Workplace Watch – 28 October 2025: Payday Super changes, Full Bench decision re flexible working request, Baby Priya’s Bill

Welcome to the latest edition of the Workplace Watch, our key summary of developments in the ER/IR space.

In this edition we cover:

• a recent Full Bench decision upholding an employee’s right to flexible work arrangements despite their inconsistency with the rostering provisions of the applicable enterprise agreement;
• the federal government’s introduction to Parliament of “payday superannuation” legislation;
• changes to parental leave laws following the introduction of “Baby Priya’s Bill”; and
• an important Federal Court decision reiterating the costs implications of unreasonably refusing reasonable Calderbank offers in the Fair Work jurisdiction.

LEGISLATIVE UPDATES

Payday Superannuation changes proposed to Parliament

The Australian Government introduced the Payday Superannuation Bill to Parliament on 9 October 2025, proposing changes to how employers pay superannuation. If passed, the new laws would require employers to pay employees’ superannuation guarantee (SG) at the same time as their salary and wages, rather than quarterly. The proposed start date for these changes is 1 July 2026.

Under the proposed legislation, employers would need to ensure that SG contributions reach employees’ superannuation funds within seven business days of each payday. The Bill introduces a new concept called qualifying earnings, which covers ordinary time earnings, salary sacrifice contributions, and other payments currently included in SG calculations.

The Superannuation Guarantee Charge (SGC) would also be updated. Employers who do not make contributions in full and on time would be liable for the SGC, which would include unpaid amounts, interest to reflect lost fund earnings, and administrative charges. Additional penalties could apply if contributions remain unpaid after notice from the Australian Taxation Office.

If the Bill becomes law, employers will need to update payroll systems to align super payments with wage cycles and ensure accurate reporting through Single Touch Payroll. The ATO has released a draft compliance guideline outlining its intended approach for the 2026–27 income year, recognising that some employers may face challenges adapting their systems.

If passed, the Payday Superannuation Bill represents a proposed shift toward more frequent superannuation payments. If enacted, it would commence from 1 July 2026, aligning super contributions with employee paydays.

You can view the Bill here.

Proposed amendment to paid parental leave after child loss  

The Australian Government has introduced the Fair Work Amendment (Baby Priya’s) Bill 2025 to Parliament, proposing changes to the Fair Work Act 2009 to ensure employees can access employer-funded paid parental leave if their child is stillborn or dies shortly after birth.

Under the National Employment Standards, the minimum entitlement to parental leave is unpaid leave and there is no provision for paid parental leave. However, many employers choose to offer paid parental leave through employment contracts, workplace policies, or enterprise agreements. The proposed Bill would make it unlawful for an employer to cancel or refuse this employer-funded paid parental leave because of a stillbirth or the death of a child, unless they provide alternative leave arrangements.

The Bill follows public advocacy from the parents of baby Priya, whose mother was prevented from taking her paid parental leave following her daughter’s death at six weeks old. The proposed changes aim to remove uncertainty for grieving parents and provide clarity for employers about their obligations in such circumstances.

The Minister for Employment and Workplace Relations Amanda Rishworth said the reforms would ensure parents are not required to negotiate leave entitlements during a period of loss.

If enacted, the Fair Work Amendment (Baby Priya’s) Act 2025 would take effect the day after receiving Royal Assent, clarifying that employer-funded paid parental leave must be preserved even in cases of stillbirth or infant death.

You can view the Bill here.

CASE UPDATES

Full Bench upholds single member decision granting employee’s flexible work request

A Full Bench of the Fair Work Commission has upheld a decision of Commissioner Yilmaz, ordering an employer to grant an employee’s flexible work request and affirming that “a mere inconsistency between the requested flexible working arrangements and an enterprise agreement could not be relied upon as a reasonable business ground for refusing the request for the purposes of s 65A”.

Prior to refusing the employee’s request, the employer, Paper Australia Pty Ltd (Opal) made an organisation-wide decision to cancel individual rostering arrangements for a particular cohort of EA-covered employees in Maryvale due to its view that they may cause the business to become non-compliant  with the applicable enterprise agreement’s rostering provision.

In dismissing the appeal, the Full Bench found that Opal failed to demonstrate that granting the request would be impractical or cause  “a significant loss of efficiency or productivity or have a significant impact on customer service”. Accordingly, Commissioner Yilmaz’s orders were upheld, compelling Opal to grant the employee’s request.

Read the Full Bench decision here.

FWC releases statement on SDA’s proposed variation to the minimum rates for junior employees under 3 modern awards

In June 2024, the Shop, Distributive and Allied Employees’ Association applied to the Fair Work Commission under section 157 of the Fair Work Act 2009 (FW Act) to amend the General Retail Industry Award 2020, Fast Food Industry Award 2020 and Pharmacy Industry Award 2020. Section 157 of the FW Act allows for the variation of modern awards between reviews but only on a limited basis, namely, that the Commission is satisfied that making the determination or modern award outside the system of four yearly reviews of modern awards is necessary to achieve the modern awards objective.

The SDA proposes that 18 to 20 year olds’ minimum pay rates be increased to 100% of the adult minimum, while 16 year olds’ would be set at 50% and 17 year olds’ at 75% across the 3 awards.

The Commission has issued directions to the parties and gathered evidence and expert reports (including 11 submissions and over 84 witness statements). Commission staff have produced summaries of submissions, expert evidence, and a research reference list, to assist both the Full Bench and the parties in navigating the large volume of material (the summary of submissions can be viewed here).

Submissions supporting the variation include that aged based wage rates are discriminatory, in particular when considering current living standards and allowing young people to spend more time in education and that junior employees aged between 18 to 20 perform identical work to those over 21 (with no material difference in duties skills or conditions). Submissions opposing the variation include that it would significantly threaten the viability of employing junior employees in the retail sector, the work performed by junior employees aligns with their abilities and work (more supervision and lower level of experience, skill and productivity) and it would have an impact on businesses’ sustainability and competitiveness.

A Full Bench of the Commission will hear all evidence between 27 October and 7 November 2025.

Deputy President Bulter’s Statement can be viewed here.

Federal Court awards indemnity costs for unreasonable refusal of settlement offers

Justice Anderson has exercised the Court’s discretion to award indemnity costs following a Calderbank offer. His Honour found that the appellants’ unreasonable acts or omissions in refusing reasonable offers of settlement caused the respondent to incur costs in defending the appeals.

The respondent made a Calderbank offer on 3 April 2025, which was not accepted by the expiration of the Calderbank offer (18 April 2025).  The appeals were ultimately dismissed in their entirety on 13 August 2025. The respondent then sought indemnity costs from the expiration of the Calderbank offer, arguing that the rejection of the respondent’s offer was unreasonable and caused the respondent to incur costs in defending the appeals.

Costs were sought on two bases: (1) the proceeding was initiated “vexatiously and without reasonable cause” and (2) the appellants’ “unreasonable acts or omissions” caused the respondent to incur costs.

On the first point, the Court explained that a proceeding may lack a “reasonable cause” if it is clear on the facts that the appeals had no substantial prospects of success.

On the second, the Court noted that a broader inquiry was required, including contextual factors such as: the stage of the proceeding when the offer was made, the time given to accept it, the extent of the compromise, the offeree’s prospects at the time, the clarity of the offer’s terms, and whether the offer foreshadowed an indemnity costs application.  The Court was satisfied that the appellants acted unreasonably in refusing the respondent’s reasonable offers of settlement and caused the respondent to incur costs in defending the appeals.

The Court ordered indemnity costs from the expiration of the Calderbank offer.

Read the full decision here.

This article was written by Sandy Suliman (Associate), Tim Agius (Associate), Marcus Di Blasio (Senior Associate), Ned Fitzgerald (Senior Associate) and Chris Gianatti (Director).

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