Are More Changes on the Horizon
We’ve come through a whirlwind few years in Australian Industrial Relations, with businesses grappling with some of the most extensive legislative changes since the Fair Work Act was introduced in 2009.
As the dust begins to settle, a natural question arises: are we in for another wave of change?
The short answer: yes - but not to the same extent. That’s the good news.
Still, for business owners and HR leaders, there are several important developments to watch, understand, and prepare for.
What’s Confirmed: Changes You Need to Know About
While the next few years might not bring quite the same scale of transformation, there are still several changes confirmed by the federal government. These are the things we know are happening (or are very likely to):
Minimum Wage Increases
The government is continuing its push to lift minimum wages in line with cost-of-living pressures. While annual reviews are nothing new, we can expect continued support for real wage growth. For business owners, this means tighter payroll margins and the need to budget for increases each financial year.
Penalty Rate Protections
Expect legislation that will lock in penalty rates across Modern Awards. While most employers are already operating within award structures that include these rates, formalising them will remove the possibility of dilution in the future. No surprises here - just confirmation that penalty rates are here to stay.
The Ban on Non-Compete Clauses
This is one to watch closely. The Government has committed to banning non-compete clauses in employment contracts. While these clauses are already difficult and costly to enforce, their complete removal will impact businesses that rely on them to protect sensitive information or client relationships.
What we don’t yet know is how this will be implemented. Will all restrictive clauses be included? Will non-solicitation clauses also be affected? There are still lots of details to be ironed out, but we know this change is coming - likely before 2027.
Right to Disconnect
Already law for larger businesses, the right to disconnect will apply to small businesses (those with fewer than 15 employees) from August 26th 2025. This legislation gives employees the right to ignore work-related communications outside of hours - unless the request is deemed “reasonable.”
The challenge lies in defining “reasonable,” as the Fair Work Act does not offer a clear-cut explanation.
For now, employers should begin internal conversations to shape their own policies around after-hours communication.
A Focus on Productivity
Expect a broader national focus on improving workplace productivity. While not tied to specific legislation (yet), this shift suggests future policies and programs will be geared towards streamlining complaint handling, improving fairness, and potentially lifting efficiency across industries.
What’s Still Unclear: Timing and Details
While we have a good sense of the direction the government is heading, many specifics remain unclear:
- Non-compete clause ban: Timing is vague, with potential implementation by 2027.
- Penalty rate legislation: We’re waiting for exact timelines and legislative details.
- Further agenda items: No additional reforms have been announced, but priorities can shift rapidly.
This uncertainty underscores the importance of staying informed and agile.
The Unknown Fallout: Why Court Cases Matter
Just because a new law is passed doesn’t mean we understand how it will work in practice. Often, the real-world implications only become clear when cases are tested in court.
For example, the right to disconnect is already making its way through the Fair Work Commission in cases involving larger employers. These outcomes will set important precedents for all businesses.
Another recent case involved a Filipino worker classified as a contractor by an Australian business. The Fair Work Commission ruled that she was, in fact, an employee - entitling her to make claims for back pay and move forward with lodging her intended unfair dismissal claim. This case, driven by changes to the employee/contractor definition in 2024, has sent shockwaves through businesses engaging international contractors.
Court rulings like these are where the true meaning of legislation becomes clear - so watching legal interpretations is just as important as knowing what’s been passed.
Gender Undervaluation: Industry-Specific Impacts
One area with potentially significant industry implications is the Fair Work Commission’s review into gender undervaluation in modern awards. Provisional findings suggest that workers in female-dominated industries- like health, community services, and early childhood education- may be underpaid relative to their skill level.
While the final outcomes aren’t yet confirmed, affected businesses should prepare for possible award rate increases and a push toward pay equity reforms.
What You Can Do Now
So, with change still on the horizon, what actions can businesses take now?
- Get Compliant with What’s Already in Place
Many businesses are behind on implementing changes that have already been legislated. Don’t assume you’re safe because you haven’t been caught - audits and legal action could be just around the corner.
- Prepare for the Right to Disconnect
If you’re a small business, get ahead of the curve. Start conversations about reasonable communication expectations, draft your policies, and consult with staff to prepare for August 2025.
- Review Contracts and Culture
If your business depends on non-compete clauses, start rethinking your contracts and company culture. There may be other, more sustainable ways to retain staff and protect sensitive information.
- Stay Informed and Get Support
Trying to track every policy change, legal update, and compliance requirement on your own is exhausting. Whether you lean on HR consultants, peak bodies, or a membership community, make sure you’re in the loop. Ignorance is no longer a defence.
An Invitation
If you’d like to connect with other business owners, leaders and managers, I’d love for you to join us inside our free Facebook Group where you can connect with other like minded business owners, leaders and managers to discuss all things HR: https://www.facebook.com/groups/hrsupportaustralia
