EMPLOYMENT & WORKPLACE RELATIONS POLICIES
Impediments to Business and How to Solve Them
There are many unnecessary impediments placed upon businesses, that cause unnecessary expense, lost-time and obstruction. It is vital that these impediments are removed.
Workers Compensation
In Australia we have multiple Workers Compensation jurisdictions, that all operate differently, charge differently and insure differently. Such as, in the ACT and WA Directors can be insured under a policy, whereas in Victoria, Directors and Sole-traders cannot acquire Workers Compensation. A Director in Victoria will need to employ themself and pay a PAYG wage, then they can be included in the policy as an employee. A Victorian Sole-Trader will need to incorporate and do the same, as the above, to achieve the same result.
Premiums in all States are calculated on the wages paid, some include superannuation and others don’t. Each occupation has a gazetted code, which has a percentage amount, this percentage figure is applied to the wages and this creates the base premium, to which levies and GST are applied. Furthermore, because the business can only select one occupation code, this ends up being the highest rated code; e.g. a building firm will have the same high rate applied to all employees, even if half are only admin staff. To get around this issue, firms have to set up two companies, one employing the higher rated builders and the other employing the admin staff, so that the admin staff can be rated at the lower percentage rate and charged less premium.
Furthermore, the system rewards low paying employers and penalises better paying employers, this is because the premiums are calculated on the wages paid. So, the employer that pays their staff well is penalised by having to pay a higher premium; whereas the employer that pays poorly, benefits from a lower premium, even though the two firms may have the same turnover. From a risk perspective, better remunerated employees are more likely to act prudently, as opposed to the poorly paid employees who may cut corners, resulting in injury. This is clearly wrong, as good employers are disincentivised to pay better wages. The reason they use the wages paid, is because in the event of a claim the injured worker will be seeking to be paid their salary as part of the claim.
The alternative solution is to go to an occupation rated system to calculate the premium. They could use a set dollar amount for an admin person and a set dollar amount for a builder. When calculating the premium, you will simply select the occupation type and the number of staff that fit within that category. So, if you have two builders at $1000 premium each and four admin at $250 premium each, the total base premium is $3000. This would mean that similar building companies with the same number of employees, would pay the same premium, irrespective of the wages paid.
Furthermore, the deeming provision should be scrapped and every business should be eligible for workers compensation. So, all Directors and sole-traders should also be eligible; and because the premium calculation is based upon the occupation and a fixed dollar amount, then wages paid would be irrelevant, especially if the director doesn’t take a wage or only takes a low wage.
Payroll Tax
Companies, that employ more people are penalised with a payroll tax when they reach a certain monetary threshold, simply for giving people jobs. When a company’s payroll nears the threshold, there is in fact an incentive not to employ more staff, to avoid paying the payroll tax. We should be doing the opposite and rewarding companies for employing more people.
The solution is, that Payroll tax should be abolished and companies should be eligible for a one percent reduction in corporate tax for every ten thousand employees they employ. This will encourage businesses to employ more people.
BAS
When a company’s payroll reaches a certain amount, the company is obliged to go from a quarterly reporting BAS to a monthly reporting BAS, for wages. This adds an additional burden to the company as they must make additional time each month to undertake this task. For small businesses with limited resources, this is an unnecessary burden that adds to the pressure of running a small business. The solution is simple, the business will decide whether they want to do their BAS monthly, quarterly, bi-annually or annually.
Employee Leave
The number of reasons by which an employee can be absent from work is growing all the time. Although holiday leave and sick leave are reasonable, they have now added additional reasons, such as carers leave, domestic violence leave, parental leave and referendum failure leave. It is not the employer’s fault that their employee has issues. Socialists seem to think that a business is there for the benefit of its employees; who can come and go whenever they like; and the employer is expected to bend over backwards to accommodate their employees every whim.
The reality is, that businesses are there to make money, to provide or sell a product or service, for profit. The business will employ staff as the business grows, thus providing employment opportunities to ordinary people. Most business owners will be considerate of issues involving their employees, but they cannot be expected to have their business impacted by external issues, that are not of their making. This is especially relevant for small businesses, that do not have a large workforce, who can cover the absenteeism.
The solution is to keep leave simple. Every employee will get six weeks paid leave annually and they can take it in any way they like. Once used up, if something arises, then they are on unpaid leave, but subject to agreement with their employer. Also, all holiday leave loading will be abolished.
Superannuation
There is a logic to increasing the compulsory superannuation rate, but every increase is another cost burden placed upon a business, for which many small businesses find hard to afford. The solutions are, reduce the corporate tax, allow for salary sacrifice to enable the employee to contribute more to their superannuation and abolish the tax on superannuation contributions, thus leaving more in the employees’ superannuation. Possibly consider an optional percentage above the standard rate as an employment negotiation tactic, i.e. employers could offer a higher superannuation rate to potential candidates, instead of a higher salary.
Bureaucracy
The new employment laws and processes are so arduous, that it is making employing someone very hard. Rather than making the process as simple as possible, they now expect you to use the MyGov system, which is complicated and has no practical help for struggling employers. Firing poor staff is near impossible and you could face an unfair dismissal claim, simply for getting rid of an incompetent employee. The solution is simple, abolish as much bureaucracy as possible and make everything as simple as possible.
Fringe Benefit Tax
This tax impedes businesses, that wish to reward their staff with a perk or company car, so ultimately reduces demand for company cars. The employee loses out, and it might affect their taxable income simply for being rewarded for their hard work. The solution is simple, abolish fringe benefit tax.
Taxation
Taxation is a massive burden placed upon businesses. If, they are able to make a profit after all the above expenses, the Government rewards businesses by taxing their profit. For small businesses the gross profit made could be the difference between surviving or going under. The solutions are, introduce a corporate profit tax-free threshold of $50,000; $45,000 for sole-traders, reduce the corporate income tax rate down to 20% and apply an additional 1% corporate tax reduction for every ten thousand employees that are employed.
The Current Solutions for Business
For many businesses these bureaucratic and tax burdens have become too great to bear, so they have sought out various solutions. The growing common solution is, not to employ Australians, but to outsource the work to overseas cheap labour. The advantages of this for the employer are many;
- They do not need to go through the arduous process of employing or firing people.
- They can hire and fire on a whim, without paying any severance pay, holiday pay or any other entitlements that might normally be owed.
- The overseas weekly wage paid is a fraction of the cost, that an Australian employee would expect to be paid.
- There is no minimum wage, no holiday or sick pay, no superannuation, no workers compensation, no redundancy paid, no PAYG tax, no Payroll tax, no monthly BAS wages reporting.
- From the savings achieved, the business can either increase their profits, or reduce their prices to gain an unfair advantage over another competitor employing the equivalent number of Australian employees.
- There are no or very limited office costs and overheads.
Negative Effects
If this trend continues, you could end up with a situation where there are no businesses operating in Australia, with no Australians being employed. In the meantime, all the taxes and contributions which should be paid, are not, thus reducing the available funds to the Government and the economy. This therefore places a greater burden on those Australian businesses, that continue to operate in Australia and employ Australians, by having more taxes placed upon them and increasing the rate of the taxes, that they currently pay. This in turn precipitates pushing more and more Australian businesses into overseas outsourcing. All this could be avoided, if the Government worked with and supported businesses, instead of working against them and simply using them as a cash cow.
Working Hours and Over-Time
The working week is based upon hours not days, so it doesn’t matter if you work nights or weekends, you are paid as per the following.
- First 37.5 hours is single time
- Next 5 hours is single time, but discretional as to whether paid by the employer
- Next 10 hours are time and a half, but if paying the earlier 5 hours they must be paid at single time
- Next 7.5 hours is double time
- This makes a total of 60 hours per week; no employee should be allowed to work above these hours as clearly the extra hours warrant a new position being created by the employer.
- Lunch is one hour plus morning and afternoon tea breaks of 15 minutes
- No leave loading
- Four weeks’ annual leave, increases to five weeks after an employee has continuously worked for five years with the same company.
Probation is 6 months for all employees, whereby either side can terminate employment by giving one weeks’ notice. This can be paid in lieu of working, by the employer.
No holiday pay or sick pay is paid if termination is made within the first three months by either party.
Termination after three months, but before six months accrued holiday pay is only paid if the employer terminates the employee. If the employee terminates the employment, then they forfeit any entitlement.
Termination after six months requires payment of accrued holiday pay and notice of two weeks, which can be paid in lieu, by the employer.
Employees can be terminated without just cause up to twelve months. No unfair dismissal claims can be brought. After one year, the employer must show just cause for the termination. Unfair dismissal claims can be brought by an employee, but the case must be heard at the unfair dismissals’ tribunal where the employee and employer must attend to present their respective cases. No costs are involved unless the employer is found to have terminated unfairly, where upon the employee can seek to be reinstated, be paid back pay and be paid a cash settlement of one month’s pay. Alternatively, the employer can decline to reinstate the employee, but must pay any back pay and an additional three month’s salary.
Minimum Wage Abolished
We will abolish the minimum wage. There are two main reasons, first, the majority of workers earn more per hour than the minimum wage and second; by setting a minimum you are preventing businesses from offering jobs at a lower hourly rate. On this point, not every business has the funds to pay higher rates, but if someone is prepared to accept work that pays a lower rate, then this should not be prevented, as some people place learning and earning something as more important. By abolishing the minimum wage this does not mean that we will tolerate businesses suddenly reducing wages, just because they can, but a business that is experiencing financial trouble may be left with no choice, in order to keep the business going. Also, workers do not have to tolerate low wages, if they do not want to work for a low amount then they can decline.
Recommended Minimum Wage $10 Per Hour
Although there will be no official minimum wage and businesses can offer work at any hourly rate they like, we would recommend that the guideline hourly rate should be $10. Although half the current minimum wage, it is still a reasonable amount and it could be the difference between finding work or not. As Conservatives, we believe in free market forces; and as we intend to have a country with full employment, once this occurs then the market forces will sway back to the workers favour who will be able to negotiate higher wages, due to the shortage of available workers.
Awards and Rates
We have a number of awards, specifically designed for particular industry sectors. Although there may be merit in this, the problem is, that workers can get treated completely differently, in pay, hours and conditions. We want to level up the workforce, so that workers are treated the same. Hours of work should be more consistent, but for those that work outside the normal nine to five work day, we appreciate that their award may have to be different. Wages should reflect the job that you do and not be paid out of kilter, simply because it was negotiated by a union official. We need to bring commonsense and stability to the job market to ensure sustainability of employment. Overtime rates need to be consistent and not over bearing on a business, simply because it is evening or holiday work. Ending leave loading and excessive penalty rates will help maintain businesses.
Unions
Unions should not be abolished, but they do need to be reformed to be accountable to their membership with full transparency regarding their finances. A union has the right to support any political party or cause, subject to approval by the membership. With political donations, the union must canvass its members to see which party the members’ support. Any proposed donation should then be allocated to the political parties supported by the members on a weighting basis.
Strikes action must follow strict rules, similar to those introduced by Margaret Thatcher, which placed conditions and secret votes on any proposed action, and if it passed, picket lines were restricted to just six strikers, who could not interfere with people going about their lawful business.
Skills and Training
Skills and training in the workplace are essential for continued development, but the training must be relevant to the employee’s industry. Being trained in diversity and inclusion is a complete and utter waste of time and money. The cost of all further education undertaken by employees to enhance their careers will be tax deductible
Abolish Dole
The dole should be abolished. The main reasons being are that receiving the dole slowly destroys your self-respect and will to improve your life. Although the original concept of the dole was a good idea, it has now become an alternative lifestyle, which is forcing people to have a choice between working or receiving benefit. Too many people look at a job and compare the salary with their dole payments, with many concluding that the difference in salary is not enough to justify giving up the dole. Some people will say that the job only pays say $300 a week and I can get $200 in benefits, so I will be working 38 hours just to receive an extra $100 a week, so what’s the point, I will be better off staying on the dole.
It also allows people to give up work too easily, because they can just go straight onto the dole and thus continue to receive some money. It is also far too easy for young people, straight out of school, to simply go on the dole, because it is easier than looking for a job. The peril is, that once they are hooked on the dole, it becomes ever increasingly difficult to get them off it. Long term dole recipients will dream up any excuse to avoid getting a job, just to stay on the dole. Many often feign illness or injury to avoid work. Some even go to extreme lengths of having a child just so that they can get even more money in benefits, whilst justifying to everyone that they really want to work, but how can they when they have a young child to look after.
The addictive effects of the dole are more akin to addiction to narcotics; the recipient just cannot break free of the addiction and will find any excuse to continue their habit.
Abolishing the dole has many benefits. First, it will break that mindset that someone has the right to be paid to stay at home and not work. It will break the addiction and once people know that they will no longer be paid to do nothing, then they will have no choice if they want an income, but to get a job. Then the $300 a week job will become very appealing. It will also make people think twice before giving up a perfectly good job, just because they don’t like working. People will regain their self-respect; they will learn to stand on their own two feet and not take things for granted as if they were owed a living.
Ending the dole, will end the need for the unemployment register, the Centrelink department and the raising and channelling of taxes. So, we will see a reduction in Government spending in paying for a department and staff as well as the financial transaction costs involved in paying out the dole.
We would expect to see a far higher and quicker take up of job vacancies. Small businesses would no longer be competing for staff with the government backed dole. Small business would be able to get vacancies filled far quicker, thus pushing their business forward.
Of course, there may be more unemployed than there are job vacancies or there may be people who are not suitable for employment, due to disability, addiction or general lack of work ethic. In this case those that simply do not want to work, will not be compelled to do so. They can if they wish stay at home and watch television, but they will not receive any benefit. They will stay at home at their own expense.
Government Work Programme
INITIAL STAGE IMPLEMENTATION
For those that genuinely want to work, they will have an opportunity to join a Government Work Programme (GWP). They will work a normal 38-hour week and will be paid a set rate of $10 per hour plus superannuation. The unemployed and retirees will attend their local Council, where they will sign up to work on projects. Typically, they will do all the odds and sods jobs, such as, picking up litter, removing graffiti, cutting grass, back burning, planting trees, etc.
Their wages will be paid fortnightly, just like any other employment. The annual wage will be $19,760 and be tax free, which although low is still greater than the dole. The idea is, that we want people to get into a normal working state of mind, hence the 38 hours per week. The GWP is a temporary stop gap for the unemployed, until they find a proper place of employment. The rate is set at $10 an hour, so as, to encourage workers to accept jobs that are on offer which may pay say $12 or $14 per hour. The GWP is designed to ensure, that people can earn some money whilst looking for full-time careers. It will also make them want to get a proper job, with more prospects, whereas the dole just makes them lazy and stuck in a comfortable rut.
Abolishing the dole stops the double dipping dole cheat, it will force people to live up to their responsibilities, drug addicts will find that they must kick their habit, but having a habit will not prevent them from picking up litter or cleaning graffiti. People with disabilities will be harder to cater for depending upon their disability, but we should be able to find suitable work that can be done in their condition.
Aboriginals may be an issue for various reasons, but we could use their unique bush skills to help them combat feral infestations, such as cane toads. The GWP for aboriginals in remote areas would be to eradicate pests, which in turn would ease environment issues.
All participants will also earn superannuation, which will help with their retirement, rather than not receiving superannuation, by being on the dole.
The main thing is to change mindsets and to end the cycle of welfare dependency.
SECOND STAGE IMPLEMENTATION
Once the concept of the Work Programme has taken shape, we will then expand it to include Land Conservation and Back Burning – See Environment policy
Universal Basic Income
Universal Basic Income (UBI) is a proposed social policy where governments provide regular, unconditional cash payments to all residents, regardless of their income or employment status. Designed to combat poverty, reduce bureaucracy, and provide a safety net against automation-driven job loss, it aims to guarantee a basic living standard. This policy is gaining traction among socialist minded persons and is supported by research that alleges great benefits for a society and its economy. Other than taxing the wealthy, there is no other explanation as to how these payments would be funded. Socialist Modern Monetary Theory, advocates that the government should just print whatever money they require to meet this cost. If you accept and follow the socialist logic, then in theory, this could work, but relying upon taxing the wealthy and then printing money to cover the shortfall, is where their case falls down. The wealthy do not like paying tax and most will leave a country that tries to force them. So, the revenue is unlikely to come from taxing the rich. This leaves MMT, which again, in theory, could work, but will place great pressure on inflation, which would negate any benefits the UBI was intended to provide.
Universal Basic Work Income
If we take the concept of UBI; and for the purposes of this exercise ignore the negative effects of printing money, then could UBI be used in a more constructive way. Rather than paying people for doing nothing, why not pay them to work and earn, this way you will receive something in kind for the money expended. The reason why people leave the countryside to live in the urban areas is for work. The countryside simply does not have enough jobs to warrant staying. So, could a Universal Basic Work policy change this. If people could be guaranteed enough work and earnings, would this stop them leaving the countryside. The answer is, yes. Printing money where there is no return of the money, is a recipe for hyperinflation. But what if the money was printed solely for the purposes of paying a wage and not for wage increases. If the money is just used to pay wages for the purposes of creating jobs, then in theory, you are just stimulating the local economy by creating jobs, which in turn helps the local community to thrive. Which is more beneficial, paying someone the dole not to work or paying someone a basic normal wage and have them work.
