Introduction
On Thursday last week, the Victorian Government passed the Equal Opportunity Act 2010 (Act).
The substantive provisions of the Act commence on 1 August 2011.
The Act introduces new obligations that will impact national and Victorian employers, including a new duty to eliminate discrimination, sexual harassment and victimisation.
It also heralds a new era in complaint handling by the Victorian Equal Opportunity and Human Rights Commission (Commission). It gives the Commission powers to investigate discrimination, sexual harassment and victimisation even without a complaint and to issue compliance notices to employers.
In this article, we provide detail on these changes. Freehills will also be running a seminar on the changes in the coming months.
A change in focus for the Equal Opportunity Act 2010
The Act represents a significant shift in the approach taken to equal opportunity law in Victoria, and may foreshadow a change in focus of laws in this area from other states and territories in the future.
The traditional focus of the Commission was on the investigation and resolution of individual complaints of unlawful behaviour.
Under the new Act, the Commission’s role is refined to one of education and resolution of individual complaints, with its investigative and inquiry role reserved for issues affecting a broader group of people in an effort to deal with systematic discrimination.
A change to dispute resolution
Individual complaints will be known as ‘disputes’ under the Act, and the Commission will no longer have a duty to investigate these complaints. Instead, the Commission’s role will be to facilitate the resolution of these disputes.
The dispute resolution procedure will be flexible and targeted to the nature of the dispute. The emphasis will be on early resolution.
In a significant shift from current procedures, involvement in the dispute resolution procedure is completely voluntary, and either party to a complaint can withdraw at any time.
As a consequence, it will no longer be compulsory for an individual to have brought their complaint to the Commission before proceeding to the Victorian Civil and Administrative Tribunal (VCAT). Under the new Act, complainants will be able to proceed directly to VCAT, whether or not their complaint has first been dealt with by the Commission.
The new dispute resolution procedures are based on the current model in place in New Zealand. There, the dispute resolution process relies heavily upon mediation between the parties.
Some complainants may view the new dispute procedures as less than satisfactory—an employer’s involvement is voluntary, and the Commission is largely ‘toothless’.
It could, however, cause a shift in the way that employees bring complaints. It may push employees to apply to VCAT at a much earlier stage, meaning that mediation occurs in the context of VCAT rather than Commission proceedings. Alternatively, it may make the ‘adverse action’ jurisdiction of Fair Work Australia even more attractive, given that Fair Work Australia may have more powers against employers in the early stage of a dispute than the Commission.
New investigation and inquiry powers
The Commission will have new powers to conduct investigations into potential breaches of the Act that relate to a class or group of persons.
The intention is that by giving the Commission this power, it will be able to tackle issues of systematic discrimination that can occur within an organisation or industry, which it has not been able to address previously due to the individual complaint focus of previous legislation.
Although an investigation cannot be triggered by an individual complaint (where dispute resolution applies), the Commission can use this information to decide whether an investigation might be needed. The Commission can also use information it receives from calls to its inquiry line, reports in the media or submissions from stakeholders or community groups for this purpose.
Where an investigation is commenced, the Commission has power to compel attendance and require the production of documents.
If an investigation reveals a breach of the Act, the Commission can issue a compliance notice, or a party may enter into an enforceable undertaking.
The Commission also has the power to conduct a public inquiry into serious issues affecting a class or group of persons. The outcome of the public inquiry is a report, which may be tabled in Parliament.
New duty for employers to eliminate discrimination, sexual harassment and victimisation
One of the most significant changes for employers is the obligation on ‘duty holders’ (including employers) to take ‘reasonable and proportionate measures to eliminate discrimination, sexual harassment and discrimination as far as possible’.
This is not unlike the current ‘defence’ to an action for breach of the current Equal Opportunity Act 1995 (Old Act) where an employer is required to show it has taken ‘reasonable precautions’ to prevent the unlawful behaviour occurring.
The important difference with the new duty is that a positive obligation is imposed on employers to take these measures, instead of an employer only being required to demonstrate the steps it takes to prevent unlawful behaviour if and when a complaint is made.
In determining whether a measure is reasonable and proportionate, the Act provides that a number of factors must be taken into account, including the size of the employer’s business, the nature and circumstances of the business and the practicability and cost of the measures.
In our view, for large organisations this means at a minimum that employers must:
- identify potential areas of non compliance with the Act – this includes reviewing policies for discriminatory impact, as well as the employer’s history of complaints to identify any potential systematic issues (under the Act an employer can request the Commission to conduct a compliance review of its programs)
- develop a strategy for meeting and maintaining compliance – at a minimum, best practice includes a regularly updated and circulated equal opportunity policy, training for all staff and effective complaint management processes, and
- review and improve compliance where necessary.
An employer who fails to meet the new duty faces the possibility of investigation by the Commission, which may result in a compliance notice being issued against the employer, or the employer entering into an enforceable undertaking.
Making it easier to prove discrimination, and duty to accommodate impairments
The Act simplifies the definition of direct and indirect discrimination, which will make it easier for a person to successfully argue that discrimination has occurred.
It also places a positive obligation on employers to make reasonable adjustments for a person offered employment or an employee with an impairment (or disability).
Examples of ‘reasonable adjustments’ include:
- providing a ramp for access to the workplace or particular software packages for computers
- modifying work instructions and work manuals
- allowing an employee to take breaks more frequently, and
- allowing an employee to be absent during work hours for rehabilitation.
Similar changes were recently implemented in the federal Disability Discrimination Act.
Removal and amendment of exceptions and exemptions to unlawful behaviour
The exceptions under the Act have been the subject to much controversy, and over 500 submissions were received by the Scrutiny of Acts and Regulations Committee in the exceptions review.
The Act has removed a number of exceptions to unlawful behaviour. In some cases, the exceptions were removed to make the Act consistent with federal equal opportunity legislation. These include exceptions allowing:
- discrimination in family employment or by small businesses
- the setting of standards of dress and behaviour
- compulsory retirement of judicial officers
- youth wages, and
- single sex accommodation.
A number of exceptions have also been changed or clarified, including:
- The special measures exception which allows discrimination for the purpose of achieving substantive equality for disadvantaged groups – this exception is now arguably broader and has been given an elevated importance under the Act to allow employers and others to engage in discrimination as a means to progressively realise equality. This will support employers implementing initiatives to increase diversity on their boards, senior management or workforce. This change is timely with the proposed new ASX regulations requiring public companies to have gender diversity policies with measurable targets, which in many cases will constitute a ‘special measure’.
- The ‘club’ exception – the definition of club has now been limited to organisations holding a liquor licence to bring it into step with provisions in other states. The legislation retains the right for clubs to restrict membership to one gender.
- The ‘religious bodies’ exception – this is now significantly narrowed, and discrimination in employment can only be justified if the possession of a particular attribute is an inherent requirement of a role.
Exemptions under the Act will be available for a period of five years, instead of the previous three-year period.
Application to volunteers
The Attorney General in his Second Reading speech to the Legislative Assembly stated that the intention is that for the Act to apply to unpaid workers and volunteers from 1 July 2012.
The delay in commencement of these provisions is intended to give the community and not-for-profit sector (which have limited resources) time to adapt to the new rules.
The Act as presently drafted however provides that it will apply to these workers only in respect of sexual harassment, and from its commencement in August 2011. We expect this will be corrected in due course.
What does this mean for employers?
This year is fast becoming a year for action in equal opportunity.
In addition to the changes set out in the Act, the last 12 months has seen significant new legislation and proposals which affect equal opportunity in the workplace. These include:
- new Fair Work Act avenues for individuals to make complaints about discrimination in employment under the ‘adverse action’ provisions
- new provisions in the Fair Work Act giving certain employees the right to request flexible work arrangements and the option of extending parental leave to a total of 24 months
- changes in the federal Disability Discrimination Act which make it easier to claim discrimination
- changes to the grounds of discrimination prohibited by the Fair Work Act and the Old Act (adverse action and employment rights respectively), and
- proposals by the ASX to change its regulations to require public companies to have gender diversity policies with measurable targets.
As a result, employers should consider:
- When was the last time you comprehensively reviewed your policies?
- Are they easy to find and do employees know how to find them?
- Do your managers know how to react to allegations of unlawful behaviour, and will they address complaints appropriately?
- Do you train your employees on their responsibilities under the equal opportunity laws?
- Do you have a policy and procedure in place to deal with flexible work requests?
- Are there policies in your organisation which cause concern because they pose questions of systematic discrimination that have been in the ‘too hard’ basket?
The Act commences in August 2011. Now is the time to carefully review your workplace policies, procedures and practices to ensure you are not caught out.
This article was written by Lisa Croxford, Special Counsel and Kate Jenkins, Partner, Melbourne.
More information
For information regarding possible implications for your business, contact a member of the Employee Relations team.