Businesses are being forced to pay money for employees to leave a company under the Federal Government’s new Fair Work industrial relations laws, shadow small business and workplace relations minister Steven Ciobo and Andrew Southcott have said.
The claim comes as figures from the workplace relations minister’s office show 2,339 unfair-dismissal applications were made in the first 10 weeks of operation of the new laws, prompting fears businesses are finding it more difficult to sack problematic staff.
The number is nearly double the figure of 1,268 complaints recorded during the same period last year.
“This, combined with the massive increases to business operating costs arising from Labor’s so-called ‘modern awards’, is a recipe for disaster,” Southcott said in a statement.
“This is damaging to the economy, productivity and the relationships between workers and enterprise. At a time when we are supposed to be encouraging business to lead the economic recovery, Labor is doing everything to make the recovery harder.”
Ciobo said the laws are leading to an epidemic of “go-away” money, which is where small businesses will pay money to employees in order to settle an unfair dismissal case instead of going to the Fair Work tribunal.
“This is a major disincentive to growth as it will make business, particularly Australia’s 2.4 million small businesses, think long and hard about taking on new staff. In June I predicted this is what would happen, and within just a few months we’re already seeing the fruits of Labor’s policy.”
Ciobo also claimed that changes to the Small Business Fair Dismissal Code had put the burden on small businesses to prove their own case when an unfair dismissal claim is made.
The first unfair dismissal case to be heard by Fair Work Australia resulted in an employee being paid $9,522 in lost wages.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
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