"This legislation contains four main elements: closing the labour hire loophole that has been used to undercut pay and conditions, criminalising wage theft, properly defining casual work so casuals aren't being exploited, and making sure that gig workers aren't being ripped off."

Address to the House of Representatives, Bills - Fair Work Legislation Amendment (Closing Loopholes) Bill

Wednesday 6 September 2023

I also rise to speak in favour of the Fair Work Legislation Amendment (Closing Loopholes) Bill. Only recently, what a marvellous speech we had from the member for Holt. I would like to remind the House of comments I made last year in the House when we were debating the first round of Fair Work legislation. I spoke last year about some of the facts that formed part of the reality of industrial relations in this country over the last decade. The reality is our system is completely and utterly broken and has been for some time. There has been no balance in this system. There has been no fairness. It has been working for neither employers nor workers. Well, for the first time in a decade there is a plan on the table to fix this mess. Last year's changes breathed life back into collective bargaining and the Fair Work Commission, and these changes build on this foundation for fairness. I come to this debate with real experience of industrial relations in this country. Before coming to this place, I spent two decades in workplace relations, including more than a decade in the labour movement, representing working Australians across different jobs, industries and employers. I've represented scientists, police officers, engineers and pharmacists. I've seen the impact of the growth of uncertain work and the undermining of collective bargaining.

The Albanese government was elected on a promise to get wages moving. We started that job last year, but to do that effectively and with fairness we need to close the loopholes that are undermining wages and conditions. That's what this set of workplace relations reform is largely about—I say 'largely' because the reforms relating to transport are, critically, about worker safety. This legislation contains four main elements: closing the labour hire loophole that has been used to undercut pay and conditions, criminalising wage theft, properly defining casual work so casuals aren't being exploited, and making sure that gig workers aren't being ripped off. These reforms are not new. The Albanese Labor opposition announced all four of these policies while in opposition more than two years ago and we took them to the Australian people at the 2022 election. We've undertaken extensive consultation on the precise design of these measures, including with business groups. Indeed, those opposite could have participated in both the national and regional jobs and skills summits last year. There was an open invitation to be part of this important conversation for all groups that were interested last year.

At the heart of it, these are not radical changes. All we are doing is making the current law work effectively and fairly. Closing labour hire loopholes will simply require an employer to pay rates that it has already negotiated and agreed to through collective bargaining. These are rates of pay that are already set for the work being done and for the classifications covered. Our employee-like reforms simply require workers to have some minimum standards benchmarked against existing award rates when they are working in a way which is similar to employees. They are not radical changes. Our wage theft reforms will simply strengthen the enforcement of existing rates of pay. Most employers out there don't want to be undercut by bad apples doing the wrong thing. In fact, it has been a constant message back to us that we need to act on those bad apples.

Our new definition of casual employment will clarify what was intended with casual work: if you are working regular and predictable hours and want to be permanent, you will have that pathway available to you. These laws will strengthen the current workplace relations framework and provide certainty, fairness and a level playing field for both businesses and workers. This government is standing up for casual workers who want to become permanent employees. We are closing the loophole that leaves people stuck classified as casuals when they actually work permanent regular hours. A decade ago they would have been permanent. That means they work just like permanent employees but don't get any of the benefits of job security. This government is legislating a fair, objective definition to determine when an employee can be classified as a casual. These reforms will help more than 850,000 casual workers who have regular work arrangements, giving them greater access to leave entitlements and more financial security if desired. We on this side of the chamber understand that rent isn't casual, electricity bills aren't casual and school fees aren't casual—they're a certainty. But people in insecure work do not have the same certainty about their hours or their income despite those patterns of employment. There are many casual workers who prefer being casual. The government understands this. Under these reforms, no-one will be forced to convert from casual to permanent employment if they don't want to. There isn't a net cost to business. Employers will pay a loading if someone is casual and will pay leave entitlements if someone is permanent. They won't pay both. Eligible employees will have two pathways to change their status: by the definition based employee choice pathway or through the existing casual conversion mechanism.

Labour hire has legitimate uses in providing surge and specialist workforces, and that will continue to be the case. But what this government is concerned about is the labour hire loophole, which companies deliberately use in order to undercut the agreements that they've already made with their workers. They'd agreed on fair rates of pay with their workers and made an enterprise agreement, and then they undercut that agreement by bringing in a labour-hire workforce that is being paid less. That is a loophole we have to close.

This bill amends the Fair Work Act 2009 to give powers to the Fair Work Commission to make orders that labour-hire employees be paid at least the wages in a host enterprise agreement. We're seeing multiple examples of this with our national carrier, Qantas. Qantas exploited current loopholes and set up multiple labour-hire subsidiaries in order to deliberately undermine and avoid their own enterprise agreement for cabin crew, saving money for the company at the expense of the staff and deliberately undermining wages and conditions. The direct impact on one of my constituents was to almost halve the hourly rates they would have been entitled to under the negotiated agreement. Under the current system, this is perfectly legal. Under this legislation, this extraordinarily unfair business practice will no longer be acceptable.

These reforms will extend the powers of the Fair Work Commission to include employee-like forms of work, allowing the better protection of people in new forms of work from exploitation and dangerous working conditions. This change will allow the Fair Work Commission to make orders for minimum standards for new forms of work such as gig work. This legislation is not trying to turn people into employees when they don't want to be employees. The government understands that a lot of gig workers like the flexibility from using this technology, and that won't change under our laws. However, we on this side know that there is a direct link between low rates of pay and safety. Low rates of pay lead to a situation where workers take risks so they can get more work because they are struggling to make ends meet. There is simply no such thing as a safe risk in any workplace, and we know that some gig platforms have unconscionably incentivised risk.

We cannot continue to have a situation where the 21st-century technology of the gig platforms comes with 19th-century conditions. Just because someone is working in the gig economy shouldn't mean that they end up being paid less than they would if they had been an employee. The Albanese Labor government will not let Australia become a nation where you have to rely on tips to make ends meet. These reforms deliver on our election commitment to allow the Fair Work Commission to set minimum standards for employee-like workers, including in the gig economy.

If a worker steals from the till, it's a criminal offence, and there is no argument on that from anyone in this House. But in many parts of Australia, if an employer steals from a worker's pay packet, it is not a criminal offence. Employers who intentionally steal from their workers should face criminal penalties. This is not a large moral leap. The former government did nothing to stop the wage theft epidemic. It took the Liberals and Nationals years to even acknowledge there was a problem. Eventually, those opposite did bring in some half-hearted legislation, but when it came to the Senate they voted against their own legislation. I remember this well. They tore up their own draft laws because they couldn't get enough support for their plans to cut workers' pay and conditions in other ways. In doing so they decided to send a clear signal to wage thieves: keep it up. Business owners who withhold wages should face the harshest penalties.

We must also ensure our new laws do not water down any wage theft laws already put in place by the states. The Labor governments in Victoria and Queensland criminalised wage theft because they got sick of waiting for the previous federal government to act. Australia needs a national wage theft system to end the rip-offs, and this government is determined to deliver on our promise to Australian workers and make wage theft a crime. This proposal is to introduce a criminal offence for intentional underpayment of employees' wages and certain entitlements and to increase penalties for civil underpayment breaches in line with the government's election commitments. It will include a new way for calculating penalties with the inclusion of the value of the underpayment option to be available to the court where that value exceeds the maximum penalty measured in penalty units.

Under this legislation the Fair Work Commission will be able to set minimum standards for independent contractors who are regulated road transport contractors performing work under a services contract in the road transport industry. The proposal implements a Jobs and Skills Summit outcome to allow the Fair Work Commission to set fair minimum standards to ensure the road transport industry is safe, sustainable and viable. It will help address exploitation in the supply chain. The measure will give the Fair Work Commission the power to set minimum standards for the road transport industry. Standards may be mandatory and enforceable with civil penalties or for guidance only.

Last month I met workers, independent contractors, industry representatives and Transport Workers Union members as part of the convoy to Canberra. I have also appreciated the many union and industry led briefings on industry reform. At the rally outside of parliament, TWU national secretary Michael Kaine was emphatic as to why reform was needed. He talked of the 325 logistics companies that have collapsed over the last year under the strain of uncommercial contracts, unrestrained supply chain pressures and unfair competition from gig models like Amazon Flex. He also spoke of the 132 people that have been killed in crashes on our roads, including 34 truck drivers. A further two transport gig workers have been killed in the last two months. Under these reforms, road transport safety will be taken seriously. The call for this reform has united industry.

The fair work legislation amendment also introduces a new offence of industrial manslaughter whilst significantly increasing the penalties for the existing category 1 offence. This proposal is to implement recommendations of the 2018 Review of the model work health and safety laws which will strengthen the Commonwealth WHS offence and penalty regime by introducing an industrial manslaughter offence and increasing penalties. This will create an industrial manslaughter offence for the Commonwealth work health and safety jurisdiction with penalties of $18 million for a body corporate and 25 years for an individual.

I'm proud to be part of a government that wants a fair go for workers and understands that this is a key underpinning for a community that delivers for all. This comprehensive legislation represents a government that is ready to address the structural loopholes that have continually hurt some of our most vulnerable workers. These reforms provide a foundation for fairness for workers in the gig economy.

In the last year Australia has had the strongest jobs growth in the first year of any Australian government. Half a million jobs have now been created, and 85 per cent of those jobs have been full time. Wages are growing at their fastest rate for a decade. The gender pay gap has fallen to its lowest level ever, and the number of days lost to industrial action has fallen sharply. The sky has not fallen in.

But many Australians are not receiving the full benefit of these changes because of loopholes that allow pay and conditions to be undercut. For these workers, the minimum standards in awards and enterprise agreements are words on a page with little relevance to their daily lives. This legislation critically rebuilds a foundation for fairness in workplace relations, particularly for those most vulnerable. That's why I chose a career in workplace relations before this place: I was committed to fairness in the workplace. I congratulate the Minister for Employment and Workplace Relations for making these changes a priority, the Australian union movement for their powerful advocacy and the Australian Public Service for doing the hard work in terms of consultation and bringing this legislation forward. I commend this legislation to the House.