Saturday, 29 March 2014

My Thoughts on Industrial Relations

Industrial relations has been a thorny subject ever since the industrial revolution over 100 years ago. Working conditions in the first ever factories were absolutely terrible. Workers would be abused underpaid, blackmailed and dismissed on a whim. The working environment was also incredibly dangerous and bad for your health.

It wasn’t long until unions were formed to fight for worker’s rights. It was a long battle but eventually the workers won. Since then unions have been forever vigilant to protect their hard won gains. It is now very difficult for governments to change industrial relations laws without mass hysteria. But I do think there are a couple of things that could be improved without impacting the rights of workers.

I think our current system is way too complex - almost too difficult for an ordinary person to find the time to learn and comprehend it. On the employer side it is even worse. Workers have a large number of entitlements such as superannuation, holiday pay, sick pay, long service leave and then there is overtime loading, time and a half on Saturday and double time on Sunday. They have got awards EBAs - it goes on and on.

I firmly believe workers are entitled to fair work and conditions, but there is absolutely no reason why our system has to be so complex. For example maybe they could change entitlements and put them all in one package add it into superannuation and allow people to draw down a percentage of their super every year or not. This will also stop employees from losing all their entitlements when a company goes bankrupt.

Also maybe they could simplify penalty rates. I don’t think it is particularly fair when a business gets a new employee the business just happens to have a free shift on Sunday this employee ends up being the best paid worker in the business as the award states that work on a Sunday is payed doubletime. Maybe they could partially eliminate permanently rates and raise the amount that all workers are paid.

I also have an idea to simplify the tax system by scrapping tax brackets and instead of having a tax curve. At the moment tax brackets are arbitrarily selected. Instead I would replace it with a tax curve this could be created by an algorithm you just punch in the amount of money you earn and it calculates exactly how much tax you should pay. I also think that people who earn ridiculously absurd amounts of money should pay more tax than they currently do.

Governments need to also stop punishing those on government benefits such as disability pensions when they work. If someone on a disability pension earns more than $156 a fortnight they lose 50 cents out of every dollar earned after this figure. This means that pensioners pay a higher equivalent tax rate to Gina Reinhart - what is the point in looking for work? The government needs to reduce this equivalent tax rate to be the same as the bottom bracket 19 cents in the dollar. This would cost the budget initially, but would probably pay for itself as more disabled people enter the workforce.

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