Industrial relations wars: bosses slam portable leave plan

Australia’s biggest union-backed worker entitlement scheme is urging the Albanese Government to set up a national portable leave scheme across the workforce.

Innes Willox says the portable leave proposal is “another zero productivity money grab”.

Australia’s biggest union-backed worker entitlement scheme is urging the Albanese government to set up a national portable leave scheme across the workforce, opening a new battlefront with employers who slammed the ­proposal as a “zero productivity money grab” by unions.

Erik Locke, chief executive of worker entitlement giant Incolink, said Labor should go beyond its election pledge to examine a portable leave scheme for insecure workers and look at a ­nationwide approach that would create a multibillion-dollar system of leave entitlements similar to superannuation.

Anthony Albanese promised before the last election that Labor would work with state and territory governments, unions and ­industry to develop portable entitlements for annual leave, sick leave and long service leave for Australians in insecure work.

Department of Employment and Workplace Relations officials are due next month to start consultations with unions and employers about a scheme that, if enacted, would allow insecure workers to carry over leave from job to job.

Mr Locke, a former Victorian ALP secretary, will tell a building industry forum in Canberra on Tuesday that it was time for the government to turn its pre-election commitment into action.

Mr Locke said the government could start by focusing on industries with high levels of insecure work “and progressively expand as we go”.

“A national portable leave entitlement scheme, rolled out first in industries characterised by insecure work, and then nationwide, means critical workplace redundancy entitlements follow the worker – not the employer – and accrue in their account, much like superannuation,” he said.

“Over time, the scheme would result in funds like ours growing to a scale similar to super funds and that, my friends, is a very good thing because it allows you to invest workers’ money to create jobs and improve their wellbeing.”

Australian Industry Group chief executive Innes Willox said the proposal was “another zero productivity money grab”.

“Most Australian workers would prefer to have extra cash in hand rather than a complex paper trail to a potential future benefit. Portable long service leave would create a new compliance and administrative burden on businesses and taxpayers.”

He has previously said the Labor policy could add 10-11 per cent to the wages bill of affected employers, who would then pass the cost on to customers

Master Builders Australia chief executive Denita Wawn said before the government considered expanding the current worker entitlement funds model to other sectors of the economy, it “should first ensure that existing funds are subject to more rigorous rules that deliver better transparency, clear management accountability, give genuine choice for workers, and mandate that any profits generated from the fund are put directly back into workers accounts”.

ACTU secretary Sally McManus said portable leave entitlements had been a major benefit to both employers and workers in many industries or sectors where it currently operated.

“It assists in retaining skills within an industry as workers are more likely to stay if they can carry their entitlements across employers,” she said. “It has also allowed industries to invest more in training. Portability of entitlements also recognises that the world of work has changed, with people likely to have a dozen jobs over their lifetime.”

Mr Locke said the initiative would give insecure workers the safety net of leave between jobs and create “a multibillion-dollar industry over time”.

“Why should even the minimum amount of leave owed to workers with no job security sit on the employer’s balance sheet as a liability when instead it could follow the worker like a superannuation account?” Mr Locke said.

“Our proposed system would create a new industry of funds which hold entitlements on a worker’s behalf, allowing them to aggregate leave entitlements and turbo-charge investment into the relevant industries, funding training and driving productivity.

“We have this system for superannuation, and we should have the same for workers’ entitlements. Today, I am calling on this government and this parliament to set up a summit for industry, union leaders and government to set out the aims and principles of this new industry.”