Oppn fails to cap receivership redundancy at 16 weeks

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Oppn fails to cap receivership redundancy at 16 weeks

The Federal Opposition has failed in an attempt to cap redundancy payments at 16 weeks for workers whose employer goes into receivership. Legislation protecting such employees’ entitlements has passed the Senate.

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The Federal Opposition has failed in an attempt to cap redundancy payments at 16 weeks for workers whose employer goes into receivership. Legislation protecting such employees’ entitlements has passed the Senate.

The Opposition objected to a provision in the Fair Entitlements Guarantee Act 2012, which replaces the GEERS scheme and caps redundancy payments at 4 weeks per year of service, rather than at a total of 16 weeks as in the FWA national employment standards (NES).

Shadow Workplace Relations Minister Eric Abetz said the scheme should only cover redundancies ‘in line with the wider community standard’.

More generous
 
Abetz said the Bill would set a new standard that would be ‘undoubtedly used to argue for more generous redundancy arrangements in enterprise agreements and modern awards’.

Having failed to amend the legislation to include the 16-week cap, the Opposition voted against the Bill.

However, the Parliamentary Secretary for Workplace Relations, Jacinta Collins, said the legislation contained a provision to prevent employers artificially enhancing entitlements for their employees and then leaving the taxpayer to foot the Bill. Increases in conditions of employment in the six months prior to insolvency can be ignored by the government if it was not reasonable to expect that the employer could have funded those increases.

Fears not realised
 
Collins said the removal of the 16-week cap had been in place for almost two years and fears that some employers would exploit it had not been realised.

The Minister for Workplace Relations, Bill Shorten, said that over the past five years more than 63,700 employees across Australia have received GEERS assistance worth a cumulative total of over $663 million.

Shorten said the Act will provide certainty for Australian workers who find themselves without a job, and with entitlements owing, when their employer enters liquidation or bankruptcy.

‘Employees are often given little to no warning when a company goes under. It’s vital we ensure they are not disadvantaged through situations they have no control over,’ he said.

‘Workers who lose their job have enough to worry about. They don’t need the extra worry of how they will put food on the table or where the next mortgage repayment is coming from.’

True colours
 
ACTU secretary Dave Oliver said the Coalition had shown its true colours on workers’ rights by trying to stop the legislation. He said the legislative changes should have had bi-partisan support.

Oliver said the Bill contained safeguards that ensure the system can only be used in cases of genuine insolvency, and not as a way for employers to avoid their obligations.

‘This is a balanced and sensible piece of legislation,’ he said.
 
‘The Coalition should be ashamed that they did not support it.’
 
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