Victoria delays hybrid work mandate as employers seek changes

Victoria has delayed its proposed right-to-work-from-home law by almost a year following strong opposition from business groups.

The legislation was due to take effect on September 1. Media reports said Premier Ben Carroll has pushed the start date to July 1, 2027, to allow more time for consultation and possible amendments.

The proposed law would give eligible employees the right to work from home for two days a week.

Government seeks more time

Carroll said he remains committed to flexible work. But he said the policy must also work for businesses.

“I want to be very clear – I support work from home, I support flexible work. It is good for working families,” Carroll told reporters in Melbourne on Tuesday.

“Equally though, we need to make sure that our economy, everyone, knows it’s a partnership between working families and the business community and the government.”

Carroll said he would continue discussions with business groups.

He also said the legislation would pass before the November state election.

“I've spoken with Sally Curtain this morning, and Tim Piper, and I've informed them that work-from-home will not proceed on the 1st of September,” he said.

“It will proceed on the 1st of July, 2027.”

Business groups call for law to be scrapped

The Victorian Chamber of Commerce and Industry has strongly opposed the proposed rules.

The group has warned of higher costs, added compliance and potential damage to hiring and investment.

Chamber chief executive Sally Curtain welcomed the delay. But she said the legislation should be abandoned.

“The Victorian Chamber maintains that the Bill must be scrapped, as it is completely unnecessary, costly and burdensome for Victorian businesses,” Curtain said.

“The premier has been in touch with us directly and has indicated he is willing to meet with us. We hope to persuade him to abandon this destructive course.”

The Council of Small Business Organisations Australia has also warned that the rules could create additional compliance costs for small businesses.

Business Council of Australia chief executive Bran Black said the delay showed the government was listening to employers.

But he also called for the legislation to be scrapped.

“Already, Victoria has the highest unemployment rate in the country and the Victorian economy cannot afford another policy that drives investment and jobs away, which only hurts Victorians through lower living standards,” Black said.

Opposition backs changes

Victoria's opposition supports work-from-home arrangements but wants changes to the proposed law.

Shadow Attorney-General James Newbury said the original timeline was too short.

“Rolling out a change of this nature within three weeks across an entire economy is difficult,” he said.

“I think it's only reasonable that there's some understandable delay.”

The opposition has proposed a transition period.

It also wants to remove provisions allowing unions to enter the homes of people working remotely.

Greens accuse government of giving in

The Greens have criticised the delay.

Greens leader Ellen Sandell said the government had prioritised business concerns over workers.

“Workers were weeks away from finally getting these hard-earned rights. Then the corporate lobby came knocking and the new Labor premier rolled over,” Sandell said.

“Women, carers and disabled people might now be forced back into commuting full-time for at least another 10 months because the new premier has decided keeping big business happy matters more than making working people's lives easier.”

Melbourne's return-to-office challenge

The decision comes as Melbourne continues to grapple with low office attendance.

The city endured some of the world's longest Covid-19 lockdowns. Many workers have since adopted hybrid working arrangements.

Melbourne also has the highest office vacancy rate among Australian capital cities.

The city is home to major employers including BHP Group, Rio Tinto Group, National Australia Bank and ANZ Group.

Victoria also has the highest debt burden of any Australian state, according to S&P Global Ratings.

The state's economic outlook is expected to remain a key issue ahead of the November election.

New start date set for 2027

The proposed law would create a formal right for eligible workers to work from home two days a week.

The government now plans to introduce it on July 1, 2027.

The delay gives the government more time to consult employers and consider amendments before the new start date.