Australians are already struggling to save for a dignified retirement. Wages are stagnant and living costs like electricity prices, rent and transport are through the roof, leaving little room for savings.
According to one recent report by MLC, six in 10 Australians think they will only save about half what they need to retire. Our older Australians inability to retire in a dignified way is directly related to their retirement savings not keeping up with the cost of living.
The realisation has already dawned on many that the only option is to keep working, and working … and working. One in three Australians are now working beyond 65 according to the Australian Bureau of Statistics, and almost half of these work into their 70s.
The situation is about to get worse in one industry – the mining industry. A decision by the Fair Work Commission, approved on judicial review this week, means $380 million in workers’ retirement savings will be stripped and handed over to big mining companies.
Up to now, coal employees’ redundancy pay has been calculated at two weeks’ pay for every year of service, if they are retrenched. Now, once an employee reaches 15-years of service, they can no long accumulate any further redundancy benefits.
For employees with more than 15-years’ service today, their existing benefits are frozen and they can no longer accumulate any redundancy pay. How is someone supposed to save for retirement, when it is no longer possible to accumulate redundancy pay?
This decision not only deprives employees of fair benefits at a time of retrenchments but it will impact significantly on many regional economies where these mine workers and their families live and spend their money.
This decision tells you everything you need to know about our industrial relations laws – the rules are broken.
When our industrial umpire – the “Fair” Work Commission – can literally transfer $380 million from the retirement savings of tens of thousands of workers and hand it over to big business, we have a major problem in this country.
When the rules allow big mining corporations, many of which pay no tax in Australia, to steal older Australians’ retirement savings from under their nose, we have a problem.
While this decision affects mining workers for now, we have already heard that companies in other industries intend to use this as a precedent to come after the retirement savings of workers in other industries.
The answer is simple: we need to re-write the rules and bring back fairness to Australian workplaces. The CFMEU will campaign to change the rules so that we can reverse today’s outcome and protect older workers’ hard-earned redundancy pay.
Tony Maher is National President of the CFMEU