Victorian Sick Pay Guarantee

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Victorian Sick Pay Guarantee

Written by: Canny Accounting

 

While the last two years have been difficult for many people all over the world, in Australia at least, those people who work on a casual or contract basis over the long term have been particularly impacted.  While there are certain benefits with casual and contract work, a serious potential liability is the absence of any sick leave pay.  While this has always been a concern during the winter ‘flu season’, it is now compounded by COVID-19.

The Sick Pay Guarantee is a Victorian Government pilot program running from 14 March 2022 for the next two years.  It will provide Victorian casual workers in eligible jobs up to 38 hours per week of sick and carer’s leave pay at the minimum wage rate.

Contract + Casual Worker Eligibility

To be eligible, a contract or casual worker must:

  • Be 15 years or older;
  • Physically work in Victoria;
  • Have the rights to work in Australia;
  • Work an average of 7.6 hours per week or more in an eligible job; and
  • Not have access to sick and carer’s leave entitlements at any job.

contract worker which includes self-employed workers, independent contractors, contractors and sub-contractors – provides services under a contract and can work for more than one client at a time.

casual worker accepts job and work offers from an employer with the knowledge that there is no commitment to ongoing work, or to work with an agreed pattern.

During 2021, a public consultation was conducted by the Victorian Government with workers, unions, businesses, and industry groups to determine the industries and jobs with the highest rates of casual and contract workers.  They also took into consideration jobs and industries with high rates of potentially vulnerable workers, such as those from culturally and linguistically diverse backgrounds, young people, and women.  The resulting list is:

  • Hospitality;
  • Food trades or food preparation;
  • Supermarkets;
  • Retail;
  • Sales;
  • Aged care and disability care;
  • Cleaning and laundry; and
  • Security.

While this is undoubtedly a program that will assist eligible workers with greater security and life balance, it was necessary to look at the proposal from both sides – employers and business owners as well and the Government’s Public Consultation Report (the Report) does this.

Impact on Employees As The Workers

The Report found that workers were overwhelmed by the opinion that the sick pay scheme would have a positive impact on their well-being, confirming the difficulties in making a decision to stay home when unwell knowing that they will not be paid.  This aligns with the recent concerns identified in the media by the medical profession about COVID-19, where highly infectious people may feel that they have no choice other than to continue to turn up to work as they cannot manage the financial consequences of prolonged leave without pay.

This, of course, has been an even longer-term problem with increasingly severe ‘flu season’ and the rapidly mutating ‘flu virus’.  One worker stated that she was working alone and was so sick that she almost fainted, but had to keep turning up to work each day as she would be unable to pay her rent if she missed even just one shift.

The Report also found that even before the pandemic struck, 84% of workers regularly attended work when they were sick.  Workers also stated that being unwell and not able to go to work and get paid negatively affected their mental health.  One worker mentioned difficulty having difficulty with getting Centrelink income support after she lost her job because of needed to take sick days, because of the employer’s refusal to provide a separation certificate.

One concern of worker respondents was a potential necessity for providing medical or sick certificates, as people advised that it could be difficult to obtain given work and other time constraints.  For the pilot program, however, it is necessary for those registered for the pilot program and making a claim to provide one of the following for claims over 15 hours:

  • A medical certificate;
  • An absence from work certificate;
  • A carer’s certificate; and/or
  • A statutory declaration stating that they were not able to work.

Impact on Employers

Importantly for employers, there is no cost to them throughout the trial period (two years) as the program is fully funded by the Victorian Government.  There is also no change to the existing pay and entitlement requirements for workers.

The Report found that although there were some concerns from employers and industry groups, overall there was broad support for the pilot program and for the eligible industries.  Some proposed that jobs in the childcare, meat workers, warehousing, and logistics industries should also be included.  It was strongly agreed that the National Employment Standards be the guiding reference for defining sick and carer’s leave.

Interestingly, while there was a strong agreement that proof of identity and eligibility were essential, some employers and industry groups also raised the concern that medical/sick certificates can be difficult for workers to obtain, particularly for those living in regional and remote areas.

Help From The Accountants Geelong Trusts

With the rising cost of living showing no signs of abating, uncertainty about the longevity of the pandemic, and new strains of not only the Covid-19 virus but also the influenza virus, the financial and emotional stress on those without secure and permanent jobs has been extreme.

A trial of the Victorian Sick Pay Guarantee as a pilot program for the course of two years is a significant innovation to address some of these concerns and to increase the physical and mental health and well-being of economically vulnerable workers.

Given that potentially infectious people are much better off staying home from work, the success of the pilot program will go a long way to encouraging other governments to innovate measures to ensure a better system not only for casual and contract works but also for our wider community.

…no workers should be put in a position where they have to choose between earning an income and taking necessary time away from work while unwell or looking after sick family members.

[Community services peak body, Secure Work Pilot Scheme Public Consultation Summary Report]

Pictured, Canny Group's Accounting team consisting of; Adam Ramage, Jamie Arrington, Danny Grigg, Krystine Canny-Smith and Amanda Wilkens - standing next to a yellow circle!

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