The right to disconnect in Australia: What we know so far

At a glance

• The right to disconnect law will be effective from 26 August 2024 for many Australian businesses, and from 26 August 2025 for small businesses.
• The Fair Work Commission (FWC) is required to insert a right to disconnect term into all modern awards by 26 August 2024, and it’s currently reviewing the changes this will entail.
• The FWC will confirm changes to modern awards on 23 August 2024, but there’s no legislative deadline for the development of guidelines on the new right to disconnect.
• Employers should prepare for the introduction of the right to disconnect by reviewing employment contracts, updating or introducing policies regarding out-of-hours contact, updating recruitment policies and procedures, and conducting training. 

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For many Australian businesses, the right to disconnect will come into effect on 26 August 2024. For small businesses, the new laws will commence on 26 August 2025.

Following our initial overview of the right to disconnect introduced by the Closing Loopholes No. 2 Act 2024, this article takes a deeper dive into the implications of this new right.

Modern awards

In addition to the new Fair Work Act 2009 (FW Act) provisions, right to disconnect changes are also being made to modern awards. The FWC is required to insert a right to disconnect term into all modern awards by 26 August 2024. The FWC is also required to make written guidelines about how the right to disconnect will operate.

The FWC is currently undertaking a review in this regard, including reviewing submissions about what the changes will entail. As part of this review the FWC has identified several different aspects of modern awards which will be impacted by the right to disconnect. These include overtime provisions, on-call arrangements, maximum daily hours, and changes to rosters.

As part of the FWC’s consultation on the matter, differing approaches as how modern awards and the right to disconnect should intersect have been suggested by unions and employer advocate groups. Not unexpectedly, unions advocated for descriptive guidance and positive obligations for employers, while employers’ advocacy groups called for the award clause to mirror rather than to expand the legislation. A draft right to disconnect clause was published by the FWC on the 11 July 2024. The clause in its current form goes further than just acknowledging the right to disconnect but is not as detailed a clause as requested by the unions.

The FWC has outlined that changes to modern awards will be confirmed on 23 August 2024.

The FWC are also obliged to develop guidelines on the new right to disconnect. The FWC President has commented that there 'is no legislative deadline' to produce these guidelines and that they won't be available before 26 August 2024. The President also stated that guidelines won't be issued until the FWC has dealt with some disputes relating to the right to disconnect. Employers will need to take steps to prepare for, and implement, the right to disconnect without waiting for these guidelines.

Next steps for employers

The introduction of the right to disconnect in Australia, follows the introduction of similar laws globally, including in France, Portugal, Belgium, and Ireland. The strength of the 'right to disconnect' has varied from country to country, with some jurisdictions giving the right more teeth than others. However, there are lessons that can be learned from these other jurisdictions as to how an employer should prepare for the introduction of the right to disconnect in Australia.

Review employment contracts

It is common practice for wording to be included in contracts of employment that the employee will be required to work such additional hours as are reasonable and necessary to perform the employees’ duties and responsibilities. Considering the new right to disconnect, employer should review their clauses and whether they appropriately reflect expectations, including for employees reporting into international teams.

Consider updating or introducing policies regarding out-of-hours contact 

Having clear policies in place regarding out of hours contact that will assist in setting clear parameters and expectations in the workplace. This will be particularly useful for organisations who have individuals located outside of Australia but who manage employees located in Australia by helping them to understand their obligations under the new rules.

Update recruitment policies and procedures

Role descriptions can often be out of date and not accurately reflect the requirements of a role. If after hours contact across different time zones is something that is likely to be a crucial element of a role, making that clear to employees from the outset, will help to evidence the reasonableness of a request to ask employees to engage in out-of-hours contact. Updating role descriptions and making sure that recruitment policies are updated, is therefore a pro-active step that employers can be taking now.

Training

In some organisations, the roles which have after hours contact may be clear due to the senior and international nature of the role. However, for other organisations, it may be less clear, and an audit may be useful to enable the company to address any problem areas before the new legislation comes into effect. Carrying out an audit, may help identify practical processes that could be put in place to reduce the risk of any issues being raised by employee’s and also to evidence the company’s reasonableness.

Don’t hesitate to reach out to our team if you would like to discuss this further and understand how best to prepare your business.