Employers urged to be aware of 'Closing Loopholes' employment reforms

'We want employers to get it right in the first place,' FWO says

Employers urged to be aware of 'Closing Loopholes' employment reforms

Fair Work Ombudsman Anna Booth is encouraging employers to be mindful of the changes from the new Closing Loopholes workplace laws that was passed late last year.

"We urge workplace participants to be across the changes which create new or different rights or responsibilities," Booth said in a media release.

According to Booth, jail time is among the significant penalties awaiting employers if they are found violating the law.

"But we want employers to get it right in the first place and are here to help with free information and advice to ensure they do," she said.

Closing Loopholes workplace laws

The first part of the Closing Loopholes Bill was passed in December despite strong opposition from employers across Australia.

Employment Minister Tony Burke said the passing comes after the government secured the support of Senate crossbenchers Jacqui Lambie and David Pocock. Among the changes introduced in the legislation include:

  • Stop companies underpaying workers through the use of labour hire
  • Criminalise intentional wage theft
  • Introduce a new criminal offence of industrial manslaughter
  • Better support first responders with PTSD
  • Better protect workers subjected to family and domestic violence from discrimination at work
  • Expand the functions of the Asbestos Safety and Eradication Agency to include silica
  • And close the loophole in which large businesses claim small business exemptions during insolvency to avoid redundancy payments

"I want to thank Senators David Pocock and Jacqui Lambie for their constructive engagement during this process. I look forward to continuing to talk with them about next year's legislation," Burke said in a statement.

The second part of the bill, called the Fair Work Legislation Amendment (Closing Loopholes No. 2), remains before Parliament.

Changes to legislation

The Fair Work Ombudsman said most of the changes under the new legislation has begun on December 15, 2023, while others are expected to begin before 2025.

This change includes criminalising intentional wage underpayments, which is expected to be implemented before January 1, 2025.

Employers who are found breaching this law will face penalties three times the amount of underpayment, or a maximum penalty of $7.825 million, whichever is greater.

For individuals, they can be imprisoned for up to 10 years or be fined either three-times the underpaid amount, or up to $1.565 million.

"Employers should know – these laws don't apply to those who unintentionally underpay their employees or pay the wrong amount by mistake," Booth said.

Labour hire, discrimination protections

The law also introduces amendments on the labour hire system, allowing employees, unions, and host employers to apply to the Fair Work Commission for a regulated labour hire arrangement order.

The order, once in effect, will mandate employers to pay labour hire employees the same as employees directly employed by host employer, according to the Fair Work Ombudsman.

The law also advocates the greater protection for employees who are victims of family and domestic violence. Under the law, awards and enterprise agreements should not have terms that may discriminate an employee who has experience with family and domestic violence.

Both changes began taking effect since last December, according to the Fair Work Ombudsman.

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