Closing the Loopholes 2 Legislation: Key Dates and Information
With the passage of the Fair Work Legislation Amendment (Closing Loopholes No. 2) last year, there are many upcoming changes to employment and workplace relations to be aware of over the coming months.
Here at Akyra, we speak with many businesses who are confused, worried or simply don’t know the dates and details that might impact on the way they engage their workforce. In order to ensure you are able to understand when these changes come into effect and what they might mean for your business, we have compiled this helpful timeline of important dates and information.
The table below provides key dates and a brief explanation of what will be required in relation to this Closing the Loopholes 2 legislation.
As can be seen below, August 2024 in particular is a very busy month with many of the changes to take effect in that month!
Closing the Loopholes 2: Timeline
|
Date |
Legislation | Details |
|
1 July 2024 |
Right of entry to investigate wage underpayments |
Union officials will have a right of entry to workplaces to investigate contraventions subject to holding a permit and meeting other requirements. Where they once needed 24 hours’ notice before being able to enter a premises to investigate wage underpayments, entry permit-holders will be able to apply for an exemption certificate where the FWC is satisfied advance notice of entry may compromise the investigation. ———————————————————– |
| 27 February 2024 | Sham contracting defence changes |
Sham contracting is misrepresenting employment as an independent contractor. The test for sham contracting is now if the employer reasonably believed it was an independent contractor arrangement. There are increased civil penalties for sham contracting. ———————————————————– |
|
26 August 2024 26 August 2025 (small business code) |
Right to disconnect |
Employees will have the right to disconnect and reasonably refuse to respond to contact (attempted contact) from their employer (or third-party) outside their ordinary work hours. There are some exemptions to this. Assessment of unreasonable refusal will be based on reason for the contact, the level of disruption the contact may cause, the employee’s role, whether the employee’s salary compensates for out-of-hours contact and the employee’s individual personal circumstances. The Fair Work Commission (FWC) will have the power to resolve disputes and make stop orders against either an employer making unreasonable contact or an employee unreasonably refusing contact. This does not mean employers cannot contact their employees out of the ordinary hours for that business. It is more about employees not being disciplined if they reasonably refuse to connect outside their ordinary working hours; particularly if they are not expected / paid to be available to connection from the employer. ———————————————————– |
| 26 August 2024 | Minimum standards for ‘employee-like’ workers |
The FWC will have the power to set minimum standards for ‘employee-like workers’ who are engaged to work via a digital platform – e.g. gig economy workers. The amendment also provides for consent-based collective agreements frameworks and access to dispute resolution for unfair deactivation from a digital labour platform. The FWC might set minimum standards that include payment terms, deductions, record-keeping, cost recovery and insurance. Terms will not be set where it is inappropriate for the work undertaken by digital platform workers – e.g. penalty rates, payments for time between jobs and minimum periods of engagement. ———————————————————– |
| 26 August 2024 | Definition of a ‘casual employee’ and casual conversion rights |
Employees will be defined as a casual if the employment relationship is characterised by an absence of a firm advance commitment to continuing and indefinite work AND the employee is entitled to either a casual loading or a specific rate of pay. In addition, casual employees will be able to request conversion to permanent employment after 6 months with an employer where there are consistent rostered hours. Casual employees engaged by businesses who fall under the Small Business Code will be able to request permanent conversion after 12 months. Casual employees will not be mandated to request permanent employment where that engagement meets the criteria – it will be at the employee’s request. ———————————————————– |
| 26 August 2024 | Definition of ‘employee’ and ‘employer’ |
Amendments will be made to the definitions of ‘employee’ and ‘employer’ to include an interpretive principle to assess the real substance, practical reality and true nature and totality of the relationship between the parties. Employees will be able to opt out of being employees through a notification process if they earn more than the contractor high-income threshold. This is a return to the multi-factor assessment previously used by the courts when deciding whether an employment relationship exists. ———————————————————– |
| 26 August 2024 (or earlier by proclamation) | Disputes between contractors and principal about unfair contract terms |
A new flexible, low-cost and informal jurisdiction will be established in the FWC to resolve disputes about unfair contract terms between contractors (below high-income threshold) and principals. Subject to the high-income threshold, contractors will be able to challenge unfair terms in a services contract by applying to the FWC. The contract term in dispute must be akin to a dispute of a contract term in a contract of employment. If the contract term is found to be unfair, the FWC will be able to set aside all or part of the contract and change the terms of the contract. ———————————————————– |
| 1 January 2025 | Increased civil penalties |
There will be an increase in the maximum civil penalties that courts may impose for certain contraventions. These penalties can apply against companies but not where the business falls under the Small Business Code. There will also be an increase in the maximum civil penalty a court can order for failing to comply with a compliance notice. Additionally, a new threshold will be introduced for what constitutes a serious contravention. Penalties for underpayment will commence the later of 1 January 2025 or the day after the Voluntary Small Business Wage Compliance Code is declared. ———————————————————– |
Key Takeaways
- With last year’s passage of the Fair Work Legislation Amendment (Closing Loopholes No. 2), there are a number of employment and workplace relations reforms coming into effect between July 2024 and January 2025.
- These changes range from the definition of key terms such as “employer”, “employee” and “casual employee” to union officials being granted right of entry to investigate wage underpayments.
- Considering the wide-ranging nature of these changes, it is critical for employers to have a thorough understanding of the legislation, including when these changes are coming into effect, and what they mean for businesses.
- Many of these changes will come into effect throughout the month of August, so be prepared – and don’t get caught out!
- Our handy timeline provides an overview of key dates and information to get you on the right track.
Akyra can assist with your questions and concerns regarding employment and workplace legislation and reforms. Contact us today for an obligation-free consultation.
Disclaimer – Reliance on Content
The material distributed is general information only. The information supplied is not intended to be legal or other professional advice, nor should it be relied upon as such. You should seek legal or professional advice in relation to your specific situation.
