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Mrs Armitage (Launceston) to ask the Honourable the Leader of the Government -

(1) (a) What is the situation with regard to long service leave entitlements paid to casuals in Tasmania’s construction industry via Tasbuild if they leave the industry before completing seven years of service; and

(b) can the Government advise if those payments are instead used to cover employers defaulting on long service entitlements?

(2) Will the Government seek to amend the Construction Industry (Long Service) Act to remove casual workers to give employers the ability to pay a set long service payment to casual workers upfront in their pay?

Answer from the Leader of Government, Dr Vanessa Goodwin:

(1) (a) If an employee, casual or otherwise, leaves the construction industry before accruing sufficient service to access a long service payment, then contributions made with respect to that employee are retained in the fund administered by TasBuild.

(b) Contributions and earnings of the fund are pooled, and entitlements and other expenses, including those for administration of the scheme, are paid from this pool. An employee who has an entitlement will be paid by the fund even if one or more his or her employers have defaulted on their contributions. In saying this, it is important to note that TasBuild will seek to recover monies owed where it can. Retained funds also contribute to keeping the contribution rate for employers as low as possible.

(2) The Government is considering its position in relation to this matter. The Treasurer, who is the Minister responsible for the administration of the Construction Industry (Long Service) Act 1997, is currently assessing the arguments put forward for an upfront payment. It would be premature to suggest an outcome. However, I can provide you some background information, including clarification on how casual employees are dealt with in Tasmania's Long Service Leave Act 1976 and in other Australian construction industry schemes. Subject to being regularly employed by the employer for not less than 32 hours in each consecutive period of four weeks, casual employees are covered under the Long Service Leave Act, which applies to most other industries in Tasmania.

All Australian jurisdictions have a portable long service leave scheme for employees who undertake construction work, and/or those who are engaged in the construction industry. Like Tasmania's scheme, the construction industry long service schemes of other jurisdictions cover casual employees, and they pay entitlements based on service in the industry or undertaking construction work, rather than service for an individual employer.

The Government can see that paying long service benefits to casual employees as they go would be simple for employers; would benefit casuals who might not otherwise receive an entitlement; and employers would know that their money is going to their employee.

Nevertheless, there are also some disadvantages or difficulties. Payment of an ongoing loading to casual employees in lieu of accrued entitlements would be a departure from the concept of providing a benefit based on length of service within the construction industry. It would also create inequities if one group of employees were to receive payments as they go, while others have to wait years. It would also be out of step with other schemes across the country.

Question answered August 18, 2015

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