The start to the year has brought with it yet more changes on the industrial/employee relations front.
These changes build upon other recent changes such as variations to employee authorised payroll deduction requirements, new rules for labour hire workers and small business redundancy changes (click here to access our January update for details).
As for these latest changes, we’re focusing in this article on those changes that are most likely to potentially impact our clients (though there is a reference to additional/perhaps less broadly relevant changes towards the end of the article).
Please note in particular the dates from which these changes take effect, which may be different for small business employers. Note that a “small business employer” is an employer with fewer than 15 employees.
Here goes….
The Right to Disconnect
(commences 26/08/24 for non-small business employers, and from 26/08/25 for small business employers)
Under the new legislation, eligible employees will be given the ‘right to disconnect’ outside of work hours. Essentially, this means that employees will have the right to refuse to monitor, read or respond to contact (or attempted contact) from an employer or a third party outside their working hours, unless that refusal is unreasonable.
Guidelines will be produced to determine whether an employee’s refusal is unreasonable or not.
Employers and employees will be able to refer matters in dispute to the Fair Work Commission.
Changes to Casual Employment (again!)
(commences 26/08/24 for all employers)
The legislation will introduce a new definition of casual employment, such that an employee will only be deemed to be a casual employee if:
- there is no firm advance commitment to continuing and indefinite work (noting that the substance/reality of the relationship needs to align with the provisions of any employment contract or agreement)
- the employee is entitled to be paid a casual loading or a specific pay rate for casuals.
A new pathway to permanent employment will replace existing arrangements. This new pathway will give eligible employees who believe their work arrangements are no longer accurately reflect the definition of casual employment the opportunity to notify their employer and seek conversion to part-time or full-time employment. Employers will be required to consult and provide a written response in writing within 21 days.
Interestingly, the new legislation also provides that a casual employee will remain a casual employee, even if the nature of the relationship changes so that they cease to meet the new definition, unless a “specified event” occurs (such as conversion to part-time or full-time employment via the new conversion pathway, or the Fair Work Commission makes an order to convert the relationship). There is a notable exception to this however, in the event where an employee was incorrectly engaged as a casual upon commencement.
Changes to Independent Contractor Arrangements
Several changes (commencing 26/08/24, or sooner if possible, for all employers), require that consideration be given to the ‘totality’ of a given relationship when determining whether a worker is appropriately engaged as an employee or independent contractor. This shifts the current emphasis on the terms of a written contract, to considering the full and actual substance of the relationship (including the terms of the contract) when seeking to determine the correct status.
Further changes, which have already commenced (from 27/02/24), seek to reduce the instances of “sham contracting”, whereby an employer mischaracterises or misrepresents a relationship as an independent contractor arrangement when it is in effect an employment relationship. While there was already legislation in place to prevent sham contracting, the changes serve to limit the defences of the parties against a contravention. Whereas previously it was a defence to prove that you did not know AND were not reckless in regarding the relationship as a contractor arrangement, you now need to be able to prove that you “reasonably believed” that a contractor rather than employment arrangement was appropriate.
Underpayments and Serious Contraventions
From 27 February 2024, there are increased civil penalties for certain contraventions of the legislation, including increased penalties for failing to comply with a compliance notice. Some penalties are even higher for non-small business employers. The definition of a “serious contravention” has also been changed, with the result that more breaches will likely reach this threshold level, beyond which stronger penalties apply.
Changes effective from 1 July 2024 will make it quicker and simpler for representatives of organisations such as unions to investigate claims (which must be reasonable) of suspected employee underpayments. Changes include an exemption (in certain circumstances) from the minimum 24 hours notice requirement prior to entry to a workplace to investigate a suspected breach, and protection for those exercising relevant rights to investigate.
These changes are on top of the new “Wage Theft” provisions, which will apply from January 2025, and which will make it a federal criminal offence for employers to intentionally underpay their employees. Details are still being worked through, and further information will be provided closer to the operative date.
Other Changes
Other changes that are less likely to be applicable to most HR Success clients/contacts, include:
- (from 26 August 2024 or sooner) An expansion of the protections and rights available to employee workplace delegates to include “regulated workers” and associated regulated businesses, and increasing protections for “employee-like workers” (this will most likely impact workers and businesses involved in the road transport industry and those workers engaged by means of a digital labour platform, or those in what’s commonly referred to as the “gig economy”);
- (from 26 August 2024 or sooner) Further regulation of road transport contractors;
- (from 26 August 2024 or sooner) Increasing powers of the Fair Work Commission to deal with disputes about unfair contract terms in service contracts, and;
- (effective 27 February 2024) Changes to enterprise agreements, bargaining, franchisees, model terms and unions.
Over the coming few months, we’ll provide further details as to how the most impactful of these new requirements will likely work in practice, so keep an eye on our social media posts and newsletters to ensure you have access to this important information.
Of course, reach out to us directly if you need further support.
Note that this article includes general information and is a summary only. It is not formal or legal advice. Information is we believe current and accurate at the time of publication – 18/03/2024.