Managing your workforce and commercial risks during disruption
WA businesses are being urged to review their workforce plans, remote work policies and commercial contracts as global disruption continues to impact fuel costs and supply chains.
In short: Fuel price volatility and supply risks are creating new legal, workforce and contract challenges for WA businesses. Planning now can help you avoid disputes, reduce disruption and stay compliant.
CCIWA Workplace Relations Associate Director Ryan Martin said uncertainty was already driving employer questions about how to manage their people and operations.
“Like any business continuity planning, it's best to consider all of the circumstances and have a plan for them to minimise confusion, stress, reactive decision-making and disputes.”
Here’s what employers need to know – and what to do now.
Workforce changes to minimise disruption – standing down employees
Economic challenges, or significant disruption to operations often cause employers to rethink their workforce, including adjusting rosters and standing down employees.
If your business can be impacted by fuel shortages that may expose it to work stoppages, Martin suggested being proactive rather than reactive by having a plan and considering all potential alternatives.
“A stand down is a really exceptional situation … and largely exists to help reduce the need for other, more permanent options like redundancies,” he said.
“A stand down cannot be implemented just because a business is quiet or experiencing a downturn, even if that downturn is due to unusual circumstances.”
In most instances, stand downs are governed under the Fair Work Act 2009 (FW Act), which is the Federal system.
Under the FW Act, stand downs can only occur if:
- There is a stoppage of work outside the employer’s control, which may include fuel supply disruption; and
- Employees cannot be usefully employed elsewhere in the business
“If fuel was to become unavailable or commercially unviable due to supply chain issues, that would likely be a circumstance outside of the employer’s control which could result in a stoppage of work,” Martin said.
“If your business does get to this point, it’s important to revisit the circumstances of the cause, and that it is a genuine stoppage of work and seek advice.”
For State system employers governed by the Industrial Relations Act 1979 or Minimum Conditions of Employment Act 1993 there may be different requirements.
Enterprise agreements (EAs) and employment contracts may include additional stand down rights.
If you’re not sure which system applies to your business or you need support understanding obligations under EAs and employment contracts, contact CCIWA’s Employee Relations Helpline.
Why getting it right matters
If a stand down is challenged and found to be unlawful, the consequences can be significant.
Martin said if the Fair Work Commission (FWC) decided the legal requirements were not met, it could order the employer to back pay wages and compensation.
“Even if a stand down was absolutely necessary and lawful, the FWC process is going to take time, effort and potentially legal fees, which will likely delay your ability to get things back to normal as quickly as possible,” he said.
Always consider alternatives first
Before standing down employees, businesses must explore all reasonable alternatives, including:
- Redeploying staff across the business
- Offering reduced hours across teams
- Inviting employees to take accrued leave
- Adjusting operations or roles
Communication is critical
Even where a stand down is lawful, poor communication can trigger disputes.
“The most likely time that you're going to get a claim is when people don't understand why they've been treated a certain way or why things are being done in a workplace,” Martin said.
A strong communications plan should cover:
- Why the stand down is happening
- What alternatives were considered and why they were not possible
- Expected duration (if known)
- Impacts on pay and entitlements
Remote work requests are rising
Fuel cost pressures are already driving more employees to request flexible or remote work.
“We've seen an increase in employees requesting to work from home to try conserve fuel and mitigate those costs,” Martin said.
Since COVID-19, flexibility and work-from-home arrangements have become commonplace for many businesses.
However, Martin said the fuel crisis was different to COVID, which had health risks and specific government directives.
What employers should do
Most businesses can rely on existing hybrid or remote work policies, but they must be:
- Up to date
- Clearly communicated
- Applied consistently
Exceptions should be assessed case-by-case, particularly where employees face different commuting challenges.
Don’t overlook WHS risks
Remote work still carries work health and safety obligations, particularly around psychosocial hazards such as social isolation, blurred work-life boundaries, poor communication and online bullying.
Employers should:
- Conduct risk assessments
- Set clear expectations
- Maintain regular check-ins
- Provide support channels for employees to raise concerns and seek support, including an employee assistance program (EAP).
New road transport rules: what businesses need to know
A major recent development in response to rising fuel costs was the Road Transport Contractual Chain Order introduced by the FWC.
It aims to ensure costs flow through the entire supply chain, rather than transport operators bearing most of the weight.
“The order has significant commercial consequences for most businesses,” Martin said.
What the order requires and who is impacted
Businesses involved in road transport supply chains must:
- Pass on fuel cost increases through contracts
- Adjust rates at least twice a month
It applies broadly to most businesses who engage with transport companies, including:
- Primary parties (eg. businesses engaging transport providers)
- Secondary parties (eg. subcontractors in the chain)
- Road transport businesses
- Digital labour platform operators in transport
- Road transport employee‑like workers
- Regulated road transport contractors (owner/drivers)
It does NOT cover:
- Small businesses with fewer than 15 employees who are not a road transport businesses
A practical example of how this could apply:
Primary parties
- Your construction company, Main Constructions Pty Ltd contracts a trucking company, Captain Freight to organise the freight of materials to site by road.
- Your company and Captain Freight are ‘primary parties’.
- You both need to ensure any rates you currently pay are increased at least twice a month to account for that difference in the fuel cost between March 6 and now.
Secondary parties
- The manufacturer of the materials you need is based in Geelong, so Captain Freight engages another trucking company based in Victoria, Sunshine Haulage to freight goods from there to WA.
- Sunshine Haulage subcontracts a portion of the cartage in Victoria to Tom Small, who is an owner-driver of his own truck.
- Captain Freight and Sunshine Haulage in this part of the supply chain are ‘secondary parties’ and need to increase their rates twice a month to account for the difference in fuel costs between March 6 and now to ensure the increased amount is being passed along to the party at the bottom of the supply chain, Tom Small.
Additional requirement
- Also, Main Constructions Pty Ltd has more than 15 employees, so as a primary party, you have an additional obligation to take reasonable steps to make sure all secondary parties in the supply chain adjust the rate they pay to ensure the fuel cost is passed on.
- To comply with this requirement, Main Constructions contacts Captain Freight to ask who it has subcontracted for the work, and how Captain Freight is ensuring it has passed on fuel increase to Sunshine Haulage and Tom Small. Captain Freight, does this by showing Main Constructions its new fuel levy, calculated on an amount above what it paid for fuel on March 6, 2026.
- The adjustments can be made by increasing your existing rates, adding a fuel levy, directly reimbursing or offsetting any fuel costs – or any combination of those measures. You can also use ‘rise and fall’ formulas that already exist in your contracts, or cost models in contracts or industrial instruments, if they account for or address the recovery of that increased fuel (since 6 March).
- Existing contracts or fuel clauses may need to be reviewed or amended to comply.
Contract risks and compliance
Existing contracts may not be compliant, particularly fixed-price or long-term agreements.
Businesses should:
- Review all transport-related contracts
- Identify exposure in supply chains
- Implement fuel adjustment mechanisms
- Engage counterparties early
Failure to comply can result in financial penalties.
What businesses should do now
Martin said preparation was key, even if disruptions do not escalate.
“It is always good to plan for these things so that you're not reacting if the worst case does eventuate,” he said.
Immediate actions:
-
Workforce preparation
-
- Map workforce and operational risk exposure
- Review employment contracts and enterprise agreements
- Update and reinforce remote work policies
- Build contingency and communication plans
-
Commercial preparation
- Audit commercial contracts for fuel cost exposure
- Confirm whether the road transport order applies to your business (remembering that it might even if you aren’t a road transport business)
- Seek advice before re-negotiating or amending contract terms
How CCIWA can support your business
Businesses are advised to plan for potential disruption and seek advice if unsure.
CCIWA Members can access tailored advice to navigate these issues, including:
- Employee Relations Helpline – timely, trusted advice on workplace issues. Free, unlimited support for CCIWA Members. Contact our team on 08 9365 7660 or via [email protected].
- Business Law WA's – employment, WHS and commercial lawyers provide strategic legal advice to help ensure your business’ compliance and mitigate risk. Contact [email protected] or call 08 9365 7560.
This article is authorised by Business Law WA, an incorporated legal practice and wholly owned subsidiary of CCIWA. The content of this article is general in nature and is not legal or professional advice and should not be relied upon as such.
