Red tape backlash: Business groups say new rules could crush small biz

Australia’s leading small business and retail groups say increased workplace regulation is putting small businesses at risk and making it harder to stay afloat.

In a joint statement, the Australian Chamber of Commerce and Industry (ACCI), the Council of Small Business Organisations Australia (COSBOA), and the Australian Retailers Association (ARA) warned that more red tape could hurt job creation and stall growth.

Business is at peak regulation

ACCI CEO Andrew McKellar said business owners are overwhelmed by workplace rules and red tape.

“Employees want choice and flexibility and that needs to be at the heart of any workplace proposals. Business needs that agility to survive,” he said.

“Tying Australian businesses up in knots around workplace systems has the effect of strangling growth – and that means less jobs and lower wages.”

McKellar also warned the proposals risk “killing even more small businesses and damaging the Australian economy.”

“There is more volatility coming for Australian businesses, through the trade wars and increased global competition. That is where our government’s focus urgently needs to be,” he said.

“From energy, fuel and rent, to wages, insurance and transport – the costs of doing business have risen obscenely. Whether we like it or not, that influences what Australians pay at the checkout. The cost-of-living crisis, and the cost-of-doing-business crisis, are directly linked and we need policies that recognise and address that.”

Red tape and complexity is undermining the viability of Australian small businesses. It’s not sustainable.”

Penalty rates will not be removed

ARA Chief Industry Affairs Officer Fleur Brown said proposals to the Fair Work Commission are about offering more choice to workers, not removing benefits.

“Aside from the dangerous precedent of interfering with an independent legal process, opposing these changes means many employees lose the chance to gain on flexibility and wages,” she said.

“Penalty rates will not be removed under our proposal. What’s proposed is that retail managers can opt into an annualised salary which provides greater income and financial stability and would see them on average $5,841.65 better off annually.”

Brown added, “On the one hand, the Federal Government has been saying it wants to provide a system where Australians have more flexible work options, but on the other hand it seems intent on stopping commonsense efforts to achieve this. It’s also just another example of why it’s so hard to survive as a small business in Australia.”

Reducing, not adding, complexity

COSBOA CEO Luke Achterstraat said small businesses are under intense pressure and need support.

“Australians operate in a seven-day economy and employees need the flexibility to structure their work in a way that fits their lives. These changes give them more control while making sure small businesses can confidently meet their obligations and run a sustainable business,” he said.

“Reducing, not adding complexity, will help small business owners focus on running their businesses and supporting their employees.”

He pointed to data from the Reserve Bank.

“According to the Reserve Bank of Australia, more than three-quarters of recent insolvencies have been small businesses with under 20 employees.

“In the retail sector alone, employers must navigate 994 different pay rates across 96 pages just to ensure their employees are paid correctly. It’s unworkable,” he said.

“Red tape and complexity is undermining the viability of Australian small businesses. It’s not sustainable. We need to make sure our workplace system supports economic growth and productivity, job security, and fair opportunities for employees and employers alike.”

“We call on all candidates at this Federal election to stand up and support the five million Australian jobs that exist because of small business.”

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