Cuts to the Department of Defence, the ATO and other Australian Public Sector (APS) departments and agencies will flow from a general reduction in the size of government and the abolition or merger of various government agencies. This is in addition to a wave of public service staffing cuts under the previous government. The total number of Australian public service job losses identified in the budget is 16,500 across the four years to 2016 17, which includes 14,500 positions that had been flagged for reduction through the previous government's efficiency dividends.

Norton Rose Fulbright partner Sarah Ralph says public service employers will need to ensure that genuine redundancy obligations under the Fair Work Act 2009 (Cth) are met in order to avoid unfair dismissal claims, which apply to public service employees covered by modern awards or enterprise agreements or those employees earning less than $129,300. Employers will also need to make sure that they comply with enterprise agreement provisions.

Ms Ralph says that "APS employers should ensure that they are compliant with their obligations including enterprise agreement requirements. These obligations can include consultation requirements as well as specific redeployment and redundancy procedures. A failure to comply with a provision of an enterprise agreement is a breach of the Fair Work Act, and can lead to civil penalties".

"Other key areas of risk during periods of workplace change are increases in employee stress and workplace tensions arising from uncertainty, which can result in workers' compensation claims and allegations of workplace bullying," she says. "These risks can be reduced by clear communication about the selection processes for redundancies and how work will be performed after the changes have taken place".

It was also announced that the introduction of the government's paid parental leave scheme, with a maximum payment of $50,000 for women earning more than $100,000, will be funded by a 1.5 per cent levy on big business and taxpayers. The existing paid parental leave scheme, set up by the former government, pays eligible mothers the minimum wage for 18 weeks, regardless of whether they earned more or less than this prior to going on maternity leave. People are only eligible for the payments under the current scheme if they earn less than $150,000.

Ms Ralph says that "the paid parental leave legislation has not yet been introduced into Parliament, and will, from 1 July 2014, require the support of the Greens or five out of the eight Independents and micro-parties in order for the government to pass the legislation. The government's paid parental scheme is likely to face significant hurdles and there is a real likelihood that it won't make it through Parliament without changes".

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