Important amendments to the IR Act and the IR Regulations

The New Anti-Bullying and Sexual Harassment Jurisdiction

The proposed new Chapter 3A of the IR Act will contain the anti-bullying and sexual harassment jurisdiction within the IRC. These new provisions are not yet operative.

For each of these new regimes, civil penalties will apply for a breach of any orders made by the IRC (up to $18,870 (individuals) or otherwise $93,900) and, to avoid any double dipping for compensation, those wishing to apply for bullying or sexual harassment orders may only do so if they have not made other claims arising from the same facts under state or federal anti-discrimination legislation.

When making orders under the new jurisdictions, the IRC must also consider any other grievance or dispute procedures available to the employee, outcomes from related investigations, and any other relevant factors.

Anti-bullying

The key elements of the proposed new anti-bullying jurisdiction under the IR Act are:

1. Bullying is defined in accordance with the Work, Health and Safety Act 2011 (NSW) whereby an employee is “bullied at work” if, while the employee is at work, an individual or group of individuals, repeatedly behaves unreasonably towards the employee, or a group of employees of which the employee is a member, and that behaviour creates a risk to health and safety. Reasonable management action carried out in a reasonable way is excluded from this definition.
2. An employee who reasonably believes that they have been bullied at work may apply for stop bullying orders from the IRC provided the employee is not covered by the FW Act.
3. The IRC has the power to conciliate, arbitrate, and issue orders to stop and remedy the bullying. However, the IRC must endeavour to initially settle the matter by conciliation.
4. If the IRC is satisfied that both bullying at work has occurred and that there is a risk that the bullying of the employee will continue, it may make any order it considers appropriate. Notably, this includes a payment of damages to the employee of up to $100,000 (a remedy not available under the FW Act).

Other orders include a prohibition on continuing or repeating the bullying, performance of reasonable actions or a course of conduct to be carried out to redress loss or damage suffered by the employee, a public apology or retraction, or the implementation of a program or policy aimed at eliminating bullying.

Prohibition on sexual harassment in connection with work

The key elements of the new prohibition on sexual harassment under the IR Act are:

1. The definition of “sexual harassment” has the same meaning as in the Anti-Discrimination Act 1977 (NSW) (AD Act).
2. A person (the aggrieved person) who alleges they have been sexually harassed may apply to the IRC for a sexual harassment order provided the application is made within 24 months after the alleged sexual harassment takes place.
3. All stages of a claim, including conciliation, arbitration and final determination may be heard by the IRC (unlike the current approach adopted by the anti-discrimination legislation which generally requires a two-step process involving referral to a court or tribunal following an initial conciliation). However, the IRC must endeavour to initially settle the application by conciliation.
4. If the IRC finds that a person has been sexually harassed, the IRC can make any orders it considers appropriate. Notably, this includes a payment of damages to the employee of up to $100,000. Other orders include a prohibition on continuing or repeating the sexual harassment, performance of reasonable actions or a course of conduct to be carried out to redress loss or damage suffered by the employee, a public apology or retraction, or the implementation of a program or policy aimed at eliminating sexual harassment.
5. Vicarious liability may apply if the employer is unable to prove that they took all reasonable steps to prevent the alleged conduct.

Significant expansion of the victimisation provisions

Section 210 of the IR Act prohibits an employer or industrial organisation from victimising an employee or prospective employee for prescribed reasons. However, up until recently, these prescribed reasons were of fairly limited application given their narrow scope and, consequently, this section was not well used.

The Bill significantly expands the grounds on which an employee or prospective employee must not be victimised. These changes came into effect on 3 July 2025.

The prescribed reasons now include where an employee has made a complaint or enquiry regarding their employment, where an employee is entitled to a benefit or claim under workers compensation legislation, and if an employee has a characteristic protected from discrimination under the AD Act. Some of the existing grounds have also been reframed such as to make them of broader application.

The existing reverse onus of proof under s.210 of the IR Act has also been amended and an objective test has been introduced. Section 213 of the IR Act provides that the IRC must be “objectively” satisfied that the alleged matter was not a substantial and operative cause of the detrimental action. Section 213 further provides that the IRC may have regard to “conscious and unconscious factors” when determining whether the alleged matter was not a substantial and operative case of the detrimental action.

Clarification of the IRC’s powers during industrial disputes

The Bill broadens the IRC’s powers in disputes, allowing it to issue recommendations or directions during conciliation—even without the consent or agreement of the parties involved—and to require written reasons for any failure of the parties to comply with those recommendations or directions.

A party’s failure to comply with a recommendation or direction may not be penalised, but it may be taken into account by the IRC in exercising its functions under the IR Act.

The IRC will also have the power to issue interim or final arbitration orders or determinations including in relation to the interpretation or application of industrial instruments for the purposes of resolving a dispute, with breaches attracting a civil penalty of up to $25,000. These changes came into effect from 3 July 2025.

Small claims procedures

The Bill has amended the IR Act and the IR Regulations by increasing the maximum amount that an industrial court may order an employer to pay on a small claims application, in respect of an employee, from $10,000 to $100,000. These changes came into effect from 3 July 2025.

What is the significance of the changes?

Given the changes to the IR Act and the IR Regulations proposed by the Bill, we are likely to see an influx of claims under these new provisions particularly given their expansive scope and the ability for the IRC to make pecuniary orders for applicants of up to $100,000 (which the Fair Work Commission is not permitted to do for similar claims relating to bullying and sexual harassment under the FW Act).