Does Hiring Remote Workers Mean Updating Employment Contracts?
When COVID-19 first hit, businesses across Australia scrambled to shift their teams online. Overnight, spare rooms became home offices and boardrooms became Zoom calls.
However, if you’re reading this, you’ll know this well. Remote work wasn’t just a stopgap measure. It quickly proved to have major benefits.
Lower overhead costs, wider talent pools and happier, more productive employees who appreciated the flexibility, this all became reality. But as the dust settled, new challenges emerged.
Managing a remote team wasn’t just about handing out laptops and trusting everything would run smoothly. It raised questions about compliance, safety and legal obligations.
If you’re hiring remote workers or letting existing employees work from home, you might be wondering. Does hiring remote workers mean updating your employment contracts becomes necessary? The short answer? It’s not that simple. Let’s walk through what you need to know.
Your legal obligations when it comes to remote workers
Before you even think about updating contracts, you must correctly classify your workers and adjust accordingly.
1. Are they employees, contractors or something else altogether?
Employees are entitled to specific protections under the Fair Work Act 2009 (Cth) and other legislation, while independent contractors have different rights and obligations.
Misclassification can have serious consequences, even if it’s accidental. Always confirm whether your remote worker is an employee or contractor.
2. Work health and safety laws
As an employer, your duty of care doesn’t stop at the office door. Under Australian work health and safety (WHS) laws, you’re responsible for ensuring your employees have a safe working environment. That includes their home.
This might mean you will need to conduct a risk assessment of their home office or provide ergonomic equipment.
3. The Fair Work Act 2009 (Cth)
Remote employees have the same rights as employees working in the office. The Fair Work Act recognises that employees may request flexible working arrangements, including remote work.
If an employee has worked for you for at least 12 months and has responsibilities such as caring for a child or has a disability, you’re legally required to consider their request and respond in writing within 21 days. You can refuse on reasonable business grounds.
4. Discrimination laws
Australia has strong protections for employees when it comes to their carers’ responsibilities and their disabilities.
For example, under the Disability Discrimination Act 1992 (Cth), employers must make reasonable adjustments for employees with disabilities and employees. This could include allowing an employee to work from home.
A failure to make reasonable adjustments constitutes unlawful disability discrimination under the Act. There are a number of exceptions to this rule. This includes that the adjustment would cause unjustifiable hardship to your business.
Whether or not allowing an employee to work from home would cause an unjustifiable hardship to your business will always depend on the circumstances, and you should consult an employment lawyer for specific advice on your circumstances.
5. Workers compensation laws
Just because an employee is working from home doesn’t mean they’re off the clock when it comes to workers’ compensation.
In the case of Workers’ Compensation Nominal Insurer v Hill [2020] NSWCA 54, a worker died while working from home. Her children brought a workers compensation claim, and the court found that the employee, while working from home, was entitled to workers compensation.
Employers must remember: a home can still be considered a “workplace” under the law. Note that workers compensation laws differ in each state and Territory.
5. Privacy laws
Monitoring employees is more complex in a remote environment. Surveillance (like tracking keystrokes or webcam monitoring) must comply with privacy laws and workplace surveillance legislation, especially when it invades the home.
This could also undermine your legally binding employment contract terms, which may contractually bind your organisation to comply with privacy law.
The law on workplace surveillance differs in every state and Territory, so ensure you seek advice from a professional employment lawyer before updating your employment contracts.
How to update your employment contracts for remote working
Now that you understand the legal framework, how should you update your contract for work from home arrangements?
Ensure the terms comply with Australian law
Employment contracts must have terms consistent with all relevant legislation and other industrial instruments.
This includes the Fair Work Act 2009 (Cth), state-based laws, modern awards and any applicable enterprise agreement.
It’s essential to ensure that your legally binding employment contract terms are correctly drafted to cover remote work scenarios.
Be cautious if you’re adapting templates found online. They might not suit Australian laws or your specific industry.
Address work-from-home expenses and other liabilities
Who pays for the internet? Electricity? A new office chair?
Your contract should clearly spell out what expenses you’ll reimburse and what costs the employee is expected to cover.
It’s also worth considering provisions for insurance and liability for equipment provided.
Clearly define working hours and performance expectations
Remote work often blurs the lines between “work time” and “personal time.” To avoid disputes around things such as overtime, ensure your contracts specify working hours, availability expectations and how performance will be measured.
This protects both the business and the employee.
Introduce a remote work policy
Along with updating the employment contract, businesses should implement a clear remote work policy. You might be wondering, what is a typical remote work policy?
Generally, it outlines expectations around communication, cybersecurity, WHS obligation, and performance monitoring.
It does not necessarily need to be incorporated directly into the employment contract itself, but employees should be made aware of it.
Keeping it separate makes it easier to update as business needs evolve.
Consult a specialist employment lawyer
Remote work raises unique legal issues that differ from traditional employment. A specialist employment lawyer can help you review and update your contracts and policies so they meet all legal requirements and suit your business operations.
They can also guide you on best practices for implementing a remote work policy without causing unintended contractual issues.
Need help updating your employment contracts for your remote workers?
Remote work is here to stay, but navigating the legal requirements doesn’t have to be overwhelming.
At Prosper Law, we help businesses of all sizes update contracts for work from home arrangements, draft legally binding employment contract terms and create remote work policies that comply with Australian law.
If you’re growing your remote team or reviewing your current arrangements, don’t risk costly mistakes. Contact the team at Prosper Law today to get the expert help you need.
