Make the bosses pay


Make the bosses pay

The successful fight of the 342 workers sacked by National Textiles when it went bankrupt to secure payment of their full leave and severance entitlements is an important victory for all workers. It opens the door for other workers who have money owing to them by bosses who moved elsewhere to increase the pressure on the government to secure what is rightfully theirs.

The National Textiles case has highlighted the failure of Liberal and Labor governments to stop tens of thousands of workers every year from losing their entitlements, and the fact that workers are going to have to solve this problem through their own action.

On February 8, the government at last proposed a scheme for the payment of entitlements. (Following the fight to secure the Oakdale coalminers' entitlements, which led to a national coal strike last year, the government had promised to have something in place before the end of 1999.) The proposed scheme caps payments at $20,000 — including up to four weeks' unpaid wages, up to four weeks' annual leave, up to five weeks' pay in lieu of notice, up to four weeks' severance pay and up to 12 weeks' long-service leave. But many workers are owed much more than this when they are made redundant.

Treasurer Peter Costello and industrial relations minister Peter Reith have backed different ways of funding the scheme. Reith, backed by employer bodies, who oppose any extra costs being imposed on companies, wants government funding for the scheme. This has been set up on an interim basis, backdated to January 1.

Costello, however, backed by PM John Howard, has the government considering a compulsory employer-funded insurance scheme, from which small business would be exempt. Big business representatives complain that this would require businesses that meet their obligations to cover those that don't.

The ALP, supported by union leaders like NSW Transport Workers Union secretary Tony Sheldon, also backs an insurance scheme. Its option, which would guarantee all entitlements, would, it says, cost companies 80 cents a week for each worker.

For workers, all of these schemes, while offering some protection, are inadequate. The ACTU and some unions have begun to spell out the problems, and the solution.

"Employees are entitled to full protection against businesses that go to the wall", the ACTU's Greg Combet is quoted in the February 9 Sydney Morning Herald. He reportedly added that employers should be made to foot the bill.

Reith's government fund proposal is an attempt to avoid the fact that employees' entitlements are owed by employers, but government funds are primarily provided by workers, through income tax and indirect taxes like goods and services taxes. And Costello's insurance fund, while paid for by employers, could run out of money, especially in economic downturns, when the number of company failures would increase rapidly.

Only a trust fund, such as has been proposed by the Australian Manufacturing Workers Union and already exists for long-service leave in the construction and coal industries, in which all entitlements (including sick leave) would be kept until needed, could prevent this.

Also, in a trust fund a worker's entitlements could be moved from one employer to another, if the trust was established at an industry or national level, and companies would only be liable for the entitlements of their own employees.

As ACTU president Jennie George said on February 7, workers are willing to take industrial action on this issue. The question now is whether or not their union leaders will organise them to win, and make the bosses pay.