With fuel prices continuing to rise across Australia, many workers are feeling the strain of simply getting to and from work. It is an increasingly common question: if the cost of working is going up, should employers be contributing to that burden? While the concern is understandable, the legal position remains largely unchanged. The key distinction under workplace law is between ordinary commuting and travel that forms part of your job.
As a starting point, the law does not treat your daily commute as work. Even though you may feel like your working day begins the moment you leave home, travelling to your usual place of employment is generally considered a personal expense. This remains the case regardless of distance or rising fuel costs. Whether you live five kilometres away or fifty, the responsibility for getting to work sits with the employee. In this sense, fuel costs are treated no differently to other personal expenses such as food, clothing, or general living costs.
However, the position shifts significantly where driving forms part of your actual duties. If your employer requires you to use your own vehicle during the course of your work, the law recognises this as a work-related expense rather than a private one. This can include situations where you are travelling between job sites, attending client meetings, transporting goods, or otherwise performing tasks that require the use of your car. In these circumstances, there is usually an entitlement to compensation, although the exact form of that entitlement will depend on your modern award, enterprise agreement, or individual employment contract.
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The key question. When is fuel your cost vs your employer’s?
At the heart of this issue is a simple but critical distinction in workplace law: are you travelling to work, or are you travelling for work? While it may feel like a technical difference, it is the line that determines whether fuel costs fall on you or your employer. As a general rule, the law treats your commute to your usual place of employment as a personal choice. That means the cost of getting there, regardless of distance, traffic, or rising petrol prices, is typically your responsibility.
However, once your employer requires you to travel as part of your duties, the character of that expense changes. It is no longer about getting yourself to work; it is about performing work. In those circumstances, the law recognises that the cost should not be borne by the employee alone. Instead, there is usually an expectation and often a legal entitlement , that the employer compensates you for using your own vehicle.
To put this into context, consider two employees. Sarah works in an office in the CBD and drives 40 kilometres each day to get there. Despite the significant cost, Sarah’s fuel remains her own expense because she is simply commuting to her regular workplace. By contrast, Daniel starts his day at the same office but is then required to visit multiple client sites throughout the day using his personal car. While Daniel’s initial commute is not reimbursable, the moment he is directed to travel between locations for work purposes, those additional trips become work-related and should ordinarily be compensated.
This distinction often catches employees off guard, particularly where roles gradually evolve. Someone may start in a purely office-based position but later find themselves regularly travelling for meetings or site visits without any adjustment to their pay or allowances. In those situations, it is important to step back and assess whether the nature of the role has shifted in a way that gives rise to a lawful entitlement to reimbursement.
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Why your daily commute is still considered a personal expense
Although it may feel like an extension of your working day, the law draws a firm line between your employment and your personal responsibility to get to work. Your daily commute is generally treated as a private matter, meaning the cost of fuel, even in times of sharp price increases, remains your own. The reasoning behind this is that where you choose to live and how you choose to travel to your workplace, are considered personal decisions rather than something directed or controlled by your employer.
From a legal perspective, your employment typically begins when you arrive at your place of work, not when you leave your front door. This is why commuting costs are treated in the same category as other everyday living expenses. Even where the journey is long, inconvenient, or significantly more expensive due to external factors like fuel spikes, the law does not shift that burden onto the employer.
A common example is an employee who chooses to live in a regional area but works in the city. Take Michael, who drives over an hour each way to reach his office in Melbourne. While his travel costs may be substantial, they remain a personal expense because he is simply travelling to his usual workplace. The employer has not required that distance, nor directed the method of travel. As a result, there is no legal obligation to reimburse him for fuel, regardless of how expensive the commute becomes.
This can often feel counterintuitive, particularly where employees are making significant financial sacrifices just to attend work. However, unless the employer imposes a requirement that changes the nature of that travel, such as directing the employee to attend different locations or perform duties on the road, the commute remains firmly on the employee’s side of the ledger.
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When driving becomes part of your job (and changes everything)
The moment driving is no longer just about getting yourself to work, but instead becomes something your employer requires you to do as part of your duties, the legal position changes in a meaningful way. At that point, the cost of fuel is no longer tied to your personal circumstances, it is tied directly to the performance of your job. That distinction is what gives rise to a potential entitlement to compensation.
This often arises in roles where employees are required to move between locations during the day or attend offsite meetings. For example, consider Priya, who works in administration but is regularly asked to visit different branches to provide support. While her initial trip from home to her usual office is her own responsibility, the moment she is directed to travel to another location during work hours, that travel becomes part of her employment duties. In those circumstances, it is generally expected that the employer covers or compensates the associated costs.
These situations are not always clearly defined, particularly where travel requirements develop gradually over time. Employees may find themselves informally expected to use their own vehicle without any discussion around reimbursement. Where driving becomes a regular and necessary part of the role, it is important to recognise that this is no longer incidental, it is part of the job itself and the law tends to treat it accordingly.
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Vehicle allowances, kilometre rates and what actually applies
Even where there is an entitlement to compensation, it does not always take the form people expect. Employers do not typically reimburse fuel receipts dollar-for-dollar. Instead, compensation is usually structured through pre-determined allowances or rates, which are set out in the applicable workplace instrument.
In many cases, modern awards include provisions requiring a per-kilometre payment where an employee is directed to use their own vehicle. Alternatively, some contracts provide a fixed vehicle allowance intended to cover the general cost of maintaining and using a car for work purposes. The method can vary significantly depending on the industry and the terms of employment.
A point that often causes confusion is the use of the Australian Taxation Office’s cents-per-kilometre rate. While some employers adopt this figure as a benchmark, it is not automatically the legally required rate. It is primarily a tax tool, not a workplace entitlement. The enforceable position always depends on what is written in your award, agreement or contract, rather than any external guideline.
To illustrate, take James, who is required to use his personal vehicle to attend client appointments. His employer pays him a set allowance under the relevant award, which may not perfectly reflect current fuel prices but still satisfies the legal obligation. Even if fuel costs rise, the employer’s responsibility is to comply with the applicable instrument, not necessarily to match real-time expenses. This is why understanding the specific terms governing your employment is critical when assessing whether you are being properly compensated.
The fine print: why your award or contract matters
When it comes to fuel costs, the answer is rarely found in general principles alone, it sits in the fine print of your employment arrangements. Your modern award, enterprise agreement, or individual contract will ultimately determine whether you are entitled to any form of reimbursement and how that entitlement is calculated.
Many employees assume that if they are using their own vehicle, they should automatically be compensated in full. In reality, the law does not operate on that basis. Instead, it looks to whether there is a specific clause requiring payment and if so, what form that payment takes. For example, an award may prescribe a set kilometre rate or allowance that applies regardless of fluctuating fuel prices. If the employer complies with that clause, they are generally meeting their legal obligation, even if the payment does not fully reflect current costs.
This is why two employees performing similar work can receive very different outcomes. One may be covered by an award that provides clear entitlements, while another may rely solely on a contract that is silent on vehicle use. Understanding the instrument that governs your employment is therefore critical in determining where you stand.
Rising fuel costs and the pressure on Australian workers
The sharp increase in fuel prices has placed significant strain on workers across Australia, particularly those who rely heavily on driving to perform their roles. What was once a manageable expense has, for many, become a substantial and ongoing financial burden.
This pressure is being felt most acutely in industries such as transport, logistics, construction and delivery services, where travel is unavoidable. Workers in these sectors are not only facing higher costs but are often unable to reduce their travel or switch to alternative arrangements. As a result, the cost-of-living impact is immediate and difficult to absorb.
Beyond individual hardship, the issue is beginning to affect workforce participation more broadly. Employees are increasingly weighing the financial viability of attending work, particularly where wages have not kept pace with rising expenses.
Calls for reform: can the system keep up with fuel prices?
In response to these pressures, there has been growing momentum for reform. Industry bodies and unions have argued that the current framework does not adequately account for rapid increases in operational costs, particularly in sectors where workers bear the expense directly.
The concern is that existing mechanisms for adjusting pay and allowances are often too slow to respond to sudden economic changes. By the time rates are reviewed or agreements renegotiated, workers may have already absorbed months of increased costs. This has led to calls for more flexible and responsive systems that can adapt in real time to external pressures such as fuel price spikes.
The role of the Fair Work Commission in fuel cost disputes
The Fair Work Commission sits at the centre of this debate, with the power to vary awards and address broader workplace issues. In the context of rising fuel costs, there have been proposals to expand its ability to intervene more quickly and effectively.
This includes allowing urgent applications to adjust rates or contract terms where workers are disproportionately impacted by external cost increases. For industries such as road transport, where margins are tight and fuel is a core expense, these powers could play a significant role in ensuring that costs are distributed more fairly across supply chains.
Is work from home a practical solution or overreach?
One of the more immediate responses to rising fuel costs has been the renewed focus on work-from-home arrangements. Reducing the need to travel altogether is, on its face, a simple way to alleviate financial pressure on employees.
For many office-based roles, remote work offers a practical and cost-neutral solution that benefits both employees and employers. It eliminates commuting costs entirely while maintaining productivity in roles that can be performed digitally. However, it is not a universal fix, particularly for industries where physical presence is essential.
Employers push back and why not everyone agrees on WFH
Despite its apparent benefits, not all employers support a broad return to remote work. Many organisations have adopted hybrid models and are reluctant to move further, citing concerns around collaboration, culture and productivity.
There is also a recognition that blanket approaches do not account for the diversity of workplaces. While some roles can transition seamlessly to remote work, others cannot. As a result, employers have generally resisted calls for mandated work-from-home arrangements, preferring to retain flexibility at an organisational level.
The real-world impact of absenteeism and productivity concerns
The effect of rising fuel costs is not limited to household budgets, it is increasingly visible in workplace outcomes. Employers across various sectors have reported higher levels of absenteeism, as workers struggle with the financial and practical challenges of commuting.
This trend is particularly pronounced in industries where remote work is not an option. In these environments, the cost of attending work can become a genuine barrier, leading to disruptions in staffing and productivity. Over time, this has the potential to create broader economic impacts, particularly if labour shortages begin to emerge.
So where do you stand legally?
From a legal standpoint, the position remains relatively settled. Employers are generally not required to cover the cost of commuting to and from your usual workplace. However, where you are required to use your vehicle as part of your job, there is often an entitlement to compensation, subject to the terms of your award, agreement, or contract.
The challenge lies in applying these principles to real-world situations, particularly where roles are not clearly defined or where expectations have evolved over time.
Read more: What Are Your Rights When Working From Home & Returning To The Office?
When should you seek advice about fuel costs?
If you are regularly using your personal vehicle for work without any form of compensation, or if you are unsure whether your employer is meeting their obligations, it may be worth seeking advice.
Issues often arise where there is a disconnect between what an employee is being asked to do and what their contract or award provides for. In those situations, a proper assessment can clarify whether there is a legal entitlement that has been overlooked or misunderstood.
At A Whole New Approach (AWNA), we assist employees in navigating these kinds of workplace issues, ensuring they understand their rights and are in a position to take informed steps where necessary.
