Bosses find right to disconnect laws ‘have led to a productivity boost’

In findings that might surprise the Coalition and industry groups that opposed the laws, a survey of more than 600 senior business decision-makers found just 4 per cent negativity.

AHRI chief executive Sarah McCann-Bartlett says employers are generally positive about recent IR law changes.

Almost 60 per cent of employers report Labor’s right to disconnect laws have improved productivity and employee engagement, while more than one-third have seen a fall in employee stress and an improved work-life balance among staff.

In findings that might surprise the Coalition and industry groups that opposed the laws, a survey of more than 600 senior business decision-makers by the Australian Human Resources Institute found just 4 per cent reported that the right to disconnect legislation had either “significantly decreased” or ”somewhat decreased” employee engagement and productivity levels.

The AHRI found 58 per cent of employers believed the right to disconnect had improved employee engagement and productivity; 37 per cent had observed a reduction in employee stress; and 39 per cent reported improved work-life balance among staff.

Public sector employers were especially positive about the right to disconnect, with 77 per cent reporting increased productivity and 75 per cent reporting higher employee engagement.

However, the changes have been resisted among some in company ranks, with 38 per cent of organisations indicating the changes had been met with resistance from middle managers.

Among large organisations that employ 200 employees or more, 47 per cent of large organisations reported resistance from middle managers.

According to the survey, the right to disconnect has had a noticeable operational impact on only a small proportion of employers, with just 10 per cent of organisations reporting the right to disconnect had affected their organisation’s communication practices outside standard working hours.

There was some variation across sectors, with 23 per cent of public sector employers saying they had been operationally affected.

The right to disconnect has improved the ability of organisations to manage urgent or time-sensitive matters outside standard working hours, with nearly half (47 per cent) reporting an improvement in this area.

Many employers reported that a number of the Albanese government’s other workplace policy reforms, including changes to fixed-term contracts, casual employment and measures to prevent and respond to workplace sexual harassment and bullying, had had a positive impact on their organisation, including on productivity and employee engagement.

Employers were asked whether any of the policies had led to changes in their organisation. The legislative changes most likely to lead to change were flexible working (50 per cent of organisations), casual employment (39 per cent), and fixed-term contracts (34 per cent).

The survey found broad support for additional specific legislation, with 48 per cent of employers saying they would now support flexible work rights being extended to all employees. In addition, 30 per cent supported the policy, but not before 2027.

A majority support the immediate inclusion of reproductive health as a protected attribute under anti-discrimination law while a further 23 per cent employers supported such a policy, but not before 2027.

AHRI chief executive Sarah McCann-Bartlett said it was important to note that the data reflected the views of business leaders and HR professionals, who were well placed to assess the impact of changes to employment legislation on both the organisation and employees.

“Overall, employers saw positive outcomes out of recent workplace legislation and for many it was adding to workplace productivity,” she said.

The employers surveyed expect wages to grow 3.3 per cent over the next 12 months, up from 3 per cent last quarter. Recruitment difficulties are rising again, up from 30 per cent to 38 per cent in the June quarter.

Ms McCann-Bartlett said this could be from a combination of labour supply pressures, such as skills shortages, higher wage expectations and tighter migration caps.

“Although conditions in the Australian labour market have eased slightly compared with a year ago, the market remains tight,” she said. “Many organisations continue to contend with rising wage pressures and persistent challenges in attracting new employees and retaining existing ones.”