Finance Consumer Why a Commonwealth-backed paid pandemic leave scheme makes sense

Why a Commonwealth-backed paid pandemic leave scheme makes sense

Pay envelope surrounded by hundred dollar notes.
Paid pandemic leave could be the solution to growing rates of workplace transmission.
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Calls for a national paid pandemic leave scheme are mounting as Victoria battles to contain workplace transmissions.

Victoria is continuing to weigh on Australia’s economic recovery with more than 3600 active cases of the infectious coronavirus forcing a shutdown of the greater metropolitan area and nearby Mitchell Shire.

With the cost of failing to contain the Victorian outbreaks estimated at $100 billion, Premier Daniel Andrews has revamped the state’s paid pandemic leave policy in a bid to curb workplace transmissions.

Under revised rules, the Victorian government will pay workers without sick leave $300 if they have taken a test and need to self-isolate while awaiting the result.

This is on top of a pre-existing $1500 payment for workers who test positive and need to stay at home for two weeks.

Given 80 per cent of Victoria’s new cases are linked to workplaces, it’s a sensible move, according to ANU Crawford School of Public Policy professor Peter Whiteford.

Speaking to The New Daily, Professor Whiteford said 37 per cent of Australian workers have no access to paid leave, and taking time off work could mean they can’t afford to put food on the table.

Professor Whiteford said that’s a “pretty obvious” reason for workers to continue showing up to work, despite the risk to public health.

“The need for paid pandemic leave, in my mind, is pretty clear,” he said.

If you want people not to have to go into work when they don’t have paid sick or annual leave, what do you expect them to do?”

Although Victoria’s response is to be commended, Professor Whiteford said the Commonwealth should adopt a similar program nationwide to reduce the chance of further outbreaks.

How paid pandemic leave would work

Professor Whiteford said pandemic leave should be seen as a kind of workplace entitlement, rather than a social security payment.

Workers required to test or self-isolate would notify their employer, which would continue to pay them and file a reimbursement claim with the federal government.

A similar system is in place for paid parental leave, Professor Whiteford said.

“That way, it’s not like someone has to turn up at Centrelink and go through that whole grizzly process,” he said.

Such a program would also be quite affordable despite the record deficit outlined in Thursday’s budget.

That’s because these one-off payments would only go to the tens of thousands of workers required to isolate with no other form of financial support – and it would also minimise the overall economic cost of the pandemic by reducing the chance of further outbreaks.

Effectively, the cost of paid pandemic leave could be seen as an investment towards fighting the pandemic.

The Victorian model

Where a worker is forced to self-isolate for two weeks because they are confirmed to have the disease, or are suspected of having it, the Victorian government will pay them $1500.

This money is intended to allow those with no paid leave to stay home, rather than choose between putting food on the table and infecting others.

It’s only available to people who meet the state government’s strict eligibility criteria and was originally only for workers who needed to isolate for two weeks.

To be eligible, workers must reside in Victoria, be at least 17 years old, be in continuous employment, and cannot be receiving other government support payments like JobKeeper. (More details are in the graphic.)

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Premier Andrews announced the extra $300 payment after government data revealed 53 per cent of Victorians who took a coronavirus test went to work, shopped, or otherwise ignored advice to self-isolate when awaiting their result.

The extra payment is intended to cover the cost of not going to work while staying at hone. 

“To fight this virus, we need every Victorian who is sick to get tested and then stay home. If you are waiting for a test, you must stay home until you are notified of your result,” Mr Andrews said.

“We know that having to isolate can mean missing work – and no one should be making the choice between their health and putting food on the table. That’s why we’re making sure those who need our support can get it.”