COSBOA National Small Business Summit
Good morning.
I acknowledge the Gadigal people of the Eora nation as the Traditional Custodians of the land we are meeting on this morning.
And I pay my respects to their Elders, past and present.
Thank you to COSBOA for the invitation to speak to you this morning.
And a particular thank you to chief executive Skye Cappuccio, for your constructive approach to engagement and advocacy on behalf of COSBOA’s members.
That advocacy is really important.
Because the 2.7 million small businesses in Australia are the engine room of our economy.
Whether it’s cafés, shops, tradies, accountants or many others – small businesses contribute almost $600 billion to our economy, every year.
Small businesses are an especially important in my portfolio of employment and workplace relations, as they employ more than 5 million workers.
As Minister, I am always looking at how we can encourage more cooperative and productive workplaces.
And our Government has passed a number of workplace relations reforms to facilitate discussion between employers and employees.
But we understand that most small business owners aren’t looking to become experts in workplace law.
That’s why our Government is funding supports for small businesses to engage with the system.
Through the Productivity Education and Training Fund, we have committed more than $14 million over 5 years to COSBOA, to provide resources and guidance for small business to engage with workplace relations reforms.
Our Government has also delivered $20 million over 4 years to the Fair Work Ombudsman to provide free, tailored advice specifically for small businesses.
And a parliamentary committee is currently reviewing the National Employment Standards after 15 years, to consider if these are still meeting the needs of workers and employers, including small business.
Our Government has also made it simpler and easier for small businesses to access enterprise bargaining if they want to, which can deliver the flexibility to negotiate bespoke conditions that are right for your business.
Things like simplifying the Better Off Overall Test, and cutting red tape for single-enterprise bargaining.
In this year’s Budget, our Government has also extended $1.3 million in funding to the Fair Work Commission specifically to support small businesses to engage with the Commission, including support for bargaining.
Our Government understands that flexibility is important – but so is certainty.
Many small businesses want clear rules and confidence that they are doing the right thing.
Because I know small businesses want to do the right thing by their workers.
And in some cases, it is more helpful for policy settings to be more explicit, rather than less.
Baby Priya’s Law, which passed the Parliament last year, is a really good example.
That law removed grey areas in relation to the cancellation of employer-funded paid parental leave, in the event of stillbirth or early death of a child.
By removing ambiguity, all parties – workers and their employers – have clear direction on what should happen in such a terrible situation.
And when everyone is on the same page, meaningful cooperation is much more likely to follow.
Of course, where there are disputes, it is essential that parties can access timely and effective resolutions.
That is why having the Fair Work Commission as the independent workplace umpire is such an important part of building more cooperative workplaces across Australia.
Our Government recently passed legislation to strengthen the Commission’s ability to fulfil that role and speed up the process for both employers and workers.
Our legislation has now made it easier for the Commission to dismiss vexatious or frivolous claims.
This is particularly important as we see a rise in AI generated claims.
The Commission also now has the power to prevent a frivolous or vexatious applicant from making more applications.
And where appropriate, the Commission will be able to determine more matters on the papers, without going to costly and time-consuming hearings.
These changes will deliver faster resolutions to disputes, and provide small businesses with more certainty.
Of course, a key part of access to justice is having an effective way to apply and enforce the law.
And because Australia does not have a specialist national employment court, many workplace matters end up in the federal court system or even a relevant state court.
This creates particular challenges for small businesses, who don’t have the time or resources to manage lengthy legal proceedings in the Federal Court system, which deals with a vast variety of matters, not just employment law.
Parties can spend months, in some cases years, seeking a resolution.
In the Federal Court system, there has been a roughly 30% increase in pending workplace matters.
That’s a 30% increase in people having to wait for an outcome through the federal court system.
But where there are state-based specialist employment courts, we are hearing from stakeholders that they are quicker and easier to navigate.
For example, the South Australian Employment Tribunal has been able to achieve a clearance rate of close to 100% in its workplace matters over the last few years.
While some people are telling us they prefer these state-based employment courts, they are not available in every jurisdiction, and their set-up differs from state to state.
This leads to potential increased complexity, creating a minefield for small business to navigate.
Our Government wants to see a clear pathway for faster and more effective outcomes for workers and employers across the whole country.
That’s why our Government recently announced that we will establish a Fair Work Court.
This new court will provide a specialist judicial forum for resolving workplace disputes.
Because employment contracts are very different to ordinary commercial contracts.
They are governed by an entirely different statutory framework.
And there are rights and obligations in the workplace that exist beyond any employment contract.
The judges on the Fair Work Court will be experts in workplace relations matters, bringing deep specialist knowledge of the Fair Work framework and how it applies to Australian workplaces.
Having a federal jurisdiction can provide a clear, single pathway for workplace dispute resolution under the Fair Work Act.
And by having expert judges in workplace matters, the Fair Work Court will deliver a more efficient system that can resolve disputes as quickly and fairly as possible, reducing the burden on all parties.
The concept of a dedicated workplace relations court is not new.
Paul Keating established the Industrial Relations Court of Australia in 1993, which was well-regarded for being user-friendly.
It was able to tailor its processes to its specific remit, by reducing the documentation required in matters and simplifying application forms.
Let me be very clear: the creation of a Fair Work Court is not about adding additional obligations for employers.
It is about improving the way existing laws are administered and enforced.
The Fair Work Commission will retain its central role in conciliation and arbitration as Australia’s workplace tribunal.
Of course, like with any major proposal, there will be extensive consultation on the design of this Fair Work Court.
There is a lot of detail that will need to be worked through, including the Court’s exact design, scope and interaction with the Fair Work Commission.
I am determined to ensure we are hearing from small businesses throughout this consultation process, so we can work to address your specific needs.
And more details about the consultation process will be released soon.
As I have said, I want to see more cooperative workplaces in Australia.
And AI is a really good example of why that cooperation matters.
AI offers enormous productivity benefits and economic gains, both for individual businesses and the broader economy.
Small businesses are telling us that they can see the opportunities that AI presents, but many are unsure where to start.
And what’s really needed is practical support for small business owners to develop AI literacy and build their capability.
That’s why our Government has invested over $25 million in Round 3 of the Digital Solutions program, with a focus on delivering practical support to help small businesses adopt AI.
And through the AI Adopt program, we are providing free advice for small and medium enterprises to find and integrate the right AI tools for them.
Of course, what’s also critical for the successful adoption of AI is workers’ trust in this technology.
I know that for many small businesses, your employees are long-term colleagues, deeply invested in your business’s success.
That’s why maintaining trust with your workers is so important in the adoption of AI.
Evidence suggests that trust can be built by ensuring there is transparency and consultation with employees during the process of adopting AI in the workplace.
This will help bring workers along on the journey.
But it also just makes good economic sense.
Jobs and Skills Australia published a major study last year showing that businesses get the best return on AI when they involve their workers in its delivery.
This is a really dynamic policy space.
And the question of how we can share these benefits and gains across our economy is very much a live one.
But it’s not a question that Government can – or should – answer on its own.
That’s why I have established and chair the AI Employment and Workplaces Forum.
This tripartite Forum brings together business, unions and government around the same table, to develop a shared understanding.
And I want to again thank Skye for her participation and contribution to the Forum, as COSBOA’s representative.
Having these discussions is something I really value.
Collectively, Forum members have agreed on five key priorities to address regarding AI in the workplace: trust, capability, safety, productivity and transparency.
While it’s really important to have these agreed priorities, we are also looking at ways to operationalise them, so they can translate into action at the workplace level.
Through the Forum, members are developing best practice guidance for AI adoption, including how to support workers transition, which will in turn deliver better productivity benefits for employers.
We will be engaging with COSBOA and the broader small business community to develop this guidance, to ensure that your perspectives are included.
Just as we are working together to maximise the benefits of AI adoption, we can also work together to tackle another challenge: gender equality in the workforce.
Unfortunately, Australia has some of the highest rates of industry gender segregation amongst advanced economies.
And that has negative impacts across our economy.
Occupational shortages get worse as gender segregation intensifies.
And businesses miss out on the diversity of thinking that drives growth.
We see this gender segregation reflected in small business as well.
Women only own around one-third of small businesses in Australia.
And in male-dominated sectors like construction, only about 10 per cent of small businesses are led by women.
That’s why our Government’s grant program to advance gender equality in gender-segregated industries has delivered funding to both employer-led and worker-led projects, to tackle the systemic barriers that women in those industries face.
COSBOA has received $6 million over three years to support women in small businesses within gender-segregated industries like finance, technology and the trades.
Just this morning, I met some of the participants who had benefited from this program.
It was great to hear their stories, which illustrate the importance of building practical, workplace-based initiatives to drive cultural change.
Because when we create an environment where women thrive, then both individual businesses – and the broader economy – reap the benefits.
The Albanese Labor Government is absolutely committed to backing Australia’s small businesses.
And I want to acknowledge the great work done by my colleague Anne Aly, the Minister for Small Business, who unfortunately couldn’t be here today.
Of course, global events are contributing to significant economic uncertainty here at home.
While Australia is well-placed to face these challenges from a position of strength, our Government knows that many small businesses are still doing it tough.
That’s why the latest Budget included a wide range of measures to support small businesses.
We have made the $20,000 instant asset write-off permanent from 1 July this year, giving businesses more certainty to invest.
And we are introducing loss refundability, to support start-up businesses to invest and grow in their first two years of operation.
Of course, we are keeping all 4 of the current CGT concessions for small businesses.
But for the CGT reduction on active assets, we are also increasing the turnover threshold up to $10 million, meaning 98 per cent of all Australian businesses will be eligible for this concession.
I’d like to acknowledge COSBOA’s positive and constructive engagement with the Government on this issue.
Finally, I want to thank COSBOA and all of you for the important contribution you make to our economy and our communities.
Our Government is committed to working with you to ensure that small businesses have the support they need to invest, grow and succeed.
So thank you again for having me here this morning.
I wish you all the very best for the rest of the Summit.
Thank you.