Closing Loopholes Bill Part 1: new laws pass Parliament

Background



3 min read

Key provisions of the Federal Government’s Closing Loopholes Bill have passed Parliament on the last sitting day of the year, following an 11^th hour deal with Independent Senators Jacqui Lambie and David Pocock. Part 1 of the Bill includes a new criminal offence of wage theft and new provisions regarding increased rates of pay for labour hire employees (same job, same pay) and rights for workplace delegates.

The remainder of the Bill, including the proposed provisions regarding intractable bargaining declarations, casual employment and independent contractors will be included in Part 2 of the Bill for further consideration early next year.

Key takeaways

• The Federal Government’s Closing Loopholes Bill has been split into two parts, following a deal with the Senate crossbench.
• Key provisions in Part 1 of the Bill have passed Parliament, including those regarding wage theft, labour hire (same job, same pay) and workplace delegates.
• Other elements of the Bill will be considered early next year, including proposed provisions regarding intractable bargaining declarations, casual employment and independent contractors.
• As we head into 2024, employers should carefully consider how the new laws may impact their business, including the impact on current and future enterprise bargaining and how they will respond to any Fair Work Commission applications for ‘same job, same pay’ orders.

New laws

Key provisions included in Part 1 of the Bill, which have passed Parliament:

• Introduce a new federal criminal offence of ‘wage theft’, which will commence on 1 January 2025 (or an earlier date set by proclamation).
• Allow the Fair Work Commission to make (same job, same pay) orders requiring ‘labour hire’ employers to pay their employees no less than the full rate of pay that would be payable to those employees if the ‘host’ employer’s enterprise agreement applied to them. These provisions extend beyond traditional labour hire arrangements and will take effect from the day after the Act receives Royal Assent, which is likely to be before the end of the year. Although the earliest effective date of any order is 1 November 2024, employers could face applications from early in the new year.
• Introduce a new rights framework for workplace delegates, which will commence the day after the Act receives Royal Assent.

For a summary of the new laws (and the provisions held back for Part 2 of the Bill), see our previous Insights here and here.

Next steps

The Federal Government remains committed to ensuring the passage of Part 2 of the Bill as soon as possible next year, and potentially as early as February when Parliament returns after the summer break.

As we head into 2024, employers should carefully consider how the new laws may impact their business, including the impact on current and future enterprise bargaining and how they will respond to any Fair Work Commission applications for ‘same job, same pay’ orders.