Employers in Australia are legally required to consult with employees about major workplace changes and safety matters.
This article, by our workplace lawyers, explains your consultation obligations under the Fair Work Act and work health and safety (WHS) laws, including recent updates, penalties for non-compliance, and practical steps to meet your duties.
Key Takeaways
Consultation is mandatory under the Fair Work Act for major workplace changes and changes to regular rosters or hours.
Default rules apply – if an enterprise agreement lacks a consultation clause, the model term is automatically enforced.
Employers must engage by sharing relevant info, seeking employee input, and genuinely considering feedback.
WHS laws require consultation on safety matters across all states and territories.
Non-compliance carries penalties, and upcoming changes will give the Fair Work Commission greater control over model terms.
Legislative Framework
Under the Fair Work Act 2009 (Cth), employers in Australia must consult with employees about:
Major workplace changes that are likely to significantly affect them (such as redundancies or restructures)
Changes to regular rosters or ordinary working hours
For Businesses Covered by an Enterprise Agreement
The enterprise agreement must include a consultation clause. If it doesn’t, the model consultation term from the Fair Work Regulations automatically applies.
For Businesses Not Covered by an Enterprise Agreement
Consultation obligations may still apply under:
Modern awards – Most awards include a standard consultation clause that employers must follow.
National Employment Standards (NES) – Some consultation duties arise under NES (e.g., changes to working hours for casual employees converting to permanent).
Work Health and Safety (WHS) laws – All businesses, regardless of award or agreement coverage, must consult workers on health and safety matters.
For a broader overview of your responsibilities as an employer, read our guide to The Fair Work Act for Employers.
Model Consultation Requirements
If the model consultation term applies (or if you’re following similar requirements under a modern award), you must:
Provide information about the proposed change, including what is changing and why
Invite employees (and their representatives, if any) to provide feedback, particularly about impacts on family or caring responsibilities
Genuinely consider the views expressed before making a final decision
Note: You do not have to disclose confidential or commercially sensitive information during the consultation process.
WHS Consultation Duties
The Work Health and Safety Act 2011 (NSW) and equivalent laws in other states require businesses to consult with workers who may be affected by safety matters.
Consultation is required when:
- Identifying hazards and risks
- Choosing control measures
- Modifying workplace conditions or equipment
- Establishing monitoring or training procedures
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.
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
Penalties for Non-Compliance
Failing to meet consultation obligations under the Fair Work Act or WHS legislation can result in serious legal and financial consequences.
Employers failing to consult employees as required under a modern award or enterprise agreement may face Court-imposed penalties, enforced by the Fair Work Ombudsman.
Under state WHS laws (e.g. Victoria’s OHS Act 2004 s 35), serious risks can arise when consultation is skipped (especially before workplace changes).
Example: A manufacturing company could face a $150,000 fine where a serious injury occurred following a layout change without proper worker consultation.
Latest Legislative Developments: Model Terms Update
On 21 February 2025, the FWC Full Bench released new model terms for enterprise agreements, including consultation, flexibility, and dispute resolution clauses, under the Closing Loopholes No. 2 Act
These updated model terms became effective on 26 February 2025, ensuring all enterprise agreements (whether silent or non-compliant) now include the latest standards
The updates modernise workplace practices by:
Clarifying employer obligations during consultation
Enhancing employee rights to representation and feedback
Standardising provisions across newer agreements
Best Practice Consultation Checklist 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.
