Spotlight on overwork: unreasonable additional hours, the right to disconnect and psychosocial risks

A number of recent high-profile cases have drawn attention to the difficulties employers can face in managing employees' working hours, and the potential consequences of getting it wrong.

A Melbourne law firm has recently been fined $50,000 for forcing a junior lawyer to work "self-evidently excessive" hours, including 24-hour days and 79-hour work weeks.

In 2023, former chief-of-staff Sally Rugg accepted $100,000 to settle a dispute over allegations of unreasonable additional hours, in which she claimed usually working 70 to 80 hours a week while working for MP Monique Ryan.

The Finance Sector Union is currently pursuing "substantial" penalties against the National Australia Bank plus compensation for allegedly forcing managers to work 10 to 16-hour days as part of a "systemic cultural issue of deliberate understaffing".

These cases are symptomatic of working hours being brought into sharper focus, with claims of "availability-creep" abounding in a post-pandemic and globalised environment. Recent reform to work health and safety legislation and implementation of the right to disconnect mean there is increasing focus on employers complying with their obligations surrounding working hours.

The key prohibition

Under section 62(1) of the Fair Work Act 2009 (Cth) (FW Act), employers are prohibited from requesting or requiring an employee to work more than the maximum weekly hours of work unless the additional hours are reasonable. For full-time employees, this means over 38 hours per week, and for employees who are not full-time employees, this means the lesser of 38 hours per week and the employee's ordinary hours of work per week. Under section 62(2), employees have a right to refuse the request or requirement to work additional hours, if those hours are unreasonable. The protection under the FW Act (and formerly under the Workplace Relations Act 1996 (Cth)) has not historically been widely utilised, but we are anecdotally seeing an increasing number of employees claiming that they are working excessive hours by reference to the protection. 

What are reasonable additional hours?

Where an employee works additional hours, it is the responsibility of the employer to show that the additional hours were reasonable. There is no clear definition of what are considered "reasonable" additional hours. The following factors set out under section 62(3) must be taken into account in making this determination:

• any risk to employee health and safety from working the additional hours;

• the employee’s personal circumstances, including family responsibilities;

• the needs of the employee’s workplace or enterprise in which the employee is employed;

• whether the employee is entitled to receive overtime payments, penalty rates or other compensation for, or a level of remuneration that reflects an expectation of, working additional hours;

• any notice given by the employer of any request or requirement to work the additional hours;

• any notice given by the employee of their intention to refuse to work the additional hours;

• the usual patterns of work in the industry, or the part of an industry, in which the employee works;

• the nature of the employee’s role, and the employee's level of responsibility;

• whether the additional hours are in accordance with averaging terms in a modern award or enterprise agreement that applies to the employee, or with an averaging arrangement agreed to by the employer and employee; and

• any other relevant matter.

Determining what is reasonable or unreasonable can be challenging for employers, especially in service-based industries where employers may be managing high demands from customers and clients, cross-border teams, and external pressures such as market volatility and regulatory change. Where disputes are litigated, caselaw decisions have been highly fact dependent, making general conclusions difficult to draw.

For example, in Chin v Visual Thing Australia Pty Ltd [2024] FedCFamC2G 896, the Court determined that a creative retouching specialist's contract requiring her to work 40 hours per week was unreasonable. Central to the decision was the fact that there was nothing in the nature of the employee's role that required her to permanently work more than 38 hours per week and that she was not paid for overtime. On the other hand, in Gorval v Employsure [2016] FCCA 231, the Court held that it was not unreasonable to require a lawyer to work 45 hours per week where 5 of those hours comprised the employee's lunch breaks, and the further two hours were not unreasonable considering the nature of the work and the culture of the profession.

The right to disconnect

Claims of excessive working hours may also manifest as disputes regarding unreasonable out of hours conduct, under the new right to disconnect which was brought into effect on 26 August 2024. Under section 333M of the FW Act, an employee can refuse to monitor, read or respond to contact, or attempted contact, from their employer (or a third party like a client, where the contact or attempted contact relates to work) outside their working hours unless the refusal is "unreasonable".

Small businesses are currently exempt from the provisions, but will soon need to take steps to ensure compliance ahead of the new rights taking effect for small business employees on 26 August 2025.

While there are a small number of cases involving the right to disconnect being brought before the Fair Work Commission under general protections and dismissal laws, this right has not contributed to a significant number of disputes as yet. There is, however, anecdotal evidence that it has contributed to a cultural shift, with employers having more frequent conversations about appropriate out of hours contact and working hours more generally. Further, with safety regulators becoming increasingly active in the psychosocial risk space, as explored in further detail below, infringements of the right to disconnect may manifest as complaints to a safety regulator about high job demands or long working hours.

Psychosocial risk implications

SafeWork Australia has recognised high job demands, including working long hours, as a psychosocial hazard. If employers request or require their employees to work unreasonable additional hours, there is a risk that they could be in breach not only of their obligation under section 62 of the FW Act, but also of their primary work health and safety (WHS) duty to employees under applicable state or territory WHS laws. This duty generally requires employers to provide and maintain a working environment that is, so far as is reasonably practicable, safe and without risks to health, including by identifying and managing psychosocial hazards.

Psychosocial risks have recently been high on the agenda in the WHS space, with NSW leading the push to expressly require businesses to manage psychosocial risks to worker health and safety by issuing the Managing Psychosocial Hazards Code of Practice in 2021, following which the Work Health and Safety Amendment Regulation 2022 (NSW) introduced new express requirements to manage psychosocial risks. Currently, Victoria is set to introduce regulations to impose specific obligations on employers in respect of managing psychosocial risks, including new reporting requirements which will increase legal risks for employers in the event of non-compliance.

We expect to see increased discussion and recognition around excessive working hours as a health and safety issue. Employees and regulators alike are likely to apply increased pressure on employers to take more proactive steps to manage employee working hours as a psychosocial risk.