Australia to ban wage secrecy clauses in job contracts

Such clauses have traditionally been used to stop co-workers from comparing their wage package and pushing for pay hikes.
By: | November 1, 2022

Australia is set to ban wage secrecy clauses in employment contracts under industrial relations changes by the government, in a move that it hopes would be able to create a level playing field and narrow the country’s gender pay gap. 

Large financial institutions and corporations have traditionally used pay secrecy clauses to stop co-workers from comparing their wage package and pushing for pay hikes. So far, banks like Westpac and Commonwealth Bank have stopped the use of such clauses this year, reports the Australian Financial Review.

The Secure Jobs, Better Pay Bill, said Australia’s Workplace Relations Minister Tony Burke, will  help close the country’s 14.1 per cent gender pay gap, and protect women through “security, fair pay and proper protections”.

Burke added, “Workers who want to have a discussion about pay equity at work should not be prohibited by their employment contracts from doing so. Critically, this bill protects workers by saying if you want to tell someone how much you are paid, that’s up to you. These reforms reflect our vision for a fairer, safer and more inclusive Australia.”

READ: Australia strengthens flexible work rights with new workplace legislation

According to findings from LinkedIn, some 45% of workers in Australia believe more transparency on wages would lead to better pay equality, 16% said they would share information about their pay with co-workers they trust, while 37% noted that sharing wage levels was stressful.