put an employer on notice of a possible hazard that it must address.  

Other indicators of latent, unaddressed psychosocial hazards can be identified via poor scores in response to questions such as: 

• “I am confident I can report issues to my manager, and they will take them seriously.” (May possibly indicate poor organisational justice and possible unreported behavioural, bullying or harassment issues.)
• “I understand how decisions are made about my role and my career progression.” (May possibly indicate low job control, clarity or lack of reward and recognition.) 
• “I think the organisation holds people accountable for their unsatisfactory behaviour and actions.” (May possibly indicate unreported behaviour, bullying or harassment issues.) 
• “My manager allows and encourages me to make decisions and take responsibility for my work.” (May indicate low job control, low job demand and poor workplace relationships.) 

Acting on findings from employee surveys

Results from employee surveys that indicate a psychosocial safety hazard mean that an employer is on notice of possible safety risks. It must then take steps to apply the WHS risk assessment framework. Once a risk is identified, it must be assessed and controlled with measures to mitigate the risk. 

To properly identify and assess the risk, it is particularly important to be able to drill down into department, division, location or manager-level results. Where an employer can do so, it can use the survey results to decide on next steps, and assess and control identified risks more effectively. 

If not, a follow-up survey may be the first step, with more targeted questions and increased ability to filter results and determine areas of the business where psychosocial hazards are an issue.

Otherwise, depending on the scope and nature of the issue, and the extent to which results can be filtered to narrow in on where a problem may exist, we recommend the following identification and assessment measures: 

• HR meets with line managers or supervisors in an identified division or work group to discuss the survey results. HR representatives should be prepared to ask managers specific questions and may need to have hard conversations with managers about why the results are poor. These meetings should be followed up to ensure that managers are taking necessary action as required. 
• Additional monitoring by HR of an identified division or team, including arranging catch ups with members of the team to discuss wellbeing and experiences. 
• Engage experts to conduct wellbeing interviews with members of a team with poor survey results, to gather more specific information about concerns in that team.  
• Engage experts to conduct a culture review investigation by interviewing people throughout the organisation or selected teams to gather information about culture, leadership, organisational justice and misconduct management. 
• Review the practical impact of organisational policies and practices such as performance review processes, grievance handling procedures, remuneration and recognition.  
• Establish employee culture consultation committees or working groups to provide and collate information about psychosocial risks across business units and to provide specific and real-time feedback about how to address issues.   
• Review and promote the organisation’s grievance procedures and reporting mechanisms, including giving assurances about encouraging a “speak up” culture and having a no-tolerance approach to victimisation. 
• Introduce “contact officers” or “go-to” people for workers to report issues outside of the human resources and leadership teams. 
• Roll out training for line managers and supervisors on topics such as leadership, respectful behaviour, psychosocial safety, workload and capacity management and handling complaints. 

Understanding legal professional privilege 

When investigations, culture reviews, wellbeing interviews or other information gathering is conducted, we recommend seeking legal advice and, if possible, having external counsel conduct or engage culture reviews. This will ensure, as far as possible, that any findings about current psychosocial hazards in the workplace are covered by legal professional privilege* and legal risks can be mitigated confidentiality and effectively. 

In our experience, employers that take these steps following any concerning pulse survey results will be demonstrating compliance with their work health and safety duties. By acting on the early warning signs contained in survey results, employers can more effectively mitigate the risks associated with psychosocial hazards. The practical benefit of this, as well as being legally compliant, is a healthier, safer and more productive workforce, with higher retention rates and a reputation as a great place to work. 

*Legal professional privilege protects confidential communications and confidential documents between a lawyer and the client where they have been made for the dominant purpose of the lawyer providing legal advice or professional legal services to the client (or for use in current or anticipated litigation).

Aaron Goonrey is a Partner and leads the Australian and APAC Employment & Rewards practice at Pinsent Masons. Emma Lutwyche is a Special Counsel and Yuliya Chis is an Associate at Pinsent Masons. The advice in this article is general in nature and does not constitute formal legal advice.

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A recent case has provided further guidance in Australian employment law on the role of multiple decision-makers in matters involving the termination of employment. 

This case serves as a critical lesson for HR and employers on the importance of either a unified approach by all decision-makers involved in the termination process, or having a single impartial decision maker. 

The case also illustrates the importance of employers providing thorough and transparent reasons for termination of employment.

A brief outline of the case in question

In April 2020, a former employee and truck driver for a freight and logistics employer filed an adverse action application, alleging that the employer wrongfully dismissed him from his position.      

Among other allegations, he claimed that this action was in contravention of statutory protections, as he had exercised a workplace right and believed that the dismissal was in response to him exercising this right.

The Federal Circuit and Family Court found that the former employee’s dismissal was not due to alleged safety breaches or unprofessional behaviour as asserted by the managers. Rather, the Court found that the dismissal constituted unlawful adverse action against the former employee by the employer in relation to having exercised workplace rights, including requesting flexible work arrangements, querying the alleged underpayment and initiating proceedings with the Fair Work Commission.

The dismissal occurred after the national HR manager perceived the former employee’s queries about a flexible work arrangement to care for his child, and his queries about alleged underpayment, as “badgering” and “harassing”. 

The Court found that most of the former employee’s email interactions were respectful, and that he was seeking solutions to genuine issues, not harassing the HR manager. 

The HR manager acknowledged to the Court that in the event of significant safety violations involving an employee, it would be standard procedure for the overseeing manager to initiate a comprehensive investigation. However, the HR manager admitted that there was no paperwork before the Court about any investigation having been conducted into any of the alleged safety matters involving the former employee.

The Court highlighted that there was no documented evidence showing how the single alleged safety incident, which reportedly resulted in a “verbal warning”, transformed into a history of safety issues in breach of the employer’s ‘Three Strike Policy’, or “continual breaches” of that policy, which were given by the employer as reasons for the dismissal decision. 

The Court pointed out that there was a deficiency of credible evidence from the employer regarding the investigation and clarification of supposed safety issues involving the former employee. Moreover, evidence of the explanations provided by the employer for the dismissal was either non-existent or lacked credibility as to how the alleged safety concerns were factored into the decision to terminate the worker’s employment. 

This lack of evidence and plausible explanation convinced the Court that the alleged safety issues likely never occurred. Further, the Court held that the safety issues could not have been significant or influential factors in the decision to dismiss the former employee. 

The Court found no evidence of the serious safety issues that were claimed to have occurred, and accordingly, concluded that these could not have been substantive or valid reasons for the dismissal.

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The intricacies of decision-making in dismissal cases

A key aspect of this case was the involvement of multiple decision-makers, including the national HR manager, a partner of the business, the national transport manager and two state-level managers. 

Despite there being five decision makers, only two of these individuals provided evidence to the Court about the reasons for the dismissal of the former employee – the national HR manager, and the national transport manager. 

The Court found no explanation or evidence capable of discharging the reverse onus imposed on the employer in matters like this. 

Accordingly, the Court was satisfied that adverse action had been taken against the former employee by the employer in dismissing him from his employment for exercising his workplace rights.

Understanding the reverse onus of proof 

Under the applicable Australian law, once an employee establishes an apparent case that their dismissal may have been due to the exercise of workplace right(s), the onus shifts to the employer to prove otherwise. 

In this case, the employer had failed to discharge the reverse onus as it did not provide sufficient evidence or explanation from all decision-makers involved in the dismissal of the former employee.

The Court determined that the employer did not provide adequate evidence to counter the presumption that the former employee was dismissed for exercising his workplace rights. 

The absence of evidence from other decision-makers besides the national HR and transport managers left the Court without a substantive defence from the employer. 

The ruling stated: ‘There was no opportunity for the state of mind or mental processes of the not-called other joint decision-makers to be exposed to or considered by the Court. Further, the Court can also infer that those other joint decision-makers were not called because their evidence may not have assisted [the employer’s] case that the reasons for the dismissal were limited to alleged safety issues and alleged unprofessional behaviour.” 

The judge noted that the former employee’s minor disrespect in an email came late in a series of communications and did not justify dismissal. Instead, the timing suggested that a reason for dismissal may have been the former employee’s threat to involve the Fair Work Ombudsman, which occurred the day before the discussion of his dismissal.

Further, the national HR manager and national transport manager admitted that they had omitted some reasons for the former employee’s dismissal in the dismissal letter. The Court found that these omitted reasons included the former employee’s complaints about underpayment, which are a protected workplace right. 

Lessons for HR and employers 

This case highlights several important lessons for HR and employers. Firstly, it’s essential that all decision-makers are aligned and that their reasons for termination are comprehensively documented and presented. 

Had the employer in this case led uniform evidence from all the decision-makers about the reasons for termination, the result may have been different. Discrepancies or omissions in the reasons for dismissal will likely be detrimental, as seen in this case.

Secondly, employers must be aware of the reverse onus of proof where purported workplace rights are being exercised and prepare accordingly. This involves having a clear, documented rationale for termination that is not related to an employee exercising a workplace right. 

Finally, where possible, employers should elect to have an impartial and sole decision maker in dismissal matters – ideally, someone who is not involved in any previous process or the facts of a matter which may lead to the dismissal of an employee. 

The decision maker should ideally not be familiar with or involved in any workplace rights that the employee may have, or have exercised. Their decision regarding any disciplinary action, including dismissal, should be based objectively on the employee’s performance, conduct or behaviour. Accordingly the decision maker’s lack of knowledge about any workplace rights in the matter, would be advantageous. 

This decision is a reminder of the consequences of inadequate preparation and inconsistent decision-making in adverse action cases. 

The matter is set to proceed to a penalty hearing for the contravention of the relevant legislations, with legal costs reserved.

Aaron Goonrey is a Partner and leads the Australian and APAC Employment & Rewards practice at Pinsent Masons and Yuliya Chis is an Associate at Pinsent Masons. The advice in this article is general in nature and does not constitute formal legal advice.

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Over the past week, there have been numerous media reports about the mishandling of sexual harassment and toxic workplace complaints and investigations, alleged cover-ups of senior executive misconduct and unsatisfactory complaint handling within organisations.

This might seem relatively surprising given changing community and business standards, not to mention the recent legislative reforms that place a positive duty on businesses to eliminate, as far as possible, various unlawful behaviours relating to sexual conduct in the workplace or in connection to work. 

If you speak to business leaders, seasoned HR professionals and people managers, they will usually respond by declaring that their organisation has addressed the positive duty and has robust systems for handling sexual harassment and toxic workplace behaviour.

However, this response may be analogous to when some employers previously proclaimed they did not have issues with underpayments of employee wages, only to find out some time later that they had been underpaying employees over many years, albeit, in many cases, unintentionally. 

So, what’s missing? Why does it seem organisations are still getting it wrong?

The Australian Human Rights Commission published guidelines in August 2023 that included practical examples of what employers should proactively be doing to comply with their positive duty to eliminate unlawful sexual behaviour in the workplace. The 112-page guideline makes it clear that it’s simply not enough for organisations to undergo a box-ticking exercise.

The guidelines comprehensively indicate that companies with strong culture and governance can effectively prevent and respond to workplace misconduct by:

• Having clear complaint handling procedures that are well-known within the organisation, so employees feel safe to report unsatisfactory workplace behaviour at an early stage.
• Creating support mechanisms for workers to feel safe and assisted by the organisation in raising issues about unsatisfactory workplace behaviour. For example, this could look like internal support through nominating workers or asking for volunteers to act as contact officers, and creating peer support networks and ensuring they’re trained in receiving disclosures of relevant unlawful conduct and harm. Organisations could also engage external specialist support through work-funded Employee Assistance Programs.   
• Ensuring investigations into allegations of unsatisfactory workplace conduct are undertaken in a fair and consistent manner to provide workers with confidence that their organisation is committed to creating a safe and inclusive work environment.

Below, we provide an overview of what boards, senior managers, HR, legal and risk professionals should be doing at a minimum and offer best-practice tips in relation to complaint handling and investigations to ensure the safety of their workers.  

This should help employers and HR avoid any reputational damage that their organisations may face when these issues are not managed to the high standards now expected by both workers, the government and the broader community. 

Best-practice complaint handling    

While best practice will look different in different businesses, depending on organisation size, operations (e.g. remote or international), HR and employee relations capacity, etc., employers should generally be implementing the following best-practice steps to ensure complaints are handled appropriately:

1. Consult with workers about existing and proposed complaint handling measures within the organisation.    

As persons conducting a business or undertaking, employers must, so far as reasonably practicable, consult with workers (which includes employees, contractors, volunteers and anyone else who carries out work for the business) who are or are likely to be directly affected by a health and safety matter.

Inevitably, many complaints about unsatisfactory workplace behaviour relate to safety matters, including psychosocial hazards.  

In engaging and consulting with workers about complaint handling measures and mechanisms, organisations are able to obtain real and practical knowledge and experience to make improved and informed decisions about how to handle complaints in a safe manner.

2. Implement a workplace policy that sets out the organisation’s complaint handling procedure

The policy should set out in clear, concise and plain language for workers to understand:

1. The who, what, where, why and how of making a complaint or raising a concern (including various options based on the level and rank of the person being complained about and the information required).   
2. That the process will be undertaken as confidentially as possible, explaining that information may need to be disclosed on a need-to-know basis.   
3. That their complaints or concerns will be taken seriously.   
4. What immediate action will be taken by the organisation after a complaint or concern is raised, including expected time frames.   
5. Options available to the worker to ensure their safety and wellbeing (e.g. if required, temporary adjustments to reporting lines, access to leave, etc.).   
6. Informal and formal options available to resolve the complaint where appropriate.   
7. An outline of possible consequences if misconduct in breach of an organisation’s policy or law is found to have occurred    
8. Where workers can provide feedback about the policy.

3. Implement a bystander policy

This policy should set out the organisation’s expectations for workers to report any inappropriate conduct witnessed as a bystander.

4. Regular and continuous communication

Organisations should regularly communicate the existence of relevant policies and procedures to employees and where they are located.

This should not be an exercise limited to the induction and starter packs for new workers, but part of a wider HR strategy to ensure workers are embedded with knowledge about the organisation’s expectations and the rules that govern the workplace.

5. Access to information

The complaint handling policy and procedures should be easily accessible and publicised to all workers (for example, located on the organisation’s intranet, on staff notice boards and provided as part of the welcome pack for new workers). The regular communication, mentioned above, should capture this point.

6. Appropriate training

Provide tailored training to all workers, and separate training specifically designed for managers and those who have people management responsibilities, to ensure they:

1. Understand the obligations they have in the complaint handling procedure.  
2. Equip them with the knowledge and information to discharge their obligations    
3. Know how to respond and/or escalate the matter appropriately, by testing them on the training content.

The training for everyone may be conducted by way of an interactive learning module or workshop that simulates different scenarios and guides decision-making depending on the type and severity of the allegations, and tests employees on the content covered.

Organisations may also like to consider offering mental health first aid training to equip front-line managers with recognising and responding to workers experiencing a mental health crisis arising from workplace conduct experienced or witnessed by workers.

“Communication is key throughout the investigation process to limit prolonged uncertainty and anxiety for all parties involved.”

Best-practice investigations    

Once a complaint or concern has been reported, and the organisation is aware of an issue, appropriate action must be taken by the organisation within a reasonable timeframe, and taking into account its available resources.

This is because there is a potential hazard that the organisation has been made aware of and needs to address promptly. Failing to act swiftly is the equivalent of leaving hazards such as a puddle in the middle of a shopfront, or a loose screw in a piece of machinery, meaning it often becomes too late to act.    

Appropriate action may take the form of a factual investigation to determine whether the allegations are more likely to have occurred than not, on the balance of probabilities, and should involve at least the following steps:

1. Undertake a risk assessment and determine whether any workplace adjustments are required to protect the safety of the complainant, and ensure confidentiality      

Depending on the nature of the allegations and proximity of working relationship between the complainant and the alleged perpetrator, workplace adjustments may need to be made to ensure everyone’s safety while the investigation is being undertaken.

For example, temporarily changing reporting lines, directing one of the parties to work from home or, in serious matters, suspending the alleged perpetrator from work until further notice.

2. Determine whether the investigation will be undertaken internally or by an external/independent party, and select an appropriate investigator

Subject to the seriousness of the allegations, it may be appropriate to conduct the investigation internally, by way of desktop review, etc; or seek legal advice; and/or engage an external third party to conduct the investigation.

Whatever way the matter is to be investigated, the investigator must be impartial, which means the investigator should not have any conflict of interest (either actual or perceived) – such as a former manager or close colleague – with the parties involved in the complaint; and should ideally be trained with undertaking investigations.

3. Communicate next steps clearly      

Communicate appropriately, and as applicable to all relevant parties, that a complaint has been made, who will be undertaking the investigation, what the investigation process will involve – including estimated timeframes – and what some of the potential outcomes could involve. 

This may also involve strategic communications with relevant teams to ensure confidentiality is maintained and the organisation’s commitment to a safe and inclusive workplace environment is highlighted. 

Communication is key throughout the investigation process to limit prolonged uncertainty and anxiety for all parties involved.

It provides assurance to complainants that their complaint is being treated seriously and managed appropriately, and keeps alleged perpetrators abreast of when findings are expected to be made.

4. Review the organisation’s policies and procedures with respect to complaint handling and investigations      

If the organisation has committed to a policy or procedure in relation to how complaint handling and investigations will be undertaken, these must be complied with, as all employees will expect that the process they have been notified about will be followed.

5. Conduct fair and objective interviews with the complainant, all relevant witnesses, and the alleged perpetrator

Give all parties the benefit of the doubt. Everyone involved should be treated in a fair and uniform way. Questions should be prepared in advance so interviewees will be able to tell their side of the story fully. Leading questions such as, “You knew what you were doing was wrong, didn’t you?”, should be avoided as theymmay lead to a biased response.

Where additional witnesses are identified during interviews, care must be taken to determine whether or not they should be spoken to, to ensure all available evidence is collected before any factual findings are made.

6. Record keeping

Keep a clear and comprehensive record of all steps taken, including keeping all interview transcripts, notes and evidence collected.

7. Investigation report

In many instances, the investigator should prepare a report at the conclusion of their enquiries. The report must contain the findings of fact and, if asked by the organisation, make recommendations and/or a determination.

If the investigation has been conducted in order for the organisation to obtain legal advice, the report should only be provided to the ultimate decision-maker(s) and not to any other parties.

8. Findings

The organisation should, after receiving the investigator’s findings, communicate those findings and any decision appropriately to all the parties involved.

The ultimate decision maker should ensure the final decision is proportionate to the findings made. Where adverse findings and outcomes are proposed, the organisation should provide the alleged perpetrator with the opportunity to respond before a final decision is made.

 This ensures the alleged perpetrator is given a procedurally fair process to provide any additional information that may not have been disclosed and could therefore impact the findings and outcome proposed.

What should HR do next? 

It’s clear that workers and the wider community are increasingly placing a higher standard on businesses and organisations to provide a safe and inclusive work environment. 

Accordingly, it’s more important than ever that organisations review their governance structure to ensure they have an effective ‘prevention and response plan’.

Such plans should include adequate complaint handling systems and ensuring workplace investigations are conducted correctly.

 As has been seen recently, failure to do so has far-reaching consequences, not only in damaging the organisation’s reputation with the public, but internally damaging workplace culture and creating a loss of trust in leadership, which will take significant time and resources to repair, if they are, indeed, repairable at all. 

Aaron Goonrey is a Partner and leads the Australian Employment & Rewards practice at Pinsent Masons and Jessica Park is an Associate at Pinsent Masons. The advice in this article is general in nature and does not constitute formal legal advice.

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Editor’s note (05.04.24): This legislation is set to come into effect on 26 August 2024 for businesses with more than 15 employees. Small businesses (with less than 15 employees) will have until August 2025 until changes come into effect.

The right to work from home and the right to disconnect from work are both currently  being considered as additional new rights for employees in Australia.

While there are a number of steps that need to occur before these rights become legal entitlements, the issues are being debated. It’s important for employers, HR professionals and people managers to understand how these changes might impact the way they run their businesses.

Currently, there are no rights either in modern awards or legislation that give working from home entitlements or the right to disconnect. Similar provisions, which were temporarily included in the Clerks – Private Sector Award 2020 during the COVID-19 pandemic, were removed after working from home directives were lifted.

The Fair Work Commission (FWC), in conducting its four yearly modern award review, is considering whether the right to work from home and the right to disconnect should be included in modern awards. They are currently seeking submissions on the potential inclusion of both rights, which are expected to be heavily supported by unions and workers.       

The next phase of the Closing Loopholes Bill

At the date of writing, the Government has secured support to pass the Closing Loopholes No 2 Bill through the Senate by reaching agreement with the Greens and a number of independent senators. The agreed version of the Bill includes the right to disconnect.      

The push to have employee protections to work from home will unsurprisingly meet opposition from some employers, particularly considering the recent objective of some to mandate at least part-time office attendance.

This has resulted in recent examples where enterprise agreements have been unable to be agreed upon without stipulated working from home provisions.

It is likewise anticipated that creating a legal right to disconnect will be resisted by employer groups and deemed difficult to manage, monitor and enforce. This is especially true for organisations that have redesigned their work structures to be asynchronous.

However, research undertaken by the Greens also demonstrates that 56 enterprise agreements already include a right to disconnect, covering tens of thousands of employees. In Australia, it was first included within the Victoria Police Enterprise Agreement of 2019. Many of the provisions in these agreements typically come with extensive exceptions, allowing business operations to continue largely unaffected.

Read HRM’s case study outlining how Victoria Police introduced a right to disconnect in its EBA.

What might the right to disconnect look like?

The legislative right to ‘disconnect’ is proposed to cover all employees, not just those covered by modern awards.

At the time of writing, we understand that the proposed right as set out in the Closing Loopholes No 2 Bill that has passed the Senate, is a right for workers to disconnect from “unreasonable” out-of-hours contact from employers.       

Under the proposal, the FWC would be empowered to issue stop orders, similar to the stop bullying and stop sexual harassment orders. If the stop orders are breached, it is envisaged that civil remedies may be imposed. The Commission would have the power to determine what is “unreasonable” contact, taking into account a non-exhaustive list of factors such as: 

• the reason for the contact;
• the frequency and method of contact;
• remuneration;
• role and responsibilities; and
• the worker’s personal circumstances, which may include family responsibilities.

This change is purported to support a healthier work-life balance for employees. In fact, research from the Australian HR Institute, which surveyed over 600 senior HR professionals and senior decision makers, shows that almost two thirds of respondents think a right to disconnect would have a positive impact on workplace flexibility and 41 per cent already have some form of right to disconnect in place.

However, there are still plenty of points of clarity needed. For example, how this proposed change would interact with overtime and penalty rates is currently unclear.

Other considerations for HR and employers to keep in mind include:

• The practicalities of preventing contact with employees outside their working hours, especially for global businesses spanning multiple time zones, raises logistical and management considerations.
• An increase in employee claims if: the right is allegedly breached; or employees perceive unfavourable treatment, such as disparities in pay or promotions, compared to colleagues who remain connected outside standard working hours. This is also a consideration for employees who’d choose to work from home if that were to also become a legal right.
• Businesses relying on flexibility for connecting with employees outside regular work hours, particularly those with global operations, may experience disruptions to their operations.
• Employee morale may be affected if some exercise the right and others do not, leading to dissatisfaction within the workforce. This could result in a perception that some colleagues are not contributing, placing a heavier workload on those who choose to stay connected beyond regular hours.

 What might the right to WFH look like?

While working from home arrangements are not possible in all sectors and positions, if the right is included within modern awards, many employers may need to consider negotiating and entering into separate flexible working arrangements.

These may be similar to ‘time off in lieu’ agreements (being a written agreement which could be as simple as email correspondence confirming an employee’s entitlement to take time off from work in place of receiving overtime pay for additional overtime) or formal flexible work requests under the Fair Work Act.

Separate agreements may also need to consider what working from home means on an individual basis including by:

• Expanding the definition of ‘ordinary hours’ while working from home;
• Abandoning the requirement to agree on employee start and finish times or to agree to a specific range of times;
• Allowing for meal and rest breaks to suit personal circumstances; and
• Changing recording requirements in respect of timesheet reporting of hours worked.

Presently, the Fair Work Act only allows flexible working arrangements in certain circumstances such as pregnancy and/or parental requirements. The proposed inclusion of a right to work from home in modern awards would be additional to and broader than the current right, without being tied to a particular attribute or responsibility.

 Proactive steps for business to take

While the FWC considers the inclusion of these new rights in modern awards, there are proactive steps that employers, HR and people managers can take now. 

Consider:

Policies and processes

• Reviewing and assessing current policies and processes related to working from home requests, and for managing employees working from home.
• Consider conducting an audit on the potential impact of a right to disconnect. For example, if your organisation’s workers had the right to not respond to emails from 6pm to 8am, what impact might that have on operations?
• Examine practical measures that your organisation could take to prevent contact with employees outside their ordinary working hours if a right to disconnect was introduced.
• Consider what policies or procedures would need to be revised or introduced.
  
• Contemplate the right to disconnect provisions that would need to be introduced to employment agreements and enterprise agreements under negotiation.

Implementation 

• Consider establishing a system to monitor employees’ work activities outside the agreed-upon working hours.
• Actively encourage people leaders and managers to respect employees’ time away from work and employees’ out of work time.
• Provide training to managers to prevent any adverse action against employees who exercise the right to disconnect.
• From a wellness and work health and safety perspective, educate all employees about the right to disconnect and any applicable business initiatives, including promoting the wellness advantages of disconnecting from work.
• Implement internal processes for employees who choose to work outside agreed hours.
• Communicate to all employees, and across the business, the expectation that emails and tasks should be scheduled for delivery during agreed working hours.

Business implications

• Assess whether your organisation can comply with its obligations to employees should they request to work from home.
• Evaluate the impact that increased working from home might have on your business, culture and employee wellbeing, and, alternatively, what impact it would have to refuse working from home requests.
• Based on duties and responsibilities, consider what reasonable business grounds you have for refusing requests to work from home.

 What happens next?

The FWC is publishing a ‘work and care literature review’ on 8 March 2024. Submissions will be open to interested parties during consultations in March and April 2024.  

It is anticipated that the Closing Loopholes No 2 in its agreed form, including the right to disconnect, will pass the Senate. Once passed, it will proceed to Royal Assent, after which there will likely be a period of time before the right to disconnect takes effect.

Aaron Goonrey is a Partner and leads the Australian Employment & Rewards practice at Pinsent Masons, Emma Lutwyche is a Special Counsel and Jeremy Bilski is an Associate at Pinsent Masons. The advice in this article is general in nature and does not constitute formal legal advice.

Need help brushing up on HR laws and compliance? AHRI’s short course will give you an understanding of the key elements of legislation, regulation and practices HR needs to be across.

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The Australian Human Rights Commission (AHRC) has recently published its guidelines to help employers and persons conducting a business or undertaking (PCBUs) comply with the new positive duty to eliminate sexual harassment and discrimination in the workplace, in effect since December 2022. 

The guidelines have been published ahead of the AHRC’s new enforcement and investigative powers, which commenced on 12 December 2023 and allow the AHRC to investigate employers/PCBUs expected of non-compliance with the positive duty requirements (their duty to take ‘reasonable and proportionate measures’ to eliminate unlawful conduct).

The guidelines provide practical guidance to employers to eliminate workplace sex discrimination, provide information on how employers can satisfy their obligations and set out seven expectations of organisations and companies to satisfy the positive duty.

In this article, we’ll help explain the principles and standards, and summarise 112 pages of the guidelines, distilling what HR needs to know.

Details of the standards 

The guidelines are based on seven standards which provide an ‘end-to-end’ framework that employers and PCBUs can use to tailor their approach to preventing unlawful behaviours. These are:

1. Leadership 
2. Culture 
3. Knowledge 
4. Risk management 
5. Support
6. Reporting and response
7. Monitoring, evaluation and transparency 

Under the guidelines: 

1. Senior leaders should understand the positive duty and know specifically what conduct is unlawful. They are responsible for ensuring appropriate measures are taken, updated, reviewed and communicated to workers.

Importantly, senior leaders should role model respectful behaviour and set the standard for inclusion and equality. It is useful to reinforce the message to senior leaders that, “The standard you walk past is the standard you accept.”

2. Employers and PCBUs should create a safe, respectful and inclusive culture, and workers should be encouraged to report any unlawful behaviour.

A culture that encourages reporting of unlawful behaviour helps prevent potential legal, reputational and financial risks that could otherwise harm the stability of the organisation.

3. Employers are expected to establish a policy in relation to respectful behaviour. They should educate and train their workers on expected behaviour standards, how to identify unlawful behaviour and relevant consequences, and their rights and responsibilities in workplaces.

4. Employers and PCBUs should consult with all stakeholders about sexual harassment risks and hazards, and take a risk-based approach to prevent and respond to unlawful behaviours.

In addition, under work health and safety legislation, a PCBU is required to eliminate or minimise risks to psychological health and safety. Sexual harassment is a psychosocial hazard that must be eliminated. 

Read HRM’s article on the new psychosocial hazards Code of Conduct.

5. Employers and PCBUs should provide workers who experience or witness unlawful behaviour in workplaces with appropriate support. That support should be accessible and readily available, whether or not the conduct has been reported.  

6. Workers should be provided with appropriate options for reporting unlawful behaviour, and those options should be regularly communicated. All reports should be responded to in a consistent and timely manner, and in a way which minimises harm to victims.  

7. Organisations are expected to be collecting relevant data in relation to unlawful behaviours in workplaces.

This data should be used to continually improve the work culture and build further precautions to prevent unlawful behaviours. Transparency about the nature and extent of reported unlawful behaviours, and action taken to address them, is recommended. 

What should employers do?

As immediate steps, we recommend that employers and PCBUs:

• Ensure that senior leaders and managers are informed and engaged about the positive duty – including by having sexual harassment and positive duty compliance as a standing agenda item at board and senior leadership management meetings.
• Regularly consult and engage with workers to discuss measures to eliminate potential sexual harassment risks and hazards. This can also be used as an opportunity to promote a ‘speak up’ culture.
• Identify and assess circumstances that may give rise to the likelihood of sexual harassment incidents. This involves taking a work health and safety approach to sexual harassment and conducting regular risk assessments.
• Evaluate overarching measures that can effectively reduce or remove risks to align with changes to sexual harassment legislation and work health and safety obligations. Consider, for example, a bystander policy under which all workers are obliged to report inappropriate behaviour they witness, even if it is not directed at them.
• Develop practical and proactive plans for prevention and compliance with the positive duty. These should be monitored and reevaluated on a regular basis to ensure they are adequate. 
• Assess policies and training programs to guarantee their effectiveness and alignment with the employer’s obligations.  ‘Tick-and-flick’ training and policies buried within handbooks are no longer likely to be sufficient. There needs to be meaningful engagement from leadership and include all workers. 

Aaron Goonrey is a Partner and leads the Australian Employment & Rewards practice at Pinsent Masons and Emma Lutwyche is a Special Counsel at Pinsent Masons. The advice in this article is general in nature and doesn’t not constitute formal legal advice.

Need help brushing up on HR laws and compliance? AHRI’s short course will give you an understanding of the key elements of legislation, regulation and practices HR needs to be across.

This article was originally published in August 2023 and is being resurfaced due to the changes coming into effect.

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‘Tis the season for merriment and joy, but what happens when the holiday cheer takes an unexpected turn? 

Following an increased focus on preventing sexual harassment and protecting employees’ psychosocial safety over the past couple of years, most employers are well-versed in the steps they have to take ahead of their end-of-year party. Appropriate service of alcohol, the right level of supervision, issuing cautions and clearly communicating expectations prior to the function about unacceptable behaviour are now par for the course. 

But what should employers do if, despite taking all reasonable preventative steps, they receive a complaint about an alleged incident at the end-of-year party? 

In this article, we will guide you through some practical steps to deal with the fallout from an incident, including complaint handling, workplace investigation processes and appropriate disciplinary action.  

“Witnesses are the backbone of any good investigation. Seek out those who might have seen or heard something unusual.”

Deck the Halls with complaint handling 

Just like selecting the perfect ornament for the Christmas tree, choosing the right level of investigation requires careful consideration. Some allegations may require termination, while others may simply warrant a gentle warning. 

So, before you embark on your investigative journey, pause and gauge the seriousness of the allegations, considering your approach meticulously.

Once an allegation has been made, consider the following framework:

1. Victim support: As with all complaints of misconduct, an employee who complains about an incident at a Christmas party should be treated fairly, empathetically and given support. 

2. Initial assessment: If alcohol was served at the function, any initial assessment of the incident should find out to what extent the complainant and the respondent were under the influence of alcohol. 

This should include asking the complainant about how much they had to drink, and their perspective about how much the respondent had to drink.

3. Suspension: While no assumptions should be made about the truth of the complaint, if the allegations of misconduct are serious, such as if they are of a sexual nature, the respondent may need to be suspended from work while the complaint is investigated. This is because the safety and mental wellbeing of the person who made the allegation should come first and foremost. Among other things, this approach encourages a speak-up culture where victims feel supported and encouraged to voice concerns about toxic workplace behaviour. 

4. Confidentiality: The complaint should be kept strictly confidential, including by the complaint and respondent. In circumstances where there are many possible witnesses to the alleged incident, strict confidentiality should be implemented so rumours aren’t spread, which could impact your investigation, and so neither the complainant nor the respondent is gathering support for their version of events. 

Workplace investigation tips

In the spirit of yuletide fairness, your plan should follow the principles of procedural fairness. 

Start by planning the timetable and mapping the investigative journey. As you unfold the plan, list the key players required for each step. 

We recommend interviewing the complainant and then the respondent first to identify what, if any, aspects of the complaint can be substantiated on the basis of agreed facts or admissions. 

Secondly, identify any other sources of reliable information, such as CCTV footage. Then, if there is a reduced list of outstanding allegations to be substantiated, identify specific witnesses who were said to have seen the particular allegation. 

Witnesses are the backbone of any good investigation. Seek out those who might have seen or heard something unusual. The more eyes and ears you have, the better your chances are of uncovering the truth. 

It also is important to only interview people who are strictly necessary to obtain relevant information, to keep the matter as confidential as possible. They should be reminded that they would be in breach of their employment obligations and, where applicable, your company’s policies if they were to discuss this matter with their colleagues.

It’s also wise to consider engaging an external investigator. Many organisations are not trained or equipped to conduct workplace investigations. A proper investigation must be dealt with promptly and may take a significant amount of time to conduct. An investigation that is conducted internally may also be subject to claims of bias and lack of transparency or impartiality. 

Making an informed decision

Once you have gathered all the evidence, findings can be made on the balance of probabilities.

When weighing and balancing evidence, the effect of alcohol consumption on recollection should be considered. This will include an assessment, as objectively as possible, about how each person’s recollection may have been impacted.

Once the investigation is completed, it is not the investigator’s job to make any decision about disciplinary actions. That role will fall to someone else in your organisation’s leadership team. 

When determining any disciplinary action, the fact that a person had been drinking should not reduce their culpability or responsibility for their actions. To the contrary – having drunk too much at the party may weigh against them, in circumstances where they were at a work function and should not have drunk to excess. 

Otherwise, the same standards of behaviour apply at an end-of-year function as in the office. A comment or action engaged in which would constitute misconduct in the office also constitutes misconduct if done at the end of year party. Therefore, disciplinary action should follow this same principle. 

While it’s important to be across the details of a post-event investigation, putting preventative measures in place ensures everyone has a happy and safe festive season which is remembered for the right reasons!

Need help brushing up on HR laws and compliance? AHRI’s short course will give you an understanding of the key elements of legislation, regulation and practices HR needs to be across.

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The Australian Privacy Act 1988 (Cth) currently includes an exemption for handling the records of current or former employees, commonly referred to as the ‘employee record exemption’. 

This means that private sector employers don’t have to comply with the Australian Privacy Principles (APPs) when dealing with employee records. This allows employers to collect, use and disclose personal and sensitive information about a current or former employee if the information relates to the employment relationship between the business and the individual.

The exemption does not cover prospective employees, so job candidate information must be dealt with in accordance with the APPs. 

Earlier this year, the Federal Attorney-General’s department recently released its response to the Privacy Act Review Report. The report’s consideration on proposals to reform the employee records exemption is relevant reading for HR and employers.

Among other things, it considered multiple options to reform the way employers deal with employee information, including the removal or modification of the employee record exemption, or the enhancement of protections within workplace relations legislation. 

It predominantly focused on strengthening employee protections and proposes that employers would still be able to collect information that is “reasonably necessary to administer the employment relationship”, which could include information for superannuation and payroll purposes, for example. 

However, it has also suggested introducing additional limitations on the employee records exemption to prevent misuse of such data. The Report did not detail what the additional limitations may be, but we anticipate there may be a stricter definition of what constitutes use in relation to the employment relationship. 

The proposed reforms 

On 28 September 2023, the Federal Government indicated its in-principle agreement with the recommendation, stating that it agrees with bolstering privacy protections for private sector workers, including:

• Enhancing transparency in how employers utilise employee personal information.
• Permitting employers to “collect, use and disclose” worker information only when it is deemed “reasonably necessary to administer the employment relationship,” including an assessment of the necessity of obtaining consent.
  
  This may include information about an employee’s medical conditions, if it’s relevant to an application for sick leave, or to the inherent requirements of the employee’s role.
• Safeguarding employee information from misuse, loss or unauthorised access, with a condition for its deletion when it’s no longer needed by employers.
• Ensuring that both employees and the Information Commissioner are notified in cases of data breaches involving employee personal information that may result in serious harm, such as leaking an employee’s banking details. 

The Government has also indicated its willingness to engage in further consultation with employer and employee representatives to determine the legislative framework for enhanced employee privacy protections, including the interaction between privacy and workplace relations laws.

For example, such consultations would have to consider how any requirement to destroy employee information would interact with the requirements under the Fair Work Act 2009 (Cth) to retain certain employee information for seven years. 

In addition to these reforms, there is the prospect of a privacy code of practice being introduced, with the aim of clarifying obligations related to the collection, use and disclosure of personal and sensitive information. 

Read HRM’s article, ‘Do your pre-employment checks contravene privacy laws?’

Potential issues that could arise

Given the scope of changes that employers have had to deal with over the past two years, more changes which potentially increase the administrative costs and operational burdens on employers are unlikely to be welcome. 

Employer groups have expressed opposition to the changes, citing reasons such as: 

• Requiring employee consent to collecting personal information could jeopardise an employer’s ability to achieve workplace diversity and inclusion, as this involves collecting and using employees’ sensitive information, such as racial and ethnic origin and health information.
• An employer’s ability to administer sensitive matters such as complaints, disciplinary action and performance management may be negatively affected if they are required to comply with the APPs. 

Employee information data leaks are already a concern. In Australia, major companies have had employee information hacked and leaked on the dark web. 

How to help your organisation prepare

We anticipate it will be at least another year before any reforms take effect, and it’s likely that employers would be given a grace period to get their current employee records in order. However, we still recommend employers start to prepare by:

• Conducting a high-level audit of what, where and why your business has particular employee data. This will be helpful in ensuring all compliance issues can be identified and remedied quickly when the reforms take effect.
• Engage with internal IT, line management, payroll and HR teams about the organisation’s current practice of collection and use of employee data.
• Assess external service providers who hold your employee data, such as payroll or incentive scheme systems.
• Consider whether there is any current and former employee data that is unnecessary to retain and therefore can be securely destroyed, and whether there are any destruction practices that can be implemented going forward. 

We anticipate that any limitations on the employee record exemption will likely cause significant practical implications for employers. For example, many employers do not currently have collection or use notices for employee information. Some  employers may also have to closely audit their processes and systems, including what information is stored on various HR and payroll software and systems. 

Presumably a breach of the Privacy Act will apply to a more limited employee record exemption in a similar way as it does to other Privacy Act breaches – meaning that there could possibly be penalties and fines for both individuals and companies. This is one to watch as we move into the new year.

Aaron Goonrey is a Partner and Emma Lutwyche is a Special Counsel, at Pinsent Masons.

Need help brushing up on HR laws and compliance? AHRI’s short course will give you an understanding of the key elements of legislation, regulation and practices HR needs to be across.

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Last month, we wrote about the importance of having clear, concise, plain language workplace policies that employees can easily understand. 

Recent Fair Work Commission (FWC) decisions relating to employee social media use have underlined this message, criticising “tick-and-flick” training programs that should be avoided in favour of clear, practical training. 

Inadequate training comes back to bite

 In April 2023, the FWC presided over two cases related to the dismissals of two firefighters for numerous offensive, “vulgar” and pornographic posts they shared in a Facebook Messenger chat called “Sickos video sharing group”. 

The Commission decided to reinstate one of the firefighters, despite his posts including one of a group of near-nude women and some sexist and offensive comments. 

The FWC took into account the fact the worker was not properly trained in the employer’s social media policy, and that the social media training was only conducted online. 

Further, out of all the employee’s posts which led the employer to dismiss him, most had been made outside of work hours. The Commission stated that the employee was “entitled to a private life” and that the FWC “does not sit in moral judgement” of how the man should conduct himself in that private life. 

However, the Commission upheld the dismissal of another firefighter who posted a pornographic video in the group while he was on the clock at work. 

While the Facebook chat didn’t name the employer and that the Applicant didn’t use work devices to post in the chat, the on-shift message was enough to warrant his dismissal. 

The Commission reasoned that, “it was not credible that any employee would think that it was appropriate to distribute pornography while they were working and being paid”, and that the man “should not have needed a training course to know that distributing pornography during his shift was not appropriate conduct”. 

Despite ultimately upholding the second firefighter’s dismissal, the Commission did strongly criticise the “haphazard” way his employer went about training in its social media policy, noting that it appeared the be “along the lines of self-taught, tick-and-flick approach, which is simply not appropriate and lacks the educational rigour and outcomes of face-to-face training”.

The line between personal and professional life

In an unrelated decision this month, the Commission rejected an argument that an employee’s “concerning and inappropriate” social media posts breached his employer’s social media policy. 

The Commission found there wasn’t sufficient connection between the employee’s posts – which were made during his personal time – and the employer’s reputation. 

This was found despite finding that the employee’s posts were often racist, contained “tiresome stereotypes” and would be confronting even to those who railed against “wokeness.” 

Concerns over the content of the employee’s posts seemed to be outweighed by the fact they were made in private, in personal time, and without identifiable connection to his employer.

Need help brushing up on HR laws and compliance? AHRI’s short course will give you an understanding of the key elements of legislation, regulation and practices HR needs to be across.

Ensure your training and social media policy is up to scratch

 These decisions are a strong reminder to employers and HR professionals to: 

1. Ensure they have a clear approach to the timing and context of private social media posts, which may, depending on the circumstances, be more critical than the content of posts themselves in any disciplinary action or termination decisions; and
2. Review the clarity and delivery of all social media policies and training. The purpose and scope of your policy should be clear to all employees. For example, it should include the platforms that it encompasses (LinkedIn, TikTok, Facebook, etc.) and details about how employees are expected to conduct themselves when representing their employer on public social media platforms. Employers should also make clear to employees that their online conduct may impact their employment if such conduct can be:
   • connected to their employment; and
   • reflects badly on the employer

Even if an online approach is the most appropriate for your workplace, you should also consider the following:

• Training materials should be appropriate to the context of the workplace (i.e. face-to-face if employees aren’t exclusively remote workers).
• Plain language should be used
• Expectations about employee conduct and behaviour both at work and outside of work must be abundantly clear
• Training and dissemination of policies must be frequent and in-step with legislative changes 
• Understanding and compliance with policies should be monitored on an ongoing and continuous basis.

You could also consider adding clarity around the boundaries when using personal accounts/devices to share divisive opinions (i.e. offensive/inappropriate comments made on a personal LinkedIn account can quite easily be traced back to an employer), information about how to handle confidential information, and the details of your intellectual property boundaries (i.e. what can/can’t employees share online).

A robust policy, backed up with clear and regular training, ensures there are no grey areas around your expectations of employees’ online conduct. And in a world where social media use is only continuing to grow (in 2023, 21.3 million Australians are predicted to be on social media – that’s over 80 per cent of the population – for over two hours every day), this isn’t a topic for employers to ignore.

The advice in this article is general in nature and does not constitute legal advice.

Aaron Goonrey is a Partner and Emma Lutwyche is a Senior Associate and Meredith Oliver is a lawyer at Lander and Rogers.

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An employee’s breach of a workplace policy is often relied on as sufficient evidence by their employer as grounds for dismissal. Provided the process leading to the dismissal was fair, a breach of a workplace policy may also be held by a court or tribunal to be a valid reason for the termination of employment. 

However, in order to be relied upon to support disciplinary proceedings, workplace policies should also be clear and comprehensible to the people using them.

In a recent decision, the Fair Work Commission (FWC) reinstated an employee and compensated her for lost pay because it found that, although there was a valid reason for dismissal, the policy breached by the employee was not accessible, understandable or “reasonable”.

Here’s what HR can learn from this case.

Complicated workplace policies

The employee in this case was dismissed for deleting data from a work-issued mobile phone, with the employer citing a complex and detailed IT procedure manual which prohibited the removal of data from work-issued devices without authorisation. 

As a result, the employee’s role was terminated. She then commenced unfair dismissal proceedings against her former employer.

While the FWC considered the act of deleting data as a valid reason for terminating the employee’s employment, it determined that the dismissal was harsh, unjust and unreasonable because: 

• The IT procedure manual that the employee had allegedly breached was “long, complex and legalistic.” 
• The manual did not clearly state that deleting data from a mobile phone without authorisation would constitute serious misconduct and lead to significant disciplinary outcomes up to and including dismissal.  
• Managers and other employees in the organisation routinely deleted data from their mobile phones without repercussions.

The employee was reinstated to her position and compensated for lost pay, with a reduction of 25 per cent to account for her data-deleting conduct.

Read HRM’s article on how to determine the harshness of a dismissal.

Creating clear and concise policies

Employers and HR professionals are reminded that in order to rely upon a policy and enforce its terms, the policy should be:

1. Readily available to all applicable employees.

2. Transparent and clear in its terms. 

3. Reasonable in relation to its objectives and what it seeks to regulate.

To avoid the risk of facing unfair dismissal proceedings as a result of inadequately thought-out or overly complex workplace policies, employers are advised to take note of the following checklist:

1. Adopt plain language as much as possible, and limit the use of jargon and complex or legalistic terms. Policies and procedures should be clear, concise, and related to relevant industry or organisation.

2. Clearly specify the behaviours that may constitute misconduct and/or serious misconduct, and the particular sections of the policy that, if breached, may constitute misconduct.

The policy should also specify what, if any, disciplinary action may follow on from a breach. If a policy is lengthy and contains a range of obligations of differing scopes, a catch-all provision noting that any breach of the policy may constitute misconduct is likely to be inadequate.

3. Before disseminating a policy, imagine being in the position of an employee accused of breaching its terms. Are the policy’s objectives and terms easy to understand? Is what the policy seeks to regulate reasonable? Is the mode of communicating the policy effective? Having various modes of communicating the policy such as video format, a written document and, if possible, in a summary document for onboarding, is recommended.

4. Update policies and procedures regularly to remain compliant with legislative changes, such as the many that are arising from the Secure Jobs, Better Pay Bill, and be consistent with evolving workplace practices and community standards. Do this every 12 months (more if there is a large-scale legislative change, as is the case in 2023).

Conduct regular reviews to ensure uniform compliance with the policies and procedures among managers and supervisors and in each sector of the workforce.

5. Communicate policies and procedures clearly and frequently, particularly where the obligation is strict. If employees are not familiar with a policy and its terms, relying on the policy as a ground for termination will likely be challenging. For employees who have challenges with comprehension, and/or who are non-English speaking, consider what adjustments you may need to make to communicate policies and procedures to make them easily understood.

Getting your policies and procedures in order is not a task to put on the backburner. A compliant and clear policy can keep your organisation out of hot water, especially in the current legislative environment, which is changing quickly and often.

Need help crafting policies that set clear behavioural expectations and meet FWC requirements? AHRI’s short course will help you understand how to structure, write and implement policies and procedures.

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Imagine you’re in the business of making fast cars. How do you make them go faster? One easy approach is to take key employees from a competitor. 

This scenario occurred in the Formula 1 racing world recently when the Aston Martin team recently enjoyed some success after years of defeat. Much of the credit for this turnaround has been given to a shrewd recruiting move by Aston Martin in 202, to bring on the Head of Aerodynamics (the employee) at Red Bull, along with several other staff from his department. 

The matter was taken to court, with Red Bull claiming it would hold the employee to the terms of his contract until 2023, which included a six-month gardening leave period. However, the dispute was settled in 2022 and the employee was released from his contract with Red Bull.     

The case for non-compete clauses 

Many employers have become concerned about their employees leaving to go to a competitor and taking their intellectual property, clients and/or other employees with them. In Australia, non-compete and non-solicitation clauses are standard in employment agreements for many employees.

On the other hand, employee and pay equity advocates object to the existence of these clauses, as they can restrict employee and pay mobility, and may prevent legitimate competition between businesses.

In Australia, courts have sought to balance these interests by adopting the position that restraint clauses are by default not enforceable, unless the employer can demonstrate that they go no further than reasonably necessary to protect the employer’s legitimate business interests (such as confidential information and client relationships).

Some other jurisdictions around the world have taken a different approach. For example, in California non-compete clauses are prohibited and can never be enforced.

Should non-competes be banned in Australia?

 Recently, the Assistant Minister for Competition, Charities and Treasury announced that the Federal Government had requested advice from the Australian Competition and Consumer Commission and Treasury for advice about the competitive impacts of non-compete clauses and any action the government should take in response.

The reasons given for such a request were that there is a “growing body of evidence” that non-compete clauses hamper job mobility and wage growth. Reference was also made to the US Federal Trade Commission recently concluding that banning non-compete clauses could increase worker earnings by almost US$300 billion (AUD$445 billion), and also ease racial and gender pay gaps by up to 9 per cent.

In the announcement, the Federal Government cautioned that it “has not reached a fixed view on whether new action is needed to tackle the impact of market concentration on wages”, and it is “watching developments [in the USA] closely and seeking advice from the key economic and competition agencies”.

Ensure your employment contracts are legally compliant by signing up for AHRI’s introduction to HR law short course.

What would be the effect of a ban on non-competes?

Firstly, it is important to distinguish between non-competes and non-solicitation restrictions. A non-compete seeks to prevent a person from working for a competitor altogether for a set period of time, while a non-solicitation clause allows a person to work for a competitor, although without poaching their former employer’s clients and staff.

Accordingly, employers could use other protections available to them, in the form of non-solicitation clauses and confidential information obligations.

Non-competes are also already much harder to enforce than non-solicitation clauses, as they require a court to be persuaded that the threat to an employer’s legitimate interests is serious and unavoidable, should the person work for the competitor. 

Courts are generally reluctant to enforce them as they often prevent individuals from earning an income until the non-compete expires ─ unless, of course, the individual is being paid for the duration of the non-compete.

Non-solicitation clauses are generally easier to enforce as they do not prevent a person from earning an income, so long as it is not at the expense of their former employer’s clients and staff and use of the employer’s confidential information.

If a prohibition was introduced on non-competes, it is expected that non-solicitation clauses would still be enforceable, as they are understood not to have the same impact on job mobility and wage growth.

The other key employer protection that is not under threat is the integrity of an employer’s confidential information. Under both the Australian Corporations Act and case law, an employee is not able to misuse an employer’s confidential information, either for their own benefit or someone else’s,  during or after their employment. 

This protection has no set time limit, unless the employee is able to demonstrate that the information is no longer confidential for whatever reason, such as the employer disclosing the information.

What should employers do now?

While nothing has been set in stone yet, that’s not to say that the Government could soon choose to ban non-compete clauses. With this in mind, employers should: 

1. Think through how a prohibition on non-competes might impact them, to ensure they have the maximum protection available to them should they be banned in the future
2. Ensure they are not over-reliant on non-competes to protect their interests.  Apart from being difficult to enforce, it is feasible that they may be prohibited in the future.
3. Review their employment agreements (both their templates and existing agreements with senior employees) to ensure their clauses regarding confidential information and post-employment restraints, excluding non-compete restrictions,  are as robust and thorough as possible
4. Ensure that offboarding processes are in place to fully “re-educate” (or at least re-acquaint) exiting employees with their post-employment restraints and obligations. This should include the possible consequences of any breaches, to minimise the risk of any accidental or deliberate breaches of those obligations.

It is also essential that employers take urgent action should they become aware of a former employee breaching their restraints or other obligations. In these matters, any delay can sink the chances of successful proceedings against the employee before they even begin.

Aaron Goonrey is a Partner and Luke Scandrett is a Special Counsel at Lander and Rogers employment law firm.

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