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Coalition’s IR Policy a Major Disappointment for Small Business

By David Bates, MD, Better HR – Australia’s leading employment relations service for employers

The Federal Opposition’s IR Policy for the 2013 election offers little hope for small businesses struggling with the complexities of Australia’s highly re-regulated labour market.

While the policy does promise greater flexibility for employers and an increased focus on productivity, it comprehensively fails to address serious issues concerning unfair dismissal and adverse action claims.

David Bates, Managing Director of Better HR – a leading provider of HR and employment relations services to SMEs – today described the Coalition’s policy as a small step in the right direction, but deeply disappointing. He says:  “Australia’s small business owners deserve proper protection against frivolous unfair dismissal claims. The Coalition’s policy is silent on this important issue and this is deeply disappointing to employers who are tired of paying ‘go-away’ money to ex-employees.”

Mr Bates describes the conciliation and arbitration process as fundamentally flawed and maintains employers expected much more from the Coalition’s policy. According to Mr Bates: “Our unfair dismissal system is broken. Employers, especially those running small businesses, have no confidence in a system that effectively encourages them to pay out hard-earned money to ex-employees simply to make them go away.”

The Coalition’s policy also offers little relief from ‘adverse-action’ claims. According to Mr Bates: “Better HR had hoped the Coalition would pledge to remove the reverse onus of proof that applies to adverse action claims. The Coalition’s policy will continue to see employers effectively deemed guilty until proven innocent. That’s neither fair nor very Australian”.

Better HR notes the Coalition’s commitment to provide small businesses with immunity from financial penalties where they have acted in good faith and have previously sought advice from the Fair Work Ombudsman (FWO). However, according to Mr Bates: “This change sounds good in theory, but the FWO is consistently unable to answer calls from employers within a reasonable timeframe and they will not generally provide written advice. As a result, most employers simply can’t obtain advice from the FWO at all, let alone rely on it in good faith.”

Better HR welcomes the Coalition’s commitments to improve the Enterprise Bargaining system and reduce the disproportionate influence of trade unions, but Mr Bates notes: “These changes are of little relevance to small business owners. SMEs want and deserve an IR system that values their contribution to the economy, rewards their incredibly hard work and respects the vital role they play in local communities.”