Australian workers will be able to access two weeks of unpaid pandemic leave and double the amount of leave they can take at half-pay, after a breakthrough between unions and the Morrison government.
The temporary measures will apply to workers across 103 of Australia's 121 modern awards, as businesses attempt to stay afloat during the coronavirus pandemic.
The changes will address a gap on the award safety net for employees who are required to self-isolate, the Fair Work Commission said.
That gap meant an employee who had to self-isolate because they had been exposed to someone infected with COVID-19 did not have protection from unfair dismissal, if they had not tested positive to COVID-19 themselves or were not displaying any symptoms.
Attorney-General Christian Porter said the changes would allow businesses to be more flexible, and would save "tens of thousands of jobs".
It came after backroom negotiations with the Australian Council of Trade Unions, the Australian Industry Group and unions like the Shop, Distributive and Allied Employees Association, and represents a "massive reform to our employment relations system", Mr Porter said.
"It probably is fair to say that there has been the type of change in three weeks inside the award system that you might otherwise wait 30 years to see," Mr Porter said.
It comes amid an historic armistice between the Coalition and the union movement in the face of unprecedented job losses due to the coronavirus crisis.
Prime Minister Scott Morrison even thanked Australian Council of Trade Unions secretary Sally McManus personally for the way she had engaged with government on the issue.
"There are no blues teams or red teams. There are no more unions or bosses. There are just Australians now. That is all that matters," Mr Morrison said.
Mr Porter said government would not be claiming credit for the changes either.
"We are here to thank the parties who have facilitated those changes," he said, of the unions.
It comes after unions and industry groups last week won a bid for hospitality businesses to be able to reduce employee hours and put staff on leave at half-pay with 24 hours notice, a temporary measure to help businesses stay afloat and save jobs.
A report to the Fair Work Commission from University of Melbourne economist Professor Jeff Borland found would there would be wider economic benefits if awards were modified to more easily vary hours of work, especially in the hospitality, restaurant and fast food industries.
"For example, a business which used to hire three workers for 40 hours per week, and which during the pandemic only requires 40 hours of labour in total, might then be able to retain each of the three workers for 13 hours per week, rather than needing to lay off two workers and retaining one worker in a full-time position," Professor Borland wrote.
"Retaining extra employees in employment has potential benefits for both the employee and an employer. Employees who are laid off experience a variety of costs that do not occur - or are smaller than - when they are retained at reduced hours - including loss of income; loss of firm-specific human capital and skill atrophy; negative psychological effects; and the need to undertake search activity to find a new job."
Employers who have to look for new workers when conditions improve also have the added costs of recruiting and training staff, Professor Borland said.
"The potential benefits of retaining employees during episodes such as the current pandemic seems to represent are especially large," he wrote.
"Many firms are experiencing a substantial decrease in their demand for labour, but as the pandemic is controlled are likely to have the same level of labour demand as before the pandemic.
"That reversal of the effect on labour demand, together with what will hopefully be a shorter duration than an average downturn, makes it more valuable for firms to retain an already trained worker and to not have to search for a new worker."
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