A new industrial relations Bill aims to reduce pressure on the Fair Work Commission and encourage enterprise bargaining. Here’s what HR needs to know.

Generative AI is becoming an increasingly influential force in Australia’s workplace relations system.

Earlier this year, FWC President Justice Adam Hatcher revealed that the Commission’s overall workload had increased by an estimated 70 per cent over the past three years, prompting concerns about delays and the growing strain on resources. 

The surge in claims is attributed to employees increasingly using AI tools to research workplace laws and prepare cases.

“Particularly lately, the Commission has been seeing complaints that have been inflated because of AI, where the applicant has a really distorted sense of what their rights are,” says Elisha Middleton, Workplace Relations and Remuneration Lead at Western Power.

“They often see it all the way through, because they genuinely feel that they have a really valid case, and nobody tells them otherwise.”

In response to the growing pressures on the workplace relations system, the Federal Government has introduced a series of reforms through the Workplace Relations Legislation Amendment (Building Cooperative Workplaces No. 1) Act 2026, which came into effect earlier this month.

Many of the reforms introduced by this Bill are intended to reduce administrative burdens on the FWC and help it resolve matters more quickly. 

The Bill also includes changes to government procurement, which allow the government to preference suppliers with enterprise agreements in place.

Here are the key changes HR should be across, and how to help your organisation prepare.

Addressing the FWC’s mounting workload

The FWC has already begun adapting to the increasing volume of claims. Earlier this year, it released draft guidelines on the use of generative AI in Commission cases, which would require any employee submitting an application to declare if their claim was AI-assisted, and to verify any information provided by AI prior to submission.

The new legislation goes a step further by making fundamental changes to how the FWC is able to manage and progress workplace disputes.

Measures in the Bill to streamline the FWC’s processes include: 

1. Expanding the circumstances under which it can determine matters ‘on the papers’

As part of the changes, the FWC can now determine certain disputes using written submissions alone, without holding a conference or hearing.

This will only happen if the Commission considers the case suitable for a paper-based process and all parties agree to it. This is intended to help resolve straightforward disputes quickly and free up resources for more complex cases.

2. Removing the requirement for a hearing to determine whether an applicant in a general protections matter has been dismissed

Before the Bill came into effect, employers could respond to a general protections dismissal claim with a jurisdictional objection arguing that the employee was not in fact dismissed. This objection could become a preliminary issue requiring separate consideration. 

Under the new laws, the Commission is no longer required to make that determination before progressing the matter. Instead, it can deal with disputes purely on the grounds that a dismissal is alleged.

3. Making it easier to dismiss ‘frivolous’ or ‘vexatious’ claims

The legislation also expands the Commission’s ability to manage frivolous claims.

If an application has been dismissed or an applicant has demonstrated ‘vexatious’ conduct, the Commission can issue orders restricting that person from lodging further applications without permission. 

Middleton stresses that the bar for these orders is high, and the restriction is not a blanket ban on submitting future claims. 

“You can apply later, but it would need to be assessed and reviewed and approved,” she says.

“So, if you’re 18 years old and you submit a [frivolous] claim, and then 10 years later you have a genuine reason to lodge a claim, there would still be an avenue for you to do that.”

While these reforms will alleviate some of the pressure on the FWC, they may not be enough to close its resourcing gap, according to Amy Zhang, Executive Counsel and Team Leader at Harmers Workplace Lawyers.

“In particular, more funding needs to be provided to the Commission to address [its] unsustainable workload and resourcing pressures, which result in delays in matters being progressed and impact on the quality of services – in particular in the area of conciliation conferences, which businesses are finding are rushed and not conducive to settlement of disputes,” she says.

“Nevertheless, these reforms, together with the Commission’s own procedural reforms, should go some way in addressing efficiency issues and make the system better for all participants.”

“Reading new legislation [in detail] is important for HR, both to make sure they have a factual understanding of what’s coming up, but also for their own knowledge, awareness and development.” – Elisha Middleton, Workplace Relations and Remuneration Lead at Western Power

Preferencing employers with enterprise agreements

The legislation also introduces a more controversial reform aimed at encouraging enterprise bargaining.

Under the new framework, the Commonwealth will be allowed to preference businesses with enterprise agreements when assessing certain procurement and grant opportunities.

This measure has attracted criticism from some industry bodies, including the Business Council of Australia and Australian Industry Group.

In its response to the Bill, Australian Industry Group argues that the law undermines the principle of ‘freedom of association’ and could result in “delays, cost blowouts and union misbehaviour”.

According to Middleton, the changes could prompt some employers without enterprise agreements to reconsider their approach, particularly if access to government contracts forms an important part of their business strategy. 

However, negotiating and implementing an enterprise agreement is often far from straightforward.

“There are a lot of benefits to having one, but it doesn’t work for every organisation, every sector or every profession type,” she says. 

“If there’s not really any other commercial benefit to it, it could introduce a lot of mess and complexity.”

Exactly how this measure will operate in practice remains unclear. During the second reading of the Bill, Workplace Relations Minister Amanda Rishworth clarified that the legislation does not impose any obligation on the Commonwealth to prefer employers with enterprise agreements. 

She added that when and how it would be appropriate to do so is being carefully considered as part of the development of the Secure Australian Jobs Code. 

How can HR help their organisations prepare?

With these reforms in place, employers need to ensure their own processes can keep pace with the changes to Fair Work proceedings.

One practical implication is that employers may be less able to rely on jurisdictional arguments as an early defence to delay unfair dismissal proceedings. 

As cases move through the Commission more efficiently, organisations may therefore have less time to gather evidence and prepare their response.

Maintaining detailed records of performance management discussions, disciplinary action, investigations and termination decisions will therefore become even more important.

Middleton strongly advises HR practitioners to look beyond the headlines and read the legislation in detail to establish what’s relevant to your organisation and the practical implications of the reforms.

“[Employers] can’t put their heads in the sand and just assume that something is not going to apply to them, or that somebody else has already picked it up,” she says.

“Reading new legislation [in detail] is important for HR, both to make sure they have a factual understanding of what’s coming up, but also for their own knowledge, awareness and development.”

🧰 HR’s career resource toolkit

• Article: Every employee now has an AI ‘lawyer’ in their pocket. Is your organisation prepared?
• Podcast: Stay across Australia’s evolving employment law landscape with AHRI’s ER/IR Unpacked podcast.
• Learning: Gain clarity and stay ahead of AI-driven change with AHRI’s AI & HR: What You Need to Know to Stay Compliant course.

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