The push for a four-day work week has reignited debate in Australia, sparking a strong response from industry leaders who view the proposal as “completely unrealistic.” Andrew McKellar, Chief Executive of the Australian Chamber of Commerce and Industry (ACCI), recently voiced strong opposition to legislating a shorter workweek, emphasising its potential negative impact on small and medium-sized businesses.

The Four-Day Work Week Proposal

The Australian Greens have renewed their push for nationwide trials of a four-day work week. Under this policy, workers would maintain their full salaries while reducing their working hours to 80% of their current load. Senator Barbara Pocock argues that this approach could enhance productivity, reduce absenteeism, boost staff retention, and improve work-life balance.

According to Pocock, introducing a four-day week is “good for everyone,” allowing employees greater flexibility and time to manage personal responsibilities. She highlighted successful trials internationally, notably in the UK, Canada, Germany, and Spain, that demonstrated positive outcomes such as improved employee health, reduced stress, and increased happiness.

Employer Concerns and Industry Realities

Despite growing popularity among workers, McKellar strongly criticised the proposal during his recent speech at the National Press Club. He argued that mandating extra annual leave or reducing the workweek nationally would negatively impact productivity, particularly in smaller businesses already facing operational challenges.

McKellar insists that decisions on workweek structures should remain at the discretion of individual businesses, suggesting that employers themselves are best positioned to judge the most effective working patterns.

Growing Employee Demand

Employee interest in flexible working arrangements is undeniably high. Recent reports from recruitment agency Robert Half indicate that 65% of Australian workers prefer working their current hours across four days without a salary reduction, while an additional 63% are open to reduced hours overall if salaries remain unchanged.

Companies across Australia have begun trialling and adopting four-day weeks voluntarily. Notably, North Melbourne social enterprise ‘Our Community’ successfully implemented a permanent four-day week following a successful trial period in 2022, reporting high employee satisfaction and no significant productivity losses.

Global Success and Positive Outcomes

Globally, the four-day work week trials in countries like Spain and the UK have yielded encouraging results. Spain’s pilot saw workers reporting increased happiness, lower stress levels, and improved health. Additionally, it resulted in environmental benefits due to decreased commuting, reducing pollution significantly.

The UK’s pilot program similarly revealed benefits for both employers and employees, reinforcing the feasibility of shorter work weeks.

Moving Forward: Balancing Flexibility and Productivity

The debate in Australia continues to centre around balancing workplace flexibility with economic realities. While business leaders like McKellar highlight practical challenges for SMEs, legislators and employee advocates see shorter weeks as essential for modernising Australian workplaces.

Ultimately, whether legislated or employer-driven, the four-day work week discussion highlights a critical conversation about redefining work-life balance for the future.

Key Takeaways

• Four-day work weeks are increasingly popular with employees globally and in Australia.
• Business leaders warn against legislating shorter weeks, citing potential harm to productivity.
• Successful international trials demonstrate possible benefits including increased employee wellbeing and environmental advantages.
• Individual Australian businesses are already adopting shorter workweeks voluntarily, highlighting the need for a balanced and flexible approach.

Unfair Dismissal Case: Why Proper Redundancy Procedures Matter

The Fair Work Commission (FWC) recently ruled on an important unfair dismissal case highlighting the critical importance of adhering to proper redundancy procedures. This case involved a senior application manager from Kognitiv Australia Pty Ltd, whose sudden termination after nearly eight years of dedicated service raised significant legal and ethical concerns.

Sudden Dismissal Without Consultation

The employee was abruptly terminated without prior notice or consultation on 22 November 2024, amid claims of financial difficulties stemming from delays in selling the Enterprise Loyalty Business. Her employer, Kognitiv Australia, argued that immediate staff reductions were essential. However, the abrupt nature of the dismissal and the lack of prior consultation violated essential workplace regulations.

The worker repeatedly attempted to contact her employer for clarification regarding her dismissal and outstanding leave entitlements but received no response. This lack of communication compounded the financial and emotional impact of her sudden unemployment.

Legal Requirements for Genuine Redundancy

Under Australian employment law, particularly Section 389 of the Fair Work Act, redundancy must satisfy specific criteria to be considered genuine. Crucially, employers are legally required to consult employees regarding significant operational changes, especially when these result in termination.

In this case, despite the employer’s financial justification, the FWC determined the redundancy was not genuine due to the employer’s failure to meet these consultation obligations. Specifically, Clause 38 of the Clerks-Private Sector Award 2020, covering the worker’s role, clearly mandates prior consultation for significant employment changes, including termination.

Impact on Employees and Legal Implications

The FWC highlighted the considerable impact of this failure to consult, noting the worker had served without any performance issues for nearly a decade. The abrupt termination significantly disrupted her financial stability, particularly as her accrued leave entitlements remained unpaid.

The Commission emphasised the importance of consultation, citing the lack of any dialogue or notice before dismissal. The absence of communication, even after termination, further underscored the unfairness experienced by the employee.

Compensation and the Importance of Fair Treatment

Although the worker secured new employment shortly after, the FWC ruled that her sudden and unconsulted dismissal had indeed caused economic hardship warranting compensation. The Commission applied the “Sprigg formula,” which evaluates potential remuneration lost due to dismissal. Despite the employer ceasing all Australian operations, the FWC determined it would be unjust not to award compensation, reinforcing the principle of fair treatment embedded in Australian employment law.

Ultimately, the FWC ordered Kognitiv Australia to pay the employee three weeks’ wages, totalling $7,701, as compensation for the unfair dismissal.

Key Takeaways for Employers

• Always adhere to statutory consultation requirements when implementing redundancies.
• Clearly communicate with employees about operational changes and potential job impacts.
• Recognise the legal obligation to pay accrued entitlements promptly upon termination.
• Understand that failing to follow redundancy procedures can result in costly legal consequences.

This ruling serves as a timely reminder of the critical importance of proper redundancy procedures to ensure compliance with Australian employment laws and to maintain fairness and transparency within workplaces.

When Should Small Businesses Engage an External HR Partner?

Managing staff effectively is crucial for Australian small businesses, yet the complexities of human resources (HR) can often become overwhelming. Engaging an external HR firm is a strategic decision that can support your business’s growth and ensure compliance with Australian employment law. Here are clear indicators of when your business should consider seeking external HR support:

1. Rapid Business Expansion

When your business grows quickly, so do your HR responsibilities. An external HR firm can efficiently manage hiring, onboarding, and employee management, enabling you to focus on core business operations and strategic goals.

2. Limited Internal HR Expertise

Many small businesses lack specialised knowledge in areas such as employment contracts, award conditions, and workplace relations. External HR experts bring valuable expertise, ensuring compliance and reducing the risk of costly mistakes.

3. Managing Employee Conflicts

Persistent workplace conflicts negatively impact morale and productivity. External HR specialists provide impartial conflict resolution services, helping your business maintain harmony and reducing employee turnover.

4. Ensuring Compliance with Australian Employment Law

Australian employment laws and awards frequently evolve, and non-compliance can lead to significant fines or legal action. An external HR provider ensures your business stays current with Fair Work regulations, WHS (Work Health and Safety), and other essential employment laws.

5. Developing and Implementing HR Policies

Effective HR policies ensure fairness and clarity within your workplace. HR consultants can help develop, update, and implement tailored policies, keeping your business aligned with Australian employment standards and best practices.

6. Employee Training and Development

Investment in employee training and development is key to maintaining a productive, motivated workforce. HR firms offer structured training programs suited to Australian standards, improving your team’s skills and supporting business growth.

7. Payroll and Benefits Administration

Payroll and superannuation administration can be complex and time-consuming. Outsourcing these functions ensures accurate, timely processing and full compliance with Australian taxation and superannuation obligations.

8. Conducting Workplace Investigations

For serious workplace allegations such as harassment, bullying, or discrimination, external HR firms can provide impartial, professional investigations, protecting your business legally and reputationally.

Key Takeaways for Small Businesses:

• Engage an external HR firm when specialised HR expertise is required or internal resources are limited.
• Outsourcing HR ensures compliance with Australian employment laws, minimises risks, and enhances operational efficiency.
• External HR providers significantly enhance employee relations, training, and overall workplace culture.

By recognising when to engage an external HR firm, small businesses can manage their workforce effectively, maintain compliance, and focus confidently on achieving their strategic business objectives.

10 Unusual Employment Laws from Around the World

Employment laws exist to protect workers and employers, but some regulations around the world can seem peculiar, unusual, or downright baffling. Here’s a look at ten of the world’s strangest employment laws:

1. Chewing Gum Ban at Work (Singapore)

In Singapore, chewing gum is famously banned due to strict cleanliness laws. Employees are prohibited from chewing gum at workplaces, aligning with the nation’s focus on cleanliness and order.

2. Smiling Required (Milan, Italy)

In Milan, there’s a legal requirement for workers in customer-facing roles to smile at customers, with exemptions for hospital and funeral workers.

3. Weight Limits for Flight Attendants (India)

Airlines in India can legally dismiss cabin crew members if they exceed specific weight limits, under the rationale that weight affects job performance.

4. Mandatory Vacation (Austria)

Austrian law mandates that employees receive not only generous annual leave but also requires them to take at least one continuous holiday of two weeks per year.

5. Illegal Overtime (Japan)

While overtime work is common in many places, Japan limits the monthly overtime for employees. Employers can face fines or penalties if limits are exceeded.

6. Strict Dress Codes (North Korea)

North Korean employees face stringent dress code laws, with restrictions on hairstyles, clothing, and accessories that employees must adhere to strictly.

7. Permission to Quit (Qatar)

Historically in Qatar, workers required employer approval to change jobs or leave the country, although recent reforms have eased these strict conditions somewhat.

8. Siesta Law (Spain)

Though less common in big cities today, certain regions in Spain traditionally observe legally protected afternoon breaks (siestas), where businesses close temporarily.

9. Paid Leave for Weddings (Greece)

Greek employment law grants workers paid leave specifically for getting married—typically up to five days to celebrate.

10. Illegal to Work in High Temperatures (Saudi Arabia)

In Saudi Arabia, working outdoors between noon and 3 pm in extreme summer heat is prohibited to protect workers from heat-related illnesses.

Liquid HR is a leading HR consulting firm helping businesses of all sizes to navigate the complexities of human resource management, while providing tailored HR services based on their unique requirements, including HR Outsourcing, Recruitment and HR Advisory Services.

With offices in Melbourne, Sydney and Brisbane, we work with businesses across Australia.

For more information, please contact us on 1300 887 458 and speak with one of our HR Consultants.