ICYMI: Slimmed-down Closing Loopholes Bill passes Parliament – what employers need to know

By Aaron Dearden, Jessica Luker and Abby Wright

Read our previous article on the Closing Loopholes legislation from October 2023.

A slimmed-down Fair Work Amendment (Closing Loopholes) Bill 2023 (Bill) passed Parliament on 7 December 2023, despite the previous expectation the Bill would not be passed until February 2024 at the earliest.

Following a deal between the Albanese Government and several crossbench senators, the Bill was amended to be divided across two pieces of legislation. The remainder of the amendments (now contained in the Fair Work Amendment (Closing Loopholes No. 2) Bill 2023), have been set aside for debate early this year.

The key amendments that have passed relate to:

  • labour hire arrangement orders (‘same job, same pay’ orders);
  • small business redundancy exemption provisions;
  • workplace delegates’ rights;
  • wage theft;
  • strengthening protections against discrimination; and
  • amendments to the Work Health and Safety Act 2011 (Cth).

Some of the amendments, including in relation to labour hire and workplace discrimination, came into effect on 15 December 2023. This article will outline these changes to assist employers navigate the quick turnaround of this legislation.

Closing the labour hire loophole

Significantly, the key amendment to the Fair Work Act 2009 (Cth) (Act) surrounding regulated labour hire arrangement orders (‘same job, same pay’ orders) for labour hire workers has passed and took effect on 15 December 2023.

Where an order is granted, a labour hire provider would be directed to pay its employees no less than they would be paid under the host employer’s enterprise agreement (or other instrument), had the employee been directly employed by the host employer (their protected rate of pay). Host employers have an obligation to provide information to labour hire providers to assist them with determining the protected rate of pay.

Applications for a regulated labour hire arrangement order can now be made by employees (or unions); however, no such order can come into effect until 1 November 2024.

Small business redundancy exemption

From 15 December 2023, a small business may now be required to pay redundancy pay to employees if a series of specific criteria are met:

  • at the time of the termination, the employer was a small business; and
  • the small business is bankrupt or in liquidation; and
  • the employer was a small business as a result of one or more employees being terminated; and
  • those terminations occurred because of the insolvency of the employer, or within six months prior to the employer becoming bankrupt or going into liquidation.

This provision was introduced to prevent medium and large sized businesses from avoiding redundancy pay obligations resulting from downsizing.

Workplace delegates rights

All modern awards, new enterprise agreements and workplace determinations will be required to contain a term that deals with workplace delegates’ rights. This term must include a right to represent members within their workplace, rights to reasonable access to paid time off for training, and reasonable access to the workplace and its facilities to advance their members’ industrial interests.

These rights will be workplace rights for the purpose of the Act, which means general protections provisions apply where adverse action is taken because of the exercise of the delegates’ rights.

The protections around workplace delegates’ rights have commenced from 15 December 2023.

Provisions regarding the delegates’ rights term come into force for all new instruments or modern award variations from 1 July 2024.


Employees who have been subject to family and domestic violence are now protected within sections 351 and 772 of the Act. This means it is expressly unlawful for an employer to take adverse action against an employee who has experienced or is experiencing family and domestic violence.

This change came into effect on 15 December 2023.

Wage theft

There will be a new criminal offence in the Act for intentional wage theft, with harsh penalties for both body corporates (up to three times the underpayment or $7,285,000, whichever is greater) and individuals (up to 10 years’ imprisonment or a fine). Civil penalties for underpayments have also significantly increased, with body corporates facing up to $4,695,000 for a serious contravention.

The Minister will publish a ‘Voluntary Small Business Wage Compliance Code’ (Code). Small businesses found to have underpaid their workers, but have followed the Code, must not be referred for a criminal offence.

Wage theft provisions will not come into effect until the Code is published, and in any event will not commence until at least 1 January 2025.

Amendments to the Work Health and Safety Act 2011

The Work Health and Safety Act 2011 (Cth) will be amended to include an industrial manslaughter offence, which will commence from 1 July 2024.

Further, monetary penalties for offences have been significantly increased across all categories of offences. The maximum penalty for a category 1 offence is now $3 million for an individual and $15 million for a body corporate.

Key takeaways for employers

  • Employers who engage labour hire workers may find their costs increase if their labour hire provider becomes subject to a regulated labour hire arrangement order.
  • Employers who will commence bargaining for a new enterprise agreement in the coming months should expect a push from employee representatives to include a workplace delegates’ term, despite these not being lawfully required until 1 July 2024.
  • Small businesses will have access to a wage compliance Code, which may protect them from criminal wage theft charges in the case of an underpayment. They will not, however, be protected from civil penalties, which have also greatly increased. The Code is yet to be published.

Timeline of the changes

15 December 2023
  • Regulated labour hire arrangement (‘same job, same pay’ orders) jurisdiction commences;
  • Small business redundancy exemption provisions commence;
  • Workplace delegates’ rights provisions commence; and
  • Protections for those subject to family and domestic violence commence.
1 July 2024
  • Modern award variations, workplace determinations and enterprise agreements to include a delegates’ rights term; and
  • Industrial manslaughter charge comes into effect.
1 November 2024
  • Regulated labour hire arrangement orders can commence operation.
1 January 2025*
  • Wage theft provisions apply.

*the later of 1 January 2025 or the day after the Minister declares a Voluntary Small Business Wage Compliance Code

But wait, there’s more

The remaining amendments originally proposed as part of the Bill have been separated into the Fair Work Legislation Amendment (Closing Loopholes No.2) Bill 2023 (No.2 Bill). The No.2 Bill deals with changes to the definition of and conversion process for casual employees to permanent employment, reforms to the gig economy and to the road transport industry.

The No.2 Bill is expected to be debated in the Senate early this year.


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