Under the government’s impending industrial relations changes in the Senate next week, pay secrecy clauses are about to become illegal. Employers who enforce such clauses once these changes are implemented face serious penalties.
Pay secrecy clauses have been common practice for employers for some time, taking form in either confidentiality clauses in employment contracts or existing in policy and procedures. Generally, pay secrecy clauses forbid employees from disclosing and discussing their pay in the workplace. In some cases, if employees were found to have breached their employment contract or policy, an employer may have commenced disciplinary proceedings.
The changes create a new workplace right, enabling employees to disclose and discuss their pay and ask their colleagues about their pay. Employers will no longer be able to enforce pay secrecy clauses and will no longer be able to put such clauses in employment documentation.
Concerningly, employees may face undue pressure from their colleagues when asked to disclose their pay. Employers must ensure they inform their employees that they are empowered to say no and not disclose their pay when asked.
Employers also need to be prepared for discussions arising in the workplace about pay. Employees may request that their pay be reviewed because they have discovered that a colleague is paid more than them. Employers need to be equipped to deal with these conversations and understand their rights as an employer.
Employers should act now and begin reviewing all employment documentation regarding confidentiality and pay.
Our team of Senior Consultants are experts in Industrial Relations. They are here to help you ensure your compliance with these changes.
Find out more about the changes and what you need to do to be compliant by contacting our Business Advice Hotline on (08) 8300 0000 (select option 1).
