The landscape of transgender employment laws is evolving globally, with various jurisdictions adopting laws that ensure inclusivity and non-discrimination in the workplace. This area is one of the most complex issues in employment law systems and has generated much controversy. Notwithstanding this, many global companies seek to support and promote the interests of women regardless of their gender identity or expression. This commitment aligns with the broader international trend of recognising the rights of transgender individuals in the workplace. Transgender rights have been part of broader DEI initiatives for some time and are protected by law in some countries. There is an emerging body of law considering how these transgender legal protections interact with existing legal protections based on sex or gender.

In this blog we consider, in the international context, a recent decision of the Federal Court of Australia that has been noticed around the world. We have focussed on selective jurisdictions for the purposes of comparison, but this issue is much wider than the limited number of countries referred to in this blog.

The Australian case

In Australia, the recent decision of Tickle v Giggle for Girls Pty Ltd (No 2) [2024] FCA 960 looked at the removal of a transgender woman (Ms Tickle) from a female-only networking and dating app known as Giggle because on a visual inspection, someone responsible for administration of the app, had determined that she was a man (and therefore ineligible to participate).

Ms Tickle is a transgender woman whose female sex is recognised by an official updated Queensland birth certificate.

The respondents’ conduct was found to be unlawful gender identity discrimination in the provision of goods and services, on the basis that:

  • the app was imposing a requirement that users appeared to be (cisgendered) women, based on an examination of their profile photo
  • while this requirement applied equally to everyone, it had the effect of disadvantaging transgender women, and
  • in the circumstances, the requirement was not reasonable.

The respondents argued that Ms Tickle was believed to be a male, meaning there was no discrimination because of gender identity, and that Ms Tickle was denied access to the App based on her sex at birth, which they considered to be male. They also argued that the Giggle app should be considered as a ‘special measure’ to achieve substantive equality between men and women.

The Court rejected these arguments:

  • confirming prior cases that had found that a person’s sex is changeable and sex can refer to a person being male, female, or another non-binary status”
  • determining that the respondents had engaged in conduct in breach of the clear Parliamentary intent to prohibit discrimination on the ground of gender identity in the provision of goods and services
  • commenting that “It simply cannot be that a special measure of advancing substantive equality between men and women provides any shield from gender identity discrimination.”

The respondents were ordered to pay $10,000 plus Ms. Tickle’s legal costs. Their evidence in the case was that they had also made the decision to close down the Giggle app.

Australia

Under the Sex Discrimination Act 1984, gender identity has been a legally protected ground since 2013. However, the Australian Human Rights Commission has described this as the first case of its kind to go before the court.

This case highlights the need to be cautious in Australia before implementing any measures intended to advance the interests of a group based on sex or gender, if such measures exclude persons with different gender identities. Unless the measure (and discriminatory impact) can be shown to be reasonable or come within a ‘special measures’ exemption to remedy certain types of existing sex-based inequalities, then there is a real risk this would be unlawful.

United States

In the United States, the legal position on transgender protection is more nuanced. National (Federal) law bars discrimination based on sex under the Civil Rights Act of 1964. The United States Supreme Court has determined that this prohibition in extant law precludes drawing a distinction between cisgender and transgender individuals in the employment context. However, Courts continue to grapple with how this ruling applies to similarly worded prohibitions in education and public accommodation law, as well as to analyse its meaning under the United States Constitution. The Supreme Court’s reasoning in the employment context hinges on the rationale that treating a transgender female differently from a cisgender female is discriminatory sex stereotyping. However, in the employment context there remain many unanswered legal questions in the United States including balancing the interests of religiously motivated private employers and employees with the interests of transgender and non-binary individuals. The Courts in the United States have not (at this stage) adopted the Australian position that measures to advance a group based on sex or gender cannot exclude persons with different gender identities.

United Kingdom

In the United Kingdom, the legal meaning of ‘sex’ is unclear due to a conflict between the definitions of ‘sex’ under two pieces of legislation: the Equality Act (“EA”) 2010 (the UK’s anti-discrimination legislation) and the Gender Recognition Act (“GRA”) 2004 (the UK’s gender change legislation). Under the GRA, if a person has a gender recognition certificate (“GRC”), the affirmed gender in that certificate is their gender for all purposes and is their ‘legal’ sex; whilst under the EA ‘sex’ (which is a characteristic that is protected from discrimination) is not clearly defined (i.e., it is ‘a reference to a man or a woman’).

This conflict has resulted in particularly prominent legal challenges in Scotland as to whether ‘sex’ for the purposes of the EA means biological sex or recognises the legal sex of people with a GRC. This conflict will take the national stage in November 2024 when the UK’s Supreme Court hears For Women Scotland’s appeal of a judicial review decision on the legal definition of the word ‘woman’ (this litigation was first lodged in the context of the Scottish government’s definition of ‘woman’ in 2018 legislation on gender representation on public boards). The UK Supreme Court’s decision should provide clarity on the extent to which sex under the EA is defined as biological or legal.

Both pieces of legislation have also become the subject of increased political polarisation. In April 2023, the UK’s Equality and Human Rights Commission recommended to the Minister for Women and Equalities that the government carefully consider redefining sex in the EA as biological sex; it said that this would bring greater legal clarity in eight areas (including single sex and separate sex spaces), but acknowledged that doing so would create ambiguity and potential disadvantage in three other areas.

In June 2024 (before its defeat in the General Election), the Conservative Party pledged to re-write the EA so that it defined ‘sex’ as biological sex, but a Labour frontbench MP said that guidance (rather than amending the EA) would be sufficient for clarifying the uncertainty here. In 2023, the UK’s Conservative government also rather controversially blocked the Scottish parliament from enacting legislation that would have made the Scottish process for obtaining a GRC easier. Conversely, the Labour Party’s 2024 election manifesto pledged to make it procedurally easier for transgender people to legally change their identity. We must wait to see how the Labour Party’s election to government in July 2024 impacts the ongoing discourse on this matter.

From an employment perspective, UK employment tribunals have found that holding gender critical beliefs (i.e., the belief that sex is immutable and biological) can be a protected philosophical belief capable of protection from discrimination under the EA. However, the manifestation of such beliefs in behaviour might not be protected depending on what those behaviours are and how they impact on the legal rights of others not to be discriminated against on the basis of their sex or gender reassignment.

Hong Kong

Legal developments around gender identity in Hong Kong have largely been premised on constitutional rights enshrined in the Basic Law (for example, the right to marry and the right to privacy), rather than any express prohibition of gender identity discrimination. Gender identity is not a protected characteristic under Hong Kong’s anti-discrimination legislative framework, which has only four ordinances covering sex, disability, race and family status.

The progression of gender identity rights in Hong Kong has been gradual and piecemeal, with limited case law to rely on. In 2013, a Court of Final Appeal case ruled that the interpretation of the Marriage Ordinance, which treats a transgender female (having undergone full sex reassignment surgery) as a “man”, was a violation of her constitutional right to marry by preventing her from marrying under her acquired gender. Following this, in 2017, the Hong Kong government set up an Inter-departmental Working Group on Gender Recognition to consider making legislative changes to reform transgender rights in Hong Kong. However, there has been little progress on this, which may be because gender identity remains a very divisive topic in Hong Kong. In February last year came a significant development in gender identity rights when the Court of Final Appeal ruled that the policy of barring transgender people from changing their gender markers shown on ID cards unless they underwent full sex reassignment surgery was unconstitutional because it violates the right to privacy.

Italy

In Italy, transgender persons have several legal protections and rights. Since 1982, transgender people in Italy have been allowed to change their legal gender. This process involves both medical and legal procedures.

Additionally, discrimination based on gender identity in employment has been prohibited in Italy since 2003. This means that employers cannot legally discriminate against transgender individuals in hiring, promotion, or any other aspect of employment.

Discrimination based on gender identity is prohibited in various contexts, including employment and public advertisement. The Italian Constitutional Court has ruled that non-binary individuals’ rights are also protected under the principles of social identity, equality, and the right to health as guaranteed by the Italian Constitution.

Whilst these legal protections are significant, Italy still faces challenges in achieving full equality for transgender individuals, particularly in areas like healthcare access and social acceptance. Many transgender individuals in Italy still face challenges in the workplace. Surveys have shown that a significant number of LGBTQIA+ workers, including transgender individuals, feel that their careers have been negatively impacted by discrimination.

The traditional legal approach of balancing competing interests creates particular difficulties when dealing with issues like the dignity of people or fundamental philosophical beliefs. Courts in every country are going to have to decide what of these interests are the most important.


Subscribe to receive the next Workplace Law & Strategy blog direct to your inbox.

In light of recent legislative changes in the United Kingdom, from 26 October 2024, UK employers have a new duty to take reasonable steps to prevent sexual harassment of workers in the course of their employment.

This caused us to reflect on the key lessons that can be drawn from Australia’s experience with very similar legislation introduced in December 2022.

The aim of the new(ish) framework is for employers to anticipate scenarios when their workers may be subject to workplace sexual harassment and take positive action to prevent them.

Employment Law Partner Rachel Bernasconi and Work Health and Safety Partner Sarah Goodhew give some practical and real-life reflections below based on their experience in assisting clients to understand and operationalise the new duty from an employment law and work health and safety perspective.

What does the positive duty to prevent sexual harassment of or by their workers mean for employers in Australia?

Rachel: The duty requires all organisations to take “reasonable and proportionate” measures to eliminate unlawful workplace sexual harassment, sex-based harassment, sex discrimination, hostile work environments on the ground of sex, and victimisation related to complaints about these issues. The big shift here is that it’s no longer enough for employers to wait for complaints to arise and mitigate incidents of harassment—they have to actively prevent them through risk assessments and other measures such as training and creating safe reporting systems.

Sarah: This duty aligns closely with existing work health and safety (H&S) obligations for organisations to ensure, so far as is reasonably practicable, that workers and other persons are not exposed to risks to their psychological or physical health and safety. This includes psychosocial risks such as sexual harassment and sex or gender-based harassment. In Queensland, there are specific regulations relating to the control measures to be implemented to address these risks.

How have Australian employers adapted their practices to meet this duty?

Sarah: Organisations are integrating what have historically been two separate functions, drawing on their experiences from the traditional ‘HR’ and ‘safety’ functions. This includes integrating sexual harassment prevention into their broader safety management systems and utilising existing frameworks such as their H&S risk assessments and management processes. This can include regular audits, clear reporting mechanisms, and the use of technology to enhance prevention efforts. Many organisations have implemented anonymous reporting channels and use data analytics to identify trends and areas needing attention or to assess the effectiveness of control measures. Previously, safety teams have taken a much more structured approach to compliance issues than their HR counterparts, but we are seeing the more rigorous safety-oriented risk management approach being applied in the employment context more and more.

Proactive organisations are embedding this approach so that there is transparent reporting to Board committees and integration with audit, risk and whistleblower frameworks.

Rachel: We’ve seen engaged employers use a multi-disciplinary approach (i.e., including business stakeholders from legal, HR, safety, operations, and leadership) to proactively identify how the risks of sexual harassment might arise in each part of their businesses, what control measures are already in place and how those measures can be enhanced to avoid or mitigate risks. Quite often they are taking this approach more broadly in relation to managing workplace psychosocial risks (of which workplace sexual harassment is just one). We’ve also seen a change to the approach some organisations are taking to their training programs to go beyond the traditional annual tick-box exercise. Organisations that are genuine in wanting to proactively address sexual harassment risks are implementing more comprehensive programs by including mandatory leadership training (including at the Board level), regular refresher courses for all employees, and bystander intervention training. This also has implications for the frequency and updating of training modules, to capture learnings following any incident.

In addition, many Boards and senior leadership are taking a more proactive approach to acquiring knowledge and keeping up-to-date on their legal obligations in relation to sexual harassment, as well as understanding how their business controls this risk with a regular review as to the effectiveness of implemented measures.

What challenges have you seen Australian employers face in implementing these changes?

Rachel: The Guidelines from the Australian Human Rights Commission (the first instance regulator) (AHRC Guidelines) are so comprehensive (and to some extent impractical to achieve for businesses that operate in the real world) that many employers are overwhelmed. We say, make a start—if a regulator comes knocking, or employees are asking what their organisation is doing, you will be better placed if you have done something rather than nothing. We also recommend prioritising your actions in recognition of the fact that you can’t do everything immediately—work out your primary and secondary priorities based on risk, resources, and timing.

Sarah: In addition to the extensive AHRC Guidelines, there are also a variety of H&S guidance materials from regulators in various states that address both psychosocial hazards and sex and gendered based harassment. The overwhelm that Rachel has mentioned is very much seen on both the traditional safety and employment sides. I agree with Rachel that starting is important—organisations should start with a risk assessment and follow the health and safety risk management process to implement control measures based on the highest H&S risks in their business, using the hierarchy of controls.

The AHRC Guidelines encourage risk assessments to identify where sexual harassment may occur. Do you have any tips for employers to consider when undertaking these risk assessments?

Sarah: Yes, follow the risk management process for H&S risks. In Queensland, the new regulations that commenced on 1 September 2024 require a review of control measures following any report—even if unsubstantiated—of an allegation of sexual harassment or gender-based harassment. Time will tell how onerous such a requirement may be. A risk assessment should be reviewed on a regular basis, which will be informed by the levels of exposure and likelihood of the risk in your business.

Rachel: Yes, the approach I’ve outlined above to identifying risks is helpful because it ensures relevant stakeholders are at the table and have input. We also recommend this process is conducted regularly—this can’t be a ‘set and forget’ process that you do once and say you’re done.

Do the Australian laws cover harassment from customers, clients and other third parties, and do you have any tips for employers to address this?

Rachel: Yes, and it also includes harassment by employees of those third parties in a work setting. We are encouraging clients to build this into their risk assessments, so that they are thinking beyond the employee/employee harassment scenarios to all interactions that can occur in a work setting and how to mitigate those risks.

Sarah: Yes, the H&S duties in Australia extend to a very broad definition of ‘worker’, as well as to ‘other persons’ in the workplace. From a safety perspective, we are giving the same advice as Rachel to build this into the risk assessment process and into the implementation of control measures.

The key takeaways from these reflections are:

  1. Start somewhere and prioritise appropriately: Given the comprehensive nature of the guidance materials, it’s better to start the process and show a genuine effort rather than being overwhelmed and do nothing. Prioritise actions based on your organisation’s specific risks, resources, and timing.
  2. Thorough risk assessments are key: These assessments should identify the particular risks within each organisation’s unique working environment (e.g., where there may be power imbalances, involvement of alcohol, or employee interactions with clients, customers, and other third parties).
  3. Take a holistic approach: It is not enough to simply update policies. Employers need to take a range of steps to show compliance and implement a proactive risk management approach.
  4. Board and senior leadership buy-in is crucial (and legally required to discharge their individual proactive officer due diligence obligations): Senior role models set the tone and drive meaningful change throughout the organisation. Without it, efforts will lose momentum.
  5. Integration with existing systems: Employers don’t need to reinvent the wheel. Instead, they should integrate sexual harassment prevention into their broader safety management systems, utilising existing frameworks like H&S risk assessments and management processes.
  6. Robust and clear reporting systems are essential: Employers should consider anonymous reporting channels and how they can use reporting systems to gather data, spot trends, and pinpoint risk areas. Businesses should ensure reporting up to Board level about sexual harassment matters at a regular cadence.
  7. Adopt a multi-disciplinary approach: Employers should involve stakeholders from various departments (e.g., legal, HR, safety, operations, leadership, audit and risk) when identifying risks and developing prevention strategies.
  8. Ongoing review: Compliance is not a one-off task. Employers must regularly review and update their prevention strategies to ensure they remain effective, adapting them based on feedback, new risks, and/or incidents. Boards and senior leadership need to ask the right questions to understand what is going on in the business and what can be done better.

What are considered ‘reasonable steps’ will vary depending on the employer’s size, available resources and risk factors. But employers generally need to: (1) consider potential risks; (2) develop comprehensive action plans to address and mitigate such risks; and (3) implement proactive measures to prevent such incidents occurring. Harassment is not just an employee relations issue—it is a health and safety issue, and a reputational one, and needs to be treated with the utmost seriousness.


Subscribe to receive the next Workplace Law & Strategy blog direct to your inbox.

In recent months, I’ve spoken to many HR professionals about all things employee relations or “ER.”

What stood out was the challenging nature of the role of those in ER.

The role of ER has never been more valuable to Australian employers, whose workplaces have never been more regulated.

Yes, compliance is a must, but meeting business objectives is also a must.

ER is at the pointy end of keeping a business out of trouble and getting things done.

The passion with which some very experienced HR leaders spoke inspired our paper Navigating Employee Relations: The Advisor’s Role (available upon request here). This is based on that feedback.

It’s built on four themes: mastery, judgement, strategy, and influence.

Off the back of our paper, Navigating Employee Relations: The Advisor’s Role, I’m writing a series of five blogs. This is last in the series and it’s on “influence.”

You can have the best advice, but it’s useless if it doesn’t ‘land’. You can be right, but find yourself on your client’s “wrong” side. I’ve seen many examples of the same advice given but in a different way with vastly different outcomes for the advisor-client relationship. Indeed, when called upon to second guess an advice given by another law firm, I’m looking for how that advice was conveyed as a clue to why a second opinion has been sought.

The starting point is about building context. It’s about filling the void which otherwise sees you advising in a vacuum.

Navigating Employee Relations: The Advisor’s Role recommends adopting the “clinician mindset.”

You are embarking on a diagnosis. The diagnosis can only follow a solid understanding. Questions and the power of inquiry are your best friend here.”

Navigating Employee Relations: The Advisor’s Role (point 39)

Great ER professionals listen well, address emotions, and deliver advice with empathy. There is the inevitable urge to “tell” early in the conversation. You are the advisor, after all. But the best advisors are great listeners first.

Decision-makers often seek a quick and binary answer: “Can I do this or not?” or “When can we do this?” Or they seek an inherently problematic pathway: “Tell me how I can do this.”

If your advice is counter to the stated need, you had better demonstrate your understanding of the problem first. If you don’t, your client will assume that your advice is flawed out of a lack of appreciation of what’s needed. This is why empathy is critical. Your client only has so much headcount, only has so much budget, is expected to deliver more with less, and is facing tougher competition in the market. Then you say, “Yes, we have to allow this flexible work request”, or “No, we can’t remove this poor performer,” or “No, the Award won’t allow you to roster in this way.”

Your advice may be right. But it’s ripe for challenge on the basis of “whose side are you on?”

As this blog series has highlighted, ER advisors are delivering complex advice. If there is a decision tree, the tree has branches whose pathways call for a degree of speculation about outcomes. It’s often difficult for managers who run operations built on clear and well-defined processes to understand the ambiguous and nuanced environment in which you advise. For example, it’s a legal environment where “reasonableness” is often the touchstone for what can or cannot be done. Reasonable minds can differ about where a decision ought to lie based on such a nebulous concept.

The complexity is compounded where: (1) you don’t understand the need, (2) they don’t understand the ambiguity, and (3) the balance of consequences is ill-defined. Point three takes us back to risk (see part three of this blog series).

Remember, empathy is key because emotions are involved. And in the most challenging advisory situations your relationship is fundamental. If they trust you, life is easier for you and your stakeholders. Build trust to be a better advisor.

This concludes our series aimed at the “ER” community looking to grow in their role. We hope you gained some valuable insights. Remember, if you would like a copy of our paper Navigating Employee Relations: The Advisor’s Role or to learn more about our ER Mastermind program, please click here.

Read the rest of the blog series here.


Subscribe to receive the next Workplace Law & Strategy blog direct to your inbox.

The right to disconnect has been in the media a lot. But if we look behind the headlines, what impact is it actually going to have?

The new laws give employees a limited right to ignore work-related contact outside of working hours. This right is limited by what is reasonable. It does not:

  • outlaw reasonable out-of-hours contact; or
  • give employees rights to unreasonably ignore work-related communications.

Given the Fair Work Act 2009 (Cth) has always prohibited unreasonable additional work outside of ordinary hours, what – if anything – does the new right to disconnect actually add?

What can employers expect?

There are some new issues to navigate here:

  • Some employees may now wrongly choose to ignore contact that should have been actioned.
  • Employee grievances will include alleged breaches of this new right if they have been contacted out of hours. Disputes and general protections claims will no doubt follow.
  • The circumstances in which out-of-hours contact is reasonable, and when there is a right to ignore it, will be hotly debated in all of these scenarios. Large penalties can apply for getting it wrong.
  • If employees ignore out-of-hours contact, any disciplinary response needs to be managed carefully to minimise risks.

The new law does not require every business to suddenly change existing arrangements or introduce new policies. If out-of-hours contact is already managed reasonably, then the right to disconnect might not have a big impact at all.

That said there could be some “hidden” consequences – for example:

  • While the right to disconnect doesn’t specifically require more payments to be made for out of hours contact or work, unions and employees may use this to claim more benefits.
  • Businesses scared of getting this wrong might:
    • try to standardise working hours to minimise out-of-hours contact, which could pose challenges for flexible working; or
    • err on the side of avoiding contact even if that means going short staffed instead of offering workers a last-minute shift.

Will this change how Australian businesses and workers operate?

Rights to disconnect have existed in some overseas countries for some time. The experience in those jurisdictions has indicated a modest impact, not a wholesale revolution.

Given that Australia has had very few legal cases involving disputes about unreasonable work outside ordinary hours, we will need to wait to see if this new disconnect right has much of an impact after the news cycle has moved on.


Subscribe to receive the next Workplace Law & Strategy blog direct to your inbox.

In recent months, I’ve spoken to many HR professionals about all things employee relations or “ER.”

What stood out was the challenging nature of the role of those in ER.

The role of ER has never been more valuable to Australian employers, whose workplaces have never been more regulated.

Yes, compliance is a must, but meeting business objectives is also a must.

ER is at the pointy end of keeping a business out of trouble and getting things done.

The passion with which some very experienced HR leaders spoke inspired our paper Navigating Employee Relations: The Advisor’s Role (available upon request here). This is based on that feedback.

It’s built on four themes: mastery, judgement, strategy, and influence.

Off the back of our paper, Navigating Employee Relations: The Advisor’s Role, I’m writing a series of five blogs in five weeks.

So here’s blog four in our ‘5 of 5’.

One of those themes is “strategy”. Strategic thinking is essential for ER Professionals because it involves looking beyond the immediate, to develop optimal, long-term solutions. Observations on “strategy” and “strategic thinking” are ubiquitous. Formulas abound, very much context driven. Fundamentally, the many takes on “strategy” reveal some core elements: where are we, where do we want to be, and how will we get there?

Being “strategic” is often synonymous with “big picture’’ thinking. It’s the ability to see patterns, themes or connections. It’s the ability to ask: is this a trend, or what can we be doing to guard against this in the future? It’s factoring in company-wide implications for the issue at hand. It’s balancing the long term with the short term. It’s also ensuring that a problem is examined from various perspectives. It’s about looking ahead.” 

– Navigating Employee Relations: The Advisor’s Role

But how do you develop strategic thinking? Strategic thinking requires understanding the broader context, including organisational goals, stakeholder interests, and the interplay of various factors. It’s a skill that can be developed.

It involves asking insightful questions, balancing short-term and long-term implications, and considering different perspectives to make informed decisions. Judgement is key here (see our previous blog – Part 3 – about judgement here).

To enhance strategy, models like SWOT and GROW can be leveraged to guide decision-making and ensure that advice aligns with organisational objectives and values. They are the very type of models that build skill as a strategic thinker. They can provide a lens through which to think about a problem.

Great advisors excel in the skill of “inquiry” by asking insightful questions at the right time to uncover deeper meaning and needs. Advisors are called upon to provide advice. So, it’s natural to want to ‘tell’. But great advisors excel at asking questions first. They are not afraid to ask “why”, “what else”, “how do you see…”, or “what matters most here?”. This is where the advisor turns coach.

Asking questions leads to a better understanding of reality (the current situation) which can provide reason for reconsidering a goal (desired outcome), as can consideration of alternatives (options). It’s about getting clarity. From our paper, comes this basic example to illustrate the point:

Manager: I really want to sack my head of sales (Goal)

You: Okay, why is that?

Manager: Just not performing. Sales are down. Direct reports are complaining about his attitude. I don’t think his head is in the right place. I’m having to pick up the slack. (Reality)

You: Why do you think that is?

Manager: I don’t know. He’s been grumpy, and I don’t think he’s happy with anything.

You: Why is that?

Manager: Don’t know – he’s hard to talk to.

You: What’s the impact of losing him now?

Manager: Terrible. He’s been good in the past. He’ll be tough to replace.

You: So, ideally, he stays, but improves? (Options)

Manager: Yes (New Goal)

I look forward to sharing the last part of this five-part series with you next week.

If you would like a copy of our paper Navigating Employee Relations: The Advisor’s Role or learn more about our ER Mastermind program, please click here.

Read the rest of the blog series here.


Subscribe to receive the next Workplace Law & Strategy blog direct to your inbox.

In recent months, I’ve spoken to many HR professionals about all things employee relations or “ER.”

What stood out was the challenging nature of the role of those in ER.

The role of ER has never been more valuable to Australian employers, whose workplaces have never been more regulated.

Yes, compliance is a must, but so too is meeting business objectives.

ER is at the pointy end of keeping a business out of trouble and getting things done.

The passion with which some very experienced HR leaders spoke inspired our paper Navigating Employee Relations: The Advisor’s Role (available upon request here). The paper is based on that feedback.

It’s built on four themes: mastery, judgement, strategy, and influence.

Off the back of our paper, Navigating Employee Relations: The Advisor’s Role, I’m writing a series of five blogs in five weeks.

So here’s blog three in our ‘5 of 5’.

This week’s theme is “judgement”.

Judgement calls for what’s “right” in the moment having regard to the principles that matter.

Effective judgement involves a complex process of gathering, assessing, and weighing facts. Judgement involves applying knowledge within a particular context. It is the proper filtering and weighing of knowledge and facts. Therefore, the context needs to be understood, be it internal (the organisation) or external (environmental factors). It’s the cornerstone of moving from an “expert” to an “advisor.”

Our paper Navigating Employee Relations: The Advisor’s Role applies a five step model aimed at flexing the judgement ‘muscle’ being:

1.   Gather the facts

2.   Generate options

3.   Balance the consequences

4.   Apply what matters (or ‘values’)

5.   Review by learning from what happens next.

Good judgement calls for good questions. A mix of closed, open-ended, and evaluative questions will bolster a judgement call.

  • Do we do a deal or not?
  • What is the balance of consequences here?
  • Do we terminate the employment or not?
  • Did this actually happen?
  • What’s the impact here?
  • How likely is this?
  • How do we know?
  • What is missing here?
  • What’s the opportunity here?
  • What matters most here?

Judgement often calls for weighing “strategy” (making progress in line with organisational needs) with “risk” (the downside of things going wrong). These can be difficult to measure in a balanced way. A typical example is the benefits of removing a poor performer on team culture (intangible but certain) versus the risks associated with a claim (more tangible but uncertain).

There are times when risks are overestimated, with the path of least resistance as the preferred course. Conversely, there are times when risk is underestimated with the consequences of not appreciating them at the outset magnified. To quote the Stoic philosopher Seneca:

What is quite unlooked for is more crushing in its effect, and the unexpectedness adds to the weight of the disaster.”

There are short term risk impacts and long-term impacts with the human condition prone to averting the former (industrial action) despite the bigger consequences of the latter (doing a deal that undermines the capacity to manage). Accepting voluntary redundancies is easy in the short term but hard in the long term when we are left with poorer performers.

Risk can be evaluated in terms of exposure (what could happen), impact (the harm), and prospect (or likelihood). In the ER context, there is a menu of typical risks. These are, in no particular order:

  • a legal claim
  • the costs of the defence to a claim
  • reputational impact
  • employee disengagement
  • stakeholder impact
  • employee harm
  • union agitation
  • industrial action
  • productivity impact
  • delay e.g., implementing change
  • business confidence
  • customer discontent.

Understating risk is important, no doubt. But that doesn’t mean becoming obsessed with its avoidance at any cost. Again, judgement is about doing what’s right having weighed all relevant factors. And, the ER advisor needs to be solutions-oriented asking and answering “what can we do” to balance “what can’t we do”.

I want my ER managers providing options, ideas, solutions, they need to do more than present the problems.”

– HR Director, University sector

I look forward to sharing part four of this five-part series with you next week.

If you would like a copy of our paper Navigating Employee Relations: The Advisor’s Role or learn more about our ER Mastermind program, please click here.

Read the rest of the blog series here.


Subscribe to receive the next Workplace Law & Strategy blog direct to your inbox.

In recent months, I’ve spoken to many HR professionals about all things employee relations or “ER.”

What stood out was the challenging nature of the role of those in the ER.

The role of ER has never been more valuable to Australian employers, whose workplaces have never been more regulated.

Yes, compliance is a must, but meeting business objectives is also a must.

ER is at the pointy end of keeping a business out of trouble and getting things done.

The passion with which some very experienced HR leaders spoke inspired our paper Navigating Employee Relations: The Advisor’s Role (available upon request here). This is based on that feedback.

It’s built on four themes: mastery, judgement, strategy, and influence.

Off the back of our paper, Navigating Employee Relations: The Advisor’s Role, I’m writing a series of five blogs in five weeks.

So here’s blog two in our ‘5 of 5’.

This week’s theme is “mastery”.

The ER Professional is highly skilled, the depth of which is not always well recognised. First and foremost, they are subject matter experts. This expertise draws upon an extensive knowledge bank. Knowing the law and how to apply it has become key. Indeed, the role demands that the ER Professional has the type of knowledge expected of a specialist workplace lawyer without the level of training a lawyer benefits from. To think that the recent changes to the Fair Work Act 2009 (Cth) (also known as “Secure Jobs, Better Pay” and “Closing Loopholes” reforms) comprise 56 areas of amendment and more than 1,000 changes to existing law with 156 references to “reasonable” or “reasonably”. But this is dwarfed by the existing body of law that ER Professionals traverse day in and day out.

Many ER professionals I’ve spoken to of late wish they had a grounding in psychology as well; not surprising given the need to deal with individuals in often challenging circumstances. The ‘how to deal’ has become as important as ‘the what’.

The ER Professional also wears many hats, including coach, counsellor, mediator, negotiator, advocate, and stakeholder manager. For this reason, there is a need to combine a breadth and depth of knowledge, combined with a diverse skill set. It’s not an easy journey. But nothing worthwhile achieving comes easy.

“Make no mistake, this is a hard journey. So passion is a necessary ingredient. You need to have a passion for the subject matter or be intrinsically interested in the content to muster the curiosity and drive needed to thrive. As with any calling, your intrinsic motivation is fundamental. Knowing what you enjoy about what you do is essential.” 

– Navigating Employee Relations: The Advisor’s Role

Mastery is achieved through finding ways to learn, consistent practice, and reflection. “Maps” of knowledge are developed which are deepened over time as new experiences create new opportunities to learn and grow. Mentors are also key, as with any field of endeavour. Good mentors provide pathways and shortcuts.

A strong and diverse network of professionals also significantly contributes to success. The more senior you become, the more this becomes obvious.

“If I look back on my career, there are individuals who, for me, made all the difference. Without them, I wouldn’t be where I am today.”

Director of People, Manufacturing industry

I look forward to sharing part three of this five-part series with you next week.

If you wish to get a copy of my paper Navigating Employee Relations: The Advisor’s Role or learn more about our ER Mastermind program, please click here.

Read the rest of the blog series here.


Subscribe to receive the next Workplace Law & Strategy blog direct to your inbox.

In recent months, I’ve spoken to many HR professionals about employee relations (ER).

The challenging nature of the role for those in ER was a common theme.

The role of ER has never been more valuable to Australian employers, whose workplaces have never been more regulated.

Yes, compliance is a must, but meeting business objectives is also necessary.

ER is at the pointy end of keeping a business out of trouble and getting things done.

The passion with which some very experienced HR leaders spoke inspired our paper Navigating Employee Relations: The Advisor’s Role. That paper is based on that feedback.

It’s built on four themes: mastery, judgement, strategy, and influence. We will publish a series of five blogs in five weeks based on these themes.

So, here’s our first blog of our ‘5 of 5 series’ in which I provide an overview of the four themes.

Mastery

The role of an ER Professional is demanding and nuanced, requiring a depth of expertise akin to that of a specialist workplace lawyer. The role encompasses a wide range of responsibilities and skills, including, but not limited to, understanding complex legal frameworks and acting as a coach, mediator, and risk manager. It also requires balancing detailed analysis with strategic thinking.

Mastery is achieved through finding ways to learn, consistent practice, and reflection. “Maps” of knowledge are developed and deepened over time as new experiences create new opportunities to learn and grow. It’s not an easy journey, so passion for the subject matter is critical. Mentors are also crucial, as with any field of endeavour. Good mentors provide pathways and shortcuts.

A strong and diverse network of professionals also significantly contributes to success.

Judgement

For an ER Professional, judgement starts with gathering, assessing, and weighing facts, often in situations where conflicting stories emerge, such as during workplace investigations.

Judgement calls for balancing strategy with risk. Invariably, a preferred path carries risk. So, understanding risk is key. There are short-term and long-term risks, with the more immediate risks often overestimated and the longer-term risks underestimated, given the human tendency to say, “We will cross that bridge when we get there.”

Judgement is also required in the ‘how’ of advising internal stakeholders.

Strategy

Judgement and strategic thinking are closely intertwined, with strategic input adding significant value to decision-making by focusing on optimal solutions beyond immediate concerns.

Observations on strategy and strategic decision-making are ubiquitous. Formulas abound, and they are very much context-driven. A fair reading of the various takes on strategy reveals some core elements: where you are, where you want to be, and how you will get there.

Being “strategic” is often synonymous with “big picture” thinking. It’s the ability to see patterns, themes, or connections. It’s the ability to ask: is this a trend, or what can we be doing to guard against this in the future? It’s factoring in company-wide implications for the issue at hand. It’s balancing the long term with the short term. It’s also about ensuring that a problem is examined from various perspectives. It’s about looking ahead.

Influence  

You can have the best advice, but it’s useless if it doesn’t land. Unclear advice can lead to frustration or even risk. 

It’s hard advising someone you barely know. It’s like advising in a vacuum. So, a degree of connection is required. Let’s call it rapport. Indeed, professional coaches are trained in the need for rapport before advancing a client discussion. This can take time to develop. At its heart, rapport has two ingredients: likeability (people like to work with people they like, and usually, this is people like them) and trust (credibility + reliability).

Advisors need to explore what’s below the surface. There are, or may be, various contexts that you cannot afford to miss: emotional, political, environmental, and situational. There are needs and motivations at play. So, “dig deep” by flexing your curiosity muscle. A manager frustrated with a direct report’s performance demands your understanding. They deal with the employee day to day. They or others in the team are picking up the slack. As you are being told this, it’s natural to start playing the tape in your mind about “valid reason,” “procedural fairness,” “unfair dismissal,” “warnings,” etc. Launch at your peril, especially if you raise the legal hurdles (as is inevitable) without empathy. If the manager feels you need to understand the depth of the issue, your advice will be easily dismissed as not appreciating the gravity of the situation. The advice someone doesn’t want to hear (it’s ‘too hard to dismiss now’) is better received in an atmosphere of understanding and empathy.

If you wish to get a copy of my paper Navigating Employee Relations: The Advisor’s Role or learn more about our ER Mastermind workshop series, please click here.

Read the rest of the blog series here.


Subscribe to receive the next Workplace Law & Strategy blog direct to your inbox.

As we discussed in our previous blog on non-competes (as well as other types of restraint of trade), the move to add regulation has been gaining momentum since Federal Treasurer Jim Chalmers announced in August 2023 a Competition Review to examine competition laws, policies and institutions.

Whilst the move to ban non-competes in Australia has been inspired by the U.S. Fair Trade Commission vote to ban non-competes, on 20 August 2024, a Federal District Court in Dallas, Texas, struck down the FTC rule, which will now not take effect on 4 September 2024. This decision will probably be subject to review by a Court of Appeal and then up to the United States Supreme Court. It would be ironic for Australia to end up with legal changes inspired by failed efforts elsewhere.

Since Treasury and the ANU proposed changes to the law on non-competes, multiple voices, ranging from government ministers, union officials, lawyers, and academics have been raised in support of this reform, their arguments essentially being employees are severely disadvantaged (or, conversely, the cards are stacked in favour of employers), non-compete provisions have become more widespread, and, economically, they stifle innovation and competition.

We beg to differ. In this article, extracted from the White Paper, Non-compete constraints in Australia: A case for reform (available upon request), we will examine why arguments about the proliferation of non-competes are overblown and why their benefits are being sidelined in this debate.

Digging into the numbers

We do not dispute the figure that one in five employees is subject to a restraint, with survey evidence supporting this proposition. But digging deeper into the evidence, it is unclear whether there has been a proliferation of non-competes to employees in low wage jobs or others who should not be covered (of which more later).

An ANU Crawford School of Government Paper (it was authored by former Fair Work Commission President Dr Iain Ross) and a Federal Government Issues Paper both drew upon data from the ABS and the e61 Institute to suggest that a large proportion of the workforce was subject to a post-employment restraint.

In 2023, an ABS survey reported that about 20.8 per cent of businesses in Australia used a non-compete clause for at least some of their workers. Of those businesses, it reported that 68.2 per cent used non-compete clauses for more than three-quarters of their workers.

Non-compete clauses were used in all industries across the economy, although they are particularly common in knowledge and relationship focussed services industries including finance, real estate, professional services, insurance and healthcare. These statistics are broadly consistent with the e61 Institute’s 2023 online survey of 3,000 respondents about the prevalence of non-competes.

But as the famous 19th American author Mark Twain wrote, “There are three kinds of lies: lies, damned lies, and statistics.” Because while the e61 Institute gives an insight into the numbers, it didn’t collect, and we do not have information, about whether workers observed the non-compete; whether it influenced their decision to seek a new job or not; nor about whether the non-competes were enforceable on their terms. The information cited concerned workers who did not switch jobs because of the ‘chilling effect’ of the non-compete is U.S.-sourced data.

Nevertheless, it is likely that some subset of workers subject to an invalid non-compete observed it because of the ‘chilling effect’ of prospective litigation or lack of resources to obtain advice. But what percentage of the 20 per cent of workers subject to a non-compete observed a restraint that would probably be invalid? We simply don’t know.

What we can estimate is that of the 20% covered by a non-compete, some will observe the obligation because it is reasonable and they acknowledge the situation.

A second subset will negotiate a compromise with their employer that works out for everyone.

A third subset will obey a non-compete to some extent (they often cascade) that is probably invalid because it is not clear whether it is reasonable, they can manage to observe at least some of it and they don’t want to get involved in a dispute.

A fourth subset of the headline 20% will obey some or all of a non-compete which is unreasonable. This fourth subset is the real – quite narrow – scope of the problem which reform proponents touch on. This has been represented as a major issue necessitating a regulatory overhaul based on unsound arguments about Courts ignoring employees interests and issuing injunctions against them just for the asking.

On the vexing issue of low income workers being subject to non-competes, if the data is accurate then this is a cause for concern. From our perspective, there may be merit to an appropriate regulatory response targeting a very specific and narrow problem.

No poaching provisions

Critics of non-competes also argue that the legitimate interests that can be protected by a court, including a stable and well-trained workforce, have expanded. This type of legitimate interest can support a time-bound “no-poaching” clause.

But it’s worth remembering that such clauses have existed at least since early 1990 and recognise the investment needed to achieve a stable, trained workforce as well as the confidential information and customer connections that former employees may hold. For example, in Dawnay, Day & Co Ltd v D’Alphenliv, a non-solicitation provision was held reasonable in the circumstances with the former employer’s need for protection. Such a clause cannot prevent employees from leaving an employer. Rather, it only prohibits a former employee from doing the poaching. Leaving of their own volition or because of information or solicitation from any other channel (including a recruiter) is not an issue.

So, what are the benefits of restraints? Restraint of trade principles have been developed over about 600 years of common (judge-made) law to strike a balance between:

  • Businesses wanting to protect valuable business goodwill, confidential information, important customer connections or a stable, well-trained workforce.
  • Employees’ need to work, earn, and have flexibility to move jobs.
  • The public interest in ensuring competition, free markets and reasonable employer protections.

Importantly, no one set of interests is paramount – all must be considered and balanced in determining whether a restraint is justified by the special circumstances of the case such that it will be valid and enforceable.

We contend that the benefits include incentives for employers to confidently invest in research and development, and staff training, combating the fear that these investments can be quickly lost.

A reasonable non-compete restraint preventing an employee from taking up employment with a rival for a defined and usually short period of time, scope and within a defined geography may be the only feasible way of protecting employer trade secrets or confidential information.

We believe this is particularly relevant considering it can be difficult to define what is confidential information for the purposes of the restraint; a lesser type of restraint may be ineffective given the difficulty of proving solicitation; and the obligations of the employee are made clear in a way that is more forceful than if the matter is left to implication of contractual terms.

In addition, non-compete clauses can provide broader protection than an employer will have under the implied duty of confidentiality, the equitable duty of confidence or even an express confidentiality clause, and a non-compete removes the temptation for a former employee to offer, and for a new employer to solicit, confidential information, as found in Woolworths v Olsen in 2004.

Without a covenant (whether a non-compete or a lesser restraint such as a non-solicitation clause), employees cannot be stopped from canvassing customers after the employment has ceased.

Finally, a reasonable non-poaching or non-recruitment clause can protect an employer’s interests by retaining employees critical to the continued success of the business, employees with access to confidential information, or where employees have significant client connection built up during employment.

We contend these are all valid arguments that, at the very least, deserve to be fully aired while any changes are being considered. To date, it’s the proponents of change that have received all the airplay. This White Paper, we hope, will bring some balance to the debate.

For a copy of the White Paper, Non-compete constraints in Australia: A case for reform, please click here.


Subscribe to receive the next Workplace Law & Strategy blog direct to your inbox.

The last two years has seen multiple rounds of changes to employment, industrial and safety laws at federal and state level in Australia.

These represent the most significant changes since the Fair Work Act 2009 (Cth) was introduced. The fact that there have been so many different changes to different laws has made it tough to keep up.

Some of the biggest changes will come into effect on Monday, 26 August 2024. The impact won’t be felt on day one. But there will be impacts in the future and every business needs to be ready.

“Closing Loopholes” context

Before it was elected, the ALP set out its reform agenda. That included:

  • A core focus on “job security”: we have seen multiple laws give effect to this by restricting work types other than permanent employment.
  • “Get wages moving”: we have seen higher costs for business as employee remuneration and benefits have increased.
  • “Improve access to collective bargaining”: multiple reforms have made it easier for unions to force employers into collective bargaining.
  • “Ensure delegates are able to organise”: law reforms have given unions more rights to increase representation in more workplaces.

The Albanese government is delivering on its core policy promises. “Closing Loopholes” is the most recent (but probably not the last) significant law change as part of an overall reform package.

If your business has people working in it, it will be affected by these reforms

The overall reforms, including the “Closing Loopholes” changes, affect every business differently. Some simple examples show how every business that has people working in it will be affected (the “Closing Loopholes” specific changes are marked with *):

1. A business with employees of any type:

  • Right to disconnect*
  • Wage theft & penalty increases*
  • Discrimination changes
  • Sexual harassment & related unlawful conduct
  • Workplace gender equality changes
  • Flexible work requests & disputes
  • Pay secrecy
  • Leave changes

2. A business with casuals:

  • Changed definition of “casual” and changed pathways to casual conversion*
  • New dispute options*

3. A business with fixed term employees:

  • Restrictions on fixed term contracts
  • New dispute options

4. A business with independent contractors:

  • New “employment” definition and changes to “sham contracting” defences*
  • Unfair contracts claims and new minimum conditions for some independent contractors*

5. Labour hire employers / hosts:

  • Labour hire loophole*

6. Businesses with unions in the workplace:

  • Delegate rights*
  • Right of entry changes*
  • Bargaining changes including intractable bargaining determination changes*

You can see a concise summary of some of the key ways that these reforms affect arrangements for businesses that have different types of workers here.

What’s happening on Monday?

The new right to disconnect commences (for small businesses it is on 26 August 2025).

The new casual employment framework commences.

The definition of who is an “employee” under the Fair Work Act 2009 will fundamentally change.

Independent contractors will have new rights and the FWC can start the process of making minimum conditions for different types of contractors who are “regulated workers” or in a road transport “contractual chain”.

The world won’t change on Monday. But it will be a fundamentally different landscape for employment and industrial relations in the months and years to come.


Subscribe to receive the next Workplace Law & Strategy blog direct to your inbox.