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  • Writer's pictureMargherite Walsh

Does removing Pay Secrecy equal Equality?

Last month marked the anniversary of the abolition of pay secrecy in the Australian employment landscape. The premise of the abolition of pay secrecy laws, introduced with the passing of the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 on 2 December 2022 (Secure Jobs, Better Pay Laws) is based upon tackling the gender pay gap and empowering employees at work by strengthening their individual bargaining position. That is, section 382 of the Secure Jobs, Better Pay Laws amends section 333B of the Fair Work Act 2009 (Cth) to prohibit the inclusion of pay secrecy clauses in employment contracts.


However, the premise of the Secure Jobs, Better Pay Laws in respect of pay secrecy makes a few assumptions, including:

  1. Employees will be bold enough to ask their colleagues how much they are paid and what their conditions of employment are, and

  2. Those colleagues will answer truthfully and completely.

 

In reality, a probing of colleagues in the workplace regarding pay and conditions is akin to probing fellow diners at the dinner table regarding details of their weight and dress sizes. In short, it just isn’t good manners and creates an awkwardness at work amongst those employees bold enough to broach the subject in demand of full disclosure by others who are not necessarily their close friends or confidantes.

 

In fact, had the true intention of the pay secrecy reforms been to bridge the gender pay gap and level the bargaining playing field at work, then the Government would have imposed a positive obligation on Employers. That is, if transparency was the true motivation in these changes, then the pay secrecy laws would have required Employers to disclose the pay and conditions offered to all employees in the workplace, without necessarily requiring the disclosure of who each pay and conditions belonged to (and thereby protecting individual employees’ privacy and choice to disclose). There is much to be said about removing the mystery around differing remuneration rates in the workplace, and it can be seen to work well in roles where attributes like experience and length in the role do not impact overall performance in a large way, such as in clerical, junior, repetitive roles that can be performed by anyone who has completed the requisite training. However, tackling the gender pay gap and addressing concerns regarding bargaining empowerment of individuals in a workplace would not be stemmed by disclosing all pay rates where apples simply can’t be compared to other apples because employee performance and output differentiates based upon professional education and experience, amongst other things.

 

The introduction of the Secure Jobs, Better Pay Laws might intend to close the gender pay gap, reduce pay discrimination in the workplace and empower employees. However, its effect in practice requires those employees to first disregard the social etiquette violation of asking their colleagues about their pay and conditions. These laws essentially promote gossiping in the workplace, rather than requiring transparency, and such, they miss the mark in effect and assume the contemporary employee has abandoned their manners.

 

If you need assistance in relation to Employment Law matters, please contact Jenkins Legal & Advisory on 02 4929 2000 or email office@jenkinslegal.com.au.

 

This article is not legal advice and the views and comments are of a general nature only. This article is not to be relied upon in substitution for detailed legal advice.


 

 

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