Fair Work Act 2009 Explained
What the Fair Work Act is, who it covers, and the rights it gives Australian employees — the NES, modern awards, unfair dismissal, general protections, and enforcement.
What is the Fair Work Act?
The Fair Work Act 2009 is the primary law governing employment relationships in Australia. It commenced on 1 July 2009, replacing the Workplace Relations Act 1996. The Act sets minimum employment standards, regulates modern awards and enterprise agreements, establishes the Fair Work Commission and the Fair Work Ombudsman, and provides protections against unfair dismissal, discrimination, and adverse action at work.
Who does the Fair Work Act cover?
The Fair Work Act covers employees in the national workplace relations system — approximately 85% of Australian employees. This includes all employees of constitutional corporations (Pty Ltd companies), Commonwealth employees, and all employees in Victoria, NSW, Queensland, South Australia, Tasmania, the ACT, and the Northern Territory. Western Australia retains a separate state industrial relations system for sole traders, partnerships, and other non-constitutional employers. Most state and local government employees outside Victoria are also covered by their state's system.
The 11 National Employment Standards (NES)
The NES are the minimum employment entitlements that apply to every employee covered by the Fair Work Act. They cannot be excluded or reduced by any award, enterprise agreement, or employment contract. The 11 NES cover: maximum weekly hours (38 plus reasonable additional hours); requests for flexible working arrangements; offers and requests for casual conversion to permanent; parental leave and related entitlements; annual leave (4 weeks, 5 for shift workers); personal/carer's and compassionate leave (10 days paid personal/carer's leave per year); 10 days paid family and domestic violence leave; community service leave; long service leave; public holidays; and notice of termination, redundancy pay, and a Fair Work Information Statement for new employees.
Modern Awards
Modern awards are industry or occupation-based instruments that set minimum pay and conditions above the NES. There are over 120 modern awards covering most Australian industries — hospitality, retail, general manufacturing, clerks, building and construction, nurses, aged care, transport, and more. Awards set minimum hourly rates, casual loading, allowances, penalty rates for weekends and public holidays, overtime rates, and classification structures. The Fair Work Commission reviews awards and adjusts minimum wages each year in the Annual Wage Review decision, usually taking effect on 1 July.
Enterprise agreements and the BOOT
Enterprise agreements are collective agreements negotiated between an employer and its employees (often with union involvement) that replace the relevant modern award for that workplace. Before approval, the Fair Work Commission applies the Better Off Overall Test (BOOT): every employee covered must be better off overall under the agreement than under the award. The Closing Loopholes reforms softened the BOOT from a strict line-by-line assessment to a more flexible global assessment of the deal as a whole.
Unfair dismissal protections
The Fair Work Act protects eligible employees from dismissal that is harsh, unjust, or unreasonable. Applications must be lodged with the Fair Work Commission within 21 days of the dismissal taking effect. To be eligible, you must have completed a minimum employment period of 6 months (12 months if your employer has fewer than 15 employees). Employees earning above the annually indexed high income threshold are not eligible unless covered by a modern award or enterprise agreement. A genuine redundancy is not an unfair dismissal. Remedies include reinstatement or compensation, which is capped.
General Protections — adverse action and discrimination
The general protections provisions prohibit an employer from taking adverse action against an employee because they have a workplace right, because of a protected attribute such as race, sex, age, disability, religion, pregnancy, or family responsibilities, or because they engaged in lawful industrial activity. Adverse action includes dismissal, demotion, cutting hours, changing duties to disadvantage, or refusing to hire. Unlike unfair dismissal, general protections claims have no minimum employment period and no high income cap. Dismissal-related claims must be lodged within 21 days.
Fair Work Commission vs Fair Work Ombudsman
Two separate bodies enforce the Fair Work Act. The Fair Work Commission (FWC) is the independent national workplace tribunal — it approves enterprise agreements, makes and varies modern awards, conducts the Annual Wage Review, hears unfair dismissal and general protections claims, and resolves disputes. The Fair Work Ombudsman (FWO) is the compliance and enforcement agency — it provides free advice to employees and employers, investigates underpayments and other contraventions, issues compliance notices, and prosecutes serious breaches in court. Most employee questions start with the FWO.
Penalties, wage theft, and enforcement
Civil penalties for breaching the Fair Work Act are substantial and have risen sharply in recent years, especially for 'serious contraventions' involving knowing or systemic underpayment. Under the Closing Loopholes reforms, intentional wage theft became a criminal offence on 1 January 2025, with maximum penalties of 10 years imprisonment and very large fines — up to three times the amount underpaid, or a fixed statutory maximum. Underpayment claims can be recovered for up to 6 years from when the money was owed. The FWO can accept enforceable undertakings, issue compliance notices, or take employers to court.
How to use the Fair Work Act
In practice, most workplace questions come back to the Fair Work Act. Check which modern award covers your role, then compare your pay against the minimum rates, casual loading, and penalty rates in that award. Use the NES as your baseline for leave, notice, redundancy, and hours. If you think you've been underpaid, keep records and contact the Fair Work Ombudsman. If you've been dismissed and think it was unfair or discriminatory, move fast — you have 21 days to lodge with the Fair Work Commission. Our calculators cover the most common questions, and every result cites the relevant part of the Act or the governing instrument.
Use these tools
Official resources
General information and estimates only — not legal, financial, or tax advice. Always verify with the Fair Work Ombudsman (13 13 94) or a qualified professional.