Fair Work Legislation Amendment (Closing Loopholes) Legislation

On September 4, 2023, the Australian Government introduced the Fair Work Legislation Amendment (Closing Loopholes) Bill 2023 (Closing Loopholes Bill). The Closing Loopholes Bill, incorporating a range of amendments, was passed by the House of Representatives on 29 November and was introduced to the Senate on 4 December 2023.

On 7 December, agreement was reached in the Senate enabling elements of the Bill to be passed by the Parliament. This included contentious elements relating to wage theft, closing the labour hire loophole and worker delegates’ rights.

As a consequence, the Closing Loopholes Bill was split in two. The elements of the Bill that the Senate agreed to were retained in a pared down version of the Closing Loopholes Bill which was passed by the Parliament on 7 December 2023 and received Royal Assent on 14 December 2023.   

A range of other major amendments were contained in the Fair Work Legislation Amendment (Closing Loopholes No.2) Act 2023, which was passed by the Parliament on 12 February 2024, and received Royal Assent on 26 February, 2024.

Further information about the Fair Work Legislation Amendment (Closing Loopholes) Act 2023 (Closing Loopholes Act) and the Fair Work Legislation Amendment (Closing Loopholes No.2) Act 2024 (Closing Loopholes No. 2 Act) can be found below. 

Fair Work Legislation Amendment (Closing Loopholes) Act 2023

The Closing Loopholes Act introduces major changes to the Fair Work Act 2009 (FW Act) and other laws, including:

• the ‘closing the labour hire loophole’ provisions that create potential obligations for both labour hire employers and ‘hosts’ that rely on their services;
• changes to give employee union delegates new rights to represent the interests of union members (and potential members); to reasonably communicate with employees and access workplace facilities; and to access paid time to participate in related training;
• criminalising intentional underpayments of employee entitlements;
• strengthening protections for employees subject to family and domestic violence by preventing adverse action against them;
• removing the requirement that a union official must hold a Fair Work entry permit to be able to enter and assist a health and safety representative in their workplace; and
• liming the application of the small business redundancy businesses in limited circumstances (essentially involving insolvency).

For Summaries of the changes introduced by the Closing Loopholes Act please refer to our dedicated page on the HR Resource Centre.

Closing Loopholes Act - Operative dates of major changes

The following list provides the commencement dates for the various changes introduced by the Closing Loopholes Act:

• 15 December 2023

  • Small business redundancy exemption provisions commence
  • Regulated labour hire arrangement jurisdiction commences
  • Workplace delegates’ rights provisions commence
  • Protections for those subject to family and domestic violence commence
  • Amendments to compulsory conciliation conferences in protected action ballot order matters commence

• 1 July 2024

  • Determinations varying modern awards to include a delegates’ rights term come into operation
  • Delegates’ rights term must be included in a workplace determination made on or after 1 July 2024
  • Delegates’ rights term must be included in an enterprise agreement approved by vote on or after 1 July 2024

• 1 November 2024

  • Regulated labour hire arrangement orders can commence operation

• 1 January 2025

  • Wage theft provisions apply*

*The later of 1 January 2025; and the day after the Minister declares a Voluntary Small Business Wage Compliance Code

For a downloadable list of the commencement dates please see: Closing Loopholes Act Operative Dates.

Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024

The balance of the measures previously proposed as part of the Closing Loopholes Act and now contained in a separate statute, the Closing Loopholes No. 2 Act. The No. 2 Act includes amendments dealing with more complex and controversial measures related to:

• a ‘right to disconnect’ that allows employees to refuse to monitor work communications outside of their working hours if the refusal is reasonable;
• the definition of casual employment and conversion from casual to permanent employment;
• the establishment of a new unfair contracts jurisdiction in the Fair Work Commission (FWC) to be accessible to certain independent contractors;
• changes to the meaning of employee and employer under the FWC, that will impact who is an employee rather than a contractor under the FW Act;
• major changes empowering the FWC to regulate the engagement of ‘employee like workers’, which will include certain contractors engaged in the ‘gig economy’;
• changes to enable the FWC to regulate the engagement of certain contractors in the road transport industry and arrangements in the supply chain more broadly;
• the FWC having the power to vary ‘model terms’ for enterprise agreements concerning flexibility, consultation and dispute resolution in relation;
• intractable bargaining workplace determinations;
• a revised 'reasonable belief' defence for sham independent contractor arrangements.;
• union right of entry without notice in connection with suspected underpayments; and
• significantly increasing maximum penalty amounts for underpayment contraventions.

For Summaries of the changes introduced by the Closing Loopholes Act please refer to our dedicated page on the HR Resource Centre.

Closing Loopholes No.2 Act – Operative dates of major changes

The Closing Loopholes No. 2 Bill. has not yet received Royal Assent. Ai Group will advise members further of operative dates once Royal Assent has been received. The following list provides the commencement dates for the various changes introduced by the Closing Loopholes Bill No. 2:

• 27 February 2024

  • Opt-out notices for independent contractors relating to the statutory meaning of 'employee' and 'employer'
    (Note: ceases when the meaning of 'employee' and 'employer' commences – see below)
  • Bargaining for franchisees
  • Transitioning out of multi-enterprise agreements
  • Changes to intractable bargaining workplace determinations
  • Changes to civil remedy provisions and lowering of serious contravention threshold
  • Defence to sham contracting narrowed (employment)
  • Underpayment contraventions (penalties and serious contravention threshold)
  • Compliance notices
  • De-merger provisions for registered unions
  • Transitional provisions and technical amendments

• 1 July 2024

  • Exemption certificates for entry for underpayments

• 26 August 2024

  • Right to disconnect (except for small business employers)
  • Changes to casual employment (definition, employee choice, anti-avoidance and small claims proceedings)

• The date on which a proclamation is issued or 26 August 2024, whichever is earlier

  • Meaning of ‘employee’ and ‘employer’ under the FW Act
  • Workplace delegates’ rights for regulated workers
  • Regulated workers (employee-like and road transport)
  • Unfair contract terms

• The date on which a proclamation is issued or 26 February 2025, whichever is earlier

  • Model terms 

• 26 August 2025

  • Right to disconnect for small business employers

Ai Group submissions

Ai Group continues to be heavily engaged in consultation with the Government over the development of its proposed legislation. 

Although most of this consultation has been required by Government to be undertaken on a confidential basis, we are able to share the following submissions that we have provided to the Department of Employment and Workplace Relations in relation to the third tranche of reforms to Fair Work legislation:

• Inquiry into the Fair Work Legislation Amendment (Closing Loopholes) Bill 2023
• DEWR: April consultation on WR measures being considered for introduction in the second half of 2023
• Updating the Fair Work Act 2009 to provide stronger protections for workers against discrimination
• Response to 'Same Job, Same Pay' consultation paper
• National Labour Hire Regulation
• Response to Criminalising wage underpayments and reforming civil penalties Consultation paper
• Submissions to DEWR: Employee-like work, road transport and protections for contractors

Media releases and speeches

The latest media information and speeches regarding the third tranche of reforms to the Fair Work laws:

• Latest IR changes create less productive and more rigid and complex workplaces
• Opinion: Intractable bargaining changes a one-way street to inflexibility
• Pushing 'right to disconnect' through parliament a recipe for disaster
• Senate report a valuable contribution that highlights shortcomings of IR bill
• Radical delegates' rights in "Closing Loopholes" Bill an early Christmas present for unions
• Deep flaws remain in "Closing Loopholes" Bill
• A myriad of deficiencies remain after hurriedly crafted IR amendments
• Industry support for split 'Loopholes' Bill
• Opening Statement: Senate Inquiry into the Fair Work Amendment (Closing Loopholes) Bill 2023
• Senate IR Bill inquiry a welcome move to allow for proper scrutiny
• Parliament should reject deeply flawed IR Bill
• Nothing in IR changes to create jobs, increase wages or boost productivity
• Innes Willox: Comment on proposed third tranche of workplace relations legislation
• Closing the “Casual Loophole”: A Solution in Search of a Problem
• Industrial Relations ‘Reform’ – the risks of unjustified changes and the need for a better approach
• Innes Willox address to National Press Club: Industrial Relations 'Reform' – the risks of unjustified changes and the need for a better approach
• Opinion: Restricting casual employment opportunities would be economically dangerous
• Protecting worker entitlements legislation leaves employers playing catch-up amid waves of IR reform
• Innes Willox speech: The Government’s Industrial Relations Agenda
• Ai Group opposes criminal penalties for the underpayment of wages
• IR Changes – Wrong measures for the wrong times

Members who wish to discuss the Government’s reform agenda, should contact Brent Ferguson, Ai Group’s Head of National Workplace Relations Policy.