Australian HR and employment topics to prepare for in 2025

Experts from Pinsent Masons discussed how an evolving landscape across global business may impact Australian employers and organisations at a recent seminar moderated by Aaron Goonrey, head of Pinsent Masons’ Asia-Pacific employment and reward practice.

Goonrey said given the evolving landscape of employment law and the challenges highlighted by attendees in response to live audience survey polls, it is crucial for employers and HR professionals to stay informed and proactive. Here are some steps you can take:

Maintain the course with DEI initiatives

With a significant portion of Australian organisations either maintaining or increasing their DEI efforts, it's essential that employers consider and possibly enhance their DEI policies to foster an inclusive workplace, particularly to attract and retain talent.

Enhance investigation processes

Employers should address any lack of confidence in workplace investigations by investing in training, and in internal and external resources, to ensure a thorough and unbiased investigations.

Understand union rights

Organisations should familiarise themselves with the recent changes in union rights of entry and union delegate rights to ensure they are prepared to manage these effectively as and when they arise.

Ensure compliance with wage laws

With the new laws on intentional underpayment, it's vital that employers regularly review and audit their payroll processes to ensure compliance to avoid severe penalties and reputational damage.

Changes around diversity, equality and inclusion

Diversity, equality and inclusion (DEI) policies have been in the spotlight recently following the re-election of Donald Trump in the US, who has labelled the policies illegal and signed several executive orders to remove DEI policies from government agencies. However, any changes in the Australian landscape remain to be seen.

Emma Lutwyche, a specialist in DEI and discrimination law, said: “The legal situation in Australia for DEI policies and practices is very different to the US.”

“Our anti-discrimination legislation at both the state and federal level contains exceptions which allow for affirmative action, meaning discrimination that would otherwise be unlawful is lawful if it's for the purpose of addressing inequality,” she said.

“For example, the Sex Discrimination Act permits employers to take special measures for the purposes of achieving substantive equality between people of different genders, sexual orientations and gender identities.”

41% of participants in the webinar said that they expected their organisation to maintain its current approach to DEI, 41% said that they are investing more in DEI and 18% said they were unsure of their organisation's position.  No participants said they were rolling back their DEI programs.

Lutwyche said: “These laws have been tested through various cases over the years, and the courts and tribunals have repeatedly found that, for example, a programme designed to recruit First Nations people is not unlawfully discriminatory towards candidates of other races if it is for the purposes of redressing historical disadvantage.”

“Unless these laws change, DEI initiatives cannot be called illegal in Australia in the same way as they have been found or alleged to be in the US,” she said.

“In our view, even if a Liberal Coalition government takes power later this year, it's unlikely that these special measures provisions will be changed as they've been in place for many years.”

Handling investigations and privacy

Participants in the webinar also heard from Ben McKinley, a workplace investigations expert, who spoke about upcoming changes to privacy laws for employers and the consequences of recent court and Fair Work Commission decisions on workplace investigations, discipline and dismissal.

McKinley said: “The protection and privacy of information is a growing concern in Australia for employers, particularly in light of the increase in the amount of data being collected, especially DEI data,” he said.

“Employers have the benefit of the employee records exemption when dealing with personal information of current or former employees.  However, the Privacy Act review report released in 2023 suggested changes to limit the scope of that exemption.”

The first tranche of privacy reforms passed parliament in 2024, which will give employees grounds to make privacy claims against their employer but did not alter the employee records exemption.

 “If the Albanese government is returned at the next election, we anticipate the second tranche of reforms with changes to the employee records exemption will be introduced into parliament shortly after,” McKinley said.

Moving onto workplace investigations, McKinley said: “We expect to continue to see greater scrutiny and criticism of workplace investigations in light of recent FWC decisions and the High Court judgment in Elisha v Vision Australia.”

“Investigations aren’t easy, some of the common pitfalls of investigations, such as poor interviewing techniques, incorrect analysis of evidence, deficiencies in the investigation processes, and bias, arise when investigators lack the necessary expertise and experience,” he said.

“We are seeing an increase in bullying and sexual harassment complaints, and investigations are about finding the truth so businesses can make informed decisions about how to handle complaints and claims.  The cost of poorly conducted investigations can be significant for employers from a time, financial and reputational perspective.”

Based on attendee feedback, over 60% expressed a lack of confidence that their organisation had adequate expertise and resourcing to conduct a workplace investigation that would withstand scrutiny in legal proceedings.

Goonrey also observed that this is a growing and contentious area of employment law and HR practice with investigations being increasingly challenged in courts and tribunals.  It is certainly an area to watch. 

Underpayment and unions

Neil Napper, an expert in workplace relations and safety at Pinsent Masons, told attendees: “Some of the recent changes that the federal government has made over the last two to three years in workplace laws have, to a degree, gone under the radar.”

“For example, the scheme that has traditionally regulated union rights of entry at employer’s premises that has been in place for many years and largely, if not wholly, administered by the Fair Work Commission under the Fair Work Act  has been significantly altered,” he said.

“As of 15 December 2023, any union official now has the right to enter your premises and for the purposes of assisting a health and safety representative on that site at the request of that health and safety representative.”

34% of participants said that they were confident in managing a union's right of entry, 21% said they weren’t confident and 45% said they were unsure.

Goonrey added that union rights of entry and delegate rights are unlikely to be issues that will be going away soon, even with a change of government given the upcoming Australian Federal election.  This is certainly an area that employers will need to familiarise themselves with to ensure they are exercising their rights and complying with relevant legal obligations. 

Employers were also warned that intentional failures to pay wages, superannuation and other benefits can now result in criminal charges.

Napper said: “As of 1 January 2025, it's now the law that if there is an example of an intentional underpayment of wages or certain other benefits to employees, then that can be a criminal offence.”

“The risks to employers posed is not only in the form of vastly increased potential penalties that can apply in that sort of circumstances,” Napper said.

“In a suspected case of small and medium employers, but also for individual employers, the risk is a prison sentence of up to ten years.”

To become a criminal offence, the Fair Work Commission must prove that the employer intentionally did not pay appropriate wages, penalties, superannuation or other entitlements.

“I suspect we'll also see cooperation agreements, as an alternative to prosecution, being relied on heavily by employers,” Napper said.

“Every underpayment will by no means result in potential criminal prosecution, but it's certainly a reason to focus attention on the critical importance of the payroll function."