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Say Goodbye to Pay Secrecy in Employment Contracts

Updated: Oct 21, 2023

Let's dive into the recent changes in employment regulations about pay secrecy. Understanding these shifts is vital for both employers and employees, as it has significant implications for workplace transparency and compliance.

Pay secrecy refers to the practice of prohibiting employees from discussing their compensation with their coworkers.

These clauses are now officially prohibited, and any employer attempting to include them may face legal penalties.

This change in regulation means that employees now have certain rights regarding the sharing of information related to their pay and terms and conditions of employment.

Employee's Rights

Employees now have the right to:

✅ Share (or not share) information about their pay and the terms and conditions of their employment.

✅ Ask their colleagues about their pay and terms and conditions of employment.

It's important to note that no employee can be compelled to disclose this information if they choose not to.

These rights extend beyond the duration of their employment, meaning that they continue to apply even after an employee resigns or is dismissed.

What About My Existing Employment Contracts?

If you have employment contracts in place that were drafted before December 7, 2022, any pay secrecy terms included within them will lose their legal effect. In other words, they cannot be enforced in the event of any contract variations or disputes.

Understanding Your Employees' Entitlements

The removal of pay secrecy clauses in employment contracts reinforces the importance of understanding the specific entitlements of your employees.

As an employer, it is crucial to ensure that your business is in compliance with these new regulations to avoid potential risks and claims.

In light of these changes, if you require assistance with reviewing and updating your employment contracts to align with the latest regulations or have any questions, please don't hesitate to reach out.

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