The Australian Small Business and Family Enterprise Ombudsman Kate Carnell has released a position paper listing steps to combat the workplace relations systems for small businesses.

The Ombudsman has engaged in consultations with small businesses over the past two years, and has confirmed the legislation is too complicated for the majority of Australian businesses with less than 20 employees and no in-house HR or legal departments.

The Workplace Relations-simplification for small business paper includes a combination of recommendations that can be achieved without legislation and others with minor legislative changes.

“Our paper contains practical and realistic solutions that attempt to make it simpler for businesses to do the right thing and build their confidence to employ, which is what the economy needs,” says Carnell.

Achievable non-legislative solutions include:

  • The Fair Work Ombudsman to (FWO) further develop the Small Business Showcase to include an online decision-making and pay calculation tool, whereby a small business that has made a genuine effort to comply, but makes an error, will have a ‘safe harbour’ from prosecution, penalty or fine, but must still repay any underpayments to staff.
  • Ensuring unfair dismissal claims are substantiated before elevation, and dismissal claims are not judged solely on procedural errors.
  • Publishing Fair Work Commission (FWC) outcomes in plain language so established precedent is more transparent and predictable. This means small business will be better informed about the FWC’s thinking and be better equipped to do the right thing.
  • Expediting the review of the Small Business Fair Dismissal Code to simplify and remove ambiguity.
  • Improving the education and communications to small businesses by extending the FWO’s employers’ support line beyond the standard business hours, and the FWC and FWO to work together to establish a dedicated, consistent resource centre that provides advice that small businesses can understand and rely on.

“If these and other recommendations are implemented, it will level the playing field for small business who want to do the right thing and empower the Fair Work Ombudsman to deal with businesses that don’t,” says Carnell.

Three approaches that require legislative changes are:

  • Put in place a streamlined and appropriate small business Enterprise Bargaining Agreement as an option for some businesses.
  • Allow for a dignified end to employment when an employee is no longer a ‘good fit’ for the business, with payout equivalent to redundancy entitlements. Currently the only options are a manufactured redundancy or a performance based exit. Both options are bad for the business and the employee.
  • Investigate a legislated option for optional loaded rates as a method of simplifying payment for businesses that choose to.

“This is by no means our final word on the workplace relations system. It is simply some small but doable steps that will make a real difference to small businesses now, giving them the confidence to employ more staff.”

R&CA CEO Juliana Payne welcomed the various policy initiatives proposed in the position paper, emphasising the importance of a simple, easy-to-comprehend workplace relations system for small businesses.

“The time pressures facing small businesses in the café, restaurant and catering sector are enormous and the overly complicated workplace relations system is burdensome for these business-owners to try and navigate,” says Payne.

“Business-owners already spend an inordinate amount of time dealing with red tape and unnecessary government regulation, which represents a huge amount of lost productivity for these businesses and the economy.”

Read the full paper here.

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