Fair Work Ombudsman launches guide on workplace and industrial reforms

The Fair Work Ombudsman (FWO) has published an easy-to-read guide to help raise awareness about upcoming industrial relations reforms.

Fair Work Ombudsman Anna Booth urged small businesses to educate themselves about recent and upcoming legal changes, particularly those coming as a result of the Closing Loopholes package, and the Secure Jobs, Better Pay legislation.

These include reforms related to gig work, casual employment, and the right to disconnect.

Expected changes in employment policies

Aside from changes in employment policies, the FWO also expects maximum civil penalties to increase. The office encourages businesses to find out whether or not they will be affected by new wage underpayment penalties.

"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.

"We offer free information and advice on the various changes to help all workplace participants."

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Substantial penalty increases for non-compliance

According to the FWO, the upcoming reforms will substantially increase the penalties that a court can order businesses for non-compliance with workplace laws. For non-small business employers, the penalty increase could be as much as five times higher than before.

Changes to casual employment and employment definitions

One of the biggest changes is how the industry defines a casual employee. Beginning 26 August, a worker will be considered casual if:

• There is no firm advance commitment to continuing and indefinite work, considering the real substance, practical reality and true nature of the employment.
• The worker is entitled to be paid a casual loading or a specific pay rate for casuals.

There will also be new rules on how eligible casual employees can transition to permanent employee status if they choose to.

Another expected change is the definitions of employee and employee according to the Fair Work Act. To determine whether there is an employment relationship between parties, the totality of the relationship needs to be considered. This includes real substance, practical reality, and the true nature of the working relationship.

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Changes to maximum civil penalties

Under the IR reforms, courts can now impose new maximum penalties on businesses for certain contraventions. However, this only applies to employers who are not individuals or small business employers. The new rule took effect in February.

Violators face maximum penalties that are five times higher than before. This translates to about $469,500 per contravention for offending companies.

For serious contraventions, businesses face maximum penalties of $4,695,000, which is five times higher compared to the previous $939,000 rate.

Individuals and small business employers are exempted from these higher maximum penalties. These businesses face maximum penalties of only $18,780 per contravention for an individual and $93,900 for a company.

Meanwhile, those who fail to comply with a Compliance Notice will face higher maximum civil penalties regardless of the size of their business. Violators will receive a total of $18,780 per contravention if they are an individual and $93,900 per contravention if they are a company.

Minimum standards for gig workers

Beginning 26 August, gig workers will have a new framework to help protect their interests. These workers tend to do their jobs via a digital labour platform and rarely have enough bargaining power at work. They often contend with lower pay compared to other workers and have little to no say in how they perform their jobs.

Under the IR reforms, the Fair Work Commission will be given the responsibility of setting minimum standards for the gig economy. The FWC will be able to make orders, establish guidelines, and preside over disputes related to gig workers.

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Changes related to the right to disconnect

The upcoming changes are also expected to affect the right-to-disconnect policy. Under the policy, employees will have the right to refuse to monitor, read, or respond to contact or attempted contact from their employer or third party outside of established working hours. However, this refusal must be deemed reasonable.

To determine whether a refusal is unreasonable, several factors must be considered. These include the employer’s reason for contact, level of disruption, any compensation given to the employee to be available or work additional hours, and the role, responsibilities, and circumstances of the employee.

The FWC will be responsible for presiding over disputes if the issue cannot be resolved at the workplace level.