Australia Considers Legal Right to Work From Home, Sparking Small Business Backlash

By Kekeletso Nkele, small.news Assistant

(small.news) — Workers in the Australian state of Victoria could soon have a legal right to work from home two days a week, under legislation proposed by Premier Jacinta Allan, according to The Guardian.

The proposal would allow employees to work remotely if their role can reasonably be performed from home, regardless of the size of the business they work for. The policy is part of the governing Labor Party’s effort to expand workplace flexibility and increase workforce participation, particularly for parents and caregivers.

However, the proposal has drawn strong criticism from business groups, who say the law could pose challenges for small businesses managing staffing, productivity, and costs. Under the proposed law, employees whose roles can be performed remotely would have the right to work from home two days per week.

The legislation is expected to be introduced to Victoria’s parliament in 2026, with the policy written into the state’s Equal Opportunity laws. Premier Allan argues that flexible work arrangements help families and encourage more people to participate in the workforce.

Supporters say remote work has already become common since the COVID-19 pandemic, and that formalizing the right would give employees clearer protections. On the other hand, these changes have prompted pushback, especially from small businesses.

Small Businesses Push Back

Small business organizations have warned that the proposal could create additional regulatory requirements for firms that may not have the resources or human resources infrastructure of larger companies. Consider the realities of small operations, where fewer employees often means greater reliance on in-person collaboration and training.

Some business groups have also argued that the proposal could duplicate federal workplace regulations and create legal uncertainty. There are also concerns that stricter employment rules could prompt companies to relocate or invest in other states. The proposal has become part of a broader political debate in Australia about workplace flexibility and productivity.

Allan first raised the idea during a Labor Party conference in 2025, arguing that employees should be able to work remotely when it is reasonable for their role. Meanwhile, Australia’s conservative opposition has shifted its stance on remote work policies for public servants after earlier proposals to limit work-from-home arrangements drew criticism.

The debate comes as Allan’s government faces several political pressures, including controversies involving unions and law-and-order policy debates in the state. As the work-from-home proposal gains attention, it may shape broader conversations on workforce reforms.

A Test Case for Workplace Flexibility

If passed, Victoria’s legislation could become one of the first laws in the world guaranteeing the right to work from home, potentially influencing workplace policy debates in other countries.

For small businesses, however, the proposal highlights a growing challenge: balancing employee expectations for flexibility with the operational realities of running a smaller organization—a dilemma that may become increasingly prominent in global discussions.