A new law that will ring a bell for RTOs

Once upon a time, the only thing that rang after hours was the landline, usually your mum checking if you’d eaten. Fast-forward to 2025 and the average RTO owner’s phone buzzes at 6am with a compliance query, pings at 10pm with a CRICOS student panicking over an assignment and vibrates again at midnight when your trainer uploads assessments to the LMS.

Welcome to the modern workplace, where the lines between work and life have blurred more than the ASQA audit matrix.

Enter Australia’s new “right to disconnect” law. From August 2025 (for both large employers and small businesses), employees now have the legal right to refuse “unreasonable” work contact outside their normal hours and employers can face serious penalties if they don’t respect those boundaries.

For RTOs, this matters more than most industries. Trainers, compliance staff and managers are notorious for late-night work and student contact across time zones. What once seemed like “commitment” could now look like “contravention.”

As Infinity Business Brokers, we’re here to break it down: what the law says, how it applies to RTOs, the positives and negatives and — importantly — how compliance in this area doesn’t just keep Fair Work off your back, it can add (or subtract) value when it comes time to sell your RTO.

 

What the law actually says

The “right to disconnect” is part of amendments to the Fair Work Act 2009, effective in stages:

The law applies from 26 August 2025 and states that employees can legally refuse unreasonable contact outside working hours.

Key points:

• Employees have the right to ignore or refuse unreasonable work calls, emails, texts or messages outside their ordinary working hours.
• It does not mean staff can never be contacted; the test is whether the contact is reasonable given the circumstances.
• If a dispute arises, the Fair Work Commission can make binding orders.

Penalties for non-compliance:

• Breach of Fair Work Act = civil penalty of up to $18,780 for individuals and $93,900 for companies.
• “Serious contraventions” (deliberate or systemic breaches) can be fined up to $187,800 (individual) and $939,000 (company).
• Large employers also risk unfair dismissal or adverse action claims tied to right-to-disconnect breaches.

Importantly, contractors are not covered by this law and it applies to employees only.

 

How it applies in an RTO setting

On paper, the law sounds straightforward. In practice, RTOs live in the grey zones. Here’s what it looks like in real life:

Case study 1: Trainer Jo (CRICOS RTO)
Jo trains CRICOS students. Many of her learners can only contact her after hours. Students often WhatsApp her at 11pm Sydney time. Under the new law, Jo can refuse to respond until work hours, unless responding late is “reasonable.”

Reasonable? If the student has an urgent welfare issue (e.g. safety concern), yes.
Unreasonable? If it’s just a question about assessment formatting, absolutely.

Case study 2: Compliance Officer Chris
Chris gets an email from management at 10pm asking for last-minute evidence for an ASQA audit scheduled next week but the CEO is going away for a few days in between. Chris has every right to ignore the email until the next morning unless the RTO is facing an immediate compliance deadline that would genuinely collapse without his action.

Reasonable? Possibly, if the deadline is the next day and no other option exists.
Unreasonable? If the audit is two weeks away and management simply left prep too late.

Case study 3: The RTO CEO
The CEO texts trainers on Saturday morning about low enrolment numbers. Trainers can now decline to engage until Monday. The CEO could be breaching the law if repeated contact like this is deemed unreasonable.

 

The positives for RTOs

While some employers groan about “red tape,” there are silver linings for RTOs:

• Healthier, happier staff – Trainers already burn out from marking and student support. Reduced after-hours demands mean better work-life balance, which lowers turnover. In an industry plagued by trainer shortages, that’s a big win.
• Clearer boundaries improve culture: Policies that respect downtime send a strong message: “We value you as people, not just trainers.” That makes your RTO more attractive to both staff and future buyers.
• Professionalisation of management: It forces owners and managers to sharpen operations: better planning, clearer delegation and improved LMS use.
• Compliance as a value driver: Buyers pay more for RTOs that show governance maturity. A clean record with Fair Work is another tick in due diligence.

 

The negatives and challenges for RTOs

But it’s not all positive. Challenges loom:

• Loss of flexibility: Many trainers actually prefer to mark assessments or answer emails at odd hours that suit their lifestyle. RTOs will need to adapt policies so voluntary late work doesn’t morph into an expectation.
• Australia’s time zones: National RTO students don’t always respect “AEST business hours.” Without good systems, student experience scores could dip.
• Added HR overhead: Policies, contracts and induction training need updates. It’s another compliance box to tick — and for smaller RTOs, every box takes time.
• Potential disputes: “Reasonable” is vague. One trainer’s emergency is another’s inconvenience. Managers will need judgement and disputes may end up in the Commission.

 

Contractors

• Not covered by the law. However, if you use contractors heavily and treat them like employees, you may invite sham contracting risk — a separate Fair Work headache.

What’s excluded

• Emergencies: WHS issues, serious safety matters, urgent IT failures.
• Genuine flexibility: If an employee chooses to work odd hours (with no expectation), it’s fine.
• Casual chats: Social contact isn’t covered. If you bump into your trainer at Bunnings, you can say hello without breaching the Act.

 

Penalties and risks

This is where it gets serious. A failure to respect the right to disconnect could trigger:

• Civil penalties: Up to $18,780 (individual) / $93,900 (company) or up to $187,800 / $939,000 for serious contraventions.
• Unfair dismissal claims: In larger RTOs, staff disciplined or dismissed over refusing unreasonable contact could bring claims.
• Reputation risk: Word spreads fast. An RTO known for after-hours intrusion may struggle with trainer recruitment and retention.
• Valuation impact: Buyers scrutinise HR and compliance. A history of disputes or penalties could lower multiples and scare away premium acquirers.

 

Infinity’s view: compliance as value

At Infinity, we don’t just look at compliance as “avoiding trouble.” We see it as part of an RTO’s business value story.

When buyers ask about culture and governance, they want proof that your RTO manages risk. A right-to-disconnect breach isn’t just an HR issue, it signals weak systems, poor planning and potential liabilities. That can mean a lower multiple in valuation.

On the flip side, RTOs that embrace this law by updating policies, training managers and showing leadership, will not only keep staff happier but also send buyers a strong signal: this is a professionally run organisation with future-ready governance.

 

Checklist & flowchart for RTO owners

• Update employment contracts to reflect the right to disconnect.
• Revise staff handbooks and HR policies.
• Train managers on “reasonable vs unreasonable” contact.
• Communicate expectations to staff and students (especially CRICOS).
• Review contractor arrangements for cultural alignment.
• Document processes to show compliance (audit-ready).

 

Flowchart:

 

The right to disconnect doesn’t mean the end of dedication, flexibility or RTO agility. It means the end of unreasonable intrusion into staff lives.

Handled well, this law will give your trainers and staff healthier boundaries, boost retention and demonstrate governance maturity. Handled poorly, it could cost you fines, disputes and when it comes time to sell, a hit to your valuation.
Infinity have seen again and again that compliance isn’t just red tape. It’s a value multiplier. Buyers want confidence that when they step into ownership, they’re not inheriting a culture of burnout and Fair Work risk.

The right to disconnect is another curveball for employers, especially RTOs already balancing ASQA compliance, CRICOS obligations, reporting and the daily reality of keeping students and staff engaged. On top of everything else, here’s one more rule that looks simple on paper but messy in practice.

The truth is, the right to disconnect law is untested. No one knows exactly how the Commission will rule in the grey zones. Add to that the messy overlap with working-from-home arrangements, where “ordinary hours” can already be blurred  and now a law to create friction before it creates clarity.

At Infinity, we see compliance laws like this for what they are: hard work upfront, but an opportunity to separate the professionals from the rest. Smart RTO owners won’t be scared off. They’ll treat this as another discipline of good governance, one that builds resilience, attracts talent and protects long-term value.

Yes, it will create more work. Yes, it clashes awkwardly with flexible and work-from-home arrangements. And yes, it’s untested which means disputes will be inevitable before the boundaries are truly clear.

But this is not a reason to panic. It’s a reason to get organised. The RTOs that take the lead by updating contracts, training managers and showing respect for staff downtime will not just avoid fines, they’ll build a healthier culture and a stronger commercial story for buyers.