Does Victoria's WFH Law Apply to Small Business? The 1 July 2027 Deferral Explained

Yes — but small employers get extra time. Under the Victorian Government's announced plan, workplaces with fewer than 15 employees would not have to comply until 1 July 2027, while employers with 15 or more employees would be covered from 1 September 2026. This is a staggered start date, not a carve-out.

Critically, the Government has expressly ruled out a small-business exemption. The later date is a deferral — more time to update policies and contracts — not a permanent pass. Every Victorian employer whose staff can reasonably work from home is expected to be in scope eventually, regardless of size.

Status check: As at 16 June 2026, this is a Government commitment, not law. The Premier's office says the legislation is to be introduced to the Victorian Parliament in July 2026. No bill text has been released. The dates and rules below are the Government's stated intentions and could change as the bill is drafted, debated and (if passed) given Royal Assent. Treat everything here as proposed.

The proposal sets two commencement points based on employer size:

Both dates come from the Premier of Victoria's announcement (premier.vic.gov.au, original release dated 4 March 2026), which states the Government will "protect work from home in law from 1 September" 2026 and that smaller workplaces have until 1 July 2027.

The headline entitlement is the same for both groups: a right to work from home two days per week for employees whose roles can reasonably be performed from home. The only difference at this stage is when the obligation begins. Note one unsettled point flagged by legal commentators: whether "two days" is a fixed entitlement or a floor ("at least two days") will not be clear until the bill is published.

A deferral pushes back the start date; an exemption would remove the obligation entirely. The Victorian Government has chosen the former. It has publicly ruled out exempting small businesses, framing the extra year as time to adjust rather than a permanent escape.

The practical consequences for a business with fewer than 15 staff:

• You are not obliged to grant the new two-day entitlement before 1 July 2027 (on the announced timetable).
• You will be obliged from that date, assuming the bill passes as announced.
• The breathing room is for getting ready — auditing roles, drafting a policy, updating contracts — not for ignoring the change.

Because the right is built into Victoria's equal-opportunity (anti-discrimination) framework rather than federal industrial law, unresolved disputes would be handled by the Victorian Equal Opportunity and Human Rights Commission (VEOHRC) through conciliation first, and the Victorian Civil and Administrative Tribunal (VCAT) if conciliation fails — not the Fair Work Commission.

This is not yet confirmed. The Government's announcement uses "fewer than 15 employees" as the line, but no bill text exists, so the counting rules are unknown. Key questions employers near the threshold should watch for when the bill is tabled:

• Headcount or full-time equivalent (FTE)? Whether a part-timer counts the same as a full-timer is unverified. (For comparison, the Fair Work Act's separate "small business employer" definition uses a 15-headcount test that counts most casuals only if engaged on a regular and systematic basis — but that is a different law and may not carry across here.)
• Across multiple sites or related entities? Whether staff at different locations, or across associated companies, are aggregated is unconfirmed.
• What's the snapshot date? How and when the count is taken is not stated.

Until the legislation is published, do not assume the threshold mirrors any existing definition. We will update this page once the bill clarifies the test. If you are sitting close to 15 staff, plan as though you could be in the 15+ group.

Use the time to 1 July 2027 to prepare, not to wait. A lightweight version of the work larger employers are doing now:

• Audit your roles. Map which jobs can reasonably be performed from home and which genuinely cannot (the announcement covers employees "whose roles can reasonably be performed from home"). There is no published statutory definition of that test yet, so document your reasoning.
• Draft a simple WFH policy covering how the two days are set, work health and safety at home, equipment and data security. Whether the two days are employee-elected or employer-directed is not yet settled, so keep the policy flexible.
• Review contracts and any enterprise agreement. How the new right interacts with awards and agreements is untested.
• Budget and plan operationally for coverage on remote days.

Waiting until mid-2027 is risky: the rules (including refusal grounds and remedies) are still being written, guidance is promised before 1 September 2026, and you may have less time to react than you expect. Our Victorian WFH eligibility tool walks through who is likely to be covered, and our employer hub has the broader compliance picture.

If you work for a Victorian business with fewer than 15 staff, the proposed two-day Victorian entitlement would not apply to you until 1 July 2027 (on the announced timetable). But you are not without options in the meantime.

The federal right to request flexible working arrangements under section 65 of the Fair Work Act 2009 (Cth) already applies regardless of employer size — including in small businesses — today. It is a right to request, not an automatic entitlement, and it is limited to certain categories of employee: parents or carers of a school-age-or-younger child, carers, employees with disability, employees aged 55 or older, those experiencing family or domestic violence (or living with someone who is), and pregnant employees. You generally need 12 months' continuous service (eligible regular casuals can qualify too).

Under section 65, your employer must respond in writing within 21 days and may only refuse on reasonable business grounds after genuinely discussing it with you. Disputes go to the Fair Work Commission, which can conciliate and, since 2023, make binding orders. You can prepare a request with our flexible work request tool.

These are two separate schemes from two different levels of government. The Victorian proposal sits in state anti-discrimination law (the Equal Opportunity Act 2010 (Vic)); the federal right sits in industrial law (the Fair Work Act). They differ on who qualifies, what you get, and where disputes go:

In short, the Victorian scheme is broader on who can claim it and gives an automatic entitlement, but is narrower in scope (WFH only, two-day cap). Our existing explainer covers the Victorian scheme in full: Victoria's work-from-home law for 2026.

Because no bill has been introduced, several important points are unconfirmed. Watch for them when the legislation is tabled (expected July 2026):

• How the 15-employee threshold is counted (headcount vs FTE; across sites/entities).
• The exact grounds an employer can lawfully refuse on. Lawyers expect a "reasonable business grounds"-style test, possibly a higher bar than the federal one because it sits in the discrimination framework — but no refusal grounds are legislated yet.
• Penalties and remedies at VCAT (orders to grant the arrangement, compensation, costs) are inferred from the Equal Opportunity Act machinery, not specified.
• Whether the two days are employee-elected or employer-directed, and pro-rata treatment for part-time and casual staff (the Government has promised guidance before 1 September 2026).

The single biggest uncertainty is constitutional. Most Victorian private-sector workers are in the national (Fair Work) system. There is a genuine question whether a state law creating a WFH entitlement is valid for those employees, given section 109 of the Constitution and section 26 of the Fair Work Act, which is intended to exclude state industrial laws. The Government has deliberately housed the right in anti-discrimination law to reduce that risk, but business groups (the Victorian Chamber, Property Council and HIA among them) and several legal commentators expect a constitutional challenge if the law passes as announced. The right may not survive a challenge for Fair Work-covered employees. Until then, the Government quantifies the benefit at "$110 a week or $5,308 every year" — a figure attributed to the Premier's release, not an independently verified saving.