Opinion: Why COSBOA rejects the government’s complex IR changes

The Council of Small Business Organisations Australia (COSBOA) has rejected the federal government’s proposed industrial relations reforms. In this article, CEO Luke Achterstraat and chair Matthew Addison explain why. 

The issues of confusion and complexity remain, combined with an increased requirement of every business, small or large, to dedicate resources, time and money towards trying to understand and implement these onerous new obligations.

At a time when small businesses are managing increased costs of supply, of rent, of power, of wages; we don’t need changes that detract businesses from their sales and service delivery. Small businesses seek to employ and properly reward their workers. They seek to innovate and adopt new technology. We seek IR changes that enhance productivity and opportunity, not broad impacting confusion about what they are and aren’t allowed to do.

Small businesses reject the proposed legislation.

A full impact assessment of the changes must be conducted before the legislation is properly considered. The cost to implement any changes, the cost of advice, the loss of productivity and workforce flexibility are challenged by these changes.

We seek adequate time to properly analyse the detail that is now available. We argue that the government does not seek to rush these changes into law.

There is a significant increase in the questions to be answered by each small business by the proposed changes. Small businesses will need to spend time and invest money in obtaining advice to ensure they are not captured if these changes were to become law. This comes at a time when 43% of small businesses in Australia are not profitable.

Questions that small businesses are already asking in regard to the proposed changes

I provide services, sometimes on a contract

Get daily business news.

The latest stories, funding information, and expert advice. Free to sign up.

• Am I a labour hire firm?
• I am a specialist, providing specialist services, am I impacted?

I use other businesses to provide services which include a person’s time

• Are they labour hire?
• Am I impacted if they are?
• What difference does it make to how much I have to pay?

I advertise my business on Digital Directories, am I now included in “GiG” and what is its impact?

I sometimes buy things from digital directories, and websites — what is the impact on those suppliers?

I have a number of employees; they are classified by two different awards and their classification and
what they get paid is complicated.

• If I make a mistake, am I going to prison?

Who is allowed to inspect what part of my business records?

• What records and information do I have to allow a person from a Union to see?
• What records are allowed to remain confidential — Family Domestic Violence Leave/health records?
• My business is run from my home and my payroll function is provided by a bookkeeper who works from their home — Do I have to let these people into a home, possibly unannounced with my children at home?

These open questions indicate that obligations must still be understood, advice sought, and decisions made in order for a small business to know that they comply. The Small Business Code for Wage Payments is yet to be developed. It is vital that the capacity of business in particular small business is to be considered in any compliance actions.

Luke Achterstraat is the CEO of COSBOA and Matthew Addison is the chair of COSBOA.