Big redundancy rule changes

A RULING by the Western Australian Industrial Relations Commission to exempt most small businesses from new redundancy pay provisions has been widely praised by industry groups and the State Government. However, industry groups remained disappointed by the decision to give a general order for businesses with more than 15 employees to pay between four weeks’ salary to employees who are made redundant with one to two years’ service and 16 weeks’ salary to those employed for nine to 10 years. The level of payments doubles the current provisions but matches the scale determined by the Australian Industrial Relations Commission last year which applies to employees covered by federal awards. In its ruling, the commission said that “no submissions were made to it that the national or WA economy would be adversely affected by any decision that it made, particularly given that they were not imposing a requirement to pay severance pay on small business.” The Chamber of Commerce and Industry WA, while disappointed with the mandatory severance, said it was pleased that most small businesses will be exempt from the new provisions. The CCIWA said it had put forward extensive submissions and arguments to oppose the UnionsWA claim and said small businesses rarely have the necessary financial resilience to make large payments to employees who cannot be retained. WAFarmers president, Trevor De Landgrafft also welcomed the decision. Mr De Landgrafft said that rural based businesses are traditionally employers of small workforces and are generally unable to make redundancy payments. The Minister for Consumer and Employment Protection, John Kobelke joined the CCIWA in its praise of the decision to exclude small business from the order. In a statement, Mr Kobelke said the Gallop Government had recognised this was not the time to apply the standards to small business as well, but he did not rule out the need to make the new protections available to all workers when the matter is revisited at some time in the future. Jackson McDonald, industrial relations specialist, Robert Lilburne said the decision was widely in line with the federal decision last year, and was not unexpected. Meanwhile, another industrial relations issue, workers’ compensation premiums, has also recently been addressed, by WorkCover WA. WorkCover recently increased by 2.9 per cent, its recommended premium rates for compulsory workers’ compensation insurance. The government body said that “the modest increase in rates reflected generally positive trends within the scheme, enabling benefits to be increased without a major impost on employers.”

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