The last time that Australia hosted the Olympics was in 2000 in Sydney. At that time, the Workplace Relations Act 1996 (Cth) was in place. That Act was repealed following the election of a Labor Government in 2007, after 11 years of a Liberal (conservative) government in Australia.  With the repeal of the Workplace Relations Act 1996 (Cth) came the introduction of the Fair Work Act (FW Act), which today remains the primary Commonwealth legislation regulating employment and workplace relations. Most provisions of the FW Act took effect on July 1, 2009.

The introduction of the FW Act was one of the most significant reforms to Australia’s employment laws in the country’s history and (among other things) saw the introduction of the statutory modern award system. The FW Act establishes a safety net comprising: the National Employment Standards (NES), modern awards and national minimum wage orders, and a compliance and enforcement regime.

A modern award (award) is a legal document that sets out the minimum terms and conditions of employment on top of the NES. Modern awards came into effect on January 1, 2010. Awards provide entitlements including pay, hours of work, rosters, breaks, allowances, penalty, rates, and overtime. Modern awards are industry- or occupation-based and apply to employers and employees who perform work covered by the award. There are more than 100 industry or occupation awards that cover most people who work in Australia. An employer can be covered by more than one award, depending on the jobs the employees do.

Since the introduction of the modern award system, there have been significant amendments to the industry and occupation awards that are in effect and apply to a significant number of Australian employers. However, in this Olympic year we are set to see yet another significant reform with the pending introduction of criminal penalties for modern award breaches. 

The Fair Work Legislation Amendment (Closing Loopholes) Act 2023 introduces a number of workplace changes, some of which have already taken effect as of late 2023 and during the first half of 2024. Further amendments will apply from August 2024 or in early 2025, including amendments addressing the following:

• rules for labor hire workers
• criminalizing intentional wage underpayments
• new discrimination protections
• small business redundancy exemptions
• workplace delegates’ rights
• right of entry
• compulsory conciliation conferences in protected action ballot matters
• casual employment
• right to disconnect
• definition of employment
• independent contractors
• sham contracting
• right of entry and exemption certificates
• civil penalties and compliance notices
• minimum standards for “employee-like” workers
• road transport industry
• enterprise bargaining and agreements
• registered organizations, etc.

One of the most noteworthy upcoming changes is the criminalizing of wage underpayments. This means intentional underpayment of wages by employers will become a criminal offence in certain circumstances. Employers will commit an offence if:

• they are required to pay an amount to an employee (e.g., wages), or on behalf of or for the benefit of an employee (e.g., superannuation) under the FW Act, or an industrial instrument (such as a modern award), and
• they intentionally engage in conduct that results in their failure to pay those amounts to or for the employee on or before the day they are due to be paid.

The wage theft offence will carry a maximum of 10 years’ imprisonment, and/or a maximum fine of the greater of:

• three times the amount of the underpayment, if the court can determine that amount, or
• for an individual: AUD $1.565 million (approximately USD $1.04 million); or for a company: AUD $7.825 million (approximately USD $5.21 million).

Another noteworthy change for employers to be aware of in this Olympic year is the new right to disconnect law, which is a mere two months away from implementation. The new law will provide eligible employees with the right to refuse employer or third-party contact (including attempted contact) outside of working hours unless that refusal is unreasonable. In determining whether an employee’s refusal is unreasonable, several factors will be considered, including but not limited to:

• the reason for the contact
• whether the employee is compensated for being available in the period when contact is made or attempted, or working additional hours outside their ordinary hours of work
• the nature of the employee’s role and level of responsibility
• the employee’s personal circumstances, including family or caring responsibilities, etc.

In the event of a dispute, if the employer and the employee are unable to resolve it after discussion, either party can go to the Fair Work Commission (the Australian national workplace relations tribunal) for dispute resolution.

All modern awards will include a right to disconnect term by August 26, 2024, adding specific rules to awards to ensure the new terms reflect the realities of the occupation and industry.

We recommend that employers act promptly to review their pay practices, policies, and employment agreements to comply with the new laws ahead of August.