If you run a startup in Australia, the chances are good that your team communicates on Slack at odd hours, that someone occasionally fires off an email at 10pm, and that the line between “working hours” and “available hours” has never been clearly drawn. For a long time, that informality was just part of startup culture. As of August 2025, it is also a legal risk.
The right to disconnect is now part of the Fair Work Act 2009 (Cth), and it applies to every employer in the national system — including small businesses with fewer than 15 employees. If your startup has employees (as opposed to purely independent contractors), these rules affect you.
This article explains what the right to disconnect actually requires, how it interacts with the realities of running a startup with a distributed team, and what practical steps you should take to stay on the right side of the law.
What the Law Says
The right to disconnect is contained in section 333M of the Fair Work Act, introduced by the Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024. It came into effect on 26 August 2024 for employers with 15 or more employees, and on 26 August 2025 for small business employers — those with fewer than 15 employees at the relevant time.
The provision is straightforward in principle. An employee may refuse to monitor, read or respond to contact, or attempted contact, from their employer outside of their working hours — unless the refusal is unreasonable. The same right extends to contact from third parties (such as clients, customers, or suppliers) if the contact relates to the employee’s work.
Critically, the law does not make it unlawful to contact an employee after hours. You can still send that late-night Slack message. What has changed is that the employee now has a statutory right to ignore it, and you cannot penalise them for doing so — provided their refusal is reasonable.
When Is a Refusal Unreasonable?
The Act sets out a non-exhaustive list of factors that must be considered when determining whether an employee’s refusal to respond is unreasonable:
- The reason for the contact. A genuine emergency or urgent client matter will weigh differently from a routine question that could wait until morning.
- How the contact is made and how disruptive it is. A phone call at 11pm is more intrusive than a Slack message sent with no expectation of immediate response.
- The extent to which the employee is compensated for being available outside ordinary hours — whether through an on-call allowance, overtime rates, or a salary that reflects after-hours availability.
- The employee’s role and level of responsibility. A senior employee with significant client-facing responsibilities may reasonably be expected to be more available than a junior team member.
- The employee’s personal circumstances, including family or caring responsibilities.
An employee’s refusal will always be unreasonable if the contact is required by law — for example, a notification required under work health and safety legislation.
For startups, the compensation factor is particularly important. If your employment contracts are silent on after-hours availability and your employees are not being paid an on-call allowance or a salary that explicitly accounts for out-of-hours work, it will be difficult to argue that their refusal to respond at 9pm on a Tuesday is unreasonable.
Enforcement and Penalties
The right to disconnect is not just aspirational. It is backed by a dispute resolution mechanism and meaningful consequences for non-compliance.
If a dispute arises, the parties must first attempt to resolve it at the workplace level. If that fails, either party can apply to the Fair Work Commission (FWC) for assistance. The FWC can deal with the dispute through mediation, conciliation, or — if the parties agree — arbitration. It can also make orders, including “stop orders” directing a party to cease particular conduct.
Contravening an FWC order attracts civil penalties under the Fair Work Act. For an individual, the maximum penalty is up to $19,800 per contravention. For a body corporate, it is up to $99,000 per contravention.
Beyond the dispute mechanism, the right to disconnect is expressly classified as a “workplace right” under Part 3-1 of the Act. This means that taking adverse action against an employee because they exercised (or proposed to exercise) their right to disconnect triggers the general protections provisions. In practical terms, if you discipline, demote, or dismiss an employee for not responding to after-hours messages, the employee can bring a general protections claim — and the burden will be on you to prove that the adverse action was not motivated by their exercise of the right.
Why This Matters More for Startups
The right to disconnect was designed for traditional workplaces, but its impact is arguably greatest in environments where the boundaries between work and personal time have always been blurred — which describes most startups.
Remote and distributed teams. If your team is spread across time zones, one person’s working hours are another person’s evening. A Slack message sent at 3pm in Sydney arrives at 6am in London and midnight in San Francisco. Without clear norms around when responses are expected, remote employees may feel pressure to be perpetually available — exactly the kind of dynamic the legislation targets.
Always-on communication tools. Slack, Teams, and similar platforms are designed for speed and responsiveness. The notification ping does not distinguish between urgent and trivial. For employees, the practical effect of receiving after-hours messages — even those sent without any expectation of a reply — can be indistinguishable from being asked to work.
Small team dynamics. In a five-person startup, it is harder to draw bright lines. When the founder sends a message at 10pm, it carries more weight than when a middle manager does the same thing in a 500-person company. The power dynamic is different, and the implicit expectation to respond is stronger — even if the founder genuinely did not expect an immediate reply.
Contractor reliance does not eliminate the risk. The right to disconnect does not apply to independent contractors. But if your “contractors” are performing work that is functionally indistinguishable from employment, you may have a sham contracting problem on top of a disconnect problem. Getting the classification right is essential.
What You Should Do
Here are practical steps for startup founders to manage the right to disconnect without abandoning the flexibility that makes your team effective.
1. Audit your employment contracts. Check whether your contracts define working hours, address after-hours availability, and contemplate any compensation for out-of-hours contact. If the contracts are silent on these points, an employee’s refusal to respond outside standard hours will be very hard to challenge.
2. Create an after-hours communication policy. This does not need to be a 20-page document. A one-page policy that sets out when after-hours contact is appropriate, how it should be made (for example, phone call for genuine emergencies, everything else can wait), and what the expected response time is will go a long way toward establishing reasonable expectations.
3. Use technology to your advantage. Most communication platforms support scheduled sending, do-not-disturb modes, and separate channels for urgent and non-urgent matters. Encourage your team to schedule messages for delivery during the recipient’s working hours. Create a dedicated channel or protocol for genuine emergencies so that employees can safely mute everything else after hours.
4. Define “core hours” for distributed teams. If your team spans multiple time zones, establish a window of overlap during which everyone is expected to be available for synchronous communication. Outside that window, default to asynchronous communication with no expectation of an immediate response.
5. Lead by example. If you are a founder who works at midnight and fires off Slack messages as they occur to you, your employees will feel obligated to respond — regardless of what your policy says. Either draft the messages and schedule them for morning delivery, or make it unmistakably clear (and consistently demonstrate) that no response is expected until the next business day.
6. Review on-call and overtime arrangements. If certain roles genuinely require after-hours availability — an on-call SRE, a customer support lead covering a US time zone — make sure the arrangement is documented in the employment contract, that the employee is appropriately compensated, and that the scope of after-hours contact is clearly defined.
7. Check your modern award. All 155 modern awards now include a right to disconnect clause, which may impose additional requirements beyond the statutory minimum. If any of your employees are covered by a modern award, review the specific clause to ensure your practices comply.
The Bigger Picture
The right to disconnect sits within a broader shift in Australian employment law toward protecting employees from unreasonable demands on their time — a shift that intersects with work health and safety obligations, wage theft reforms, and the ongoing scrutiny of unpaid overtime. For startup founders, this is not just about avoiding a specific penalty. It is about building employment practices that are sustainable, defensible, and respectful of the people who are building your company alongside you.
Most well-run startups will not need to change much. If you already treat your team well, communicate clearly about expectations, and do not punish people for having a life outside work, you are probably already compliant. The value of the exercise is in documenting what you are already doing — because if a dispute ever arises, it is the documentation that will matter.
If you need help reviewing your employment contracts, drafting an after-hours communication policy, or assessing your compliance with the right to disconnect, get in touch.
