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Abbott Govt moves to cap redundancy payments

Sep 5, 2014News

The Federal Government is attempting to cap redundancy payments at 16 weeks, with the Industrial Relations Minister saying the current scheme is “overly generous” and creating a “moral hazard”.

Industrial Relations Minister Eric Abetz introduced the capped redundancy Bill into the House of Representatives yesterday. If passed, the 16-week cap will come into affect from January 1 next year.

Loco Division Secretary Bob Hayden said the move is another subtle attack on the rights of working people.

“This is another clear case of the Federal Government paving the way for employers to attack their workforce.

“The current scheme isn’t the ‘moral hazard’ – it’s more a case of the Government and Industrial Relations Minister being a ‘moral hazard’ to workers.

“We’ve seen in recent times in the transport industry a wave of companies introducing voluntary or forced redundancies. This Bill, if passed, will make that process that bit easier for companies.

“People should be compensated for giving a number of years to a company. It’s a real slap in the face to people who have worked hard for a company for many years to then be told their payment is going to be capped.”

The redundancy payment cap, if passed, will apply to employer insolvencies.