Move to cap liquidation entitlements at 16 weeks defeated

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Move to cap liquidation entitlements at 16 weeks defeated

A move by the Opposition to cap redundancy payments at 16 weeks for workers whose employer has gone into liquidation has been defeated in the House of Representatives.

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A move by the Opposition to cap redundancy payments at 16 weeks for workers whose employer has gone into liquidation has been defeated in the House of Representatives.

Instead, the new system which replaces the General Employee Entitlements and Redundancy Scheme (GEERS) will see workers get four weeks of redundancy pay for each year of service.

Workplace Relations Minister Bill Shorten said the change would provide greater certainty for Australian workers if their employer enters liquidation or bankruptcy and cannot pay them the employment entitlements they are owed.

‘The Bill reflects the existing protection under the General Employee Entitlements and Redundancy Scheme of 4 weeks redundancy for every year of service,’ he said.

Difficult circumstances
 
‘However the Coalition proposed an amendment to cap this entitlement at 16 weeks only thereby reducing existing protections for workers in difficult circumstances.’

‘I am therefore very pleased the Opposition’s amendment was defeated and Australian workers, who have loyally worked for companies for years, will continue to get the protections they deserve now under a statutory scheme.’

‘Many of the workers who would have felt the brunt of the Coalition’s amendments are mature aged employees who often find it more difficult to re-enter the workforce compared to their younger counterparts.’

No warning
 
‘Employees are often given little to no warning when a company goes under and this is our way of trying to ensure they are not disadvantaged through situations they have no control over.’

Eligible employees will be covered for unpaid entitlements that are not able to be paid by their employer in an insolvency event including redundancy, annual leave, long service leave, unpaid wages and payment in lieu of notice.

Employees who continue to work past the appointment of an insolvency practitioner will be eligible for entitlements. An external review process will assess each case.
 
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