Portable entitlement scheme now both necessary and practical, new report finds

The McKell Institute

An Australian portable entitlement scheme is now desperately needed and would be practical to introduce if based on proven models, according to a new report by the McKell Institute.

A portable entitlement scheme would see accumulated benefits like long service leave and sick leave follow workers from job to job in an account, like superannuation.

The new McKell Institute report, ‘Insecure Work & Portable Entitlements: a solution for Australia,’ has found a scheme that allows Australians to carry entitlements like from job to job could be modelled on successful schemes that currently exist in sectors like Victorian construction.

A portable entitlement scheme was recently identified by Opposition Leader Anthony Albanese as an area of intended reform, but the federal government has so far attempted to dismiss the idea as impractical.

But report author Ryan Batchelor, executive director of the McKell Institute Victoria, said the case for a more universal portable entitlement scheme was now impossible to responsibly ignore.

“When one in five workers changed jobs in the past year and 3.7 million have no access to paid leave that should tell us we need a portable entitlement scheme urgently,” Mr Batchelor said.

“COVID-19 has shown how vulnerable we all are when people without enough sick leave show up to work sick.

“Fortunately, there are now a range of practical models for implementation, several of which with proven real world track records.

“The Commonwealth should get on board instead of trashing a good policy idea before they’ve even had a chance to properly consider it.

“Our report shows there are actually significant benefits for the government, which currently picks up the tab when companies go bankrupt and workers lose their employees through the Fair Entitlements Guarantee. Claims that the sky will fall in are simply not borne out by the facts.

“Australians are extremely comfortable with the idea of superannuation, and a portable entailment scheme would be analogous and familiar.

“The pandemic has shown us the significant cost of people turning up to work when sick. Any extra costs from providing more people with sick leave pale by comparison with the costs of this pandemic on our community.

“Australia invented long service leave as one of our many civilising workforce innovations. It’s now time we built on that proud legacy.”

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