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Employment Law ChangesApril 1, 2016
If the Australian economy is built on the foundations of small to medium enterprises (SMEs), then politicians are our country’s landscape gardeners. The upcoming election will pave the way for changes in employment relations, which will impact business owners and employers.
What changes will affect you?
Last year’s budget items focused on SMEs along with some changes to the Fair Work Act 2009. This year it appears that SMEs and the workplace relations framework is in the spotlight again…
The Productivity Commission recently released a report on how our current employment relations framework affects the economy. The report includes a number of recommendations for the Labour and Liberal parties. It will be interesting to see if the following decisions will be agreed upon.
Penalty rates: the Commission has recommended that Sunday penalty rates should be reduced to be the same as Saturday rates in the hospitality and retail sectors, allowing more businesses to open on Sundays, and hence grow and engage more staff. Reducing penalty rates would also significantly decrease overheads, placing many businesses in a much better finance position.
Unfair dismissal: the Commission is recommending the removal of reinstatement as the primary remedy for unfair dismissal, but also recommends compensation should not be awarded for procedural errors in terminations. This would be a real win for SMEs as currently, even where there is a very justified reason for termination, employers can still end up paying out compensation purely because they did not follow a cumbersome ‘best practice’ process.
Adverse action: the Commission report recognises that the opportunity for uncapped compensation in adverse action claims are driving up the number of these claims. Sensibly, the Commission has recommended these claims be capped at the same level as unfair dismissal claims (26 weeks compensation pay).
The Fair Work Commission (FWC)
The FWC also had their say on what they would like addressed and proposed the following:
Annual leave: the FWC is looking at various changes to awards to allow more flexibility in relation to annual leave, including permitting the cashing out of annual leave, for annual leave to be taken in advance of accrual and requirements for employees to take excessive leave. At this stage, the FWC is still taking submission on these inclusions.
Time off in Lieu (TOIL): the FWC has also indicated that provisions allowing TOIL for overtime should also be added to almost all awards where this is not currently included. This would allow employees to take time off equivalent to any overtime worked (instead of being paid for the overtime), providing greater flexibility for businesses to manage overtime.
Penalty rates: another big ticket item for the FWC, which is accepting submissions from interested parties on this across all awards. Today is the final day for submissions, and five days of hearings will then commence 11 April.
The FWC is constantly reviewing and changing individual awards in order to resolve inconsistencies with the National Employment Standards, Employsure keeps all of our clients informed of these important updates when they come into play. As this can happen on a monthly basis, it makes it exceptionally tricky for businesses to keep up with the ever changing landscape, Employsure will ensure you are covered.
If you are ever confused about new employment legislation coming out of the political woodworks, call Employsure on 1300 651 415. Employsure helps small to medium businesses understand the often confusing and constantly evolving legislation.