The most disturbing part of the right to disconnect law is still to come

One of the most potentially divisive pieces of workplace regulation in Australian history hammers down on every business with 15 or more employees from today.

It’s called the “right to disconnect” law, which will allow workers to ignore an attempt by their bosses to contact them outside stipulated working hours – and woe betide any business that does not comply. Penalties can hit $19,000 per breach for individuals and explode to $90,000 per breach for companies.

Artwork: Marija Ercegovac Credit:

Even more disturbing, from August 26 next year, the right to disconnect will also apply to businesses with fewer than 15 employees. This means every business in Australia, from corporate giants such as BHP to your local coffee shop, will be hamstrung with costly industrial red tape fraught with problems that threaten workplace harmony and flexibility, and could undermine productivity right across the economy.

This disconcerting new world of industrial relations is enacted under the Closing Loopholes Bill, one of the Albanese government’s pet projects. Right to disconnect allows employees to ignore, not respond or accept contact from work by phone or email outside office hours, unless the contact is deemed reasonable. It will affect Australian business across the board.

There are hidden ramifications and impacts that business owners need to be aware of, and are unlikely to have yet considered. Be warned: you cannot afford to ignore right to disconnect, because your savvy employees definitely won’t, especially those who are unionised.

From today, not having to respond to out-of-hours contact from management becomes a protected workplace right. So what’s at stake for employers?

Employees might agitate over losing a promotion because they exercised their right not to work outside business hours. They might use right to disconnect as the trigger to end the practice of unpaid overtime. Anecdotally, lawyers are already seeing an increase in underpayment claims. According to a study by the Australia Institute, it is estimated that employees are doing an average of 5.4 hours of unpaid work per week.

What happens to productivity when the job can’t be done in normal business hours? Will a business need to reconsider its resourcing and/or outsourcing requirements to stay competitive? I fear conflict increasing in the workplace in this emerging version of “work to rule”.

Consider also that there could be five generations of employees in the workplace. According to a June survey of 1000 employees by Robert Half, one of Australia’s leading recruitment agencies, 75 per cent of Millennials are very comfortable ignoring work-related contact, and only 64 per cent of Gen Xers – who are more likely to be bosses – feel the same way. I foresee conflict here and a difficult transition period.

Right to disconnect will capture people working from home post-COVID, who are used to juggling their hours around child care and other personal issues. Such arrangements will now need to be formally documented so that employee and employer are on the same page.

Going forward, if a complaint about unreasonable contact is made by an employee, there should first be an attempt at internal resolution. If unsuccessful, either party can then go to the Fair Work Ombudsman, who will try to resolve the issue but can make orders of financial penalties.

What should business operators be doing about the right to disconnect? Explain it to everyone and tell your managers to stop contacting employees outside hours unless it is reasonable: such as finding cover for an absent employee. Implement a policy stating the expectations and exceptions. Reassess descriptions for jobs that may require contact outside of hours and ensure compensation is built into such contact. Review employment contracts to ensure they are still fit for purpose. Undertake an audit to see if you have an underpayment issue regarding overtime. And be aware of the impacts on your business if people insist on working strictly normal hours.

There is a significant amount of work required for the small-to-medium business sector who lack the skilled resources to navigate the new rules. For example, with Respect@Work and People at Work legislation, companies are required to assess and mitigate either the risk of sexual harassment or the “psychosocial hazards risk” for all employees. From what I am seeing, companies are not doing this, and exposing themselves to significant fines.

The government has adopted a softly, softly approach to date, but this could change if its patience for non-compliance on right to disconnect wears thin. And no one wants to be on the front page of the newspapers for flouting the job rules if that happens.

Natasha Hawker is the managing director of Employee Matters.

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