Whilst many organisations aspire to recruit and manage a workforce that utilises the contributions of people from different backgrounds, abilities, genders, ages, responsibilities, experiences and perspectives, recent events such as the Black Lives Matter protests, which in Australia focussed on Aboriginal deaths in custody, have made it abundantly clear to employers that they need to actively engage in diversity and inclusion initiatives within their workforces, in order to seek to understand and manage a diverse workforce.
In order to begin this more active engagement, employers need to be able to capture diversity information; however in order to do this, they first need to implement a clear communication strategy to convey the positive benefits of knowing this information in order to help to manage expectations and perceptions. Below we look at how employers can safely conduct diversity monitoring of this kind.
1. What is the position in Australia? Am I obliged to assess diversity in the workplace?
Australia has a long history of multiculturalism and rich indigenous culture and there are federal and state legislative protections in place for our diverse workplaces, as well as a common law duty for employers to take reasonable care for the health and safety of their employees. Federally, the Racial Discrimination Act 1975 (Cth) makes it unlawful for an employer to treat an applicant or employee unfavourably for reason of their race, colour or national or ethnic origin.
In addition to the Racial Discrimination Act, the Fair Work Act 2009 (Cth) extends protections to employees, potential employees and independent contractors from discrimination in the workplace. The Act sets out a number of protections available at any stage of the employment cycle. Under these provisions, individuals are protected from adverse action being taken against them on the basis of race, colour, sex, sexual orientation, age, physical or mental disability, marital status, family or carer's responsibilities, pregnancy, religion, political opinion, national extraction or social origin. States and Territories also have discrimination and equal opportunity legislation specific to their constituents.
While there are, therefore, clear obligations regarding compliance with non-discrimination obligations in Australia, there are few positive obligations on employers to review and report on the composition of their workforce. A notable exception is the requirement to report on the gender composition of the workforce under the Workplace Gender Equality Act 2012 (Cth).
2. If I'm not subject to a specific requirement, where should I start?
Whilst there is no positive obligation on employers to record diversity data (with the exception of gender reporting, as noted above), there are also no restrictions under employment law preventing employers from gathering diversity information about their workforce. This is significant, as this type of information plays an important part in a company's consideration of its policies and procedures, and allows it to identify weaknesses, key issues and priorities to ensure a safe and diverse workplace.
However, there are data protection restrictions that can apply that we discuss further below. It is worth noting that employers will need to take care when processing such information given both the sensitivity of the data and of the implications for any related lack of compliance or misuse.
The safest way to carry out diversity monitoring is by way of an anonymous survey, making sure that staff cannot be identified directly or indirectly from the information collected (for example, an individual may be identifiable where there is only one woman in a team and employees are required to disclose their gender and their team).
That said, a truly anonymous survey may not always be possible given the size of the business or the relevant teams, and may in any event be something of blunt instrument. Further, such a survey may be of limited use where it leaves the business unable to identify particular areas of concern and introduce specific measures where most needed.
Accordingly, we consider in further detail below possible steps for employers who want to take a more tailored approach to understanding their workforce and implementing change.
3. Carrying out personalised diversity monitoring
As a general rule, personal information revealing racial or ethnic origin is considered ‘sensitive information’.
There is an employee exemption in the Privacy Act 1988 (Cth) which excludes from the operation of that Act acts and practices which directly relate to a current or former employment relationship and which concern employee records. Information about an employee's racial or ethnic origin collected as part of a diversity initiative is likely in many instances to be part of an "employee record", and use of that information for the purpose of ensuring that people from different background s are treated fairly is in many circumstances likely to be directly related to a current or former employment relationship such that the exemption applies.
However, the exemption will only apply to the employing entity. Many companies are part of a group with a common diversity initiative in which case entities which do not have the benefit of the employee exemption may well collect, use and disclose the information as part of the initiative.
In those circumstances, it is often best to proceed as if the employee exemption was not available. Because of the information being "sensitive information", this means that consent must generally be obtained from the person in question in order to comply with Australian Privacy Principle 3.3 in relation to collection of the data, and to comply with Australian Privacy Principle 6 in relation to the use of the data for the survey.
There are other advantages in ensuring that employees who participate in diversity surveys do so only on a voluntary basis. Chief amongst these is that many people may feel uncomfortable giving this information, and where that is the case the benefits of having it may well be outweighed by the detriment. Measures should be taken to ensure that consent is given freely and with appropriate specific information about the purposes for which the information will be used and disclosed, and it is also from a practical perspective appropriate to provide information about any confidentiality measures taken to confine the information to an appropriate group within the company.
4. Carrying out employee opinion surveys
As with diversity monitoring, the safest approach to this is to conduct such surveys on an anonymised basis. For these types of surveys, anonymised information is less likely to reduce the value of the information, so worth considering. However, as mentioned previously the size of the company or team may mean that the data is not truly anonymised but is instead ‘pseudonymised’, i.e. the direct identifiers (such as name) have been removed or kept separately, but the remaining identifiers can still lead to the identification of an individual. If an employer can choose to identify the participants by combining data sets, then it should treat the information as sensitive information and take compliance steps on the basis that the Privacy Act is likely to apply.
In practice, it can sometimes be hard for employers to get employees to engage with such surveys and to ensure that the responses are useful, unless employees feel that they won’t suffer any repercussions as a result of speaking their mind. Whilst communication/notification to employees is key in reassuring employees, the fact that a survey is anonymised is often the best practical way of assuring employees that the business is more interested in what they have to say than who said it.
Although employers may want to take a more personalised approach, this is not without risk compared to the fact-focused diversity monitoring referred to above.
5. Can't I just ask employees to consent to personalised diversity monitoring / opinion surveys?
Whilst there is nothing to stop employers taking this approach, there are several risks with doing so.
The Privacy Commissioner takes the view that consent should be freely given, specific, informed and unambiguous. An employee should be able to refuse to give consent and to withdraw it once given without facing any detriment. Given the perceived imbalance of power between an employer and an employee, particular care should be taken in the employment context.
6. Is there anything else I should consider?
There are various compliance requirements with which an employer undertaking this kind of diversity monitoring must comply. In cases in which the Australian Privacy Principles apply (ie where the employee exemption does not), it is necessary to take reasonable steps to ensure that individuals are aware of various matters, which is best complied with by way of a notice in the survey or other communication through which the information is collected. The information which should be included in the notice includes :
7. Once I have carried out a review and have a better understanding of the workforce, what should I do?
Firstly, give any key stakeholders within the business time to review your results and identify any key areas of concern. You may decide that you need to:
All future steps should be focussed on driving a better culture of respect and inclusion in the workplace.
As to policies, these should be live documents and should be implemented, reviewed and updated regularly. It is also important to ensure that employment contracts contain obligations for employees to be aware of and comply with company policies.
Your anti-discrimination and workplace behaviour policies in particular should set out the company's commitment to a diverse and safe workplace, and require employees to meet set standards of conduct in the workplace, throughout the recruitment process and during termination procedures. Your policy can also outline any objectives you've committed to, as a company, in order to prevent discrimination, bullying and harassment and to encourage an inclusive and diverse work culture. Outlining company-wide diversity and inclusivity goals will also provide employees with a clear image of the company's expectations and aims to apply in their daily roles.
8. What if I get it wrong?
Broadly speaking, failing to maintain a safe workplace for staff especially in relation to discrimination, bullying and harassment can have serious consequences under Australian law. Discrimination or adverse action claims can attract uncapped damages But beyond legal consequences, cases of discrimination, bullying or harassment can cause irreparable damage to a company's brand and reputation, particularly where it is found that a company has failed to facilitate a safe culture for their employees.
Breaches of privacy laws can give rise to complaints to the Australian Privacy Commissioner, who can make determinations including non-binding declaration that compensation should be paid. Individuals can seek enforcement of a determination in the Federal Court or Federal Circuit Court, which will proceed by way of a hearing de novo. In cases of serious or repeated interferences with privacy, the Privacy Commissioner can seek orders for civil penalties.
9. Concluding remarks
Diversity monitoring can absolutely be achieved in Australia, and it is a hugely important tool in order to allow employers to understand their workforce and respond to employee concerns; however, due care needs to be exercised.