Woodhouse Michael: Holidays Amendment Bill — Second Reading In Committee Speaker Recalled In Committee 
Woodhouse Michael: Holidays Amendment Bill — Second Reading In Committee Speaker Recalled In Committee 
[Volume:668;Page:15477] 
MICHAEL WOODHOUSE (National) 
: 
 I am very happy to take a call on Part 1 of the Holidays Amendment Bill. I will focus on an issue that has not as far as I am aware been discussed at all either in the second reading or in the Committee stage so far. Yet as far as employers are concerned it is probably the single most important change that was made to the 2003 Holidays Act and the single most important change in this bill—that is the issue of relevant daily pay. 
In 2003 I was the vice-president of the Private Hospitals Association. It was an organisation that represented not only surgical hospitals but also a very wide range of the aged-care providers in this country. They were not the residential villages or retirement villages but rest home and hospital-level care for the elderly. We were absolutely emphatic about this issue as many employers were. Regardless of the merits of what was being attempted by the relevant daily pay calculations the calculations created some serious disincentives. 
Firstly it was completely unworkable from a payroll perspective. It simply was not possible for a payroll system to calculate relevant daily pay for organisations that ran around the clock 24/7 as hospitals and aged-care providers do. Thanks to collective employment agreements a number of allowances were being paid for evenings night shifts and weekends. The possibly unintended but certainly perverse outcome of the relevant daily pay clause as it is at present in the Act was that staff would be paid more for being sick than they would for being well and at work. 
Darien Fenton 
: That’s not true. 
MICHAEL WOODHOUSE 
: It is absolutely true. If time allowed I would give that member the numbers. Somebody working a mixture of shifts—who might work an evening shift the odd weekend shift the odd night shift and then was rostered on a day shift—is according to the Act required to be paid a relevant daily pay that includes all of the allowances that they earned on those swing shifts in the previous 4 weeks. Somebody on a base rate with no allowances who calls in sick has to be paid more than that for staying at home. 
What did that do to the sick leave provisions? Well every employee is honourable and I am sure that they did not intend consciously to take sick leave when they were not sick but two things happened. Firstly sick leave went up and it went up quite considerably. But what also happened was really interesting and it was observed across the country: the pattern of sick leave changed. Whereas there was usually an even distribution between days nights weekends and so on the sick leave shifted into the day shift. Who knows what might have been happening? Certainly the payment for being sick on the day shift was greater than what would be earned if an employee had come to work. 
That has been the case for nearly 7 years and it needed to change. It was one of the things that the working-group that the Minister set up was charged with addressing. It was their No. 1 recommendation. Although the Minister and the officials worked the solution into the bill in a slightly different way I think it represents a vast improvement to what we have now. The average daily pay calculations are much more straightforward. It is likely to take out those perverse incentives at least to some degree. I offer the view that we can still take a journey that will merge the annual leave sick leave and alternative day provisions in the future. But this is a huge advance compared with what we have. 
In the time available I will touch also on the issue of the employer determining when an alternative day might be taken. I offer a story that was given to the Transport and Industrial Relations Committee by a primary industry company. A whole department of workers who tended to be on the same shift wanted to take annual leave to go to the races. The employer quite rightly said they could not do that as the disruption to the business was too great. They had to keep things going and the employees were a whole shift. They could not do that. What did the employees do? They all took their alternative days and the business had to shut down so that those guys could go to the races. Members can draw their own conclusions about whether that was a good thing or a bad thing but someone has to determine it and when it comes to the running of a business I am very comfortable that it is the employer.