Australia’s Closing Loopholes Bill

February 12, 2024

Gig workers, independent contractors who provide services on demand via apps and websites, have grown rapidly across the globe in recent years. On February 8th 2024, the Australian Labor government’s “closing loopholes” bill, formally titled “Fair Work Legislation Amendment (Closing Loopholes No. 2) Bill 2023” passed the Senate. The bill, supported by Labor, the Greens, Lidia Thorpe and David Pocock, aims to close several loopholes in Australian workplace laws. It will return to the House of Representatives to approve amendments before becoming law.

Background

In 2023, Australian employers saw major industrial relations changes, including amendments to the Fair Work Act, new rights and protections, and additional compliance obligations. Further reforms were introduced in late 2023 and early 2024 through the Fair Work Amendment (Closing Loopholes) Act (December, 2023) and the Fair Work Legislation Amendment (Closing Loopholes No. 2) Bill, which has been recently passed in February, 2024.

Key Changes

The bill makes five key changes to Australian workplaces:

Right to Disconnect

The bill creates a new right for employees to disconnect from work emails and calls during personal unpaid time. Employees can complain to employers about unreasonable out-of-hours contact. If unresolved, the Fair Work Commission can order employers to stop the contact. Fines of up to $18,000 apply for breaches. Some reasonable out-of-hours contact is still allowed, like for on-call employees.

Gig Economy

The bill allows the Fair Work Commission to set minimum standards in the gig economy, like minimum wages, superannuation and insurance. This applies to digital platform workers with low bargaining power and authority over their work. Amendments mean workers must meet two of three criteria to be covered. Estimates suggest the changes could deliver $404 million per year in increased wages.

Casual Conversion

The bill makes it easier for casuals working regular hours to convert to permanent roles. A single pathway is created for casuals to choose to convert. Employers can refuse on fair grounds. This abolishes the requirement for employers to offer conversion.

Enterprise Bargaining

The Fair Work Commission can now arbitrate stuck enterprise agreements. A Greens amendment means arbitrated outcomes must be no less favourable than existing deals. This aims to encourage wage rises without new agreements.

Road Transport

The Fair Work Commission can set minimum pay rates for independent contractor owner-drivers. A majority owner driver committee will advise on minimum road transport standards.

Right of Entry

The bill expands union right of entry without notice to investigate suspected wage underpayment of members. Amendments require reasonable evidence of underpayment. The bill aims to close loopholes and strengthen worker rights and pay. But employer groups have raised concerns about increased union power and penalty rates.

What can India learn?

The proposed Australian “Closing the Loopholes” Bill would provide important rights for gig workers. A key provision is the right to disconnect – gig workers could refuse to work during off hours, holidays and weekends simply by logging off the app. Uber has praised this initiative. India could follow Australia’s lead in providing protections once the law is passed. Europe has already recognized the right to disconnect.

For gig workers, the model provides flexibility and the ability to use existing assets productively, without being tied to a single employer. However, they can feel pressured to be constantly “on call.” Doctors may have to respond to urgent hospital calls at odd hours. In tech, employees “moonlighting” as gig workers raises ethical issues. The most honorable path is to openly declare freelance status.

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