Legal update

RIGHT TO DISCONNECT – WHAT SHOULD BUSINESSES BE DOING?

Authors:  Amy Zhang, Hannah Nesbitt and Izabela Bowell

Introduction
In February 2024, the Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024 introduced provisions relating to a right to disconnect for all national system employees into Part 2-9 of the Fair Work Act 2009 (Cth) (“Fair Work Act”).  For non-small business employers, these provisions became operative on 26 August 2024, and for small-business employers (with less than 15 employees (factoring in employees in related entities)), these provisions will become operative on 26 August 2025. Modern Awards have also been updated to refer to, and include terms, relating to the right to disconnect.

Background
The right to disconnect was recognised as being a necessary legislative reform for Australian employees due to the increasing trend in hybrid work/work from home arrangements and technological developments, which have blurred the boundaries between work and personal life. For example, employees may find themselves taking calls or responding to emails at all hours of the day, and on any day of the week. This has raised concerns for employee mental wellbeing in the context of the legal obligation for employers to manage the risk of psychosocial hazards under the relevant state and territory work health & safety laws.

What is the “right to disconnect’?
The right to disconnect is a right that is set out in section 333M of the Fair Work Act and is a term in all Modern Awards. It allows employees to refuse to monitor, read or respond to contact (or attempted contact) from their employer, other employees, or third parties (such as a client or customer), outside of their working hours if work related, unless that refusal is unreasonable. The right applies to all forms of contact such as calls, emails, text and work-related messaging platforms (such as Microsoft Teams or Slack).

The right to disconnect is recognised as a “workplace right” for the purposes of the general protections provisions of the Fair Work Act.

Importantly, the right to disconnect does not mean that employees cannot be contacted outside of working hours if work related – or that it is unlawful for employers, employees or other third parties to make that contact. Rather, the right to disconnect provides employees with a right to reasonably refuse to respond to contact outside of their working hours.

Assessing reasonableness
Section 333M of the Fair Work Act provides the following non-exhaustive list of matters that must be taken into account when assessing ‘reasonableness’:

1. The reason for the contact or attempted contact;
2. How the contact or attempted contact is made and the level of disruption it causes the employee;
3. Whether the employee is compensated or paid extra for remaining available to work when the contact or attempted contact is made or working additional time outside of their ordinary hours of work;
4. The nature of the employee’s role and their level of responsibility;
5. The employee’s personal circumstances, including family or caring responsibilities; and
6. Any other relevant matter.

It is apparent from the non-exhaustive list of factors set out above that whether an employee’s refusal to respond is reasonable is fact specific, and must be assessed on a case-by-case basis, having regard to all of the circumstances.

For example, it will usually be reasonable to contact employees about last minute changes to work rosters or to ask them to cover shifts for absent employees. Additionally, the more senior an employee and more highly paid, the more reasonable it may be to expect a response if there is a legitimate reason for the contact outside of their working hours. Equally, if an employee works as part of a global team with different time zones, that may make it more reasonable to expect out of hours contact. Any extra compensation, time in lieu and/or flexibility provided to the employee with respect to working arrangements will also be relevant in assessing reasonableness.

Modern Awards
For any employees that are covered by a Modern Award, the Fair Work Commission has made determinations varying Modern Awards to include a right to disconnect term. In effect, the right to disconnect term in each Modern Award adopts the same obligations set out in section 333M of the Fair Work Act. However, certain Modern Awards provide specific guidance in relation to what contact is reasonable (depending on the nature of the industry and the type of work) and when payment for out of hours work needs to be made.

Disputes
Employees or employers can apply to the Fair Work Commission to deal with a dispute that arises in relation to the right to disconnect. However, such an application can only be made following an unsuccessful attempt to resolve the dispute at the workplace level.

If an application is made, the Fair Work Commission has the power to:

1. Make a stop order requiring the employer to stop contacting the employee;
2. Make an order requiring the employee to respond to the contact; and/or
3. Deal with the dispute in other ways (for example, by holding a conference to try resolve the dispute).

Non-compliance with orders made by the Fair Work Commission in relation to the right to disconnect may result in pecuniary penalties being made against an employer or individual, the amounts of which are currently up to $93,900 for corporate employers and $18,780 for individuals.

Further, as the right to disconnect is a “workplace right” for the purposes of the general protections provisions of the Fair Work Act, an employee may lodge a general protections application with the Fair Work Commission, if an employer takes adverse action against them because they are entitled to, proposing to exercise and/or have exercised, the right to disconnect as defined in the Fair Work Act. For example, if an employer disciplines, suspends or dismisses an employee because the employee reasonably refused to respond to an email that requested a response out of work hours, such conduct could be considered unlawful adverse action. If the matter is not resolved by the Fair Work Commission, or not related to a dismissal, the employee may commence Court proceedings and seek compensation and/or civil penalties against a corporate employer and/or an individual.

Key Action Points for Human Resources and In-House Counsel
As this new area of law develops, there will be more regulatory and case law guidance on the operation of the right to disconnect. However, in the meantime, employers of Australian employees should consider the following actions as a means of ensuring compliance with, and to avoid disputes in relation to, the right to disconnect:

• Consider the extent to which employees are currently being contacted outside of their working hours and assess the reasonableness, having regard to the factors set out above;·
• Educate and train employees, including senior and line managers, to ensure mutual understanding about the right to disconnect and the business’ expectations around when contact out of work hours would be reasonable. This may be in the form of communications to staff in a staff meeting and/or through email, policies, as well as training;
• Review and update employment contracts and position descriptions to include provisions about reasonable out of hours contact, noting that different clauses will be required for different employees, depending on their level of seniority, responsibilities, remuneration and/or personal circumstances such as family responsibilities and health status;
• Consider the amendments that have been made to applicable Modern Awards;
• Update or create new policies to deal with the right to disconnect and ensure they are implemented; and
• Consider whether current benefits are sufficient to make out of hours contact reasonable, including whether any additional benefits should be introduced for example, different working hours or arrangements for those working across different time zones, time in lieu policies, additional compensation, or other flexible work arrangements.

If you require legal advice or assistance, please contact our Harmers legal team on +61 2 9267 4322.