An Expert Discussion On The Labour & Employment Landscape In Australia

The labour and employment landscape has significantly changed in recent years due to the COVID-19 pandemic, but in Australia we have also seen new rules and regulations come into place as well as a shift in focus on compliance issues. To help businesses keep on top of regulatory requirements and general best practice, we spoke with employment law specialist and expert litigator Aaron Goonrey of Lander & Rogers.
 
Aaron has extensive experience working with clients across numerous industries and sectors in the areas of employment law, industrial relations, discrimination, and safety law. Working across a range of sectors, Aaron supports Australian and international employer clients regarding employment and human resources matters, delivering practical and commercial solutions in crucial and significant employee relations situations.
 
Partnering for the long term, he works with clients to develop and implement strategic human resources, employee, industrial relations and workplace management goals. Aaron also helps clients with issues including workforce restructuring, business protection (including restraints of trade), employment litigation, workplace and regulatory investigations and managing challenging employee issues.
 
Can You Outline The Current Labour Market Conditions In Australia?
 
Between 2000 and 2020, employment grew in absolute numbers for most industries. The main industries that did not experience growth in absolute numbers are agriculture, manufacturing and information media and telecommunications, which in fact saw a decline in their workforce over this period.
 
In terms of current labour market predictions, from 2020 to 2025 employment is projected to increase in 17 of the 19 broad industries, with health care and social assistance expected to make the largest contribution to employment growth followed by accommodation and food services. The professional, scientific and technical services sector is projected to make the third largest contribution, followed by education and training. It is predicted that these four industries will generate over 64.4% of total employment growth until November 2025.^[1]
 
Wage underpayment has been a recent hot topic with a number of businesses facing scrutiny following underpayment investigations that have revealed payroll non-compliance. The Fair Work Ombudsman has placed greater focus on underpayment of employees' wages and entitlements and its recent prosecution of businesses for wage non-compliance has highlighted the need for employers to effectively ensure compliance from both a legal and reputational risk perspective. Over the 2020-2021 period, the FWO recovered back-paid wages and entitlements in the amount of almost $150 million, which is nearly five times the recoveries achieved in the 2017-2018 period.
 
Although underpayment is usually not intentional, the widespread media coverage surrounding this issue has led to a greater awareness among both employers and employees. The increased awareness is demonstrated by the FWO's 2020-2021 data, which indicated that there were almost five million visits to the FWO's Pay and Conditions Toll (PACT). PACT is an online FWO tool (generating almost six million pay and entitlement calculations) that assists employees to calculate their wage and entitlements against the Fair Work Act 2009 (Cth) and other industrial instruments to ensure they are being paid correctly. ^[2]
 
In 2021, there have also been significant reforms to casual employment under the Fair Work Amendment Act 2021 (the Act). The main changes that came into effect as a result of the Act included:
 

• a new definition of casual employment (known in other jurisdictions as zero-hour contract); instead of considering subsequent work patterns, casual employment is assessed based on offer and acceptance at the time of commencement of employment;
• prevention of 'double dipping', that is, where on-going employees are misclassified as casual employees;
• introduction of casual conversion principles to prevent misuse of 'permanent casuals'; and
• consideration of an employer's needs when assessing the appropriateness of conversion of a casual employee to full-time or part-time employment.

The Sex Discrimination and Fair Work (Respect at Work) Amendment Act 2021 (Cth) commenced on 11 September 2021. It amends the Fair Work Act 2009, extending the stop-bullying jurisdiction so that the Fair Work Commission will be able to make orders to stop sexual harassment at work. Applications for such orders can be made to the Commission from 11 November 2021.
 
In addition: 

• a new legislative note in the Fair Work Act 2009 (Cth) makes it clear that sexual harassment can be a valid reason for dismissal; and
• leave entitlements have been amended to allow two days of compassionate leave if an employee, or their spouse or de facto partner, has a miscarriage.

How Has COVID-19 Impacted Health And Safety In The Workplace?
 
COVID-19 has compelled a variety of additional work health and safety considerations for employers including:

• additional measures regarding workplace risk assessments;
• responsibilities in relation to physical distancing;
• possible workplace vaccination mandates; and
• ensuring health and safety protocols are in place for the increasing number of employees returning to the traditional workplace (e.g. offices).

Accordingly, although workplace health and safety has always been an essential component of Australian businesses' operations, the risks associated with COVID-19 in the workplace have significantly increased the risks that employers are required to manage.
 
An example of this would be that prior to the COVID-19 pandemic, many employers did not normally offer their employees the option of working from home. However, lockdown restrictions in various Australian states and territories have meant that employers were required to promptly and decisively implement business continuity measures, including health and safety protocols for employees working from home.
 
What Protections Exist For Employers Facing Legal Challenges From Those Who Contract COVID-19 At Work?
 
Employers have legal obligations to maintain a safe and healthy workplace as far as reasonably practicable. This means they are required to take steps to prevent the spread of COVID-19 in the workplace, which may include ensuring adequate hygiene and cleaning protocols are in place in the workplace and promoting social distancing. However, employees who contract COVID-19 at work may be entitled to workers' compensation for associated medical expenses and loss of income. There are not necessarily any protections for employers in a situation where an employee is entitled to workers' compensation.

An employer was held liable in Sara v G & S Sara Pty Ltd,^[3] in which the New South Wales Personal Injury Commission ordered an employer's insurance provider to pay in excess of $830,000 to the widow of an employee who died from COVID-19, which was contracted during a work trip. The employer was ordered to pay death benefits and funeral costs and will potentially be liable for further medical expenses. The case demonstrates the potential liability that employers face in relation to legal challenges from those who contract COVID-19 at work and highlights the lack of any real protections for employers in this situation.
 
How Should Companies Approach The Vaccination Status Of Their Employees?

Is It Possible To Enforce Mandatory Vaccination And What Other Potential Challenges (such as data protection) Exist?
 
Where a government public health order does not apply to mandate vaccinations in a particular industry, companies may still potentially mandate vaccinations.
 
Employers in Australia can only require their employees to be vaccinated where:

• there is a law in place requiring an employee to be vaccinated;
• the requirement is permitted by an enterprise agreement, other industrial instrument or employment contract; or
• it would be lawful and reasonable in the circumstances for an employer to give their employees a direction to be vaccinated (assessed on a case-by-case basis).

The potential challenges of mandating vaccination include issues surrounding consultation with workers, protecting data relating to the vaccination status of employees as well as dealing with employees who refuse to be vaccinated. Where employers choose to mandate vaccinations, they will need to be prepared for possible internal and external complaints and the need to assess any applicable medical exemptions on a case-by-case basis.
 
What New Challenges Have Emerged As A Result Of The Shift Towards Remote Working And What Steps Should Companies Take To Remediate These Risks?
 
As a result of the shift towards remote working, employers may need to consider whether they will implement a hybrid working model in their workplaces. The implementation of hybrid working raises a number of additional challenges such as how best to regulate flexible work and ensure that the benefits of a workplace culture are not lost due to remote work. These are important considerations to ensure that employers maintain a high level of employee retention while allowing their employees to work remotely. Employers will also need to consider how they can continue to ensure their employees have sufficient opportunities for professional development in a remote working environment.
 
An important consideration for employers in a hybrid working model is proximity bias, where preferential treatment is given to those who are closest to them. In a workplace setting, it has been suggested that employers will consider employees who come into the office as more productive and overall 'better' employees. A 2008 study revealed that where teams in the workplace were split with half working remotely and half in the office, the in-person group displayed the highest level of cohesion.^[4] However, where teams were entirely either remote or in the office, they had the highest level of 'group entity'. The research demonstrates the complexity surrounding hybrid working models and the need for employers to manage these underlying human biases.
 
It is important that businesses effectively take into account the key priorities of their employees and how best they can be achieved in a hybrid/remote working model.
 
What Are The Advantages And Disadvantages Of A Hybrid Working Model?
 
A hybrid working model can potentially increase productivity because employees report that they are able to concentrate on their work without distraction; this especially applies to senior roles in which individuals are more commonly distracted in the workplace by questions and guidance sought from them.
A recent survey by McCrindle revealed that 55% of Australians reported being slightly or significantly more productive working from home.^[5] However, 45% of Gen Ys, 52% of Gen Xs, 61% of baby boomers and 73% of those aged 68 and over, reported being more productive at home. Accordingly, the data suggests there is a significant correlation between age and being more productive at home.
 
A hybrid working model can also improve employee satisfaction and culture because it gives people the freedom to choose how and where they want to work. Employees are also increasingly expecting employers to offer them some degree of a hybrid working model. There are also inevitably cost savings for employers due to the decreased need for office space, supplies, equipment and other office essentials.
 
One of the potential drawbacks of a hybrid working model is the difficulty surrounding imposing rules in relation to the working model. There are a number of questions that need to be considered such as, whether there will be a requirement for employees to work a certain amount of days in the office or whether everyone will be asked to go into the office on a certain day(s). These questions are crucial to shaping the culture of the hybrid working model within a business but are also difficult to answer because a truly flexible model needs to suit everyone.
 
For more information, please visit www.landers.com.au or contact Aaron on +61 2 8020 7605 or via email at agoonrey@landers.com.au