The Hidden Cost of Workplace Law Reform: Is Australia’s IR System Broken for Business?
- Tim Dive
- Mar 29
- 3 min read
If you’re running a business in Australia right now, you’re probably already feeling it. The admin burden. The legal red tape. The fear of getting it wrong.
Since the current Federal Government took power, we’ve seen an avalanche of changes to industrial relations laws. These aren’t small tweaks. They’re sweeping, high-impact changes that fundamentally shift the employer-employee relationship, and not in favour of business owners.
At The HR Cartel, we work with small to medium-sized businesses (SMBs) across the board, and there’s one consistent message:
"the system feels one-sided, unclear, and increasingly unsafe for those who actually provide the jobs."
Here’s some of what you may have already forgotten about, and what else is potentially coming.
1. Non-Compete Clauses are on the list to be scrapped
Non-compete clauses are one of the few tools employers have to protect their client base, IP, and trade secrets.
But the government wants to remove them completely.
Potential Implications? Your employee could potentially walk out on Friday, take your client list, and start working for your direct competitor on Monday, legally.
Why it matters: This disproportionately impacts small business. Unlike corporates, you don’t have endless resources to protect your business through legal channels. You’re left exposed.
2. The “Right to Disconnect” Is Now Law
Remember this one? The new law grants employees the right to ignore work-related communication after hours. While the intention is good, protecting mental health, there are still no clear definitions or boundaries, and still no cases to use for examples - so was it ever really needed?
What’s an "emergency"?
What if your business operates outside 9 to 5?
What if an employee checks an email voluntarily?
As of now, the law exists, but guidance doesn’t. This leaves you vulnerable to claims of unreasonable contact, with little ability to defend your actions until the Commission decides what “reasonable” means.
3. Increased Union Access and Visibility
Unions are now empowered to access more workplaces more easily, even in businesses with no unionised employees.
This means:
Greater scrutiny on your employment practices
Unexpected visits or representation during internal disputes
More pressure and compliance risk, especially in construction, manufacturing, and logistics
Even businesses with tight systems are experiencing increased fear around employee grievances and representation.
4. Wage Theft = Criminal Offence
As of January 2025, intentional underpayment of wages will be criminalised.
That means:
Potential jail time for directors and owners
Massive personal fines
Exposure for unintentional errors, if they are later deemed "reckless"
What used to be a payroll mistake is now a legal landmine.
The Real Cost for SMBs
Let’s be clear: these aren’t just philosophical debates. These changes are costing SMBs real time, money, and energy.
We estimate that the average small business (5–50 employees) will now spend:
An mandatory minimum extra 96 to 152 hours per year on admin and compliance related to IR changes
An extra $8,000–$18,000 per annum on HR advisory, legal fees, and systems alone, to try staying compliant
And that’s just the basics.
The Impact on Directors, Owners & Managers Personally
These new rules don’t just expose the business. They target you personally.
Directors and Officers are now liable for due diligence failures in areas like psychosocial risk, sexual harassment, and wage compliance.
Managers can be prosecuted if they're deemed responsible for unlawful practices.
Boards are being targeted for failing to enact or oversee WHS frameworks that mitigate these risks.
Your name. Your money. Your livelihood. All on the line.
So, What Can You Do?
We’re not here to scare you, we’re here to support you.
The first step is education and awareness. That’s why we created The HR Cartel's Online Member's Portal and The HR Cartel Podcast. To explain what’s changing in real terms, for real businesses, with real solutions.
The second step is getting expert help before things go wrong, not after.
🎧 Listen to one of our recent full episodes now: (070) No More Non-Compete: What Happens When Employees Can Walk Away With Your Business?
▶ On Spotify or Apple Podcasts.
To Wrap It Up:
This is not the time to go it alone. If you feel like you’re constantly second-guessing what’s legal, fair or safe, you’re not imagining it.
The ground has shifted, and the system is stacked against small and medium businesses.
We’re here to help you stand strong in the storm.
Call The HR Cartel on 07 5651 0066 to chat with our team, or, contact us here. Let’s simplify the complex and protect what you’ve built.
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