HR Hot Spots: 9 issues that will shape HR in 2025

As we move further into 2025, HR and workplace relations are continuing to rapidly evolve. 

We were fortunate enough to recently attend HR Daily’s HR Hot Spots 2025 webinar, which provided some great analysis of many of the latest developments in the world of people management. 

In this article, we look at some of the trends covered and give our own take on what they’re likely to mean for your organisation.

1. Artificial Intelligence in the workplace

Since ChatGPT was launched in late 2022, few issues have dominated the workplace more than the rise of AI. In just over two years, it has gone from a barely known to the most talked about topic among HR teams.

As we wrote recently, AI is already beginning to transform recruitment and workforce planning for some fast moving companies. This year, however, we expect AI to go mainstream, becoming firmly embedded in most HR departments. 

We’re particularly excited about AI’s potential when it comes to performance management and employee retention. Its ability to read data, identify and offer continuous feedback could change the way we manage teams, providing a more individualised, more motivating and more engaging workplace experience for everyone. 

2. Respect@Work: Positive duty on employers

In late 2022, the Sex Discrimination Act 1984 (Cth) underwent some major changes. While many of these took effect in December 2023, some employers are still struggling to come to terms with what they mean. 

All businesses must now take proactive steps to prevent workplace harassment, discrimination, and hostile environments. This means implementing risk management frameworks, leadership training and clear reporting processes.

If your business isn’t across the changes, make sure you act fast – the amendments also gave the Australian Human Rights Commission new powers to monitor and assess compliance, as well as to seek court orders against non-compliant employers. 

3. Psychosocial hazards and workplace safety

In July 2022, Safe Work Australia’s Code of Practice on Managing Psychosocial Hazards at Work took effect. Additional model regulations introduced in 2023 (excluding Victoria). 

This means most employers now have an obligation to identify and manage psychosocial hazards. 

Key Developments:

• Officer due diligence: Senior officers must stay informed, provide adequate resources, and implement appropriate risk management processes.
• Sexual harassment as a WHS Issue: The Sexual and Gender-Based Harassment Code of Practice was introduced in December 2023 and reinforces an employer’s duty to eliminate these risks.
• Enforcement in Victoria: While Victoria didn’t adopt the model WHS laws, WorkSafe Victoria still actively regulates psychosocial hazards through inspections.

As an employer, make sure you’re conducting risk assessments, implementing control measures, and regularly reviewing your workplace culture to prevent potential psychosocial-related breaches of WHS law. 

If you don’t, you could face heavy fines, not to mention reputational damage and potential legal action.

4. The Right to Disconnect laws

The Right to Disconnect laws let employees refuse to respond to “unreasonable” out-of-hours contact from their employer or clients. Whether a contact is unreasonable depends on its urgency, as well as the employee’s role and their personal circumstances. (It’s generally more acceptable to contact a senior employee out of hours than a junior one).

Make sure you review your policies and set clear expectations around after-hours communication. If in doubt, seek advice. 

5. Flexible work arrangements: new rules and case law

The Fair Work Act was amended to give employees stronger rights when requesting flexible work arrangements. Several categories of employees, including anyone responsible for school aged children (or younger), as well as carers and employees over 55 can request to work flexibly, once they’ve worked for the same employer for 12 months.

An employer who refuses must provide detailed reasons and Fair Work Australia offers dispute resolution mechanisms where disputes exist. 

Recent cases, such as Gration v Bendigo Bank and Fogo v Boeing Aerostructures, highlight the expectations and limits of flexible working arrangements. In the former, the FWC found employment “was a two way street” and that an employer did not need to give an employee with carer’s responsibilities the opportunity to permanently work from home.

In the latter, the FWC found there was no need to provide an older employee with the opportunity to work from home two days a week so that he could ease into retirement while preserving his mental health. 

6. Wage theft and underpayment: A criminal offence

Since 1 January 2025, wage theft has been a criminal offence, with penalties including up to 10 years’ imprisonment or $7.8 million in fines. 

With so much at stake, employers must be 100% certain they’re complying with wage laws – not least because accidental underpayments won’t be tolerated as mere ‘mistakes.’ 

As ignorance is no defence, the Commonwealth government has helped small businesses out by publishing a Voluntary Compliance Code. However, if you’re ever in doubt about employee entitlement, always get professional advice. 

7. Damages for psychiatric injury: A wake-up call for employers

Increasingly, the courts are hearing claims for psychiatric injury arising from unfair treatment at work. 

In Elisha v Vision Australia the High Court of Australia upheld a Supreme Court finding that an employer had breached the employment contract when its flawed disciplinary process caused an employee severe mental health consequences. In doing so, it awarded the employee close to $1.5 million.

The circumstances of the case involved the employee’s actions on a work-related trip in which a hotel manager claimed he had become aggressive and intimidating. The employer sided with the hotel manager and dismissed the employee based partly on its own view that the worker had displayed similar behaviour at work. It did not offer him an opportunity to refute the claims.  

The High Court’s decision is a warning to all employers that workplace investigations need to be handled sensitively and properly and due process always needs to be followed. It also puts them on notice that the potential psychological harm from workplace mistreatment should always be taken into account.

8. Secure Jobs, Better Pay Review

A couple of years ago the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth) introduced major changes to employment contracts, including limits on fixed-term contracts, pay secrecy bans and the potential for multi-employer bargaining. 

Now, a review of the reforms is underway, with a report to be handed down at the end of March and possible adjustments coming in mid-2025. 

We’ll keep you up to date with any amendments that come out of the review.

9. What else? Emerging trends to watch

Beyond the key hot spots, make sure you also keep an eye on:

• The expansion of employee-like protections for gig workers and independent contractors.
• Proposed restrictions on post-employment non-compete clauses.
• Increasing multi-employer bargaining activity, particularly in the mining and care sectors.
• Legislative changes around same job, same pay for labour hire workers.

Final thoughts

The workplace landscape in 2025 is more complex than ever, with heightened compliance requirements, new employee rights and increased regulatory scrutiny. 

To stay ahead of these developments, you’ll need to be proactive. 

That means now is the time to review policies, ensure you’re still compliant and prepare for what’s ahead.

Get in touch with out team of HR experts if you’d like to find out more.