An employer must not exert undue influence or undue pressure on an employee in relation to a decision by the employee to:
- make, or not make, an agreement or arrangement under the National Employment Standards; or
- make, or not make, an agreement or arrangement under a term of a modern award or enterprise agreement that is permitted to be included in the award or agreement under subsection 55(2); or
- agree to, or terminate, an individual flexibility arrangement; or
- accept a guarantee of annual earnings; or
- agree, or not agree, to a deduction from amounts payable to the employee in relation to the performance of work.
An employer must not exert undue influence or undue pressure on an employee in relation to the employee’s terms and conditions of employment.
An employer must not pressure an employee to agree to an individual flexibility arrangement.
There are no exceptions.
These provisions do not require coercion, but there must be some conduct which nevertheless amounts to the exercise of some influence or some pressure in order to make an employee act in a particular way. The provisions set a lower threshold than coercion.[1]
The prohibition applies in circumstances where an employer makes an agreement with an individual employee (not employees acting collectively) and where the employer should be expected to take care not to exert significant and inappropriate pressure on an employee to make the agreement.[2]
‘Undue’ conduct is conduct that is ‘unwarranted; excessive; too great’ or ‘not proper, fitting or right; unjustified.’[3]
To ‘influence’ is ‘to move or impel to, or to do, something’.[4]
The word ‘pressure’ refers to harassment or oppression.[5]
is provided in the Explanatory Memorandum:[6]
David is 18 years old and is employed by Sparkles Pty Ltd (Sparkles). The manager of Sparkles has approached David about the possibility of cashing out his annual leave entitlement saying that, because Sparkles is a small business, if David took leave the business would have to close temporarily to cover David’s absence. In the circumstances, David feels obliged to agree to the manager’s request.
Depending on the exact way in which this issue was raised with David, the manager’s request may amount to undue influence or pressure and would be prohibited. Of course, if the manager made it clear to David that he was in no way obliged to cash out his leave and that the manager was merely exploring all possible business options, the manager’s request is unlikely to amount to undue influence or pressure.
[1] Explanatory Memorandum to Fair Work Bill 2008 [1396].
[2] Explanatory Memorandum to Fair Work Bill 2008 [1395].
[3] Stuart v Construction, Forestry, Mining and Energy Union (2009) 190 IR 82 [18], cited in Wintle v RUC Cementation Mining Contractors Pty Ltd (No. 2) [2012] FMCA 459 [36].
[4] The Macquarie Dictionary (2nd ed, 1991), 903; cited in Wintle v RUC Cementation Mining Contractors Pty Ltd (No. 2) [2012] FMCA 459 [37].
[5] ibid.
[6] Explanatory Memorandum to Fair Work Bill 2008 [1370].