On a Sunday afternoon in a small office behind a workshop in Melbourne's outer north, the owner of a refrigeration and air-conditioning business is doing the job nobody hires her for. She has fifteen people on the books: eleven technicians, an apprentice, a part-time bookkeeper who comes in Tuesdays and Thursdays, and two casuals who pick up weekend callouts through summer. She is the payroll officer. She is the rostering clerk. She is the person who answers the phone when a supermarket's cool room fails at ten at night. And for the next three hours she is the human resources department, working through a printout of the Fair Work Ombudsman's guidance on the right to disconnect with a highlighter and a cold cup of tea.
The list in front of her is not dramatic. It is administrative, and it is long. The on-call roster she inherited from her father asks a technician to keep a phone on overnight for a week at a time; she needs to work out whether the allowance she pays for that is enough to make an after-hours call a reasonable thing to expect, and what happens if a technician one night decides it is not. Her employment contracts were drafted in 2016 and say nothing about after-hours contact at all. Two of her casuals are approaching the point where they can ask to become permanent, and she is not certain what she is required to give them, or when, or in writing. In January she takes on four extra hands through a labour-hire firm to get through the peak, and she now has to think about what that firm pays them compared with what she pays her own people. Nobody has made a claim against her. Nobody, on the evidence, is especially likely to. That is precisely the point of this article.
The vignette above is invented. The task list is not. It is the direct, ordinary consequence of the second wave of federal workplace law — the labour-hire orders, the right to disconnect, the redrawn casual definition and the new category of platform work — and it has to be worked through by every employer it touches, whether or not a single dispute is ever filed. The cost of these provisions is anticipatory and administrative. It is not, on the available evidence, litigious. Confusing those two things is how most of the public argument about this legislation has gone wrong, in both directions.
What the second round actually asks an employer to do
The passage of the Closing Loopholes legislation, its headline provisions and the broader argument about union bargaining power and productivity are covered in separate audits on this site. This article deliberately leaves those arguments alone. It asks a narrower and more practical question: once the Acts are law, what does a business actually have to do, and who bears the cost of doing it?
Four obligations do most of the work, and they are worth setting out plainly, because they are frequently described in headlines and rarely described in detail.
Regulated labour hire arrangement orders
Part 2-7A of the Fair Work Act 2009, inserted by the Fair Work Legislation Amendment (Closing Loopholes) Act 2023, allows an employee, a union or a host employer to apply to the Fair Work Commission for a regulated labour hire arrangement order — the mechanism the government branded "same job, same pay". Where an order is made, the labour-hire employer must pay its workers at least what they would receive under the host's enterprise agreement or other covered instrument for the same work. Applications have been open since 15 December 2023 (Fair Work Act, as amended), and under the Act's transitional arrangements an order could not take effect before 1 November 2024.
The design includes real limits. The provisions do not apply where the host is a small business employer — fewer than 15 employees, counted by headcount under the existing definition in the Act. They do not apply where the arrangement is genuinely the supply of a service rather than the supply of labour, a distinction the Commission must assess on a list of statutory factors. And short arrangements, of not more than three months, are excluded. Those exemptions matter, and the critique below takes them seriously.
The right to disconnect
Section 333M of the Fair Work Act gives an employee the right to refuse to monitor, read or respond to contact — from the employer, or from a third party such as a client — outside the employee's working hours, unless the refusal is unreasonable. It commenced for larger employers in August 2024 and extended to every remaining employer, regardless of headcount, from August 2025 (Fair Work Act s 333M).
The operative word is "unreasonable", and the Act does not leave it undefined. It lists the matters that must be taken into account: the reason for the contact; how the contact is made and the degree of disruption it causes; whether the employee is compensated for being available, or for working additional hours; the nature of the employee's role and their level of responsibility; and the employee's personal circumstances, including family or caring responsibilities. A dispute must first be attempted at the workplace level. If that fails, either party may take it to the Commission, which can deal with it and, if necessary, make an order to stop the conduct.
The casual definition and the employee choice pathway
From August 2024 the statutory test for casual employment shifted from what the contract said to the real substance and practical reality of the employment relationship. Alongside it came a pathway under which an eligible casual employee can notify their employer that they believe they no longer meet the casual definition; the employer must respond in writing within a set period, must consult first, and can only decline on grounds specified in the Act. Separately, the Casual Employment Information Statement must be given to casual employees not only when they start but, for employers other than small businesses, again at six months, at twelve months, and at twelve-month intervals after that (Fair Work Ombudsman guidance, current).
Employee-like workers and platform work
The Closing Loopholes No. 2 Act created a new jurisdiction for "employee-like" workers engaged through digital labour platforms, and for the road transport industry. The Commission can set minimum standards orders for these workers, and a platform worker who is deactivated can seek relief under a new unfair deactivation regime, governed by a code, with a short application window measured in weeks rather than months. This is a genuinely new category in Australian law: neither employment nor ordinary independent contracting, but a third thing with its own rules.
Read together, these are not exotic obligations. Most of them describe conduct a decent employer would recognise. But every one of them is a thing that has to be checked, documented and, in many workplaces, changed — and the checking is where the cost lives.
The strongest case for the policy
These provisions fixed documented harm, and the quiet aftermath is evidence they were proportionate
Start with the labour-hire provisions, because the case for them is concrete rather than theoretical. In documented instances, labour-hire arrangements were used to place workers on a site alongside directly-employed colleagues, doing identical work under identical supervision, for materially less pay — with the difference explained by nothing except which entity's name was on the payslip. That is not a marginal abuse of a system. It is the precise outcome enterprise bargaining exists to prevent: an agreement bargained in good faith between an employer and its workforce, undercut by routing part of that workforce through a different employer that is not covered by it. If an enterprise agreement can be avoided by re-papering the employment relationship, then the agreement is a suggestion rather than a bargain, and the whole architecture of the Fair Work Act rests on it being a bargain.
The Qantas matter makes this tangible. In March 2025, a settlement involving Qantas Domestic, Maurice Alexander Management and Altara Resources — reached in the shadow of the new labour-hire provisions — was expected to benefit approximately 760 cabin crew (Fair Work Commission; reported, Mar-2025). Those are real people, in a real workforce, whose pay moved because Parliament changed the law. Any assessment of the compliance burden has to be weighed against that, not stated as though the burden were the only entry in the ledger. A compliance cost that ends a practice built on paying two people differently for the same shift is a cost worth paying, and the fact that a cost falls on employers does not, by itself, make it unjustified.
The platform provisions have a similarly grounded case. Food delivery in Australia grew rapidly on a model that placed the risk of the road on the rider and very little of it on the platform. At least five food delivery riders died on Australian roads in a period of roughly two months in late 2020, prompting a joint government taskforce in New South Wales (approx.; NSW Government taskforce into food delivery rider deaths, 2020-21). Before the reforms, a rider injured on a platform-assigned delivery, or deactivated without explanation, had almost no recourse, because the law had no category for someone economically dependent on a platform but not, on the tests of the day, its employee. A regulatory response to that was overdue, not opportunistic.
And on the right to disconnect specifically, the government's best argument is the one the evidence actually supports: the provision codifies something most reasonable employers already practise. It does not ban contact. It does not prohibit on-call arrangements or penalty-rate callouts. It protects a refusal only where that refusal is reasonable, on a list of factors that includes whether the employee is being paid to be available. That is a narrow provision, and its narrowness shows in the outcome — very few disputes have arisen. Indeed the statutory review of the right-to-disconnect provisions has been paused, on the stated ground that there is limited case law to review (Australian Government, as at 2026). A critic who predicted a wave of litigation and got near-silence instead should say so plainly. The sky did not fall.
The process argument is fair too. The Commission's own machinery is built to de-escalate: an application fee of $92.70 for 2026-27, waivable on serious-hardship grounds (Fair Work Commission fee schedule, 2026-27), and a conciliation-first approach designed to resolve matters by conversation rather than hearing. And in international terms, Australia's workplace rules — including a statutory right to disconnect, which several European countries adopted first — sit within the normal range for a developed economy rather than outside it.
The evidence: a cost that does not appear in the case law
This is where the argument turns, and it turns on a distinction that is easy to state and easy to miss.
Low case volume is evidence about litigation. It is not evidence about cost.
The strongest defence of these provisions is that almost nobody is fighting about them. That defence is true, and it is worth something. But it answers a question nobody serious is asking. The question is not "how many employers have been dragged before the Commission?" The question is "what did employers have to spend in order not to be?"
Those are different questions with different answers, and the second one is invisible in the first one's data. Consider what actually happened in workplaces after August 2024. Employers did not wait to be sued and then respond. They did what the law asks them to do: they read the guidance, reviewed their contracts, looked at their rosters, and in many cases paid a lawyer or a consultant to tell them whether their existing arrangements were compliant. That expenditure happened because of the law and in order to avoid a dispute. It is therefore, by construction, absent from the dispute statistics. The lower the case volume, the more of it may have been incurred.
This is not a rhetorical trick. It is the standard structure of a preventive regulation. Nobody measures the effectiveness of a building code by counting collapsed buildings, because the code's whole purpose is to move the cost from the collapse to the compliance. The same logic applies here, and it applies to the cost as well as to the benefit. A regulation designed to change behaviour before a dispute arises will, if it works, produce a small litigation record and a large behaviour-change bill. Reading the small litigation record as proof of a small bill inverts the mechanism.
A regulation that works by changing behaviour before anyone complains will always look cheap in the dispute statistics, because that is where its cost is not recorded.
It follows that the pause of the right-to-disconnect review, on the ground of limited case law, is a genuinely awkward moment for both sides of this argument. It cuts against anyone who claimed the provision would flood the Commission; it plainly did not, and that claim should be retired. But it also means the review has been paused before it examined the thing most likely to be costly — not the disputes, but the preparation. The absence of case law is not a finding that the provision was cheap. It is the absence of a finding either way, on the only measure that was being looked at.
What the paperwork actually consists of
Abstraction is where this argument usually dies, so it is worth being specific about the work. For a firm without a dedicated HR function, "reviewing your arrangements" decomposes into a series of separate tasks, each small, none of which anybody in the business has done before.
Employment contracts. Most Australian small-business contracts predate 2024 and are silent on after-hours contact, because until recently there was nothing to say. Bringing them into line means, at minimum, deciding whether the business wants to address availability expressly, drafting that clause, and — because a contract variation generally requires the employee's agreement — issuing and collecting signed variations from every affected employee. For a fifteen-person firm that is fifteen conversations, fifteen documents, and a template that somebody has to write. The template is the part that costs money, because the business does not have anyone who can write it.
Rosters and on-call practice. The right to disconnect does not prohibit on-call work, but it does make the terms of on-call work legally relevant. Whether an employee is compensated for remaining available is one of the statutory factors bearing on whether a refusal is unreasonable (s 333M). A business that has always run an informal on-call phone, without an allowance, now has an incentive to formalise it — which means either paying an availability allowance it did not previously pay, or documenting why the arrangement works without one, or restructuring the roster so that after-hours contact falls only on people whose role and responsibility make it reasonable. All three are real changes. Only the first shows up as a cost in the accounts.
The judgement call itself. This is the part that is genuinely difficult for a small employer, and it deserves to be stated without sneering at anyone. The statutory factors are sensible and they are also, individually, matters of degree. How disruptive is a text at 7pm compared with a call at 11pm? Is a service technician's "level of responsibility" high enough that answering is expected? Does an allowance of a certain size make availability reasonable, or not? A large employer resolves these questions once, centrally, with in-house counsel, and applies the answer across ten thousand staff. A fifteen-person business faces exactly the same questions with no one to ask. The Fair Work Ombudsman publishes guidance, and it is good guidance, but guidance describes the factors; it cannot tell a particular employer how those factors weigh in their particular roster. That residual uncertainty is not eliminated by low case volume. If anything it is sustained by it: with few decided cases, there is little worked precedent for an adviser to point to.
Labour-hire arrangements, from the host's side. A host employer using labour hire now has reason to know what the labour-hire firm pays — something many hosts previously neither knew nor asked. Even where the host is confident no order would be made, forming that confidence requires work: identifying which arrangements are supply of labour rather than supply of a service, checking whether any run beyond three months, and confirming whether the business itself sits above or below the fifteen-employee threshold that triggers the provisions at all. Note the shape of that last item. The small-business exemption is a genuine and well-intentioned carve-out, and it also means a business near the threshold must now count its own headcount carefully, including regular casuals, to know which side of the line it is on.
Casual conversion administration. The employee choice pathway is opt-in, and many casuals will never use it — the loading is worth real money and the flexibility is often mutual. But the administrative obligations run regardless of whether anyone converts. The Casual Employment Information Statement has to be issued on commencement and, for employers other than small businesses, again at six months, twelve months, and every twelve months thereafter. That is a recurring diary obligation attached to every casual on the books. If a notification does arrive, the employer must consult, respond in writing within the statutory period, and if declining, do so only on permitted grounds and explain why. None of these steps is onerous in isolation. Together they are a standing process that a business either builds or buys.
Platform businesses. For a small platform operator — and not every digital labour platform is a multinational — the employee-like worker provisions require an assessment of whether the workers on the platform fall inside the new category, monitoring of any minimum standards orders that apply, and a deactivation process capable of withstanding review under the applicable code. That is a compliance function that did not previously exist, in businesses that were often built without one.
Set the last two of those numbers beside each other and the shape of the argument becomes visible. The filing fee is $92.70. That is the price of starting a dispute, and it is deliberately, sensibly low. It is not the price of compliance, and it was never meant to be. The two numbers measure different things, and quoting the first as though it answered the second is the most common error in this debate.
Why the burden concentrates at the small end
The distribution of this cost is not neutral, and the reason is structural rather than political.
Australia's business population is overwhelmingly small. Of roughly 2.5 to 2.7 million actively trading businesses, around three in five employ nobody at all, and among those that do employ, the overwhelming majority — well over nine in ten (approx.) — have fewer than 20 employees (Australian Bureau of Statistics, Counts of Australian Businesses, including Entries and Exits, June-2024). A workplace-relations obligation therefore lands, in the great majority of instances, on an organisation with no HR department, no in-house lawyer and no payroll specialist.
What that means in practice is that large and small firms pay for the same regulation in structurally different ways. A firm of five thousand employees has an employment lawyer, an HR team and a payroll system with a vendor who ships a compliance update. Its cost of understanding a new obligation is spread across five thousand people and mostly already paid for. A firm of fifteen has none of these. It must buy the expertise it cannot employ — an hour or several of a lawyer's or consultant's time, at commercial rates, for the same set of questions the large firm answers internally.
That is a fixed cost against a much smaller base. The same advice that costs the large employer a rounding error costs the small employer a meaningful share of a month's margin, and it recurs each time the rules change. Regulatory economists have understood this for decades; it is the reason regulatory impact analysis routinely distinguishes fixed from variable compliance costs. It is also why the small-business exemptions in this legislation are genuinely valuable — and why the ones that stop at fewer than fifteen employees leave a large population of firms that are, in every practical sense, small, on the wrong side of the line.
A firm of fifteen faces the same questions as a firm of fifteen thousand, with nobody to ask. It has to buy the expertise it cannot afford to employ.
A word about what the record does and does not show on volumes. The Fair Work Commission publishes application counts in its annual reports, and applications under the new jurisdictions began, necessarily, from a base of zero — labour-hire orders from December 2023, the disconnect provisions from August 2024. The direction has been upward, which is what happens when a new jurisdiction opens. But the absolute numbers remain small relative to the Commission's overall caseload, which continues to be dominated by long-standing categories such as unfair dismissal and general protections. This article does not quote a figure for those applications, because a precise, current number is not something it can verify; the direction is stated and the level is not. Readers should treat any confident claim about a "surge" in filings under these provisions with the same scepticism, in either direction.
The critique: nobody measured the sum
Here is the part of the argument that survives every concession made above, and it is not the part most critics reach for.
Take each measure separately and each has a defensible case. Labour-hire orders close a documented avoidance route. The right to disconnect codifies a norm most employers already observe. The casual definition replaces a test that had drifted a long way from the substance of the relationship. The platform provisions fill a gap that produced real harm. A reasonable person can accept every one of those propositions — this article accepts them — and still identify a problem that none of them contains.
The problem is accumulation. These measures did not arrive alone, and they did not arrive in isolation from everything else that landed on Australian employers in the same period. Between 2023 and 2025 the same fifteen-person business absorbed a redrawn casual definition, a new right-to-disconnect obligation, new labour-hire exposure as a host, a new wage-theft criminal offence with its own compliance code, changes to fixed-term contract rules, successive superannuation guarantee rate increases with a shift toward payday superannuation, and the ordinary annual round of award variations and minimum wage adjustments. Each of those has its own justification. Nobody assessed them as a stack.
That is not an accusation of bad faith; it is a description of how the machinery works. Regulatory impact analysis in Australia is conducted proposal by proposal. Each Bill in the Closing Loopholes package was accompanied by its own explanatory and impact material, examining that Bill's costs and benefits (Explanatory Memoranda and impact analyses, Closing Loopholes Bills, Parliament of Australia, 2023-2024). There is no standing instrument that measures the combined administrative load of multiple separate reforms landing on the same firm in the same period, because no single department owns that question. Workplace relations owns the Fair Work Act. Treasury owns superannuation. The Commission owns awards. The small business at the end of all of it owns the sum, and the sum is not anybody's portfolio.
The consequence is a measurement gap with a predictable bias. Every individual measure looks affordable on its own analysis, because on its own it is. The cumulative load is never priced, so it never appears as a cost of any particular decision, so no decision is ever the one that tipped it over. This is a familiar failure mode in regulatory design, and it does not require anyone to have acted badly for it to produce a bad outcome.
Two further points sharpen the critique without overstating it.
First, the thresholds are inconsistent. The Fair Work Act's small business definition — fewer than 15 employees — governs several of these carve-outs. It is a long-standing definition, applied to unfair dismissal for well over a decade, and reusing it rather than inventing a new one was a defensible choice. But it is a narrow definition by the standards of the rest of the statute book, where "small business" often means fewer than 20 employees and sometimes considerably more. The right to disconnect, notably, has no small-business exemption at all: it was phased in later for small employers, but it applies to every employer regardless of headcount from August 2025 (s 333M). A business with sixteen staff therefore sits outside several of the exemptions while being, operationally, indistinguishable from one with fourteen.
Second, uncertainty is itself a cost, and it is the cost that low case volume does least to reduce. Where a standard turns on reasonableness, employers look to decided cases to calibrate. Very few decided cases means very little calibration. An employer asking a lawyer "is my on-call arrangement compliant?" in 2026 gets an answer built largely from the words of the statute and the Ombudsman's guidance, rather than from a body of applied precedent — which is a more expensive answer to produce and a less certain one to rely on. The quiet the government points to as evidence of proportionality is simultaneously the reason the residual uncertainty has not yet resolved.
What they got right, and the honest limits of this critique
An argument of this shape can slide easily into claiming that the absence of evidence for a problem is evidence of a hidden problem. That would be dishonest, and the credit beat here is not a courtesy. It is load-bearing.
The low dispute volume is real, and it is good news. It should be said in exactly those terms. Predictions of a litigation wave — made loudly in 2023 and 2024 — did not come true. Employers did not find themselves defending a queue of after-hours claims. Workers did not, on the record so far, use the provision as a weapon. The most likely explanation is the simplest and the most creditable to the drafting: the provision is narrow, it protects only reasonable refusals, and most workplaces were already operating within it. A policy that changes the legal position without generating conflict is, on any sensible measure, well-designed policy.
The conciliation-first architecture is working as intended, and it is not an accident. The Commission's design pushes parties to resolve matters at the workplace level first, and where that fails, into conciliation rather than hearing. The filing fee of $92.70 for 2026-27, waivable on serious-hardship grounds (Fair Work Commission fee schedule, 2026-27), is set to keep access open rather than to ration it. Whatever one thinks of the substantive rules, the dispute machinery around them is cheap, accessible and designed to de-escalate. That is a real institutional strength and it should not be conceded grudgingly.
The Qantas outcome is a concrete benefit to real workers, and no amount of argument about administrative burden touches it. Approximately 760 cabin crew were expected to benefit from the March 2025 settlement involving Qantas Domestic, Maurice Alexander Management and Altara Resources (Fair Work Commission; reported, Mar-2025). That is the provision doing precisely what Parliament said it would do, to a workforce that had been on the wrong end of exactly the arrangement the provision targets. A critique of compliance cost that cannot acknowledge this is not a critique; it is advocacy.
The phasing was genuine. These obligations were not imposed overnight. Labour-hire applications opened in December 2023 but orders could not take effect until November 2024. The right to disconnect commenced for larger employers in August 2024 and only reached the smallest employers a full year later, in August 2025 — an explicit recognition that the businesses with the least capacity needed the most time. That is a government designing a transition rather than announcing one, and it is the opposite of what was often predicted.
The exemptions are real, too. The small-business carve-out from the labour-hire provisions, the service-contract exclusion, and the three-month short-arrangement exclusion all narrow the reach of the regime to something closer to the mischief it targets. The critique above is that these carve-outs are drawn at a threshold that leaves many genuinely small firms outside them, and that no exemption addresses accumulation. It is not that they are absent or cosmetic.
Finally, the honest limits of the case made here. This article cannot quantify the compliance burden, because the data to quantify it does not exist. No agency runs a standing measure of what Australian firms spend on workplace-relations compliance, or of how that spending changed after 2023. Employer-group survey evidence exists and points in one direction, but it is commissioned by organisations that opposed parts of the legislation and should be weighted accordingly. What can be established is the structure of the cost — that it is anticipatory, that it is fixed rather than proportional to firm size, and that it is invisible in the only dataset anyone is currently looking at. Establishing the structure of a cost is not the same as measuring it, and this article does not pretend otherwise.
The risk to the future
Compliance capability becoming a condition of hiring
The forward risk is not a courtroom. It is a threshold. If the practical prerequisite for employing someone in Australia becomes the ability to maintain, or purchase, a workplace-relations compliance function, then hiring becomes something that firms above a certain size do comfortably and firms below it do warily. That threshold does not appear in any statute. It emerges from the accumulated weight of separately reasonable obligations, each of which assumes a capability that most Australian employers do not have.
This should be stated as a hypothesis, not a finding, because that is what it is. There is no clean evidence that the second round of reform has suppressed hiring. Isolating such an effect from interest rates, population growth, sectoral demand and the post-pandemic normalisation of hours would be difficult even with better data than exists, and nobody is currently collecting the data that would make it possible. Anyone asserting the effect confidently — in either direction — is going beyond the record.
But the direction of the risk is worth naming, because of where it would land. A disproportionate share of net job creation in Australia occurs among small and newly-formed businesses, and those are exactly the firms with the least capacity to absorb a fixed compliance cost. The workers most exposed are the ones at the margin of the hiring decision: the first employee a sole trader takes on, the apprentice, the school leaver, the person re-entering work after a break. A firm that decides the paperwork of a first hire is not worth the trouble does not file anything with anyone. It simply does not hire, and no statistic records the reason.
The remedy, if the risk is real, is not repeal. The substantive protections in these provisions are defensible and, in the labour-hire case, demonstrably beneficial. The remedy is measurement and consolidation: a standing assessment of cumulative regulatory load on small employers, thresholds aligned across the statute book rather than inherited piecemeal, and compliance tools — model clauses, template policies, worked examples — supplied publicly rather than purchased privately by every firm separately. None of that requires weakening a single worker protection. All of it requires someone to own the question of what the whole stack costs, which at present nobody does.