The Commonwealth Government passed the Fair Work Legislation Amendment (Closing Loopholes) Act 2023 (Cth) (a reduced version of the bill originally presented to Parliament) on 7 December 2023.
This Act introduced some changes to the Fair Work Act 2009 (Cth) from 14 December 2023. Further changes will come into effect over the next 12 months.
Changes from 14 December 2023
The exemption from paying redundancy pay for certain small business employers – Under the Fair Work Act, small business employers are exempt from the requirement that an employer must provide redundancy pay for full and part time employees who had accrued 12 months continuous service with the employer on the date of termination. (A small business employer is an employer who has 15 or fewer permanent and regular casual employees).
Under the changes from 14 December 2023, the exemption is no longer available for small businesses employers in liquidation where:
- the liquidation is a result of the employer being bankrupt or insolvent, and
- the employer is a small business employer because it has terminated one or more employees:
- due to the bankruptcy or insolvency of the employer, or
- in the 6 months before the employer became bankrupt or went into liquidation, or
- in the 6 months before an insolvency practitioner was appointed, where that insolvency practitioner’s appointment was in effect the business day prior to the employer becoming bankrupt or insolvent. If more than one insolvency practitioner had been appointed and there is less than one business day between the appointment of one insolvency practitioner ending, and the next insolvency practitioner’s appointment.
‘Same job, same pay’ for labour hire workers – the Fair Work Commission can now make orders requiring labour hire workers be paid no less than the minimum they would receive if they were employed directly by the host organisation in the following circumstances:
- the engagement is for a period longer than three months
- there is a enterprise agreement or equivalent that applies to the host organisation, and
- the host organisation is not a small business employer
To make an order the Fair Work Commission must be satisfied that:
- the arrangement between the labour hire provider and the host organisation is one of supply of labour, not a contract for services, and
- it is fair and reasonable to do so in the circumstances
An application for a ‘same job, same pay’ order may be made to the Fair Work Commission by a labour hire worker, an employee of the host organisation, a union representing the worker or host organisation employee, or the host organisation itself.
Workplace delegate’s rights – a definition of ‘workplace delegate’ has been introduced and workplace delegates have been granted certain rights.
A workplace delegate is a person appointed or elected to be a delegate or representative for the members of an employee organisation employed in a workplace.
Workplace delegates have been granted rights:
- to represent the industrial interests of members, or employees entitled to be members of the employee organisation in disputes with the employer
- to reasonably communicate with those persons in relation to their industrial interests
- to access to the workplace and workplace facilities for the purpose of representing those interests, and
- to reasonable access to paid time during normal working hours to attend related training unless the employer is a small business employer.
Modern awards will be required to include a term regulating the exercise of workplace delegate rights.
Enterprise agreements may include such a term that is more favourable than the applicable modern award. If an enterprise agreement doesn’t include such a term, the term from the applicable modern award will apply.
Protected from discrimination for people subject to family and domestic violence – being subject to family and domestic violence has become a protected attribute under the Fair Work Act. Employees and prospective employees are now protected from adverse action based on this attribute.
Union representatives right to enter the workplace – where a health and safety representative requests the assistance of a union official, that official may enter the workplace to provide that assistance without the requirement to hold or comply with the conditions and production requirements of an entry permit issued by the Fair Work Commission.
Employers may not refuse or delay entry to the workplace by the union official where assistance has been requested.
Protected action ballots, conciliation conferences and protected employee claim actions – where employee bargaining representatives have applied to the Fair Work Commission for a protection action ballot order (PABO), only those employee bargaining representatives making the application are now required to attend the compulsory conciliation conference for any employee claim action to remain protected.
Increased penalties for certain offences under the Work Health and Safety Act – offences for penalties under the Commonwealth Work Health and Safety Act have been increased.
Changes coming into effect in the next 12 months
Introduction of industrial manslaughter to the Commonwealth Work Health and Safety Act – From 1 July 2024 industrial manslaughter will be an offence under the Commonwealth Work Health and Safety Act, making it an offence in all states and territories except New South Wales and Tasmania.
Criminalisation of wage theft – wage theft, where an employer intentionally fails to pay a required amount to an employee where the amount is payable under the Fair Work Act, a fair work instrument (inclusive of modern awards and enterprise agreements) or transitional instruments, will be criminalised under the Fair Work Act. A blanket exemption of superannuation underpayments from wage theft laws will not apply in most cases.
Where an organisation self-reports what may amount to a wage theft offence, the organisation may enter into a cooperation agreement with the Fair Work Ombudsman. Self-reporting will provide a safe harbour for the employer preventing future prosecution.
Small business employers may also escape prosecution by complying with a Voluntary Small Business Wage Compliance Code (the Code) declared by the Minister. The Code is intended to be developed by the Fair Work Ombudsman with employee and employer organisations.
The criminalisation of wage theft provisions will come into effect the date when the Code is declared or 1 January 2025, whichever is earlier.
Penalties for wage theft could attract up to 10 years imprisonment and a fine of up to $1.5 million for individuals. For incorporated organisations, the penalty will be a fine of the of up to $7.8 million or three times the underpayment amount where that would be more than $7.8 million.
For more information about these changes, see the Fair Work Commission’s webpage Closing Loopholes Act – what’s changing.
Are there more changes to come?
Proposed changes dropped from the original ‘closing loopholes bill include changes to the pathway from casual to permanent employment, consideration of the meaning of ‘employee’ and ‘employer’ to assist in determining employment status, and the introduction of fair minimum standards for ‘employee-like’ workers, including those working in the gig economy.
These matters will be debated under a separate bill this year.
The content on this webpage was last updated in January 2024 and is not legal advice. See full disclaimer and copyright notice.
