New employment contract with pay secrecy terms
Practice A wants to hire Jenny as a medical receptionist.
On 1 January 2023, Practice A gives Jenny an employment contract to sign that includes a clause saying she isn’t allowed to discuss her pay with anyone.
After Jenny starts her employment, a manager overhears Jenny telling a colleague her hourly rate of pay. Because Jenny’s contract was entered into after 7 December 2023:
Practice A realises that Jenny’s employment contract contains a pay secrecy provision when it shouldn’t and sends Jenny a letter confirming that the clause saying she isn’t allowed to discuss her pay does not apply.
Important: From 7 June 2023, including a pay secrecy provision in an employment contract is a civil remedy provision meaning that an employer, and relevant individuals involved in the contravention, can be exposed to penalties for breach under the Fair Work Act 2009 (Cth).
Our lawyers can help Practice A to rectify its mistake, including by preparing a letter to Jenny confirming that the pay secrecy provisions of her contract do not have effect.
We can also review Practice A’s employment contracts to ensure that they are compliant with the new pay secrecy provisions and Practice A’s other obligations under workplace law.
Existing employment contract with pay secrecy terms
Jordan entered into an employment contract with Practice B in November 2021.
Jordan’s contract of employment has a pay secrecy term that prevents him from discussing his pay with other employees.
Jordan pay secrecy term is still in effect because he agreed to it before 7 December 2022. Any pay secrecy terms agreed to before
7 December 2022 continue to operate until the contract is varied.
On 1 July 2023, Jordan receives a pay rise and Practice B sends Jordan a letter confirming his pay rise.
Jordan’s contract has been varied by the pay rise and from 1 July 2023:
Our lawyers can provide Practice B with a letter of variation to send to Jordan that confirms his pay increase and amends his contract of employment to ensure compliance with the new pay secrecy provisions.
We can also review Practice B’s employment contracts to ensure that they are compliant with the new pay secrecy provisions and Practice B’s other obligations under workplace law.
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