This month’s ER/IR Update focuses on two significant Fair Work developments with practical implications for employers. We unpack a recent Federal Court decision involving part‑time employees that highlights common compliance risks around contracts, rostering and pay practices, as well as the new Road Transport Contractual Chain Order introducing mandatory fuel cost recovery obligations. We also flag a separate blog post examining a $90,000 sexual harassment case that serves as an important reminder for small businesses.
Ruling on Part Time Workers – How it Affects Your Business
We would like to present a summary of a recent case that will have implications for how businesses manage part time employees.
The proceedings were prepared by the Australasian Meat Industry Employees Union (AMIEU) against Woolworths and heard before the Federal Circuit and Family Court of Australia (FCFRCOA). Woolworths was found to have contravened the Fair Work Act with respect to its treatment of three part time employees in one its Perth stores and was ordered to pay a fine of over $230,000.
The following errors were highlighted in the case:
- The part time employees were not provided with their contractual hours of work as specified in their contracts of employment.
- They were not provided with a predictable pattern of work.
- They were required to work additional hours without consent, and on occasion without paying overtime.
- Standard rosters were changed without following processes.
- Contracts were unilaterally changed without consent from the employees.
- There were unauthorised deductions from payments to employees.
Lessons Learned from This Ruling
This case highlights the importance of strict compliance with part-time employment provisions, particularly during onboarding and roster management. Some key points are below.
- All part time employees should have a guarantee of predictable hours and must be paid for the total agreed hours specified in their contract, including ordinary hours per week and the days and time
- Employees may work additional hours beyond their guaranteed part-time hours only if the request is reasonable and they consent. Additional hours must be paid at the appropriate overtime rates prescribed by the award or agreement. Even if a business is quiet, part time hours cannot be unilaterally reduced and must be paid for.
- Any changes to rosters must follow the notice and consultation requirements in the applicable award or enterprise agreement. In most cases, changes require genuine agreement (often confirmed in writing).
- Changes to an employee’s contract of employment (including guaranteed hours) also cannot be made unilaterally. Variations require mutual agreement.
- Employers must not make deductions from an employee’s pay unless the deduction is authorised in writing by the employee and complies with the requirements of the Fair Work Act.
Recommended Actions
- Review all part-time contracts and roster practices to ensure they clearly specify guaranteed hours and a predictable pattern of work.
- Update internal processes for roster changes, additional hours requests, and payroll deductions.
- Provide clear written agreements and maintain proper records of any variations or authorisations.
HR Central have updated guidance documents and templates in your HRC Resources Suite as below.
- Reference – Deductions
- Template – Authorised Deduction Letter
- Checklist – Employee Pay Deductions
Road Transport Contractual Chain Order – Fuel Cost Recovery – 21 April 2026
The Road Transport Contractual Chain Order – Fuel Cost Recovery – 2026, issued by the Fair Work Commission, commenced on 21 April 2026 and applies where at least one primary party in the chain is a constitutional corporation. It represents a shift from past arrangements which rely on fixed-price contracts with limited adjustment mechanisms, introducing a system that requires ongoing recognition or fuel cost changes.
Who does it apply to?
First, the order captures businesses that engage transport services, even if transport is not their core activity. This includes large retailers, supermarkets, manufacturers, construction companies, wholesalers, and mining or resource companies. If these businesses contract another party to move goods by road, they are considered “primary parties” and must ensure the rates they pay allow for fuel cost recovery. While small business employers under the Fair Work Act 2009 are exempt from the obligation to take reasonable steps to ensure other comply, they must ensure their own contracts allow for fuel cost recovery and may still be affected indirectly through increased transport costs passed on to them.
Secondly, it applies to road transport businesses and labour hire entities that sit between the client and the driver. These “secondary parties” often manage fleets or subcontract work further. They now have a direct obligation to pass through fuel cost increases to the next party in the chain, rather than absorbing or delaying those costs.
Thirdly, the order directly benefits and applies to those performing the work. These parties must receive adjusted rates that reflect increased fuel costs, rather than bearing those increases themselves.
These parties include:
- owner drivers operating as sole traders
- small family-run transport businesses
- subcontract drivers engaged by larger fleets
- “employee-like workers” in transport arrangements
- regulated road transport contractors
The order also extends to digital labour platform operators in the road transport industry and those coordinating or facilitating road transport work (for example, freight matching or delivery platforms).
What does the order require?
The order creates a recurring obligation for each party to pass through fuel cost increases down the contracting chain. Primary parties must take reasonable steps to ensure that secondary parties engaging regulated road transport contractors or road transport employee-like workers adjust the rates they pay to ensure recovery of the increased cost of fuel.
Adjustments must be made within each fortnight or twice per calendar month. Increases are measured against the cost of fuel as it was on or before 6 March 2026, meaning only the difference between current costs and that baseline, the “increased cost of fuel”, triggers the obligation.
Adjustments can be made by:
- an adjustment to the rate or a component of the rate;
- the introduction of a fuel increment or levy;
- a direct reimbursement;
- offset of money expended upon the increased cost of fuel; or
- any combination of these.
If a contract or enterprise agreement already contains a “rise and fall” formula or cost model that accounts for recovery of the increased cost of fuel, that mechanism satisfies the obligation – provided it actually delivers the adjustment.
When will the order not apply?
The requirements will cease to apply if the weekly average national terminal gate price for diesel, as measured in the weekly diesel price report of the Australian Institute of Petroleum, falls below 2.00 per litre or when the order is cancelled.
Small Business and Sexual Harassment in the Workplace:: A $90,000 Case
Additionally, we’ve posted a separate blog post chronicling the outcomes and rulings of the Federal Circuit and Family Court on a sexual harassment claim in the workplace.
Click Here to read this article in full.
Need Advice?
ER Strategies are experts in employment compliance and can assist you in managing your employment compliance responsibilities. To discuss your obligations and assistance we can provide, get in touch with us at 1300 55 66 37, or click the button below.
