The Australian Small Business and Family Enterprise Ombudsman (ASBFEO) yesterday released proposed changes to the Small Business Fair Dismissal Code (the Code).
Ed Mallett, founder and Managing Director of Employsure, welcomed the initiative of ASBEFO, Kate Carnell, in proposing the need for a revised Code for small businesses that find themselves caught up in the current complex and expensive, time-consuming unfair dismissal system that affects millions of small, family businesses.
Mr Mallett said, “There has been a growing need to reform the Code. Employing new employees is not in itself a difficult process, however if the employment relationship breaks down it can become a complex nightmare for a small business – best described as industrial divorce.”
According to Mr Mallett, unfair dismissal claims are consistently the most common claim year on year in the Fair Work Commission; describing them as, “a growth industry of sorts.”
“With options available to employees like unions, and advocacy groups, and particularly with the rise of no-win-no-fee lawyers, it’s no surprise the employer success rate in unfair dismissal cases are dipping. Lodging an unfair dismissal claim is about as easy as ordering an Uber.”
However, Mr Mallett says it’s difficult for employers to get it right: “Employers are telling us how overwhelming it is to understand what the correct process is for terminating employment in a fair way, in line with the Fair Work Act. What could seem straightforward often lies in the grey area, further highlighting the complexities of the Act.”
“The changes to the Code proposed by Ms Carnell would provide clarity and fairness to the dismissal process for both employers and employees.”
“One of the key aspects of the changes proposed by Ms Carnell is the need for small business employers to know how to follow a fair process when terminating an employee’s employment. Employers require clearer guidelines on what is required to carry out a legal dismissal.”
In an Employsure commissioned survey with small business employers, 68 per cent of respondents said workplace laws are poorly explained by regulators and three-quarters believe they are poorly communicated.
“On behalf of the 25,000 small and medium sized businesses we represent across Australia, we are in full support of the ASBEFO initiative and look forward to seeing the proposed changes become part of a new Code for small businesses. We would like to see the removal of uncertainty and expense associated with the current system,” he said.
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