Unions are claiming victory over the Federal Governments plan to scale back support for workers who lose their jobs when companies go broke. At present, the Fair Entitlements Guarantee (FEG) scheme pays workers in collapsed companies four weeks of redundancy pay for each year of service. The Federal Government wants to limit the payout to 16 weeks of pay. To get the changes through the Senate, the Government needs to win the support of the crossbench senators. The Government argues the scheme in its current form is unsustainable, with demand increasing from 8,626 claimants being paid $72.97 million in 2006-07 to 16,019 claimants being paid $261.65 million in 2012-13. It says the current scheme also creates a moral hazard, encouraging employers and unions to sign up to unsustainable redundancy entitlements, safe in the knowledge that if the company fails, the Fair Entitlements Guarantee and the Australian taxpayer will pay for it. Senator Madigan said he would like to see evidence supporting that argument. Where are these outrageous negotiations? Show us the examples of what youre pointing to, he said. Kerrie Seymour said the Federal Government would be better placed focusing its efforts on targeting the owners of companies that do the wrong thing, rather than cutting benefits to workers. The Government should be going for people who are doing dodgy deals, she said. TCFUA national secretary Michele ONeil agreed, adding that a wholesale shake-up of corporations law was needed. If there were tougher penalties for workers and companies who fail to secure workers entitlements – who repeatedly, for example, entered into phoenix arrangements – then you would have a real disincentive in terms of this happening in the first place and a stronger capacity for the Commonwealth to have penalties found against these directors, she said.
Posted on: Thu, 30 Oct 2014 20:35:29 +0000
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