Employment Law Changes Commencing in August 2024 – Is Your Business Ready?
The Fair Work Legislation Amendment (Closing Loopholes) Act 2023 and the Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024 have already sparked significant changes in workplace laws since December 2023, with more changes to commence in July and August 2024. Employers should carefully review the new requirements to ensure their businesses comply.
Below is a summary of key changes that will take effect later this year:
1. Changes for Casual Employees
(a) New definition of who is a casual
From 26 August 2024, a new definition of “casual employee” will be introduced into the Fair Work Act 2009 (Cth).
Under the new definition, an employee will only be a casual employee if:
o There is no firm commitment to continuing and indefinite work; and
o They are entitled to received casual loading or a specific pay rate.
Whether an employee meets this definition will be assessed on the basis of the ‘real substance, practical reality and true nature’ of the employment rather than the written employment contract. The factors that will be taken into consideration include:
Whether there is an inability of the employer to elect to offer or not offer work or an inability of the employee to elect to accept or reject work;
If it is reasonably likely that there will be future availability of continuing work in the enterprise, given the nature of the business;
Whether there are full time or part time employees performing the same work;
Whether there is a regular pattern of work for the employee.
Employers should carefully consider whether employees they understand to be ‘casual’ employees will continue to meet this definition.
(b) Employee choice to become a permanent employee
Casual employees will also have access to the ‘Employee Choice’ pathway of casual conversion. Employees who have worked at least six months (or 12 months in a small business) will be entitled to give their employer written notice that they no longer meet the definition of being a casual employee. Where notice is received, an employer must consult with an employee and within 21 days indicate whether they accept the notification (in which case the employee will become a permanent full or part time employee) or they refuse the notification on one of the reasons set out in the Act.
(c) Provision of Casual Employee Information Statement
Finally, the previous obligation to provide casual employees with the Casual Employment Information Statement (CEIS) when an employee commences employment has been expanded to require the CEIS is again provided 6 months after the employee commences employment (12 months for small business), and every 12 months thereafter.
(d) Anti avoidance provisions
Further protections will make it unlawful for an employer to knowingly make false representations in relation to casual employment or to dismiss or threaten to dismiss an employee to engage them as a casual to perform the same or substantially the same work.
2. Employees’ Right to Disconnect
From 26 August 2024, all Modern Awards will be required to include a ‘right to disconnect’ term which provides employees a right to refuse contact outside their working hours unless the refusal is unreasonable.
Employees can, while disconnected, refuse to monitor emails, read emails or respond to emails.
Whether an employee’s refusal is unreasonable will involve a consideration of a number of factors including:
The reason for the contact;
Whether the employee is compensated for being available in the period when the contact is made or working additional hours outside their ordinary hours;
The nature of the employee’s role and level of responsibility; and
The employee’s personal circumstances such as family or caring responsibilities.
The right will become a protected right under the general protections framework, meaning employers cannot take adverse action against employees who exercise their right to disconnect.
For small business, this right will not come into force until 26 August 2025.
Employers should review their employment agreements, policies and procedures that provide how and when employees are to be contactable outside work hours to ensure they conform to the right to disconnect.
3. Gig Economy Workers – Regulated Road Transport and Digital Labour Platforms
New minimum standards and protections will be introduced for ‘employee-like workers’ in the gig economy and contractors in the road transport industry (regulated workers). The Fair Work Commission has the discretion to determine the terms and conditions it will set as standards. For example, standards could include terms about payment terms, or cost recovery. The precise protections have not yet been finalised.
4. Road Transport Industry Employees and Contractors
The FWC will be given specific powers to make binding road transport minimum standards orders and non-binding road transport guidelines for the regulation of employees within the road transport industry. Employers covered by orders will be obliged to comply with them.
The Commission will also have powers to deal with road transport contractors who earn less than the contracting high income threshold (which has not yet been set) including:
employee-like contractors will be able to seek reinstatement or up to 26 weeks compensation where their services contract has been unfairly terminated; and
new “unfair contracts” provisions will allow the FWC to set aside, amend or vary all or parts of a services contract where the terms are unfair.
The FWC will also establish an expert panel for the road transport industry, as well as a Road Transport Advisory Group. and will have the power to deal with unfair terminations of road transport contractor’s services.
5. Independent Contractors - Meaning of ‘Employee’ and ‘Employer’
A new test will be introduced to determine whether an individual is an ‘employee’ or ‘employer’. The test will focus on ‘the ordinary meaning of that expression’, will require reference to ‘the real substance, practical reality and true nature of the relationship between the individual and the person’ to ascertain ‘the real substance, practical reality and true nature of the relationship’ the totality of the relationship. This represents a move away from considering the terms of the employment engagement and will be very important for employers who engage independent contractors on a regular or ongoing basis.
6. Key Takeaway: Review Your Employment Contracts and Procedures
It is important to ensure that your contracts and any new employment agreements comply with these changes. Employers should consider undertaking a review of contracts which employ casual employees, independent contracting arrangements and undertake a review of their procedures to ensure they meet requirements such as the provision of a CEIS and recognising their employees’ right to disconnect.
If you have any questions or would like to discuss your employment agreements, please do not hesitate to reach out to us.
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