Fair Work Act changes will raise cost of employing researchers

Changes to the Fair Work Act will raise the cost of employing researchers and threaten national capability, say universities and medical research institutes.

Changes to the Fair Work Act which restrict fixed term contracts will raise the cost of doing research in Australia, say universities and medical research institutes.

Universities and medical research institutes warn they face a “catastrophic impact” from changes to federal employment laws coming into force in December that place restrictions on the fixed-term job contracts commonly used in the research community.

In a submission to the federal government, they warn the new rules will raise employment costs and drive researchers away from Australia.

Changes to the Commonwealth Fair Work Act, which apply from December, mean fixed-term employment contracts of over two years will be regarded as continuing jobs in most cases, affecting many researchers in universities and medical research institutes who are often employed on fixed terms of three, four or five years, based on the typical funding period of research projects.

The Australian Higher Education Industrial Association, which represents universities, said the new laws, as well as a lack of longer term research funding, led to “an unsustainable situation where the nation’s world-class university research is now at risk of reaching a choke point”.

“These challenges may significantly impact on the country’s research capabilities, with research not being undertaken or researchers seeking opportunities overseas,” AHEIA executive director Craig Laughton said. In a joint submission to the federal government, the AHEIA and the Association of Australian Medical Research Institutes said the new laws could force universities and institutes to employ researchers on either a casual or a continuing basis, and both options would lead to large additional costs.

Casual employment would be less secure for researchers and “with the application of 25 per cent casual loading to rates, valuable funds will be exhausted prematurely, and the research projects will be under greater risk of not achieving outcomes”, the submission states. If researchers were employed on a continuing basis, then universities and institutes would face high redundancy costs when research funding ended for a particular project, it said.

“The severance payments for staff employed under enterprise agreements across some medical research institutes and universities are far in excess of community standards, and it would not be tenable for these organisations to pay such severance to multiple former fixed-term staff,” the submission said.

Mr Laughton said there was potentially a high cost for universities to convert casual and fixed-term workers to more secure employment because of provisions for high redundancy payments.

“Redundancy provisions associated with permanent university employment are a key driver of additional costs. These provisions provide for up to 104 week’s salary or eight times the National Employment Standards (13 weeks),” Mr Laughton said.

“The risk of converting fixed-term research staff to permanent positions without assured funding is financially irresponsible.

“This reality is a contributing factor as to why researchers are often employed on a fixed-term basis.”

Both the AHEIA and the AAMRI call on the federal government to change the Fair Work Act to offer more exemptions to the rule restricting fixed term ­contracts.

“It is crucial to strike a balance between promoting job security and providing flexibility to adapt to the unique challenges faced by our sector,” their submission said.