“ACT’s proposed changes to the personal grievance process will make it fairer and faster for all parties, providing greater certainty and making hiring workers less risky”, says ACT Leader David Seymour.
“The current process is slow, costly, and open to abuse.
“The average number of days it takes the Employment Relations Authority to deliver a determination has risen from 54 in 2019 to almost 76 in 2023. The proportion of determinations delivered outside the legislated timeframe of three months has increased from 9 per cent in 2020 to 13 per cent in 2023. The maximum number of days for delivering a determination has exceeded 450 days for every year since 2019.
“There is no good reason for these delays. District courts deal with more legally and factually complex matters every day of the week, yet still manage to issue instant decisions.
“Waiting on an ERA decision is damaging for all parties involved. It stops both employers and employees being able to move on with their lives and creates massive uncertainty.
“Employers can be tripped up by minor procedural issues. Even in situations where the reason the employee got fired is squarely the employee’s fault, the door is open for them to receive some remedies if the employer did not follow the correct process.
“Employees who might already know that they deserved to be fired still have a shot at making some money off their employer by tripping them up on procedural matters. Even the threat of raising a personal grievance can be enough to force some employers to offer the employee a pay-out before being dragged through formal processes.
“Consider the case of a small construction company who fired an employee after they didn’t turn up to work for eight days. When the employer called the employee to follow up on the absence, the employee yelled at the employer. The employee, who had only been employed for a month, received $5,520 in compensation and wages.
“If a matter has made it to the ERA, chances are the employment relationship is irreparable. Forcing the employer to retain an aggrieved employee is almost certainly not in the best interests of the employer, nor is it necessarily healthy for wider workplace relations.
“To deliver a fairer and faster personal grievance process, ACT will:
- Require all ERA decisions to be delivered within a month of the investigation meeting concluding. ACT will ensure that ERA members who fail to meet this KPI will be fired (after going through a fair performance management process).
- Remove eligibility for remedies if the employee’s behaviour is at fault. Doing so would rebalance the playing field so that both employer and employee behaviour are treated equally.
- Remove the ability for the ERA to unilaterally reinstate an employee. Remedies that the ERA can award should still include lost wages and compensation, but reinstatement needs to be the employer’s decision.
“Personal grievances can impose significant costs on businesses. As one small business owner said: ‘I’m a small business, I’m a single dad with kids to care for. I’ve run this company for 10 years, but it’s not like a company which has millions of dollars sitting in the bank to pay out to people.’
“ACT’s changes will bring more fairness in the personal grievance process, while still retaining the protections employees need against poor employer behaviour. These changes will provide greater certainty, make hiring people less risky, and encourage employment growth.”
Note to editors: The policy document can be found here.