Victorian Government response to the Victorian Parliamentary Economic, Education, Jobs and Skills Committee inquiry into portability of long service leave entitlements

23 November 2016

The Victorian Government welcomes the report of the Victorian Parliamentary Economic, Jobs and Skills Committee and is pleased to provide its response to the Committee.

The Committee found that there are strong reasons for supporting portable long service leave arrangements in the security, contract cleaning and community services sectors. The Committee, however, also recommended that feasibility studies be undertaken, to determine how such schemes would operate.

The Committee also noted that should a national uniform long service leave standard be developed under the Fair Work Act 2009, issues may arise in respect of any new Victorian portable long service leave scheme.

In accepting the Committee’s findings and recommendations, the Victorian Government intends to commence work to design schemes and study the full implications for each area at the earliest possible opportunity.

Recommendation / Response / Comments
Recommendation 1
(page 124)
That the Victorian Government commission a feasibility study into a contract cleaning portable long service leave scheme. / Support in full / The Victorian Government notes the Committee’s finding that “Due to the contractbased nature of employment in the contract cleaning industry, some workers are unable to work with a single employer long enough to qualify for long service leave.” (Finding 12).
This is broadly similar to the underlying reasons for the introduction of portable long service leave by the Hamer Government in 1975.
The Victorian Government accepts the recommendation to conduct a feasibility study into portable long service leave in the contract cleaning industry.
A study into the feasibility of a portable long service leave scheme in this industry will help to provide answers to a number of questions that were left open following the Parliamentary inquiry. These questions include the appropriate governance arrangements to apply to any portable long service leave scheme, what entitlements would apply, and running costs, including the employer levy.
Recommendation 2
(page 128)
That the Victorian Government commission a feasibility study into a security industry portable long service leave scheme. / Support in full / The Victorian Government notes the Committee’s finding that “Due to the contractbased nature of employment in the security industry, some workers are unable to work with a single employer long enough to qualify for long service leave.” (Finding14).
The Victorian Government accepts the recommendation to conduct a feasibility study into portable long service leave in the security industry.
A study into the feasibility of a portable long service leave scheme in this industry will help to provide answers to a number of questions that were left open following the Parliamentary inquiry. These questions include the appropriate governance arrangements to apply to any portable long service leave scheme, what entitlements would apply, and running costs, including the employer levy.

In addition to responding to the Committee’s recommendations, the Victorian Government is of the view that it is appropriate to respond to Finding 11.

Finding / Response / Comments
Finding11
(page 124)
There is merit in introducing portable long service leave for the community services sector on the basis of providing equity to workers and the existence of a similar scheme in the ACT. / Support in full / The Victorian Government notes the previous attempt to implement a portable long service leave scheme in the community services sector, which culminated in the Community Services Sector Long Service Leave Bill 2010.
The Victorian Government also notes the observation of the Committee at page 119 that: “The Committee acknowledges there is not enough evidence to accurately determine the costs of introducing a portable long service leave scheme for the community services sector following the introduction of the NDIS and wage increases from the Equal Remuneration Order. Prior to recommending the introduction of a portable long service leave scheme for the community services sector, the assumptions used in the previous modelling for the 2010 scheme require updating to reflect the impact of recent developments.”
Given the findings of the Committee, the Victorian Government believes there is merit in conducting a feasibility study into portable long service leave in the community services sector. This can be done in parallel with the feasibility studies into portable long service leave in the security, and contract cleaning industries.

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