Small businesses now subject to right to disconnect laws

From today 26 August 2025, Australia's right to disconnect laws will extend to small businesses with fewer than 15 employees, marking a significant shift in how these businesses must balance operational needs with employee wellbeing. While larger businesses have been navigating these waters since August 2024, small businesses may face unique challenges that require careful consideration and strategic planning. The legal landscape: navigating uncharted waters The right to disconnect, enshrined in section 333M of the Fair Work Act 2009 (Cth), grants employees the right to refuse to monitor, read, or respond to work-related communications outside their working hours, unless such refusal would be "unreasonable". However, it's crucial for small business owners to understand that we currently lack persuasive guidance from the courts about what these terms actually mean in practice. This results in a challenging environment for small businesses, who must prepare for compliance without a clear understanding of the laws to guide their decision-making. Unlike larger corporations with dedicated legal teams and HR departments, small businesses must navigate this uncertainty with limited resources and expertise. Why small businesses face greater challenges Resource and staffing constraints Small businesses operations are fundamentally different from their larger counterparts. Whereas a multinational corporation might have dozens of employees who can cover critical functions, small businesses often rely on key individuals whose unavailability can create significant operational risks. Consider a small accounting firm during tax time, or a boutique marketing agency managing a critical client campaign. When an employee exercises their right to disconnect during a genuine business emergency, small businesses have fewer options for coverage and face proportionally higher risks to their operations, finances and client relationships. The flexibility paradox Many small businesses have built their competitive advantage on the flexibility and responsiveness of their workers. The ability to quickly adapt to client needs, respond to urgent requests, or handle unexpected situations has traditionally been a key differentiator against larger businesses. The right to disconnect potentially disrupts this model. Small businesses must now carefully balance their operational flexibility with respect for employee boundaries. This may posse a considerable challenge for: Service-based businesses where client expectations for immediate responses may have been established. Businesses operating across different time zones, where coordination between team members may require some after-hours communication. Seasonal businesses that experience intense periods requiring an all-hands-on-deck approach. Client relationship management Small business owners often maintain direct, personal relationships with their clients. Unlike larger businesses where client communication flows through multiple layers of the business, small business clients may expect direct access to key personnel. Managing these expectations while respecting employee rights requires delicate communication and clear boundary-setting. Practical challenges and risk mitigation Operational risk management Small businesses face several specific operational challenges when it comes to the right to disconnect. For example, in sectors where safety is paramount, the inability to reach key personnel during emergencies could create significant liability issues. Small businesses may find it beneficial to develop clear protocols defining what constitutes a genuine emergency and ensure alternative contact methods are available. When it comes to client service standards , small businesses must proactively communicate with clients about response times and availability, potentially renegotiating any service level agreements to align with the reality of these new laws. And for those small businesses that have embraced flexible working arrangements, these may now require renegotiation to avoid conflicts with right to disconnect provisions. Technology and Process Adaptations Small businesses can consider practical technological solutions, such as: Email scheduling systems to ensure communications are delivered only during working hours. Clear escalation procedures for genuinely urgent matters. Client communication protocols that set appropriate expectations about response times. The "reasonableness" question: key factors for small businesses While we await judicial guidance, the Fair Work Act sets out factors that must be considered when determining whether an employee's refusal to respond is "unreasonable": The reason for the contact and how urgent it is. The disruption caused to the employee. The employee's role and level of responsibility. Whether the employee receives compensation for after-hours availability. The employee's personal circumstances, including caring responsibilities. For small businesses, these factors create both opportunities and obligations. A senior manager in a small business may have different ideas of what is reasonable than a junior administrative assistant. Small businesses must be prepared to justify their expectations with clear documentation and fair compensation arrangements. Strategic recommendations for small businesses Proactive policy development Small businesses need to have right to disconnect policies in place. In doing so, some relevant considerations are: A clear definition of work hours for each role and employee type. Language in employment contracts to the effect of “you are required to work between 9.00am and 5.00pm and at such other times as reasonably required” may fall foul of the law. The need to establish emergency contact procedures if appropriate with specific criteria for after-hours contact. How you might adjust client expectations that align with employee rights. How to create fair compensation frameworks for roles requiring after-hours availability. Communication and training Small business owners might find success in engaging in open discussions with employees about the practical implications of the right to disconnect. These conversations might go beyond surface-level policy explanations so that business owners can genuinely understand each employee's individual circumstances and preferences around after-hours contact. Some employees may welcome occasional flexibility that allows them to manage personal commitments during traditional hours, while others may prefer strict boundaries between work and personal time. For roles that genuinely require some degree of after-hours availability, business owners are encouraged to work collaboratively with employees to negotiate mutually acceptable arrangements that respect personal boundaries while meeting operational needs. Equally important is ensuring that everyone from management down understands appropriate after-hours communication practices, including when contact is justified, how to assess the urgency of situations, and alternative approaches when employees exercise their right to disconnect. Client relationship management Small businesses may find it beneficial to proactively communicate with clients about the these changes and how they may affect service delivery. This involves having honest conversations about revised response time expectations, particularly for non-urgent matters that may now wait until business hours for resolution. Clients need to understand that while service quality will be maintained, the timing of responses may shift to align with employee work-life balance rights. For situations that genuinely require immediate attention, businesses could establish clear alternative contact procedures for emergencies, ensuring clients know how to escalate truly urgent matters while understanding that such escalation should be reserved for genuine crises. The goal is to develop adjusted service delivery models that honour employee boundaries while continuing to meet client needs effectively and professionally. The competitive advantage opportunity While the right to disconnect presents challenges, it also offers significant opportunities for small businesses to differentiate themselves as employers of choice in an increasingly competitive talent market. By proactively embracing work-life balance and employee wellbeing, small businesses can position themselves as attractive alternatives to larger organisations that may have developed cultures of constant availability leading to employee burnout. This approach can help attract high-quality talent from corporations where poor work-life balance has become endemic, while simultaneously improving employee retention by demonstrating genuine respect for personal boundaries and family commitments. Well-rested, engaged employees typically demonstrate enhanced productivity during working hours, creating a positive cycle where respect for personal time actually improves business outcomes. Perhaps most importantly, small businesses can use this transition to build truly sustainable business practices that don't rely on employee burnout or unreasonable after-hours expectations, creating more resilient and ethically sound operations. Looking ahead: managing uncertainty The absence of judicial guidance on the right to disconnect means small businesses must prepare for evolving interpretations as disputes arise and are resolved. Staying informed about Fair Work Commission and coourt decisions, and industry best practices will be crucial for ongoing compliance. Small businesses may also find it helpful to be prepared to adapt their policies as the practical application of the right to disconnect becomes clearer through real-world implementation and dispute resolution. Conclusion The extension of the right to disconnect laws to small businesses represents a significant shift in Australia's employment landscape. While small businesses face unique challenges due to their size, resource constraints, and operational models, proactive measures and strategic thinking can help them navigate this transition successfully. The key is to view this not merely as a compliance obligation, but as an opportunity to build more sustainable, attractive workplace cultures that benefit both employees and business outcomes. By embracing the impacts of this legislative change, small businesses can develop thoughtful approaches that respect employee wellbeing while maintaining the operational flexibility that makes them competitive. This article provides general information only and should not be relied upon as legal advice. Small businesses should consider consulting with HR/employment law specialists for advice specific to their circumstances.

Small businesses now subject to right to disconnect laws

Erica Taylor

Related Posts

Create New Account!

Retrieve your password

Small businesses now subject to right to disconnect laws

This content is available to members only. Click here to register!

Erica Taylor

Related Posts

Browse by Tags

Create New Account!

Retrieve your password