ABOUT TIME FOR GOVERNMENT'S FEG ROUND TABLE
18 May 2017
The Government has announced it's going to look at doing something about companies avoiding their responsibilities to pay workers what they're owed rather than the taxpayer footing the bill.
Good. It's about time.
Labor has long been pointing out the harm that illegal phoenixing activity causes employees, businesses and the economy.
Harmful phoenix activity – deliberate related-party asset transfers and insolvency – is a tactic used by some directors to explicitly avoid paying employees their entitlements, avoid paying taxes, and avoid paying creditors – particularly subcontractors and other small businesses.
In 2015, the Productivity Commission reported 2,000 to 6,000 phoenix companies operating in Australia, costing up to $3.2 billion per year.
In contrast to the inaction of the Turnbull Government, Labor has long been committed to protecting workers‘ wages from harmful phoenix activity.
Labor will happily participate in the Government's consultations but instead of talking the Government should be acting.