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Government scraps changes to better off overall test in IR bill

Adrian Flores
Adrian Flores
18 February 2021 1 minute readShare
Government

The federal government has decided to drop changes to its industrial relations bill that would’ve allowed COVID-affected businesses to allow enterprise agreements without having to pass the better off overall test (BOOT).

The concession from the federal government comes as it tries to secure support from the Senate crossbench to ensure passage of the Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Bill 2020.

The IR bill was introduced to the House of Representatives in December last year. Under the original proposal in the bill, businesses would be allowed to put aside the BOOT when satisfying workplace agreements in certain circumstances.

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The proposal would apply to agreements made in the next two years even though there is no time limit regarding the duration of the agreement.

The BOOT considers the terms that are more beneficial and less beneficial to employees in an agreement, compared to the terms in the relevant modern award, before assessing whether employees would be better off under the agreement than under the relevant award.

 

Despite the BOOT backdown from the government, the Australian Industry Group said most of the other elements of the IR bill are “sensible and modest” and “deserve the support of all parliamentarians”.

Ai Group chief executive Innes Willox said the only provisions in the bill that are not modest or sensible are the much higher civil penalties and criminal penalties for underpayments.  

“Ai Group does not support employers who deliberately underpay their employees. However, the higher penalties are not warranted,” Mr Willox said.

“Civil penalties for underpayments were increased tenfold in 2017 and the evidence is that these increases have had a positive impact on compliance. The proposed provisions would operate as a barrier to jobs growth and investment during the recovery from the pandemic.”

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However, Australian Council of Trade Unions president Sally McManus said the changes to BOOT don’t necessarily mean that the IR bill has been fixed.

“Just to be clear, the Morrison government has not dumped the bill. They are making about half a dozen negative changes to the BOOT test and they are just dumping one,” Ms McManus said on Twitter.

“The government will try and pull the wool over the media and crossbench senators’ eyes by removing one small aspect of their IR omnibus changes and spin it that they have ‘fixed’ it. Removing the BOOT for two years is only one problem — there are PERMANENT changes that hurt workers,” she continued in another tweet.

Government scraps changes to better off overall test in IR bill
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Adrian Flores
Adrian Flores

Adrian Flores is the deputy editor of MyBusiness. Before that, he was the deputy editor for SMSF Adviser as well as features editor for ifa (Independent Financial Adviser), InvestorDaily, Risk Adviser, Fintech Business and Adviser Innovation.

You can email Adrian at [email protected].

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