Employers in Australia are required to consult with employees regarding significant workplace changes and work health and safety (WHS) matters. This article provides a comprehensive overview of employer consultation obligations under Australian law, practical compliance steps, recent legislative developments, and answers to common questions.
Key Takeaways
Employers should note the following critical points:
- The Fair Work Act 2009 (Cth) requires enterprise agreements to include consultation terms about major workplace changes and changes to regular rosters or hours
- If an enterprise agreement lacks a consultation term, the model consultation term applies automatically
- Employers must provide relevant information, invite employee feedback, and genuinely consider employee input
- Work health and safety laws at both federal and state levels require consultation on safety matters
- Penalties for non-compliance can be significant
- Recent legislative amendments are transferring authority for model consultation terms to the Fair Work Commission
Legislative Framework
The Fair Work Act 2009 (Cth) mandates that enterprise agreements must include consultation terms requiring employers to consult employees about:
- Major workplace changes likely to have significant effects on employees
- Changes to regular rosters or ordinary hours of work
If an enterprise agreement lacks a consultation term, the model consultation term automatically applies.
Model Consultation Requirements
Major Workplace Changes
The model consultation term requires employers to:
- Provide information about the nature of proposed changes, their effects on employees, and any other matters likely to affect employees
- Invite employees to express their views about the impact, including on family or caring responsibilities
- Give prompt and genuine consideration to matters raised by employees during consultation
Information Disclosure Limitations
Employers are not required to disclose confidential or commercially sensitive information to employees during consultation processes.
Work Health and Safety Consultation
Primary Duty
The Work Health and Safety Act 2011 (NSW) requires persons conducting businesses or undertakings to consult, so far as reasonably practicable, with workers directly affected by WHS matters
Mandatory Consultation Areas
Consultation is required when:
- Identifying hazards and assessing risks
- Deciding on risk elimination methods
- Determining welfare facility adequacy
- Proposing changes affecting worker health or safety
- Establishing monitoring procedures
- Providing information and training
State-Specific Requirements
In Victoria, the Occupational Health and Safety Act 2004 mandates that employer consultation involves:
- Sharing information about consultation matters
- Providing reasonable opportunities for employees to express views
If employees are represented by health and safety representatives, consultation must involve these representatives, with or without direct employee involvement
Agreed Consultation Procedures
If employers and workers establish agreed consultation procedures, consultation must follow these procedures, provided they remain consistent with statutory requirements.
Penalties for Non-Compliance
Jurisdiction | Offender Type | Penalty Units | Legislation Reference |
Victoria | Natural person | 180 | Occupational Health and Safety Act 2004 s 35 |
Victoria | Body corporate | 900 | Occupational Health and Safety Act 2004 s 35 |
Redundancy Context Limitations
Some awards may not contain obligations to consult about redundancies. Employers should check applicable awards, as certain case examples have shown no consultation requirement for redundancy situations
Recent Legislative Developments
The Fair Work Legislation Amendment (Closing Loopholes) Bill 2023 proposes:
- Transferring authority for determining model consultation terms from regulations to the Fair Work Commission (FWC), positioning the FWC as Australia’s expert workplace relations tribunal
- Requiring the FWC to consider best practice workplace relations and ensure reasonable opportunities for submissions before determining model terms
The Fair Work Commission must determine model consultation terms through Full Bench constitution, with determinations constituting legislative instruments.
Implementation Requirements
Employers must establish consultation frameworks addressing both industrial relations changes under the Fair Work Act and occupational health and safety matters under state and territory WHS legislation. Compliance requires:
- Structured information sharing
- Meaningful employee participation
- Documented consideration of worker feedback
Best Practice Steps for Employers
To comply with consultation obligations, employers should:
- Review all enterprise agreements for appropriate consultation terms
- Establish clear frameworks for consulting employees on major changes and WHS matters
- Document all consultation processes, including information shared and feedback received
- Train managers and supervisors on legal requirements and best practice engagement
- Engage health and safety representatives where appointed
For assistance in meeting your workplace consultation obligations or reviewing your existing processes for compliance, contact our team for advice tailored to your business
Frequently Asked Questions
What is considered a “major workplace change” under the Fair Work Act?
A major workplace change is any significant alteration to the structure, operations, or employment conditions in a workplace that is likely to have a substantial impact on employees.
Are employers required to consult about redundancies?
Not all awards require consultation about redundancies. Employers should check the relevant award or enterprise agreement.
What information must be provided during consultation?
Employers must provide information about the nature of proposed changes, their likely effects on employees, and any other relevant matters, unless the information is confidential or commercially sensitive.
Who must be involved in work health and safety consultations?
Employers must consult directly with workers who may be affected by health and safety matters. If health and safety representatives are appointed, they must be involved.
What are the consequences of failing to consult properly?
Non-compliance can lead to substantial penalties. In Victoria, individuals may be fined up to 180 penalty units, while corporations can face penalties up to 900 units.
