Federal power grab will cost

MOVES to expand the Federal Government’s powers over the nation’s unfair dismissal laws are expected to be costly.

The Government has committed an additional $16.8 million over four years to cope with the increased workload that is anticipated as a result of changes to Federal industrial relations laws.

Under changes laid out in the Workplace Relations Amendment (Termination of Employment) Bill 2002, the Australian Industrial Relations Commission will take over from much of the States’ competing systems.

Federal Workplace Relations Minister Tony Abbott said that once the bill was passed the Federal unfair dismissal scheme would cover around 85 per cent of employees around Australia, up from about 50 per cent currently.

“With the expansion of the Federal unfair dismissal system, the number of Federal unfair dismissal applications is likely to increase by around 75 per cent, with a similar decrease in the State systems,” he said.

While the demands on the WA Industrial Relations Commission are expected to slump as a result of the changes, that is not reflected in this month’s State Budget.

Instead of a decrease in spending, the WAIRC, which had a budget overrun in 2002-03, has had its funding increased by more than $1 million to $9.1 million compared with 2001-02.

At the same time, the number of unfair dismissal and contractual benefit applications have already been falling, from more than 2,000 cases in 2001-02 to an estimated 1,550 in 2002-03.

Employer Employee Agreement applications were also below budget forecasts with the commission processing an estimated 690 applications compared to a budgeted 3,600 during 2002-03.

 The State Budget papers say that the funding increase was necessary despite the lower than expected demand for EEAs as “the complexity of assessing the applications for compliance and applying the no-disadvantage test has meant that a higher level of resourcing and a different staffing structure than first envisaged is required to deal with applications more expeditiously”.

Mr Abbott said the proposed Bill, which uses the Government’s corporations powers would lessen the complexity, lower costs and provide more certainty.

A study carried out last year by Don Harding from the Melbourne Institute of Applied Economics and Social Research at the University of Melbourne estimated unfair dismissal cost businesses $1.3 billion each year.

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