What are the changes to workplace laws? Greater protection for workers' rights
Employers, employees, and independent contractors need to be aware of, and prepared for, several significant legislative and regulatory changes promoting and establishing greater protections for workers' rights, which came into effect on 24 August 2024.
Some of the changes include:
- A new definition of 'employment' to determine whether an individual is an employee or an independent contractor.
- A new definition of 'casual employee'.
- Changes to pathways from casual to permanent employment.
- New frameworks and minimum standards for 'gig economy' workers.
- Changes to the sham contracting defence - moving from a test of recklessness to one of reasonableness.
- A new 'unfair contracts' dispute resolution process under the Fair Work Commission for contractors.
- A new right to disconnect.
- Entitlement to protected rates of pay for labour hire employees.
What is employment?
From 26 August 2024, to determine if a worker is an employee or contractor, consider:
- "The real substance, practical reality, and nature of the working relationship"1; and
- All aspects of the working relationship between the parties.
This new definition shifts the focus from the wording of the contract to the actual employment practice, considering all elements of the employment relationship.
Any existing casual employees (employed prior to 26 August 2024) will remain casual unless they become permanent through casual conversion, by their own choice (discussed below), or by accepting an alternative employment offer.
"Real substance, practical reality, and true nature of the employment relationship"1
Some of the factors that will aid the Court in determining the "real substance, practical reality, and true nature" when assessing whether an employee is casual include, among other criteria:
- The employer's ability to choose to offer work and the employee's ability to accept or reject an offer.
- The regularity of the employee's pattern of work.
- Whether the permanent employees engage in the same work as the casual employee.
The new 'Employee Choice' pathway - changes to casual conversion
From 26 August 2024, new and existing casual employees will have access to a new avenue to move from casual to permanent employment, called the 'employee choice' pathway.
Under this pathway, an employee who wishes to change to permanent employment may notify their employer in writing of their intention to do so if:
- They have been employed for at least 6 months (12 months for small businesses); and
- They believe they no longer meet the requirements of the new casual employee definition (discussed above).
The employer must accept or refuse the notification in writing within 21 days, following a consultation with the employee.
Employers are only entitled to refuse the change under circumstances such as if the employee still meets the definition of a casual, or if there are 'fair and reasonable operational grounds' for refusing the change.
New minimum standards for 'regulated workers'
From 26 August 2024, new laws will grant regulated workers new entitlements related to:
- Accessing collective bargaining and agreements.
- Minimum standards orders (binding) and guidelines (non-binding) set by the Fair Work Commission.
- Protection against unfair deactivation of accounts on digital labour platforms or termination of contracts.
These entitlements provide greater protections to regulated workers, bringing their rights closer to those afforded to employees, particularly regarding unfair dismissal provisions and entitlements.
From 26 August 2024, regulated workers, also referred to as 'gig economy workers', will include:
- Employee-like workers (certain independent contractors who perform work in the gig economy and meet the new definition); and
- Road transport industry contractors (certain road transport workers who met the new definition) who, with a 'constitutional connection':
- Are a party to a service contract (individually or as a member of a body corporate, trust, or partnership);
- Perform all or a significant majority of work under the contract; and
- Do not perform any work under the contract as an employee.
Right to Disconnect
From 26 August 2024, all employees (of non-small business employers) covered by general protection laws will have the right to refuse contact from their employer or a third party outside of their working hours, unless it is unreasonable to do so.
Whether such contact is unreasonable will be determined by considering factors such as the reason for the contact, the employee's level of responsibility, and whether the employee is effectively compensated for their availability.
Employers should ensure they facilitate discussions with their employees about expectations and the terms related to the need for availability after hours, if applicable.
Maddens Lawyers are experienced in employment law
Navigating the recent changes to workplace laws may seem daunting however it is essential you understand them to ensure you are fully compliant. At Maddens Lawyers, our experienced employment team is here to help you understand the changes and how they may impact you or your business.
Whether you're an employer, employee, or contractor, we are ready to assist. Contact us today on 1800 815 228 or request a call back.
Written by Tatiana Haas, Lawyer at Maddens Lawyers
1 Fair Work Ombudsman (2024) Know the new workplace laws, FWO urges Available at: https://www.fairwork.gov.au/newsroom/media-releases/2024-media-releases/march-2024/20240305-closing-loopholes-2-media-release
