Huge IR battle breakout… Business looks to Vic budget… Job Network stays… MySpace to China

Huge IR battle breakout

Federal Minister for Small Business, Fran Bailey, has slammed Labor’s family friendly measures announced at the weekend, describing them as unworkable. She says Labor’s proposal to introduce 12-months unpaid leave for each parent, and to take requests from employees requesting flexible work until a child reaches school age, would “drive small business people out of their tree”.

But Opposition spokesman Craig Emerson accused Bailey of deliberately misrepresenting the facts. He also told SmartCompany that Labor had further policy announcements that would affect small business.

Bailey told SmartCompany this morning that red tape under Labor would increase as small businesses were required to restructure their businesses around the family life of each employee.

Small business owners would be forced to sign contracts with some parent employees, which will lead to disharmony in the workplace, more paperwork and far less flexibility, she says.

“You will get disgruntled older workers or younger employees saying ‘fair crack of the whip’. And when you put someone else in place of the person who has gone off for unpaid leave, you can’t offer the person job security. You spend six months training them and they are always looking for another job, because they know they can’t build a career with you. It’s appalling.”

She says Labor’s proposals to reintroduce unfair dismissal for small business, scrap AWAs and let unions back into the workforce will mean that not only will costs and red tape for small business soar, but young people will be deterred from starting businesses. “Young people are not going to fight bureaucracies.”

But Emerson says that Bailey and the Coalition is running a major propaganda campaign. He denies there would be contracts needed between employers and employees. “The only expectation on small business is they provide a written reply to a request from an employee answering a request (for flexible hours).”

He says it is all about raising community consciousness of work and family balance. He also admits that small business would prefer they had an exemption from unfair dismissal. “That’s no surprise, but many in the small business community, including many small business associations, are happy to work with us on details of a fair dismissal code.”

Meanwhile David Gregory, head of workplace relations at VECCI, says businesses are already raising concerns about Labor’s new IR plans at workshops. He also describes Labor’s family friendly policy as “strange”.

“What works in one workplace won’t necessarily work in another,” Gregory says. “History tells us that, and trying to lay down standard approaches across all workplaces doesn’t work.’

Also part of Labor’s platform announced on the weekend:

• Industry-wide pattern bargaining would be introduced. Greenfield deals that let employers set pay and conditions before hiring would be scrapped.
• Ten minimum employment standards would be introduced with workers able to negotiate overtime and penalty rates.

• Employers will provide new employees with information on their entitlements. This includes their right to join a union.

• To terminate employees, employers would need to give four weeks notice with an extra week for those over 45.

• Public holidays: Eight national days plus state days with penalty rates or other benefits.

– Amanda Gome

 

Business looks to Vic budget for tax, WorkCover cuts

Speculation is mounting that business will win cuts in business tax or WorkCover premiums when Victorian treasurer John Brumby delivers the state’s budget tomorrow.

Along with promised multi-billion dollar measures to revamp state schools and upgrade the state’s much criticised public transport system, sources say the budget is expected to deliver a boost to business in the form of tax or WorkCover premium cuts, The Australian reports today.

A premium cut of 10% would do little to dent the viability of Victoria’s WorkCover scheme, which is widely regarded as the most financially healthy and efficiently run scheme in the country, and recently reported a full year profit in excess of $1 billion.

Brumby says he expects to announce a $374 million surplus in tomorrow’s budget. The biggest threats to that healthy bottom line over the next year include enterprise bargaining rounds for police and nurses, traditionally two of the most aggressive public sector groups when it comes to wage claims, and increased pressure on Victorian manufacturers from the rising Australian dollar.

Labor to keep Job Network private

Labor reversed its longstanding policy to re-establish a CES-style public sector jobs agency at its national conference on the weekend, committing a Labor government to keeping the privatised Job Network.

The Howard Government abolished the Commonwealth Employment Service in 1998 and replaced it with the Job Network, a coalition of private and community sector employment services providers.

One private sector employment service that has thrived under the Job Network regime, Brisbane-based company Ingeus, was founded and is majority owned by Therese Rein, wife of Labor leader Kevin Rudd.

Labor’s previous policy was to re-establish a government employment agency to operate alongside private Jobs Network service providers. Labor had been particularly concerned that long term unemployed people requiring “intensive assistance” were missing out under the Job Network system.

Opposition employment services shadow minister Penny Wong told The Australian Financial Review that “there are more effective ways of monitoring behaviour and setting standards in employment services” than creating a new public employment agency. But Wong says Labor will still overhaul the way Job Network agencies are paid.

ACCI director of education and training Mary Hicks says Labor’s change in position is welcome. “The Job Network is in place, like any big network involving a lot of organisations it had a few problems in the beginning, but we think it’s working pretty effectively now and it seems sensible not to waste resources re-inventing the wheel.”

– Mike Preston

MySpace in China

Rupert Murdoch’s News Corporation is taking MySpace.com to China. Social networking sites, online games and entertainment sites are already phenomenally popular with China’s 137 million internet users. As a late entrant joining about 100 companies doing similar a thing, Murdoch’s approach will be different.

The New York Times reports that News Corporation signed a deal to license the brand for its popular online social networking site and allow local Chinese entrepreneurs who understand their market to pick and choose to build an indigenous business. Using this approach, News Corporation hopes to succeed where other Western internet ventures have failed.

The China operations of Amazon.com, eBay, Yahoo and even Google are falling behind local rivals, including Baidu, Tencent, Sina and 51.com.

Economic round-up

It appears increasingly unlikely that the Reserve Bank will announce a rise in interest rates on Wednesday after a key measure reported inflationary pressures are weakening today.

The TD Securities/Melbourne Institute inflation gauge for April rose 0.1%, well down on March’s 0.5% rise. On an annual basis, the gauge estimates inflation is now running at 3%, down from 3.5% and just inside the RBA’s target band of 2% to 3%.

All this accords with the now unanimous view among economists that interest rates are not going to rise this month. According to The Australian Financial Review’s quarterly survey of leading economists, it is likely interest rates will stay where they are for the next six months, driven by weakness in the US economy and softening consumer price index data.

And speaking of the stuttering US economy, new GDP figures show the world’s largest economy grew at a 1.3% annual pace in the first quarter of 2007, disappointing economists who widely expectations a 1.8% annualised growth rate. The US Federal Reserve has previously forecast growth of 2.5% to 3% this year.

The S&P/ASX 200 is up 0.3% on Friday’s close to be 6170.5 at 12.20pm, while the Australian dollar is trading at US82.74 cents, slightly down on the most recent Sydney closing price of US83 cents.

– Mike Preston