The bill, which has been proposed and before Parliament for some time, was ultimately split in two in order to progress these reforms – with the Albanese Government indicating it is committed to passing “every remaining clause”[1] of the Closing Loopholes Bill No. 2 “at the earliest opportunity next year [2024]”.[2]

Summary of Changes

• ‘Same job, same pay’ for labour hire workers
• Criminalising intentional wage theft
• Introducing a new criminal offence of industrial manslaughter
• Providing better support to first responders with post-traumatic stress disorder
• Providing better protection for workers subjected to family and domestic violence from discrimination at work
• Expanding the functions of the Asbestos Safety and Eradication Agency to include silica and
• Closing the loophole in which large businesses claim small business exemptions during insolvency to avoid redundancy payments.

Changes Relevant for Labour Hire Employers

While the amendments just passed are considered the ‘less controversial’ aspects of the proposed reforms, employers in labour hire industries will need to quickly mobilise to ensure they are compliant with the new statute. Importantly, ‘gig economy’ reforms were not included in the agreement for the passing of the Closing Loopholes Bill. However, this will be voted on next year as part of the passage of the Closing Loopholes Bill No. 2 through the Senate.

Part 6 of Schedule 1 will insert a new Part 2-7A into the Fair Work Act 2009 (Cth) (Fair Work Act), which allows employees and organisations entitled to represent their industrial interests to apply to the Fair Work Commission for a ‘regulated labour hire arrangement order’.[3]

These changes will empower the Fair Work Commission to make orders which could require labour hire employers “to pay their employees no less than what they would be entitled to be paid under the host business’ enterprise agreement (or other covered employment instrument) if the employee were directly employed by the host”.[4]

The legislative framework contained in Part 2-7A of the Fair Work Act will contain certain exemptions e.g., where a labour hire employee is engaged for a short-term period, if a training arrangement applies, or if the host is a ‘small business employer’.  The changes also enable the Fair Work Commission to resolve disputes, including by mandatory arbitration or by determining an alternative protected rate of pay for a labour hire employee where it would be unreasonable for an employer to pay the employee the protected rate.

When do these changes come into effect?

The new labour hire jurisdiction, changes to the small business redundancy pay rules, and protections against discrimination for those subject to family and domestic violence commenced on 15 December 2023. Other changes will not come into effect until July 2024, with the wage theft provisions to apply from 1 January 2025.

Further information / assistance regarding the issues raised in this article is available from the authors, Nick Duggal, Partner, Estelle Sarra, Associate or your usual contact at Moray & Agnew.