The ACTU has welcomed the decision late yesterday by the Australian Industrial Relations Commission to implement a single national standard of redundancy pay for retrenched employees.

Greg Combet, ACTU Secretary said:

“This is a welcome and common sense decision by the Commission that rejects the absurd proposal by employers to have different redundancy payments depending on the State or Territory in which people work.

Businesses that operate in different States would have faced a nightmare of up to three different scales of redundancy entitlements under the proposals put by ACCI and AIG.

The Commission noted that “differentiation on a state basis will lead to more problems than it will solve” and would lead to “confusion, disharmony and further argument”.

This decision maintains the integrity of the Commission’s original determination in the recent landmark test case.

The Commission has ensured there is a single national safety net for around 200,000 Australians unfortunate enough to be made redundant every year. The safety net involves:

  • Redundancy pay of up to 16 weeks pay for up to ten year’s service.
  • An extension of redundancy pay to small business employees but at a reduced
    level. They are entitled to up to 8 weeks pay for 4 year’s service – half the
    maximum available for employees of larger businesses.
  • However the ACTU is disappointed that the Commission has decided not to make the redundancy pay entitlement for small business employees retrospective.

    In effect, this means that there is a four year period for the full entitlement to be phased in for small business employees.”