There are moves afoot in Victoria to change the nature of long service leave from one of reward for working with the same employer to one of reward for working.
The Victorian Parliament’s Economic, Education, Jobs and Skills Committee an inquiry into portability of long service leave entitlements for Victorian workers.
To quote the committee chairman Mr Nazih Elasmar “Long service leave rewards workers who have worked long and hard for many years. It gives workers a well-deserved mid-career break, allowing them to return to work with renewed energy.”
Basically the proposal is that everyone accrues long service leave even if they only work for a firm for one day, or a few hours. We assume that every employer will need to fill out some forms, find some extra money and send it off to a superannuation type holding fund.
Long service leave funds belong to the employer until it is earned by the employee. This proposal changes that equation.
This is also and obviously extra red tape and an extra financial burden on businesses. This would have a bigger impact on small business due to the fact that we don’t have pay teams and experts to help manage this and the extra costs will be confusing and won’t have any return in productivity to the employer. How stupid? Very.
Long service leave is a reward for long service with an employer, the Victorian government wants to change that to a reward for working. Isn’t that called wages?
This is on top of the extra public holidays created by the Victorian government to help the economy (apparently).
The head of the inquiry talks about people taking long service leave and being refreshed and with “renewed energy”. So four weeks leave isn’t long enough and every ten years (it will be much less than that if it ever comes in) we will need another 13 weeks to be refreshed.
The messages if this is to go through are:
- Don’t start a business as you won’t get long service leave but your workers will even if they work for you for one day or are dismissed for stealing from you – they still get the reward of long service;
- Become an employee, it is very lucrative;
- Only employ contractors.
The extra red tape will be explained away as “but trifling and something that won’t take very long”. Which is the same answer we got when superannuation was introduced, when the role of pay-clerk for parental leave was introduced, when GST was introduced, when the Fire Brigade Levy (in Victoria only) was introduced, when extra reporting on insurance was introduced, when etc.
Victoria has truly gone back to the ideologies of the 1950s with this suggestion.
Portable LSL exists in the construction industry as that is inherently based on people moving from job to job and employer to employer within one industry where long term employment with one employer is not (or wasn’t) the norm. That is not the nature of other industries.
The obvious questions are:
- How will the money be managed?
- Who will manage it?
- If the person doesn’t work for ten years what happens to the money? Will it revert to the employer?
- Will it be ten continuous years or just an accumulation over any period of time?
The most important question is: who thought of this unmanageable, archaic idea. Please send that person or those people to Uzbekistan where they will fit in nicely with an old fashioned communist dictatorship where business is about cronyism and the economy is a joke.