You may have read our article ‘2024 – Some Changes to Employment Law’ in which we detailed some of the amendments that were introduced by the Federal government in the first tranche of the closing loopholes amendments. The second tranche of amendments have now passed through Parliament and received royal assent on February 26 2024. The Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024 (‘The Act’) introduces further significant changes to the Australian Employment Law landscape. Some of these changes will be briefly detailed below. 

A right to disconnect

Commencement date: 26 August 2024 or 26 August 2025 for small businesses

The Act introduces a new ‘right to disconnect’ which will commence on 26 August 2024. This means that an employee may refuse to respond to any work related correspondence outside of working hours unless it is unreasonable for them to do so.

Matters that may be considered when determining if it is unreasonable for an employee to refuse contact include:

• The reason for the contact i.e. is it an emergency?;
• The mode of contact, and the amount of disruption it causes the employee;
• Whether the employee receives remuneration for engaging in work outside of their ordinary working hours;
• The nature of the employee’s role and their seniority level; and
• Personal circumstances of the employee including family and caring responsibilities. 

Any disputes can be referred to the Fair Work Commission (FWC) if the dispute is unable to be resolved internally. 

Defnition of employment

Commencement date: a date to be fixed by proclamation or 26 August 2024

The Act enshrines a definition of employment which provides that the totality of a working relationship must now be taken into consideration when determining whether a worker is an employee or independent contractor. 

This overrides the current common law definition which prioritises the contract between parties over the substance of the working relationship. Whilst protections remain for employers that mistakenly mislabel a worker, we recommend seeking legal advice if you are uncertain to avoid doubt and risk. 

Casual employees

Commencement date: 26 August 2024

The Act introduces a new requirement that, from 26 August 2024, the substance of an employment relationship be taken into account when determining if a worker is a casual employee, providing a greater opportunity for casual staff to secure permanent employment. 

An employee who believes their employment status constitutes a permanent employee, may write to their employer requesting to be made permanent. The employer must respond within 21 days and must oblige unless they have a justifiable reason for denial under the Act.   

Gig economy workers

Commencement date: a date to be fixed by proclamation or 26 August 2024

The Act establishes a new ‘employee-like’ category of worker that will afford greater protections to regulated road transport workers and digital platform workers i.e. gig economy workers. This will include an ability for the FWC to make minimum standards orders, for regulated businesses to make collective agreements, and to protect employee-like workers from unfair deactiviation (similar to unfair dismissal of an employee). 

Independent contractors (IC)

Commencement date: 27 February 2024

Perceived unfair contracting terms in IC agreements may now be set aside by the FWC. An IC may apply to the FWC for an order to be made that will set aside an unfair contractual term/s. The FWC may take into account the following when determining whether or not to set aside a contractual term:

• The bargaining power of each party;
• Whether the IC contract demonstrates a clear power imbalance between the parties;
• Whether the term is reasonably necessary to protect the interests of a party;
• Whether the term imposes a ‘harsh, unjust, or unreasonable requirement’ on a party; and
• The comparative remuneration of that of the IC and that of a regulated woker or an employee who engages in similar work. 

We stress the importance of remaining vigilant when it comes to compliance with employment laws, and urge you to seek legal advice if you are uncertain of your obligations.The costs of mitigating risks of non-compliance with the Fair Work Act, awards and other pieces of legislation can be invaluable for businesses in terms of time, money and stress. 

If you have any concerns or queries about how this new legislation may impact you either as an employer, employee, or independent contractor, please contact Robert Lamb or John Davies on (07) 3220 1144.