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Small Business Needs An Industrial Relations System that Works For It!

Tony Perkins - Monday, September 05, 2011

Did you know that 89% of employees in Australian Businesses were employed by companies employing 20 employees or less? (Australian Bureau of Statistics 8165.0 2010)

When you consider this statistic, you need to wonder why our industrial relations system is designed for 11% of the workforce!

It all comes down to some very important factors (in our opinion):

  • The employers of 11% of the workforce are bigger contributors to the political parties
  • The 11% of the workforce are the primary targets of our union movement; and,
  • The employers of 11% of the workforce are the major drivers of industry bodies supposedly in place to support business.

Over the last 5 years we have been governed by industrial relations systems based on the "visions" of big business (Work Choices) and unions (Fair Work) of how industrial relations should be governed.

However neither of these "visions" has been designed to meet the needs of the majority of employees or employers - those involved in operating a small business!

Some points to be considered:

  • Both Work Choices and Fair Work were designed to encourage an "us and them" attitude.  Small business is largely about "getting the job done together".
  • While we need to protect minimum standards, less than 1% of employees through out Australia made an official complaint against their employer last year -  this does not indicate a major effort by employers to "rip off" their employees.
  • While the structure of the business might say "Pty Ltd", the relationship between an employer and an employee in a small business is often a "one to one" relationship.  It is not one where HR experts, lawyers or many levels of management are involved.  The current laws are not designed for small businesses with confusing arrangements and restrictions across the system.

In our opinion, the current calls for a full review of our industrial relations laws are warranted when viewed from this point of view. Unfortunately, our political system will not encourage a review with the majority of Australia's employees in mind!

Anonymous commented on 11-Feb-2012 01:54 PM
The Industrial Relations laws need to be drawn for the larger employers because their business models are more easily categorised (and understood) by regulators. Your proposition that separate laws should apply to employers with fewer than 20 employees
is sound and has been tried in earlier versions of the laws - and WORKED in the main! The relationships between employees and their employer in a small workforce is much closer - and usually stronger - than applies 'at the big end of town'. Bring it back I
say; and let the employer who fails to 'do the right thing' in the <20 space, face the consequences of civil action (and the costs associated with it) - and let the government facilitate a support mechanism for any disadvantaged employees whilst the matter
is resolved.

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