Andrew Douglas: Now we are definitely onto the main topic.

Kim McLagan: Everyone’s been waiting for.

Andrew Douglas: Have you been waiting for this, have you? I think we’ve been waiting for the bomb to go off.

Kim McLagan: Yeah.

Andrew Douglas: Can I say to you, it is just a bunch of rot. The, you know, I listened to the AI group talking about it being criminal. Well, let’s press the button for it, neh, no, it’s not. We listen to Union saying, “Look, this is always what should have happened and it’s a great thing and it’s going to change the world.” No, it’s not.

All it is is that employees under certain circumstances have a right not to respond to any form of contact that occurs so long as what they do is, it’s reasonable.

Kim McLagan: Yeah.

Andrew Douglas: So if you look at the seniority of the person, the nature of the work that they undertake, the contractual structure of that work, you know, the requirement to work extra hours as required outside of duties.

Kim McLagan: If they’re duly compensated.

Andrew Douglas: Yeah, they’re properly compensated to do that work. There’s a whole series of factors. So now you know that we go, “Well, what are the changes I need to make?” Well, it’s a governance step really. You go and look at your contracts and see are they being paid over award. If they’re award-based, is the compensation sufficient to meet award expectations for any overtime? Do all that sort of stuff, do that test. Do you have a policy around out-of-hours work and what it exists and why the reasons exist.

So do you have a policy that says very clearly that “Look, out-of-hours conduct for these classifications will be required for the following reasons and to provide business reasons,” but to ensure that people are adequately remunerated for it and not otherwise connected or engaged when it’s outside of these.

If you do that, it’s nothing, like, it’s such a small bit of infrastructure change and discussion. But you would think the world has changed.

Kim McLagan: Yeah.

Andrew Douglas: And the reality is, if I started contacting, if Kim was a young lawyer and I started ringing up and saying, “Look, it’s nine o’clock, I need you back in here.”

Kim McLagan: Mm.

Andrew Douglas: That’d be a psychological hazard, okay? Because it’s very unlikely I do. But if I did that and tried to exploit the young lawyer and put excessive workloads and demands, safety law already provides that protection. So the answer is the law is already there. It’s a more diffuse, it’s not as tangible as disclosing the loop change, but it is a complete nonsense to think that it will change the world greatly. It’ll create a more respectful world, a world with greater clarity. I accept all those things.

Kim McLagan: Mm.

Andrew Douglas: But in governance terms, what have I got to do? It’s really simple.

Kim McLagan: Yeah.

Andrew Douglas: And you must speak honestly and consult with your employees now ’cause this is a change and safety law requires you to consult. So this change is coming through, “Hey, Kim, you are paid over. You’re well and truly above an award and the reason you paid is for these reasons.”

So we will be contacted and obviously, we’ll be respectful. You know, our business after 7:30, we send a text to each other to say, “I’m going to give you a ring.” We do those things. Why we do it? Because Kim might send a text back and say, “We’re down, I’m in the middle of lunch, a dinner with the kids, gimme a ring 8:30,” this is all it’s required to take.

So I don’t know about you, but I’m underwhelmed by the change that’s going through.

Kim McLagan: Yeah, everyone’s a bit scared by it. Everyone’s a bit confused by it as to what it means. But it only means that if there is a dispute, try and resolve it internally. If you can’t resolve it internally, you can go to the Fair Work Commission. There’s no penalty unless the Fair Work Commission makes an order and you contravene.

Andrew Douglas: And there’s the other issue that if it’s not a reasonable requirement and you start to punish or treat that person adversely, it is-

Kim McLagan: It creates a general protection.

Andrew Douglas: General protection, it’s a workplace, right? That is now in the legislation, which can be defended by a General Protections claim. And can I say the difficulty with that is you have a reverse onus? So you’ve got to demonstrate that the requirement was reasonable. And the misconduct you complain of is a misconduct in the terms of what is misconduct and therefore it was appropriate to do it all. That obligation rests upon you.

Kim McLagan: Yeah.

Andrew Douglas: So I’m not a big person with lots of paperwork, but I would like you to do this governance review of the relevant paperwork.

Kim McLagan: Mm.

Andrew Douglas: I would like you to consult so there’s clarity and then you are never going to have these problems, okay?

Kim McLagan: And just keep in mind too, it only applies to employers 15 or over at the moment.

Andrew Douglas: Yeah.

Kim McLagan: We’ve already had that inquiry this week.

Andrew Douglas: Yeah.

Kim McLagan: Smaller employers doesn’t come in for another 12 months.

Andrew Douglas: And it doesn’t affect, if you’re a high-income, over the high-income threshold, you’re still caught by this legislative change that’s coming, although there’s amendments being made to all awards, it doesn’t exclude you.

Kim McLagan: Yeah.

Andrew Douglas: Okay.

Kim McLagan: Okay.

Andrew Douglas: All right.

Kim McLagan: Step forward, don’t be scared.

Andrew Douglas: Yeah, okay, well, let’s have a bit of a glance at the main topic. Okay.

Kim McLagan: All right.

Andrew Douglas: Here we go. Oh, it disappeared, come on back, Darren. So if you bring us back, what’s happening, there we are.

Kim McLagan: Darren was an IT manager for an online Super Fund called SuperGood. He worked flexibly three days a week from home. Clients needed to access SuperChoices, an online investment portal on the SuperGood website 24 hours a day to get the best results on their self-managed Super Funds. Any downtime could mean significant losses for clients. The changing requirements of clients and challenge of competitors meant that SuperGood was constantly updating the SuperChoice’s portal for reporting and client functionality.

Darren had signed a contract that explained the nature of the business and paid him a significant wage above the classification level 6 under the Banking, Finance, and Insurance Award. The contract required him to work such additional hours outside of hours as required. His contract was not an award-based annualisation contract, rather a common law contract with a set-off.

Darren was inclined to work his extra hours at work and protect his family time at home as much as he could. Over the year, there were several payroll periods where his hours worked were so high that based on the Award, he received less than he was entitled under the Award. But over the year, he was paid over 32,000 above the Award classification pay. He was above the high-income threshold and the contract said he was Award-free.

On the 27th of August ’24, Darren was home, went home on time, he was sitting down for dinner and his phone rang. It was his boss. He ignored the call. As far as he was concerned, he had disconnected for the day. The boss sent urgent messages saying the system was down and they needed him urgently. He ignored it. The calls and messages increased and the frustration of his non-response grew with it. He sent an email back saying, “I have disconnected, see you tomorrow.”

The following day, he was directed to a meeting with the CEO and HR manager. He was asked to show cause why his employment should not be terminated for significant risk caused by his non-attendance. He walked out of the meeting against the instruction to stay with his support person before it finished saying he was being bullied and treated adversely for exercising a workplace at a protected attribute.

The employer terminated Darren’s employment.

It’s a good case study, yeah.

Andrew Douglas: Yeah. Did Darren have the right to disconnect?

Kim McLagan: No.

Andrew Douglas: Like Darren, nah. Senior, paid a lot, specific job, which meant controlling a system.

Kim McLagan: Yeah.

Andrew Douglas: Yeah. Given clear directions, had a contract that acknowledged that need. Yeah, no chance at all. Was SuperGood entitled to expect a response and acquire him to work? Yes, it was.

Kim McLagan: Yes, it was.

Andrew Douglas: So there you go. Was there any breach of the Award? Really good argument here.

Kim McLagan: Yeah.

Andrew Douglas: The breach, because a common law contract is only effective in relation to Award-based payments where you were paid equal to or above in any payroll period. Fair Work Ombudsman’s unlikely to prosecute if, over a year, you are paid more. But the answer is it’s a technical breach of the Award. And there is an argument then about the application of their high-income threshold.

Not an easy argument, but I’m putting it out there just to show you where the risk sits.

Would Darren have a good General Protections claim? Not at all. Not at all. So by not being reasonable what he did, he doesn’t have a workplace, right, that Darren’s referred to as a protected attribute because he’s only just come in. He didn’t know what the law was but it’s a workplace, right.

Kim McLagan: Yeah.

Andrew Douglas: But as I’ve said before, the difficulty is there’s no doubt Darren would run it because there’s a reverse onus of proof in General Protections claims, which means you have to prove that it was unreasonable what he did and any failing in documentation consultation, those sort of issues erodes your capacity. And most definitely the decision to terminate was because he disconnected. So it goes directly to the attributes.

Kim McLagan: Yeah, okay.

Andrew Douglas: Okay. What are you up to, if there was no set-off clause or clauses having expectations of being available, would Darren have a good workers’ compensation claim?

Kim McLagan: Yeah, he would, actually.

Andrew Douglas: Just remember workers’ compensations’ gumby law. You know, let’s be honest about it. So they’re not going to apply the law as it should be applied. But even if it was applied correctly, the failure to warrant within it or to say within it that there is this expectation of extra work would not only create a workers’ compensation claim, but probably a General Protections claim as well. So it’s definitely going to get a workers’ comp claim up there.

Kim McLagan: Yeah.

Andrew Douglas: Okay.

Kim McLagan: So always looking at your contracts for your high-income employees.

Andrew Douglas: Yeah, always have the clause that excludes and it means you just got to model it carefully. That’s all, before you do it, go through each payroll period. If you’re seasonal, you’re really looking at annualised salary. If it’s not seasonal-based work, then Commonwealth contract’s a much better way of doing so long as you pay sufficient in each payroll period.

As Darren was above the high-income threshold, does that mean he’s exempt from the right to disconnect? No, it doesn’t, so there you go, that’s an easy answer. I think we’re there, you know?

Kim McLagan: No, one more.

Andrew Douglas: We’ve got one more, have we? What’s the next question?

Kim McLagan: Oh, it’s not there.

Andrew Douglas: It should be-

Kim McLagan: If Darren was an IT junior, would he have a right to disconnect in the same circumstances, particularly, if he was paid on the Award?

Andrew Douglas: Yes, he would, okay, why? Because he is not getting compensated for it. He’s got a low-skill base. He doesn’t have set-off clauses. He is exactly who the right this guy does apply. So, yes, he would.

There you go, I thought it was an interesting day, wasn’t it?

Kim McLagan: Yeah, it’s good.

Andrew Douglas: Fascinating topics and lovely to have you along. By the way, I don’t know who I’ve got with me next week, is it me who’s doing it?

Kim McLagan: No, you and Nina are doing it.

Andrew Douglas: I’m doing it. I must be coming in early. All right, thumbs up, and thanks very much guys. See you later. Bye-bye.

Kim McLagan: Bye.