Closing the loophole … and potentially opening new ones?

In brief - On Monday, the Albanese Labour Government introduced into the House of Representatives the Fair Work Legislation Amendment (Closing Loopholes) Bill 2023 (Bill), which has the potential to be one of the most dramatic shakeups of the industrial relations landscape in Australia since the introduction of the Fair Work Act 2009 (Cth) (Act). Looking beyond the spin in the Bill's title, the Bill's proposed changes seek to fulfill the Labour Government's commitment to eliminating uncertain work and ensuring that workers are protected from alleged worker exploitation.

Over the coming weeks, we will be detailing specifically how these changes will affect you and your business, but in this first instalment, we provide an overview of the changes proposed.

What are the proposed changes in the Bill?

 As foreshadowed by the Industrial Relations Minister, the Bill seeks to introduce the following:

1. Redefining casual employment by:

   • increasing the rights of casual employees to request casual conversion

   • increasing the burden on employers to be in a position to prove (on an ongoing basis) that an individual is a casual

   • creating an offence under the Act of misrepresentation if an employee is found to have been deemed not a casual employee at law.

2. A statutory requirement for insolvency practitioners to now account for redundancy entitlements as a part of employee entitlements that are payable as a priority along with other entitlements.

3. Enabling enterprise agreement making for franchise operations;

4. Giving powers to the Fair Work Commission on application by an individual or Union to regulate labour hire arrangements in workplaces by:

   • Making an order requiring a business to pay a labour hire worker the same pay for the same role that is performed by a business' direct employee

   • Imposing new disclosure obligations on businesses using labour hire workers;

   • Anti-avoidance measures to deter individuals from entering into arrangements to avoid the application of the new provisions

   • Anti-avoidance measures to prevent a business from engaging an independent contractor to replace a labour hire worker who would otherwise be covered by this scheme.

5. Increased workplace rights of entry of Unions including:

   • Codification of a workplace delegate's rights in all industrial instruments.

   • Increased protections for workplace delegates where an employer or business fails to deal with them (including placing the onus on the employer to show that it has not acted unreasonably).

6. Strengthening anti-discrimination protections to gender and intersex attributes, victims of family and domestic violence, and individuals who are breastfeeding.

7. Increased penalties for contravening the Act.

8. Insertion of a new Wage Theft regime that criminalises underpayment and nonpayment of employee entitlements under the Act.

9. Expanding the definition of employee and employer.

10. The creation of the Road Transport Industry Expert Panel to set minimum standards across the industry.

11. The creation of new regulations regarding 'gig workers' which:

    • Sets minimum standards and guidelines for any workers who are engaged in a services contract

    • Sets minimum standards for 'digital labour platform' operators and workers

    • Incorporating an unfair contract terms regime into the terms of service between business and worker

    • Creating a termination regime for regulated workers

    • Introduction of collective agreements for regulated workers.

12. Criminalisation of conduct by authorised persons and boards of directors for contraventions of the Work Health and Safety Act 2011 (Cth), particularly in circumstances where a corporate culture exists that may have directed, encouraged, tolerated, or led to the conduct constituting an offence.

What do these changes mean for you?

 Whilst the Bill is only in its infancy and is yet to pass the House of Representatives and Senate, these proposed changes, if passed will:

• Increase the costs of employee people or engaging individuals (irrespective of the size of your business)

• Increase industrial conflict as unions are given greater access to workplaces.

Stay tuned as dive deeper into each of these changes in the coming weeks.