Latest industrial reforms – what employers need to know

5 minute read 02.07.2026 Leyla Dixon, Briony Pole, Kelly Halpin

The Workplace Relations Legislation Amendment (Building Cooperative Workplaces No. 1) Bill 2026 has recently passed with the Greens' support.

Key takeouts

The Bill gives the FWC broader powers to deal with certain applications and applicants to reduce pressure on its workload. Employers should consider how these reforms impact their approach when responding to FWC claims.

A Greens amendment means mandatory terms in an intractable bargaining workplace determination must be "not less favourable" than the relevant enterprise agreement, with parties able to vary existing determinations within 12 months.

The Bill allows the Commonwealth Government to preference employers who have union enterprise agreements for procurement, grants, or other purposes the Minister determines. This will not amount to unlawful discrimination.

The Workplace Relations Legislation Amendment (Building Cooperative Workplaces No. 1) Bill 2026 (Bill) has recently passed with the Greens' support.

The primary purpose of the Bill is to amend the Fair Work Act 2009 (FW Act) and other related legislation to make changes across a range of subject areas, including to relieve workload pressures on the Fair Work Commission (FWC), to support the Government's broader policy objective of encouraging enterprise bargaining, and to enhance protections for road transport contractors.

The Bill also includes changes proposed by the Greens to ensure that a workplace determination under the FW Act's intractable bargaining regime cannot include less favourable mandatory terms (ie clauses for settling of disputes, flexibility, consultation and delegates' rights).

Unless otherwise set out below, the changes to the FW Act will start on the day the reforms receive Royal Assent.

What employers need to know

Commonwealth to preference employers with union enterprise agreements for procurement etc

The Bill enables the Commonwealth to preference employers whose employees are covered by an enterprise agreement, including union covered enterprise agreements, when entering into contractual relationships for procurement, administering grants, or for other purposes determined by the Minister for Employment and Workplace Relations, the Hon Amanda Rishworth MP.

The FW Act provides that a person must not discriminate against employers on the basis of coverage of employees by particular instruments. Under these changes, this preferencing of employers who have an enterprise agreement, or a union covered enterprise agreement, will not constitute unlawful discrimination under the FW Act.

The amendment is intended to "encourage increased participation in enterprise bargaining" – the Minister has stressed this is not a mandatory requirement and also subject to the development of the Secure Australian Jobs Code which would govern how and when this preferencing would be applied.

Intractable bargaining workplace determinations

Under the Government's Secure Jobs, Better Pay intractable bargaining reforms of late 2022, an intractable bargaining workplace determination must include the "core" terms (nominal expiry, safety net requirements, BOOT), the "agreed" terms, terms dealing with "matters at issue" between the parties and "mandatory terms" (ie clauses for settling of disputes, flexibility, consultation and delegates' rights).

In late 2025, a Full Bench of the FWC considered matters at issue in an intractable bargaining dispute. It found that the terms were required to comply with the s270A requirement that such terms "must be not less favourable… than a term of the enterprise agreement that deals with the matter", but that this protection did not extend to the four "mandatory terms". The impact of this decision was the FWC defaulting to model mandatory terms in intractable bargaining workplace determinations.

The new Greens amendment, moved by Senator Barbara Pocock on behalf of the Australian Greens, provides that a mandatory term that is included in an intractable bargaining workplace determination must be not less favourable to each of those employees, and any employee organisation that was a bargaining representative of any of those employees, than a term of the enterprise agreement that deals with the same matter.

The changes can also apply retrospectively to existing determinations – parties to an existing intractable bargaining workplace determination may apply to vary the original determination to give effect to these reforms.

These changes mirror amendments sought by the United Firefighters Union as part of the statutory Closing Loopholes Review conducted by former FWC Deputy President Booth – the final report from this review was provided to the Minister on 15 June 2026.

Fair Work Commission processes

Pressures on workload from, among other things, a rising volume of applications (including AI-assisted claims) have contributed to the FWC’s widely reported concerns about the impact of this significant workload increase on the FWC's effective day to day operation. The Act includes several amendments to address these concerns including measures to:

Enable the FWC to deal with applications involving alleged dismissal without the need to first determine if a dismissal has occurred – restoring the FWC's previous approach before the Full Court of the Federal Court's decision in Milford.
Allow certain matters that can be adequately determined in the absence of the parties to be determined 'on the papers', with the parties' consent (unfair dismissals, unfair deactivation or termination).
Expand the FWC's capacity to dismiss applications that are frivolous, vexatious or lacking reasonable prospects of success. The FWC will also be empowered to make orders restricting vexatious litigants from filing further applications without permission.
Enable greater delegation of the President's and members' powers to Commission staff to improve administrative efficiency.

These changes add to a number of procedural changes that the FWC has been trialling over the past few months for general protections dismissal related disputes.

Employers responding to dismissal-related disputes should now be considering, among other strategic considerations depending on the particular matter, earlier and more robust preliminary responses and potential consent to on-the-papers determinations for some claims.

Road transport contractors

The Government's Closing Loopholes No. 2 reforms of 2024 enabled independent contractors earning below the specified contractor high income threshold to dispute allegedly unfair contract terms in the FWC – this change was intended to be a more cost effective, applicant friendly jurisdiction than the courts.

The Bill creates a new, separate high-income threshold specifically for road transport contractors, the amount of which will be set by regulations rather than fixed in the Fair Work Act itself. This allows the Government to set a higher earnings cap for road transport contractors to reflect the higher costs of operating in that industry, so that more of those contractors can access FWC protections like unfair termination and unfair contract term remedies.

This reform will take effect on a day to be proclaimed, or otherwise within 6 months of the reform package receiving Royal Assent. The Independent Contractors Act 2006 will continue to be available for independent contractors paid above the road transport contractor high income threshold (once set by regulation under these reforms) to challenge their contract terms – though that jurisdiction has to date rarely been used for "high income" contractors.

Other changes

The Bill includes a number of other reforms including in relation to supported bargaining authorisations for multi-enterprise agreements, requirements for the administrator of the CFMEU and to the Road Transport related Advisory Group.

These reforms will impact employers in different ways. If you have any questions about the impact of these reforms on your workplace, please do not hesitate to contact us.