Australian Employment Law Changes That Put Managers at Personal Risk: Everything You Need to Know in 2025
The landscape of Australian employment law has fundamentally shifted since 2017, and the changes aren’t just affecting companies anymore, they’re targeting individual managers personally. Here’s what every manager needs to know to protect themselves and their assets.
The Wake-Up Call: Personal Liability is Here
If you’re a manager in Australia, the rules of the game have changed dramatically. The days of hiding behind corporate structure when employment law breaches occur are over. Today’s reality is stark: you can be held personally liable for workplace law violations, with your personal assets at risk.
The Fair Work Ombudsman isn’t just going after companies anymore. They’re specifically targeting individuals who are “involved in” workplace breaches, including managers, HR professionals, and anyone who assists, influences, or knowingly participates in violations.
Criminal Wage Theft: The Game Changer of 2025
January 2025 marked a seismic shift in Australian employment law with the introduction of criminal penalties for intentional wage underpayments. This isn’t just about civil penalties anymore, this is about potential imprisonment and criminal records.
What this means for you as a manager:
- Criminal prosecution for deliberate underpayments
- Personal criminal liability if you authorise or ignore wage theft
- Potential jail time, not just financial penalties
- A permanent criminal record that follows you forever
Your liability exists regardless of your company’s structure, insurance coverage, or your employment status. If you’re involved, you’re exposed.
The Closing Loopholes Revolution
The Closing Loopholes Act 2023 and Closing Loopholes No. 2 Act 2024 represent the most comprehensive employment law reforms since the original Fair Work Act. These changes have fundamentally altered the employment landscape:
Right to Disconnect (August 2024)
Every Australian employee now has the right to disconnect from work communications outside their working hours. As a manager, you must respect employees’ right to refuse contact unless the refusal is unreasonable. The factors determining reasonableness include the reason for contact, the employee’s role, their personal circumstances, and whether they’re compensated for additional hours.
Gig Economy Worker Protections
‘Employee-like’ workers performing digital platform work now receive significant protections, including minimum standards orders and unfair deactivation dispute processes. This dramatically expands who receives workplace protections and creates new compliance obligations.
Enhanced Casual Employment Rules
The definition of casual employees has changed, along with casual conversion processes. This affects how you classify workers and your ongoing obligations to offer permanent employment to eligible casual workers.
Workplace Delegates’ Rights
New protections for workplace delegates strengthen union representation in workplaces, with the Fair Work Commission now able to make model terms for modern awards relating to delegate rights.
Parental Leave Expansion: More Obligations Coming
Australia’s Paid Parental Leave scheme continues expanding, with parents now receiving 22 weeks of paid leave (increased from 20 weeks in July 2024). This increases to 24 weeks from July 2025, reaching 26 weeks by July 2026, with 4 weeks reserved for each parent.
From July 2025, the government will also pay 12% superannuation on Parental Leave Pay, creating new administrative obligations for employers through the ATO system.
Performance Management: Your Biggest Personal Risk
Here’s where most managers get caught: procedurally unfair performance management is the number one source of successful unfair dismissal claims, and as the decision-maker, you’re personally liable for failures.
The six non-negotiable requirements:
- Clear performance expectations – documented and communicated with evidence they were understood
- Adequate training and support – demonstrable attempts to help the employee succeed
- Reasonable timeframes – sufficient opportunity for improvement
- Fair investigation – gathering all relevant facts, not opinions, before decisions
- Right of reply – employee opportunity to respond to any claims
- Consistent application – treating every individual consistently every time
Fail any of these and you’re personally liable for penalties.
The Enforcement Reality: They’re Coming for Individuals
The Fair Work Ombudsman’s approach has become increasingly aggressive in targeting individual liability. In the 2023-24 financial year, they sought orders against accessories in 46 out of 50 matters filed, demonstrating a clear strategy to hold individuals accountable.
The 2024 Federal Court case Fair Work Ombudsman v 85 Degrees Coffee Australia, which resulted in $1.44 million in civil penalties, sends a clear message: they’re targeting individuals, not just companies.
Your Personal Financial Exposure
The financial reality is sobering:
- Civil penalties: Up to $93,900 per breach for individuals (2025 rates)
- Employee back-payments: Full underpayment amounts plus interest
- Legal costs: Both sides’ legal fees
- Compensation: For stress, loss of opportunity, and other damages
Remember: each employee affected equals a separate breach, each pay period affected equals a separate breach, and each entitlement breached equals a separate breach. Underpaying five employees over six months could result in 30+ separate breaches and penalties exceeding $2.8 million.
Protection Strategies for Your Personal Assets
Essential steps to reduce your personal liability:
Procedural Compliance:
Follow company procedures exactly, with no shortcuts. If procedures aren’t up-to-date, follow procedural fairness requirements precisely. Document every step of performance management processes and ensure proper consultation.
Evidence Collection:
Keep detailed records of all performance discussions with dates and times, including informal conversations. Obtain written acknowledgment of warnings and improvement plans, and document all training and support provided.
Professional Advice:
Seek advice from HR and legal professionals with deep Australian employment law expertise before making performance management decisions. Don’t rely on “that’s how we’ve always done it.”
Training and Competency:
Ensure you understand current legal requirements through regular professional development and document your compliance training participation.
Earlier Significant Changes (2017-2022)
The Fair Work Amendment (Protecting Vulnerable Workers) Act 2017 introduced stronger penalties and made franchisors and holding companies potentially liable for contraventions by franchisees and subsidiaries.
The Fair Work Amendment (Family and Domestic Violence Leave) Act 2018 provided all employees with five days unpaid family and domestic violence leave, creating new employer support obligations.
The Bottom Line for Your Financial Future
Your personal assets, including your house, car, and savings, are now at risk. Insurance may not cover intentional breaches or criminal acts, bankruptcy won’t eliminate criminal liability, and your professional reputation and career prospects could be permanently damaged.
Critical questions every manager must answer:
- Can you afford a $93,900 penalty for each employee you mismanage?
- Is it worth risking your family’s financial security?
- Do you have adequate professional indemnity insurance for employment law breaches?
- Can you demonstrate due diligence in every employment decision you make?
Act Now
The Fair Work Ombudsman has unlimited resources, unlimited time, and statutory powers to investigate and prosecute. You have personal assets to lose and a career to protect.
Your choice is clear: professional compliance management or personal financial devastation.
Immediate action required:
- Audit your current performance management cases and identify procedural gaps immediately
- Review all pending disciplinary actions to ensure full procedural fairness
- Document your compliance training to create evidence of professional competence
- Establish professional advice protocols and know when to seek help before making decisions
- Review your professional indemnity insurance to ensure coverage for employment law liability
The Australian employment law landscape has changed forever. Don’t let ignorance become your downfall when your personal financial future is on the line.
Need help navigating these complex changes? The Learn Australian Employment Law Foundation Course provides practical jargon free training to help managers understand their obligations and protect themselves from personal liability. Learn more about the Australian employment law courses and how it will support you on your journey.
CASE LAW REFERENCES TO SUPPORT THIS DOCUMENT
Managers can be personally liable for workplace breaches. Managers who are aware of breaches of workplace laws in their business may be personally liable for those breaches. https://www.mondaq.com/australia/employee-rights-labour-relations/790830/managers-can-be-personally-liable-for-workplace-breaches
Personal liability for employment law breaches: a broader approach means more of us are in the firing line https://www.bartier.com.au/insights/articles/personal-liability-for-employment-law-breaches-a-broader-approach-means-more-of-us-are-in-the-firing-line
The exception to prevent an employer from being held liable for an employee’s action is if the employer can prove they took all reasonable steps to prevent the conduct of the employee. https://lawpath.com.au/blog/can-employee-liable-mistakes-made-job
What is the liability of the individuals involved? Individuals who harass, bully or discriminate against others in the workplace are directly liable for their own actions. https://humanrights.gov.au/our-work/sex-discrimination/vicarious-liability]
Accessorial liability means being involved in a breach https://www.fairwork.gov.au/about-us/compliance-and-enforcement/litigation/accessorial-liability