8. Conclusiones y líneas futuras 105
4.1. Arquitectura del planificador
The Fair Entitlements Guarantee Act was introduced in 2012 and replaced GEERS as a government-funded safety net for unpaid employee entitlements. It is important to note that this scheme was established by means of legislation and thus created a legal obligation on government to render support to employees.123 The scheme is administered by the Department of Employment. The scheme was described as being important “to fulfil a significant community need” by protecting employee entitlements which would be lost if employees were to lose their jobs as a result of an employer’s insolvency.124 Although alternatives for the protection of employee entitlements do exist they are “insufficient to adequately protect employees”.125
The main objectives of the Fair Entitlements Guarantee Act are, firstly, to provide for the Commonwealth to pay advances of unpaid employee priorities in certain instances126 and, secondly, for the Commonwealth to recover the advances paid for unpaid employee priorities through winding-up from payments received by the company in the liquidation process.127
120 ASIC Information Sheet 46 3.
121 If employer superannuation contributions were pursuable, the Australian Taxation Office could be contacted.
122 ANAO Report 2014-15, 14.
123 ANAO Report 2014-15, 14.
124 Explanatory Memorandum for the Fair Entitlements Guarantee Act of 2012.
125 Explanatory Memorandum for the Fair Entitlements Guarantee Act of 2012.
126 S 3(a) of the 2012 Act sets out the first objective. S 3(a)(i)–(iii) contains the instances in which the Commonwealth will pay the advances to the employees, namely, “(i) the employers are insolvent or bankrupt; and (ii) the end of the employment of the former employees was connected with that insolvency or bankruptcy; and (iii) the former employees cannot get payment of the entitlements from other sources”.
127 S 3(b) of the Fair Entitlements Guarantee Act of 2012 (the “FEG Act”).
Where a company is liquidated, eligible employees may use this Act to claim their unpaid employee priorities from the Australian government. This means that employees may use the Act as a safety net to claim unpaid employee entitlements. Employees are assured that their entitlements are protected should the insolvent employer be unable stand in for unpaid claims.
Where employees make use of this claim option the Commonwealth becomes a priority creditor of the liquidated company. The Commonwealth obtains a right to receive dividend pay-outs as a creditor of the company.
The following may be claimed in terms of the Fair Entitlements Guarantee Act:128 Up to 13 weeks’ unpaid wages;129 unpaid annual leave and long service leave; up to 5 weeks’ payment in lieu of notice; and up to 4 weeks’ redundancy pay per full year service.
In terms of section 18 of the Act no amount may be claimed under FEG if the liquidator of the company can satisfy the claim within 112 days. No superannuation contributions can be claimed under FEG.130
The following table131 sets out the different government-funded schemes established in Australia over the past 15 years, the entitlements covered and maximum employee entitlements claimable:
128 Fair Entitlements Guarantee (FEG), Department of Employment at https://www.employment.gov.au/fair-entitlements-guarantee-feg (Date of use: 22 June 2016). It should be noted that unpaid superannuation guarantee contributions will not be paid under FEG. The Australian Taxation Office should be approached for unpaid superannuation payments. S 19 of the FEG Act regulates the calculation of the amount of employee entitlements.
129 S 6 of the FEG Act defines wages and includes allowances, loadings, amounts payable for overtime, amounts payable at penalty rates and other amounts. Discretionary payments such as bonuses, reimbursements, travel expenses and amounts not payable on an ongoing basis are excluded from the definition of wages (s 7(2) and (3)); ss 5 and 26–27 stipulates that the current indexed maximum wage per week is AU$2 451 per week. If an employee is owed more that AU$2 451 per week, that portion will have to be paid by the liquidator if surplus funds are available for such pay-out; see the fact sheet https://docs.jobs.gov.au/documents/what-assistance-can-feg-provide (Date of use:
22 January 2018) 1. According to ANAO Report 2014-15 at note 41 on 32 under current arrangements the maximum wage per week is indexed on 1 July each year. This was last done in August 2013. As part of the 2014–15 Budget the government announced a freeze on the indexation of the maximum weekly wage rate until 1 July 2018. This change came into effect on 1 July 2014.
130 See the fact sheet https://docs.jobs.gov.au/documents/what-assistance-can-feg-provide (Date of use: 22 January 2018) 1.
131 Note that the basics for the table and the information on EESS, SEESA and GEERS were obtained from Ferber http://www.cimejes.com/word_doc/Employee%20Entitlements%20in%20Insolvency.pdf (Date of use: 28 November 2017) 13-14. The inclusion of FEG and the change in layout is the author’s work.
Scheme EESS SEESA GEERS FEG Maximum payment AU$20 000 No maximum in
total – individual
Since 2000 and the introduction of EESS, the Australian Government has distributed almost AU$1,5 billion in advances in terms of government-funded employee entitlement safety nets of
132 This is calculated on the indexed amount of AU$2 451 per week. Ss 5 and 26–27 of the FEG Act stipulates that the current indexed maximum wage per week is AU$2 451. If an employee is owed more that AU$2 451 per week, that portion will have to be paid by the liquidator if surplus funds are available for such pay-out; see the fact sheet https://docs.jobs.gov.au/documents/what-assistance-can-feg-provide (Date of use: 22 January 2018) 1. According to ANAO Report 2014-15 at note 41 on 32 under current arrangements, the maximum wage per week is indexed on 1 July each year. This was last done in August 2013. As part of the 2014–15 Budget the government announced a freeze on the indexation of the maximum weekly wage rate until 1 July 2018. This change came into effect on 1 July 2014.
which only 13% has been recovered by the Commonwealth.133