Small business groups left fuming over “damaging” and “rushed” IR reforms

Small business advocates say the latest industrial relations reforms are “damaging” after a last-minute deal between Labor and key Senate crossbenchers saw significant changes legislated on the last sitting day of the year.

A downsized version of the federal government’s Closing Loopholes package passed in both houses on Thursday.

The first half of the Closing Loopholes Bill criminalises wage and superannuation theft, enforces ‘same job, same pay’ rules for labour hire workers, and criminalises industrial manslaughter.

The package also:

• Adds new workplace protections for employees experiencing family and domestic violence,
• Expands the remit of the Asbestos Safety and Eradication Agency to cover silicosis,
• Makes it easier for first responders to access workers compensation for PTSD,
• Closes the loophole which allowed some medium-sized businesses to avoid paying redundancy entitlements to staff.

Labor initially knocked back a proposal put forward by crossbench Senators Jacqui Lambie and David Pocock to split off the latter four measures from the IR Bill, which enjoyed broad bipartisan support, so they could be passed before broader debate over the remaining Closing Loopholes package.

In a surprise deal, Workplace Relations Minister Tony Burke agreed to the split, so long as the extra measures around wage theft criminalisation, ‘same job, same pay’ rules, and industrial manslaughter were included.

Other contentious measures from the original Closing Loopholes package will be debated next year.

Concerns over rush through Parliament

Responding to the first Closing Loopholes industrial relations reforms passing through Parliament, Council of Small Business Organisations Australia (CEO) Luke Achterstraat accused the federal government of rushing the changes into law.

“This 800-page package is extremely complex and the government is yet to conduct an analysis of the impact the Bill will have on the 2.5 million small businesses in Australia,” he said.

COSBOA initially supported the push by Senators Lambie and Pocock to carve the first four measures from the broader Bill.

In October, Achterstraat also spoke at a small business breakfast event co-hosted by Senator Pocock, which featured input from Small Business Minister Julie Collins.

However, “whilst unanimous agreement existed on issues such as first responders and silicosis, the bundling through of contentious issues regarding labour hire and union entry is an egregious breach of trust and process,” Achterstraat said.

Their passage will create more uncertainty for small businesses, he continued.

“In an already tough operating environment, small businesses will need to spend time, money and limited resources to interpret and understand new obligations, just as they were priming themselves for the Christmas trading season.”

In a separate statement, employer representatives including the COSBOA, the Australian Retailers Association, and the Restaurant and Catering Industry Association, called the new IR legislation “extremely disappointing”.

“While employers had supported particular elements of the Bill being considered separately, today’s rushed passage without adequate debate and cherry-picking other elements will have major consequences for businesses and their workforce,” the group said.

“We have always said that we welcome the opportunity to work constructively with the Government in addressing real issues, however throughout this process, it has failed to identify the clear problems it seeks to resolve.”

Small business exemptions locked into legislation

Employer group anger over the new legislation comes despite a number of carve-outs for small businesses.

Small business employers are exempt from the new ‘same job, same pay’ rules covering labour hire workers within a host workplace.

They will also be protected from the criminalisation of intentional wage and superannuation theft until a voluntary code of conduct is created.

If the Fair Work Ombudsman is satisfied the small business employer followed that code during a wage underpayment dispute, it will not be able to refer the matter to the Director of Public Prosecutions or the Australian Federal Police.

The wage and superannuation criminalisation rules will not protect employers of any size from civil action.

Small business employers will also not be forced to cover the cost of training during work hours for union delegates.

Additionally, the government will provide extra funding to the Fair Work Commission to help small businesses understand their obligations as a result of the crossbench deal.

Senator Lambie also pledged the crossbench will continue to fight for small business protections when the second half of the IR Bill is debated in 2024.