The Victorian government has launched a pilot scheme that will trial paid sick leave for casual workers.
The 'Victorian Sick Pay Guarantee' scheme will be the first of its kind in Australia and it's estimated it will cost $245.6 million over its two-year trial period.
The scheme will be funded by taxpayers to begin.
After that, it could be funded through a levy applied to business — and it's likely to be a political battleground in a year with both a state and federal election.
Hospitality, retail and cleaning are among the eligible industries
The sick pay guarantee scheme will provide five days, or 38 hours, of paid sick or carers leave for workers at the national minimum wage.
Currently, that's $20.33 per hour.
It means workers will be eligible to claim up to $772.54 a year.
It will be trialled over two years in industries identified to have large cohorts of casual workers.
The following workers are listed in the first phase of the scheme:
- Hospitality workers
- Food trades workers and food preparation assistants
- Supermarket workers
- Retail and sales assistants
- Aged and disability care workers
- Cleaners and laundry workers
- Security guards
The government said an estimated 150,000 workers across the selected industries would be eligible.
Workers under the age of 18 will be eligible for the scheme, but must have the permission of a parent or guardian to apply.
It will be on top of the 25 per cent casual loading most of these workers would currently receive.
Self-employed sole traders and freelancers are also eligible to apply.
They must supply a medical certificate if the leave is for more than 15 hours in a row, and the five days per year does not roll over.
The scheme went live on Monday morning on the Services Victoria website.
"The absolute common sense of this, and frankly, the equity and justice of this will be absolutely obvious to everybody," Premier Daniel Andrews said.
Recent Australian Bureau of Statistics data shows about 23 per cent of all employees across the country are on casual contracts.
Sofia Gray has worked three casual jobs in recent years. She said paid sick leave would prevent many people from coming to work while unwell.
"I've been in situations before where I've needed to take time off work, but because of financial concerns haven't been able to do so," she said.
Ms Gray acknowledged the pandemic had placed a strain on both workers and their employers, saying many staff felt obliged to turn up due to staff shortages.
It will be first funded by taxpayers, with a possible business levy on the horizon
The first phase of the pilot scheme will be paid for by Victorian taxpayers, with the project costed at $245.6 million.
It was first announced as part of the 2020-21 State Budget.
The Andrews government also spent $5 million on a consultation process to design the new scheme.
The government confirmed that any ongoing scheme after the two-year trial period would be subject to an industry levy.
What is not clear is what form that levy would take.
In the last budget, the government started applying a payroll tax for the top 5 per cent of the state's businesses, to fund a billion-dollar mental health plan.
Peak business organisations have expressed concern about the scheme and the pressure it might put on employers and the Australian Industry Group is calling for it to be scrapped.
Perhaps unsurprisingly, the United Workers Union has welcomed the news, saying it would go a long way to bolster financial security and prevent workplace transmission of diseases such as COVID-19.
Labor and Liberal politicians are now trading blows over the scheme
Mr Andrews said the COVID-19 pandemic had highlighted financial insecurity experienced by casuals and that the two-year pilot program would work to alleviate some of the issues.
"At the end of two years, wouldn't it be great if we had a national government that said 'yes, this is actually a national issue'," he said.
Federal Industrial Relations Minister Michaelia Cash said Mr Andrews needed to "explain to Victorian small and medium businesses what will happen after the initial two-year period expires and how much he will tax them to cover his scheme".
"Employers already pay a 25 per cent loading to casual workers, in lieu of entitlements."
Senator Cash said the state Labor policy was "sign of things to come under an Albanese Labor government" and said "Labor have consistently attacked those who choose to undertake casual work and the businesses that employ them".
The Victorian opposition's Shadow Minister for Jobs and Employment, David Southwick, said the scheme was engineered for political clout rather than to benefit Victorians.
"Why set up a trial that is politically motivated, [provides] no security and in fact does quite the opposite?" Mr Southwick said.
Mr Southwick suggested the Coalition would likely scrap the scheme should it win the November state election.
