A right to disconnect and to work from home could soon become a reality in Australian businesses. Here’s how HR professionals can prepare.

Editor’s note (05.04.24): This legislation is set to come into effect on 26 August 2024 for businesses with more than 15 employees. Small businesses (with less than 15 employees) will have until August 2025 until changes come into effect.

The right to work from home and the right to disconnect from work are both currently  being considered as additional new rights for employees in Australia.

While there are a number of steps that need to occur before these rights become legal entitlements, the issues are being debated. It’s important for employers, HR professionals and people managers to understand how these changes might impact the way they run their businesses.

Currently, there are no rights either in modern awards or legislation that give working from home entitlements or the right to disconnect. Similar provisions, which were temporarily included in the Clerks – Private Sector Award 2020 during the COVID-19 pandemic, were removed after working from home directives were lifted.

The Fair Work Commission (FWC), in conducting its four yearly modern award review, is considering whether the right to work from home and the right to disconnect should be included in modern awards. They are currently seeking submissions on the potential inclusion of both rights, which are expected to be heavily supported by unions and workers.       

The next phase of the Closing Loopholes Bill

At the date of writing, the Government has secured support to pass the Closing Loopholes No 2 Bill through the Senate by reaching agreement with the Greens and a number of independent senators. The agreed version of the Bill includes the right to disconnect.      

The push to have employee protections to work from home will unsurprisingly meet opposition from some employers, particularly considering the recent objective of some to mandate at least part-time office attendance.

This has resulted in recent examples where enterprise agreements have been unable to be agreed upon without stipulated working from home provisions.

It is likewise anticipated that creating a legal right to disconnect will be resisted by employer groups and deemed difficult to manage, monitor and enforce. This is especially true for organisations that have redesigned their work structures to be asynchronous.

However, research undertaken by the Greens also demonstrates that 56 enterprise agreements already include a right to disconnect, covering tens of thousands of employees. In Australia, it was first included within the Victoria Police Enterprise Agreement of 2019. Many of the provisions in these agreements typically come with extensive exceptions, allowing business operations to continue largely unaffected.

Read HRM’s case study outlining how Victoria Police introduced a right to disconnect in its EBA.

What might the right to disconnect look like?

The legislative right to ‘disconnect’ is proposed to cover all employees, not just those covered by modern awards.

At the time of writing, we understand that the proposed right as set out in the Closing Loopholes No 2 Bill that has passed the Senate, is a right for workers to disconnect from “unreasonable” out-of-hours contact from employers.       

Under the proposal, the FWC would be empowered to issue stop orders, similar to the stop bullying and stop sexual harassment orders. If the stop orders are breached, it is envisaged that civil remedies may be imposed. The Commission would have the power to determine what is “unreasonable” contact, taking into account a non-exhaustive list of factors such as: 

• the reason for the contact;
• the frequency and method of contact;
• remuneration;
• role and responsibilities; and
• the worker’s personal circumstances, which may include family responsibilities.

This change is purported to support a healthier work-life balance for employees. In fact, research from the Australian HR Institute, which surveyed over 600 senior HR professionals and senior decision makers, shows that almost two thirds of respondents think a right to disconnect would have a positive impact on workplace flexibility and 41 per cent already have some form of right to disconnect in place.

However, there are still plenty of points of clarity needed. For example, how this proposed change would interact with overtime and penalty rates is currently unclear.

Other considerations for HR and employers to keep in mind include:

• The practicalities of preventing contact with employees outside their working hours, especially for global businesses spanning multiple time zones, raises logistical and management considerations.
• An increase in employee claims if: the right is allegedly breached; or employees perceive unfavourable treatment, such as disparities in pay or promotions, compared to colleagues who remain connected outside standard working hours. This is also a consideration for employees who’d choose to work from home if that were to also become a legal right.
• Businesses relying on flexibility for connecting with employees outside regular work hours, particularly those with global operations, may experience disruptions to their operations.
• Employee morale may be affected if some exercise the right and others do not, leading to dissatisfaction within the workforce. This could result in a perception that some colleagues are not contributing, placing a heavier workload on those who choose to stay connected beyond regular hours.

 What might the right to WFH look like?

While working from home arrangements are not possible in all sectors and positions, if the right is included within modern awards, many employers may need to consider negotiating and entering into separate flexible working arrangements.

These may be similar to ‘time off in lieu’ agreements (being a written agreement which could be as simple as email correspondence confirming an employee’s entitlement to take time off from work in place of receiving overtime pay for additional overtime) or formal flexible work requests under the Fair Work Act.

Separate agreements may also need to consider what working from home means on an individual basis including by:

• Expanding the definition of ‘ordinary hours’ while working from home;
• Abandoning the requirement to agree on employee start and finish times or to agree to a specific range of times;
• Allowing for meal and rest breaks to suit personal circumstances; and
• Changing recording requirements in respect of timesheet reporting of hours worked.

Presently, the Fair Work Act only allows flexible working arrangements in certain circumstances such as pregnancy and/or parental requirements. The proposed inclusion of a right to work from home in modern awards would be additional to and broader than the current right, without being tied to a particular attribute or responsibility.

 Proactive steps for business to take

While the FWC considers the inclusion of these new rights in modern awards, there are proactive steps that employers, HR and people managers can take now. 

Consider:

Policies and processes

• Reviewing and assessing current policies and processes related to working from home requests, and for managing employees working from home.
• Consider conducting an audit on the potential impact of a right to disconnect. For example, if your organisation’s workers had the right to not respond to emails from 6pm to 8am, what impact might that have on operations?
• Examine practical measures that your organisation could take to prevent contact with employees outside their ordinary working hours if a right to disconnect was introduced.
• Consider what policies or procedures would need to be revised or introduced.
  
• Contemplate the right to disconnect provisions that would need to be introduced to employment agreements and enterprise agreements under negotiation.

Implementation 

• Consider establishing a system to monitor employees’ work activities outside the agreed-upon working hours.
• Actively encourage people leaders and managers to respect employees’ time away from work and employees’ out of work time.
• Provide training to managers to prevent any adverse action against employees who exercise the right to disconnect.
• From a wellness and work health and safety perspective, educate all employees about the right to disconnect and any applicable business initiatives, including promoting the wellness advantages of disconnecting from work.
• Implement internal processes for employees who choose to work outside agreed hours.
• Communicate to all employees, and across the business, the expectation that emails and tasks should be scheduled for delivery during agreed working hours.

Business implications

• Assess whether your organisation can comply with its obligations to employees should they request to work from home.
• Evaluate the impact that increased working from home might have on your business, culture and employee wellbeing, and, alternatively, what impact it would have to refuse working from home requests.
• Based on duties and responsibilities, consider what reasonable business grounds you have for refusing requests to work from home.

 What happens next?

The FWC is publishing a ‘work and care literature review’ on 8 March 2024. Submissions will be open to interested parties during consultations in March and April 2024.  

It is anticipated that the Closing Loopholes No 2 in its agreed form, including the right to disconnect, will pass the Senate. Once passed, it will proceed to Royal Assent, after which there will likely be a period of time before the right to disconnect takes effect.

Aaron Goonrey is a Partner and leads the Australian Employment & Rewards practice at Pinsent Masons, Emma Lutwyche is a Special Counsel and Jeremy Bilski is an Associate at Pinsent Masons. The advice in this article is general in nature and does not constitute formal legal advice.

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