Federal Government’s Workplace Law Changes to Increase Claims: Key Amendments Revealed
On 4 September 2023, the Federal Government introduced its long-awaited third tranche of workplace law changes to Federal Parliament. The Fair Work Legislation Amendment (Closing Loopholes) Bill 2023 aims to make significant amendments to the Fair Work Act 2009 (Cth) (FW Act), which could potentially lead to an increase in claims for employers and employment practices liability/management liability insurers.
Here are the key changes proposed in the bill:
Casual employment: The bill seeks to provide a clearer definition of casual employment and establish a new pathway for casual employees to transition to permanent roles after six months of service. This definition draws from the elements of casual employment commonly used prior to the High Court’s decision in WorkPac Pty Ltd v Rossato [2021] HCA 23.
Wage theft: The bill proposes stricter criminal penalties for intentional underpayments and introduces a new criminal offense of wage theft. The Minister for Workplace Relations argues that if it is a crime for workers to steal from the till, it should also be a crime for employers to steal from their workers.
Labour hire: The bill grants the Fair Work Commission the power to make orders ensuring that labor hire workers receive the same pay as employees covered by an employer’s enterprise agreement. Proposed exceptions apply to short-term engagements and training arrangements.
Gig economy: If the bill is passed, road transport workers and digital labor platform workers (gig economy workers) will be entitled to extensive minimum standards and protection from unfair termination or ‘unfair deactivation.’ They would have the option to resolve disputes through the Fair Work Commission and seek relief from unfair contract terms.
Statutory definition of ’employee’: The bill introduces for the first time in Australia a statutory definition of ’employee’ and ’employment,’ although it only applies to parts of the FW Act. This change requires courts and tribunals to consider the entire employment relationship when determining whether a person is an employee or an independent contractor.
Protection from discrimination based on family and domestic violence: The bill adds ‘subjection to family and domestic violence’ to the list of attributes protected from discrimination under the FW Act. However, it does not apply to perpetrators who are not subject to family and domestic violence themselves.
It is anticipated that the bill will pass in a substantially similar form by the end of the year, with most changes taking effect in early to mid-2024. Employers should take proactive steps and seek advice to prepare for these proposed changes, while insurers should assess their existing policy wordings to ensure coverage for termination claims and disputes involving gig economy workers and transport sector contractors.
In conclusion, the Federal Government’s workplace law changes aim to address various issues pertaining to casual employment, wage theft, labor hire, the gig economy, and discrimination based on family and domestic violence. Employers and insurers will need to adapt to these amendments and carefully consider their implications. Stay tuned for more detailed analysis of the bill and its potential effects on employers and insurers.
