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Wednesday, October 19, 2005

Make business welfare redundant?

So you felt a bit sorry for those working in places of 100 employees or less when their rights to challenge unfair dismissals were heading for the legislative chopping block. Now, employees of big business may be on increasingly shaky ground. It's going to be easier to lay you off on the specious grounds of 'operational requirements'. The boss can make you redundant.

And this brings me to the matter of a certain hidden subsidy for business - redundancy. Employers can make decisions to 'down-size' their workforce. Some employees in these circumstances have accesss to quite reasonable redundancy provisions. Most employees do not. Standard redundancy provisions are quite miserly.

What this means in practice is that business can throw its employees on the economic scrap heap by 'down-sizing'; pay next to nothing to employees to cushion the blow; and rely on tax-payer funded welfare schemes to pick up the pieces. Business reliance on tax-payer funded welfare schemes galls me. Business expects the tax-payer to foot the bill for something in which the tax-payer has no decision making capacity. Can you imagine if the boot was on 'tother foot? This means that 'down-sizing' is subsidised by government and the taxpayer: in other words this form of taxpayer funded welfare also becomes business welfare.