WORKER COOP DIRECTORS DON’T GET FEG PAYMENT

 

Federal Entitlements Guarantee (FEGS)

Employee-owned cooperative directors don’t get the Federal Entitlements Guarantee (FEGS) if their cooperative goes into liquidation. Even if they have been elected as a Director for a few months, they miss out on their LSL, holiday pays and redundancy entitlements etc.
However, under the 556 Corporations Act, directors can receive their entitlements owing them before they were elected as Directors of their workers’ coop.
This is based on the definitions of Priority and Non-Priority Days, where payments can be apportioned on a pro-rata basis.
Priority Days: This is the number of days as a director of the workers’ cooperative
Non-Priority Days: Is the employment days before being elected as a Director of the workers cooperative

The NSW Court of Appeal has ruled:

Section 556(1C) requires identification of the amount of payment that can be attributed to non-priority days. It assumes by use of the words “must not include an amount attributable to non-priority days” … Read more

ENLISTING WORKERS TO RESTRUCTURE BUSINESS

Preserving Jobs and Businesses in Challenging Times

Workers jobs are threatened as never before due to the worldwide economic downturn brought on by the COVAD 19 pandemic. Over the last sixty years, the booms and busts of capitalism have driven workers to demonstrate solidarity and stage initiatives to acquire the threatened company they work in to keep it operating. These have been termed worker buyouts or employee buyouts depending on the culture. From a Christian viewpoint, this has its roots in the encyclical Rerum Novarum, and its emphasis on justice, workers rights, the dignity of work and the principle of subsidiarity – decisions are to be made by those who have to carry them out. The famous worker cooperative Mondragon Co-operative Corporation in Catholic Spain was initiated by the Catholic priest Father Arizmendiarreta and has become a pilgrimage thousands take to understand the Christian business model of sharing in ownership, decision making and profits.

This phenomenon of the EBO – … Read more