AI and Workplace Surveillance: Victoria's Proposed Reforms Explained

Key takeaway for employers

• Victoria has proposed significant reforms to workplace surveillance, employee monitoring and AI-driven decision-making.
• The changes would require greater transparency, consultation and human oversight where surveillance and AI affect workers.
• Although not yet law, the reforms provide an opportunity for employers to review their current surveillance and AI practices.

Victoria's new approach to workplace surveillance

The Victorian Government has announced that if re-elected, it will introduce what it describes as the “toughest workplace surveillance protection laws in the country.”

The election commitment responds to concerns that increasingly sophisticated technologies allow workers to be monitored, tracked and assessed in ways that may be intrusive, opaque or discriminatory.

These proposed reforms would regulate when employers can monitor workers, require greater transparency and consultation, and require human review of significant automated decisions made using surveillance data that affect workers’ rights.

These reforms are not yet law.

Importantly, the proposal remains an election commitment rather than enacted legislation. No Bill or exposure draft has yet been released. Its implementation and final scope will therefore likely depend on the outcome of the Victorian State election scheduled for 28 November 2026 and, if Labor is returned, the subsequent passage of legislation through Parliament.

Nevertheless, this announcement provides an opportunity for employers to consider their current workplace surveillance arrangements. It also provides a useful insight as to some of the principles likely to shape future regulation of workplace surveillance, employee data and artificial intelligence (AI) and may signal the types of expectations that workers and unions are increasingly placing on workplace monitoring practices in policy and enterprise bargaining.

What is being proposed?

The reforms proposed by the Victorian Government would:

• require biometric data to be collected only where there's no less intrusive option;
• restrict the use of biometric data to infer workers’ emotions, unless there is a legitimate reason, such as fatigue monitoring for truck drivers;
• restrict the use of AI to track matters such as bathroom breaks, pregnancy or physical characteristics, without a specific, legitimate purpose; and
• increase protections against discriminatory uses of workplace surveillance and AI. 

The Government has also announced that the proposed framework would require employers to: 

• notify workers if they are being monitored; 
• consult workers before introducing new surveillance technology or materially changing how existing technology is used; 
• demonstrate a legitimate purpose for undertaking surveillance; 
• ensure that significant automated decisions made using surveillance data and affecting worker’s rights are reviewed by a human; and 
• provide workers with access to their own surveillance data where it has been used to affect their employment.

Covert surveillance would only be permitted where unlawful activity is suspected and would be subject to strict controls. However, the detail of those controls will not be known until the proposed legislation is made public.

AI in recruitment and employment decisions

Separate but related reforms are also proposed to address the risk of discrimination arising from the use of AI in recruitment and other employment decisions.

AI tools are increasingly capable of screening applications, ranking candidates, analysing interviews, allocating work, assessing performance and making recommendations about promotion, remuneration or disciplinary action.

However, those systems may reproduce biases contained in their underlying data or place disproportionate weight on characteristics that are not genuinely relevant to a person’s ability to perform a role.

The Victorian Government has indicated that it intends to amend the Equal Opportunity Act 2010 (Vic) to address discriminatory AI decision-making, including discrimination based on race, gender, sexuality, religion and other protected personal characteristics.

Importantly, the proposed laws do not appear to suggest that employers would be prohibited from using AI in recruitment or workforce management altogether. Rather, employers would need to ensure that the systems they use are appropriately tested, free from unlawful bias and supported by meaningful human oversight.

It is also worth noting that many of the risks that these proposals seek to address are not entirely new. Discrimination in recruitment and employment is already prohibited under the Equal Opportunity Act, and the general protections provisions of the Fair Work Act prohibits adverse actions against current and prospective employees because of a protected attribute (or series of attributes) such as race, sex, age or disability.

What prompted Victoria’s proposed reforms?

The announcement follows the Victorian Parliament’s 2025 Inquiry into Workplace Surveillance.

This Inquiry found that workplace surveillance had expanded well beyond traditional CCTV and telephone recording to include keystroke logging, webcam monitoring, wearable devices, handheld scanners, biometric identification, location tracking, sentiment analysis, productivity scoring, AI and even emerging neurotechnology.

The Inquiry also found that many workers did not know the extent to which they were being monitored or how their information was being collected, analysed, stored and used.

What would these reforms mean for employers?

If implemented, the reforms would likely require employers to approach workplace as more than simply a technology, security or IT issue. Instead, surveillance may increasingly be viewed as a workplace relations, governance and risk management issue requiring transparency, consultation and appropriate oversight.

The practical challenge for employers will be striking an appropriate balance between legitimate business, security and safety objectives and workers’ privacy, equality, autonomy and psychological health.

Regardless of whether the proposed reforms become law in Victoria or not, employers should be proactive in this space. This means being able to explain what monitoring occurs, why it is necessary, how employee information is protected and how significant decisions are subject to appropriate human oversight.

Key action for employers

To prepare for potential legislative reform in this area, employers should consider stress testing their workplace surveillance and AI systems by:

1. Audit existing surveillance and AI systems in order to identify systems that monitor, record, track or analyse workers. This may include CCTV, GPS tracking, email monitoring, call recording, access cards, productivity software, biometric systems and AI recruitment tools. 
2. Review existing contracts and policies to determine whether they accurately describe technologies being used, the information collected and the purpose for which it may be used.  
3. Record the specific business or safety purpose served by each system beyond broad justifications such as “productivity” or “security” by identifying the specific risk or operational need being addressed by the technology. 
4. Consider less intrusive alternatives by assessing whether an objective could reasonably be achieved by collecting less information, monitoring fewer workers, using the system for a shorter period or adopting a non-surveillance control. 
5. Regularly assess whether AI systems produce different or unfair outcomes for particular groups. Investigate anomalies rather than assuming that the technology is objective. 
6. Train managers who use surveillance information or AI-assisted systems in recruitment, performance management and disciplinary procedures. Managers should understand the limitations of algorithmic outputs and the need to base decisions on accurate, relevant and independently assessed evidence. 
7. Exercise caution where technology is used to make or influence decisions about recruitment, performance management, work allocation, promotion, remuneration, discipline or termination.
8. Review procurement and service agreements with technology providers to understand how employee information is collected, stored, used, disclosed and retained, and what assurance the provider gives regarding accuracy, security and bias.

Questions?

For enquiries regarding these reforms, please contact our team at info@ablawyers.com.au. Employers who subscribe to the Workplace Advice Line can contact the service for advice and support in navigating these changes.