Employers Are Being Gaslit by the Employment Relations System

With the so called Productivity Roundtable underway this week - there seems to be confusion about Australia's IR system and it's impact of handcuffing SMEs.

The IR system's impact on our nation's woeful productivity, is largely sprouted by Union friendly voices as irrelevant. These claims are baffling - grounded in ideology bias, miss the point, and can't be taken seriously.

We’ve now reached a point where the rules are so tangled and the rhetoric so disingenuous that employers are walking away from opportunities, jobs, and even entire industries.

Think this doesn't result in productivity loss? You can't be serious.

Don't be fooled by online slander against Employers, by people who have likely never even attempted starting a company, let alone developing it to a level of employing Australians and contributing to our economy, significantly.

This is happening, not because the Employers have failed, but because the system has failed them.

Here’s just a few recent examples of how:

1. Fair Work Bodies Fuel Confusion

Regulators and tribunals are making sweeping rulings while distancing themselves from the fallout. They issue decisions that leave employers legally exposed, then shrug when those employers get trampled.

Example: A prominent Melbourne university In 2023, misclassified casual academics for years, relying on what they believed to be standard arrangements.

Following a Fair Work Commission ruling, they faced millions in backpay claims. The Uni claimed they followed industry norms and Award interpretations supported by the Ombudsman's position. The Ombudsman’s response? “You should’ve known better.” No clarity. No guidance. Just blame.

2. You Try to Incentivise Staff—Only to Get Slammed for It

Everyone talks about improving productivity, but the second a business does anything outside the industrial cookie-cutter, they’re hit with challenges, audits, or union interference.

Example: A National Burger Chain, introduced a performance-based training and bonus scheme to incentivise staff and streamline operations.

Instead of being praised, they were targeted by the Retail and Fast Food Workers Union (RAFFWU), who alleged the scheme undercut Award conditions.

The campaign went national.

The Burger chain eventually scrapped the model, despite no actual breaches being found. Incentives killed by activism.

3. Contradictions in Fair Work Guidance Leave Employers Powerless

When different arms of the regulator provide different answers, or worse, when their website guidance contradicts the current law, it leaves businesses flying blind.

Example: Leading National Grocer - Even a corporate giant with legal teams got tripped up. They followed outdated Fair Work guidance when rolling out salaried contracts for managers.

Years later, they were hit with a $300 million underpayment scandal.

The reason? The interpretation of “reasonable overtime” shifted quietly over time. If Corporate giants and their legal teams can’t keep up, what hope does an Aussie small or medium sized enterprise genuinely have?

4. The Cost of Fair Work’s Delays and Errors Lands Squarely on You

If Fair Work drags its heels, miscommunicates, or gives wrong info, there’s no liability on their side. But you? You’re still expected to clean up the mess, apologise to your staff, and pay up.

Example: Global Fast Food Brand (Victoria) - A small franchisee tried to get clarification on an enterprise agreement variation in 2022. It took 11 months for the FWC to respond, by which point the business had already implemented changes based on what they were told verbally.

The written ruling contradicted the advice. They were forced to backpay 38 staff without any recourse.

5. The System Pretends to Champion Small Business, Then Ties Us in Knots

Governments and regulators love to say they’re “pro-business”, but the machinery they run tells a different story. Employers are expected to comply with systems built for multinationals, while juggling real-world constraints.

Example: A boutique bakery group in Melbourne tried to build out a simple rostering system for their expanding team, blending flexibility and Award compliance.

Instead, they faced confusion around classification levels, breaks, and weekend rates.

Their story became a case study in how hard it is for a small but growing business to comply with the labyrinth of Fair Work rules, without hiring an entire legal department.

Here’s the Truth: This "Fair" Work System Isn’t Confused, It’s Complicit

What we’re dealing with isn’t just complexity. It’s complacency.

It’s a regulatory culture that refuses to adapt, refuses to take accountability, and refuses to see that it's slowly choking the people who take the risks, build the teams, and create the jobs.

This system doesn’t serve employers. It controls them.

And if we don’t call it out, loudly and publicly, it’s going to keep doing exactly what it was designed to do: protect itself at our expense.

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