Turnbull government to review unfair dismissal proposals

Minister for Small Business Craig Laundy during Question Time earlier this year.
EWIN HANNAN
April 27, 2018
The Australian
Turnbull government to review unfair dismissal proposals

The Turnbull government will examine contentious proposals to allow small businesses to more easily dismiss employees and to slash the maximum compensation paid to unfairly sacked workers.

Workplace Minister Craig Laundy joined employers in welcoming proposals by Small Business Ombudsman Kate Carnell, but unions attacked her plan.

Ms Carnell has proposed increasing the hurdles for workers pursuing unfair dismissal claims, creating a small business enterprise agreement stream, and inserting an award provision allowing small employers to trade off penalty rates and other entitlements for a higher hourly rate of pay.

She said the maximum compensation granted against a small business in dismissal cases should be cut from six months to three months’ pay. Where a case is settled, maximum compensation should be cut from 26 weeks to 13 weeks’ pay.

She called for law changes to allow small businesses to pay out an employee deemed “no longer a good fit for the business”. Under the change, the workers would receive a payout based on the redundancy provisions contained in a relevant award.

She also proposed a “safe harbour” for small businesses that would see them not prosecuted for inadvertent underpayment of wages.

Mr Laundy said the proposals were a “constructive contribution” as the government considered ways to make the workplace relations system easier for small businesses and their employees.

He said the government would continue working with Ms Carnell on her proposals and consult widely to ensure the system worked for all Australians.

Australian Chamber of Commerce and Industry chief executive James Pearson said Ms Carnell, a former chamber chief executive, had made sensible proposals.

“We support measures aimed at reducing the time and cost for small businesses involved in termination disputes, recognising the unique circumstances of small businesses and their limited resources and capacities,” Mr Pearson said.

“The margin for error is high and even lawyers and industrial experts with decades of experience can get it wrong. It’s even harder for small businesses that don’t have in house lawyers or human resources departments to focus on the detail and get it right.

“It is nonsense that small business people are required to navigate awards that can span over a hundred pages and wade through laws as thick as a phone book to understand what they should be doing.”

The ACTU said Ms Carnell was “proposing a licence for business owners to fire any person at any time for any reason or no reason”.

“When we need meaningful penalties and strong deterrents against wage theft, these proposals are offering a free-for-all where employers can steal wages with no fear of consequences,’’ a spokesman said.