Sue Boyce (Queensland, Liberal Party) Share this | Hansard source

As Senator Abetz has ably pointed out, we have moved our amendments because we think they improve the provisions of this Fair Work Bill. I think we need to look at why there is an exemption from the unfair dismissal provisions for small business. It is about whether small business has the resources and the capacity to fulfil the legal, the technical and the regulatory requirements that, as Senator Abetz pointed out, can cost companies over and over again. I would like to go through what some other countries do in terms of what constitutes a small business. As Senator Abetz pointed out, by international standards our definition of a ‘small business’ is very low. The ABS defines a small business as having 20 or fewer workers and a medium businesses as having 20 to 199. But the majority of world regulatory agencies define a small business as having up to 50 employees. The OECD, the ILO and the World Bank all define a small business as fewer than 50 employees and, if you do the translation on the turnover, it is about A$20 million in turnover. Those agencies all say 50 employees and a turnover of under $20 million. That is vastly different from what we allege will give business the sorts of resources to cope with the regulatory framework of unfair dismissal provisions.

A Canadian business is actually considered small if it employs under 100 workers, and that might give you an idea of where some of the earlier legislation came from. As I said, the OECD says that a small firm is fewer than 50 employees and micro-enterprises up to 10. The ILO—which, as I have said here before, can hardly be seen as an economically conservative organisation—says that small firms are considered to be those with fewer than 50 employees, and it puts an upper limit of 200 on a medium sized business. The World Bank goes for a turnover of about A$15½ million and fewer than 50 employees. We could go on and on.

In the US they have gone for a somewhat more complicated system which recognises that some businesses may have a lot of employees but not a lot of capacity. A highly labour intensive business such as a factory, a milk bar or a sandwich shop might employ a lot more people than, for instance, an IT organisation which has much higher turnover, much fewer staff. So for a small business in the US they work on the sort of business. For most manufacturing and mining industries, up to 500 employees and a turnover of about A$11 million is considered a small business. It goes on: for wholesale traders, they work on a definition of under 100 employees and with annual receipts below A$52 million. They have tailored the cloth to suit the type of business—certainly not something we have done here.

Industry Canada, as I pointed out, says that a small business is any business with fewer than 100 employees and a medium business works on 100 to 500 employees—vastly different from the figures that we have here. We have worked on the basis that we think we can improve this legislation by proposing that it move to 25 full-time employees, not 15 head count. I suggest that 15 head count does not represent the sort of business that has the capacity to understand regulation and spend their time worrying about the legal side of how to undertake a dismissal—not ‘fairly’ but according to the rules, which is far more what it is about. The vast majority of employers would wish to dismiss someone simply because they do not suit the job; they would wish to dismiss them fairly. But if they do not tick all the right boxes at all the right times, they can end up being subject to the sorts of prosecutions and costs that Senator Abetz talked about before.

I think that if this government wants to persist with going for an unfair dismissal exemption limit of 15 head count they should just come clean. Why do they not just honestly say, ‘We want to get rid of the unfair dismissal exemptions altogether’? When you get down to a head count of 15, you are talking about busy milk bars, sandwich bars and other organisations that might have two or three full-time employees—perhaps even husband and wife—and a lot of casuals coming in to help out. These are not the sorts of organisations that have the resources and the capacity. This government does not really care about whether businesses have resources or capacity to undertake the technical aspects of meeting unfair dismissal requirements; what they really care about is making the playing field as uneven as possible for small business. Why not just be honest and say, ‘We want to get rid of the exemption altogether; we want everyone to be immediately liable to meet the unfair dismissal provisions’?