Changes to pay secrecy laws may make companies hesitant to offer competitive packages to attract high-performing candidates.
The recent amendment to employment law affecting pay secrecy as outlined by the Fair Work ombudsman https://www.fairwork.gov.au/pay-and-wages/pay-secrecy, effective from December 7th, 2022, invalidates all pay secrecy provisions included in new employment contracts.
According to Australian Unions/ACTU this development represents a significant milestone in promoting workplace equality and enhancing transparency in compensation practices for new employees.
Consequently, new hires can disclose their remuneration details to anyone without fear of legal repercussions or retaliation.
The purpose of the changes is to create a level playing field for employees and to encourage employers to adopt fair and equitable compensation practices.
It is important to note that employers don’t have to share remuneration information if they choose not to, but employees can ask for it.
I have noticed some shifts in our market that could be directly attributed to the changes in legislation and wanted to share those.
Over the last six months, several candidates on the East Coast of Australia have shared with me that they have received job offers where the remuneration only matched what they are currently earning. The main reason given by the Hiring Manager was to maintain wage parity with existing staff members.
The offers were to Geotechnical Engineers and Geologists with less than six years’ experience.
Increasingly, candidates aren’t accepting offers unless they have conducted solid reverse reference checks (at least two) with peers and, the “other benefits” are clearly set out and attractive, other benefits included, bonuses, business growth/direction, promotion opportunities, work hours, projects, culture, and professional development.
Wanting to find out more, we ran a LinkedIn poll in October. The data showed that only 4% of engineers and geologists surveyed would accept a job offer without a corresponding increase in their compensation, regardless of other job benefits and company reputation. This lined up quite well with what we were hearing.
So, there is the problem. Candidates want more to move, and companies are hesitant to offer better packages for fear of upsetting existing staff.
With Australia and New Zealand having the highest regional percentage of employees globally who say now is an excellent time to find a job (80%) according to The Gallup State of the Global Workplace” 2023 Report, what measures will companies adopt to attract and retain top talent?
Lastly, perhaps there is something to learn from our New Zealand counterparts. Engineering NZ conducts an industry salary survey, which is available to members. Moreover, some consultancies go as far as openly sharing the information with all staff by posting it in their staff rooms.
To learn more about how these changes relate to you, visit https://www.fairwork.gov.au/pay-and-wages/pay-secrecy.
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Patrick McManus
Director
Ground Recruitment
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