‘Is it legal to be offered a promotion with no extra pay?’

Question:

My boss called me into her office a few weeks ago and said that I’d been performing so well they wanted to offer me a promotion. She outlined what the new job would involve and it sounded great.

I’ve been trying to get a more senior role for years and I believed this was my chance! When I asked what the title would be she was quite vague and then when I asked to see the contract a few days later she said there wouldn’t be one.

It transpired that I wouldn’t get a pay rise or a new title – the “promotion” is just more work for the same respect and pay. Are they even allowed to do this? I’m worried that if I don’t accept the new responsibilities I will lose my job – Sarah, Qld

Answer:

You’ve done the right thing, Sarah, by asking your boss whether taking on the additional or different responsibilities means more pay or a new title.

Whether your employer can unilaterally change (increase) your duties will depend on whether you’re covered by a modern award, registered enterprise agreement, or employment contract.

If you have a modern award that covers your employment and these additional duties mean that you fall into a higher classification in that award, then your employer would be in breach of that award. This would also be a breach of the National Employment Standards and could be a fine of up to $82,500 for a company.

If, however, you’re employed under an enterprise agreement then it will depend on the terms of that agreement.

If you aren’t covered by an award or registered agreement, then your employment contract might outline what your obligations are. Some contracts, particularly for white-collar workers, have clauses to the effect that an employer can vary the employee’s duties provided they remain suited to the employee’s experience and/or qualifications.

Sometimes, however, the employment contract will expressly state what the duties or position will involve, and in this case varying them unilaterally can be a breach of contract.

If, on review of your employment contract, this is not unlawful then you can ask for a clear time frame for a salary review and a new title in the future, as your boss has said that a pay rise and new title is not possible at this stage (but it may be in the future).

You could also ask for some non-monetary benefits, such as additional annual leave, further training and development or flexible working hours.

The Fair Work Act says the maximum hours a full-time employee can work during the week is 38, and a request or requirement to perform more hours must be reasonable. If taking on these additional duties means you are working much more, then this may be unlawful.

If you don’t have an employment contract that sets out your rate of pay, it can be found in the industrial instrument that applies to your employment, such as a modern award or enterprise agreement.

Cross check what pay you are receiving with the relevant contract or award to ensure it is lawful.

The Fair Work Act also sets out minimum wages and paying someone under these rates is unlawful.

The Fair Work Ombudsman has some helpful online tools to allow you to easily work out what your award is (if you’re covered by one) and what your pay rates should be if you need assistance.

If you stand up for your employment rights and your boss tries to terminate you because you do not agree to a variation to your contract, or because you have requested a payrise/new title for more work, this could be adverse action.

You cannot be dismissed for exercising a workplace right, which includes making a complaint or inquiry in relation to your employment.

It doesn’t matter if your employment contract doesn’t allow for a complaint to be made, you can still make a complaint about a subject matter referred to in your contract.

For more specific advice, you should speak with an employment lawyer, or contact the Fair Work Ombudsman.

This legal information is general in nature and should not be regarded as specific legal advice or relied upon. Persons requiring particular legal advice should consult a solicitor.

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