The Fair Work Ombudsman is encouraging workplaces across Australia to be made aware and ensure compliance with the recent changes to workplace laws, or risk facing the new significantly higher penalties.
The reminder comes as the second set of ‘Closing Loopholes’ changes have now received Royal Assent after passing the Parliament in February, and follow the Australian Government’s first ‘Closing Loopholes’ changes which passed the Parliament in December.
The changes in the second Closing Loopholes laws take effect at various dates across this year and into next year, with many of the first tranche of changes already in effect.
Fair Work Ombudsman Anna Booth urged those across workplaces to educate themselves on the new laws, which cover gig work, casual employment and the right to disconnect among many other areas.
“Employers, employees and independent contractors need to understand the changes, which create new or changed responsibilities and rights in a range of areas,” Booth said. “The changes substantially increase the penalties which a court can order for non-compliance with a range of workplace laws, by up to five times for non-small business employers.”
One of the changes pertains to the definition of casual employment and employment, commencing on 26 August. With the changes, the employee is considered as casual only when:
- there isn’t a firm advance commitment to continuing and indefinite work, factoring in the real substance, practical reality and true nature of the employment relationship; and
- the employee is entitled to be paid a casual loading or a specific pay rate for casuals.
A new pathway will also replace the existing rules for eligible casual employees to change to permanent employment if they want to.
Another change that has already taken effect is the new maximum penalties that courts can impose for certain contraventions, applicable only to employers who aren’t individuals or small business employers.
These maximum penalties have increased by five times, to a total of $469,500 per contravention for a company. For serious contraventions, maximum penalties have also increased by five times to $4,695,000 for a company (previously $939,000).
Maximum civil penalties for non-compliance with a Compliance Notice also doubled for all employers of any size, to a total of $18,780 per contravention for an individual and $93,900 per contravention for a company.
In addition, from no earlier than 1 January 2025, penalties for underpayment-related contraventions by non-small businesses can be three times the amount of the underpayment if an applicant chooses this method.
The definition of a serious contravention has also been changed such that it is no longer required to prove a breach was done knowingly and systematically and reckless breaches can be considered as such.
Also from no later than 26 August, there will be a new framework for protecting the interests of certain workers in the gig economy. In particular, the Fair Work Commission will be able to set minimum standards for gig economy workers and deal with disputes on the unfair deactivation of a gig worker from a digital labour platform.
Unions that are registered organisations representing gig workers will also be able to make collective agreements with digital labour platform operators.
In addition, independent contractors who earn less than the contractor high-income threshold will be able to apply to the Commission if they think their services contract contains unfair terms. The contractor high income threshold is yet to be set.
Right to disconnect of employees is also strengthened as employees will have the right to refuse to monitor, read or respond to contact or attempted contact from an employer or third party outside of their working hours, (18 months for small-business employers and in six months for other employers beginning 26 August) unless their refusal is unreasonable. Whether a refusal is unreasonable will depend on factors including the reason for the contact, level of disruption, any compensation the employee receives to be available or work additional hours, and the employee’s role, responsibilities and circumstances.
“Employers must invest the time and resources to meet their new legal obligations,” Booth said. “We are here to help them get it right.”
