Agents are divided on the impact of the government’s forthcoming Fair Work Act which will change the way real estate professionals are remunerated.
Under the Act, a national set of awards would be introduced – including a base wage – that will be paid to all real estate agents across Australia.
RE/MAX Western Australia managing director Geoff Baldwin yesterday warned that the legislation would act as an impediment to hiring staff and would have a significant impact on a sector that traditionally uses an incentive, commission-based model.
But the Real Estate Institute of Australia president David Airey threw his support behind the Bill. Rather than reducing the number of new agents, he believed the new award wage model would benefit employees and employers alike.
Real Estate Business was inundated with comment from the industry in response to Mr Baldwin’s comments.
Ted Crockford, a real estate agent with Harcourts, supported Mr Baldwin’s comments and said an incentive was a wonderful tool for attracting agents.
“I don’t believe [the legislation would create] a level playing field. Incentive is a wonderful thing in our industry and being forced to pay people who turn out to be a dud is a disincentive,” Mr Crockford told Real Estate Business.
“How has our industry survived for so long? This is the thin end of the wedge for more socialism.”
Mr Crockford’s comments were echoed by Wes Davidson Real Estate’s managing director Wes Davidson.
“This new Act is ridiculous and will create loss of employment,” Mr Davidson said.
“It is thought out by people who clearly have no idea of the reality of our industry.”
According to Brian Parkes from Realty Executives, the Act would deter sales-focused agents from entering the industry.
“As a rep with over 20 years experience in WA, I believe it is vital to retain a workable commission only option.
“Employers will think much more carefully about employing new reps. After all, if the owner goes out of business, there is no one to employ the rep,” Mr Parkes said.
But the new legislation also drew support from the industry with some agents seeing a more level playing field emerging.
Anne Williams of Murrumbateman Properties said the Act was a step in the right direction for the industry.
“Being a New South Wales agent, and experiencing the gross unfairness of commission-only salespeople working in New South Wales from the ACT, this [legislation] is indeed welcome. All we ask for is a level playing field. [The legislation] is long overdue for those of us who have played by the rules,” Ms Williams said.
LJ Hooker’s Queanbeyan principal Michael Dyer agreed that the reforms were long overdue.
“I say welcome to the real world WA, award wages have been in existence in NSW for some 25 years,” Mr Dyer said.
“Under the new regulations, you can still have commission-only sales people, you can get a more consistent type of applicant for sales positions, build them up to the top level and then offer commissions-only or debit credit.”
Doug Svensen from PRDnationwide agreed that employment opportunities and commission-based only employees wouldn’t be affected by the incoming legislation.
He said many of his top agents would not have made the grade had they not had a supporting wage in their first 12 months.
“[The legislation] will also help weed out some of the cowboys who are willing to load up their offices with staff and make it difficult for others to make a decent living,” Mr Svensen told Real Estate Business.