Employers looking to bring retrenchments forward before Fair Work Bill

by 29 Apr 2009

More than a third of Australian employers are considering bringing forward retrenchments to before 1 July when the Fair Work Bill is introduced, recent research has found.

A Drake International survey of almost 600 employers found that the redundancy and unfair dismissal provisions in the Bill are causing the greatest concern, with 37 per cent of employers potentially speeding up retrenchments and a further 25 per cent expecting to employ fewer staff as a result.

“Many employers are preparing to cut back on recruitment, and even bring forward retrenchments, due to their concerns about new obligations and costs resulting from the legislation” said David Edwards, strategic manager of Drake International.

Only 4 per cent of employers had implemented changes to their employment policies in preparation for the Bill, while over 64 per cent admitted to knowing nothing or only a little about how the new obligations in the bill would impact them.

“A comprehensive education program is urgently needed by both the government and private sector advisers otherwise, come July, many employers will not be complying with the new IR legislation,” Edwards said.

Small businesses with less than 15 employees are even more concerned about the Bill, and 41 per cent say they will employ fewer staff.

“Small employers want to avoid new red tape associated with employment, and therefore there is a risk that they will employ less,” said Edwards.

“We expect to see a further swing away from using permanent staff and an increase in temporary staff.”

Almost half of the employers in the survey had already decided to increase their use of temporary staff or consider the option.

The survey also found there was strong concern about the flexible hours provisions for parents, with almost 50 per cent of the employers saying they would be less likely to employ staff who have young families.

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