A $245.7 million pilot program providing sick leave for Victorian casual workers will end a year ahead of schedule, as the state pores over the data — and suggests Canberra should consider its role in the scheme moving forward.
The 2024-2025 state budget, handed down Tuesday, announced the Sick Pay Guarantee Pilot will conclude on June 30 this year.
The program, formulated in COVID-affected 2020 and launched in March 2022, provides paid sick and carer’s pay for casual workers, who have traditionally gone without those entitlements in exchange for casual loading rates.
It was originally scheduled to last two years, but the government last year extended it to 2025 as sign-ups undershot expectations and sick leave payouts came under budget.
The state government also expanded the list of eligible occupations, allowing workers in 400 more jobs to sign up.
However, the program is now slated to conclude at the end of next month.
Budget papers say the government is rethinking “COVID-19 era programs that are no longer needed – or have led to inefficiency behind the scenes”.
The budget shows some 55,000 workers are projected to sign up for the pilot in 2023-2024, well down on the 72,000 registered in 2022-2023.
The state government will now assess the pilot’s effectiveness, with its findings expected some time in early 2025.
Those results will be keenly watched by industry groups, which have long argued that higher casual rates, and penalty rates for unsociable hours, make up for a lack of paid sick leave and carer’s leave.
Employer groups have also raised concerns that workplaces will be subjected to new levies to pay for casual leave entitlements in any fully-fledged program.
“The scheme is deeply flawed and should be abandoned,” Tim Piper, Victorian head of the Australian Industry Group, said when the pilot was announced in March 2022.
“The last thing that Victorian businesses need is the prospect of a hefty payroll levy in two years’ time to fund this illogical scheme.”
It appears unlikely that Victorian employers will be asked to directly contribute as part of any future extension, with the state instead turning its focus to the federal government.
In a statement provided to SmartCompany, a Victorian Government spokesperson said it will petition the federal government to take up more of the burden, framing any future funding as a decision for Canberra.
“We will now take time to assess the effectiveness of the pilot and will continue to advocate for the Commonwealth government to do more to support casual and contract workers in respect of periods of ill health and managing caring responsibilities,” they said.
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Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
