Chifley Research Centre Conference Speech
SUBJECTS: Family and Domestic Violence Leave, Secure Jobs Better Pay Bill, the year ahead, Mantle Group, closing loopholes.
THE HON TONY BURKE MP, MINISTER FOR EMPLOYMENT AND WORKPLACE RELATIONS, MINISTER FOR THE ARTS: Thanks very much to John for a very generous introduction and thank you to David Epstein who we were just working out that we've known each other for 30 years now. But thank you for the invitation to be here and I'm pleased to join you all on the lands of the Ngunnawal people and acknowledging Elders past and present.
It's actually surprising that we're here. You might remember at the end of last year we were told by Michaelia Cash that if the Secure Jobs Better Pay Bill was passed, it would close down Australia. What's more, we were warned by the member for Mallee, Anne Webster, that the Bill risked burning down the Australian economy with this industry-wide bargaining and after that, the unions will rule over the ashes. It's no wonder that they aren't worried about climate change. The apocalypse, apparently, is already upon us.
For all the hysteria that we had last year, there'll be plenty more this year, plenty more this year. Because effectively, in workplace relations, the two-year strategy works this way. Last year, what we did was start to raise the bar – raise the bar on awards, raise the bar on enterprise agreements, raise the bar on bargaining, lift the floor for workforces. This year, it's about closing the loopholes that some businesses use to undercut those arrangements.
What I want to take you through today, in the workplace relations area – there’s some interaction with the arts as well – is take you through what those loopholes are, how they've been used over the years, how for some they have become a complete business model, and to give you a sense, effectively, of the narrative of what we did last year with Secure Jobs Better Pay, and the project this year in closing loopholes.
In terms of last year, if I deal separately with what we did with awards and what we did with bargaining. First of all, while it won't affect massive numbers of people, I think the most substantial change we made last year in terms of improving people's entitlements with respect to awards is something that took effect during the course of last week, and that's the Family and Domestic Violence Leave.
The simplicity of the principle that nobody should ever have to choose between safety and pay should not be a complex principle. It is the perfect example of a campaign that began at the grassroots, was taken up by the trade union movement, found its way into Labor policy and then became the first piece of workplace relations legislation introduced under a new Labor Government. It's a perfect example of that. It will - there are, when somebody is making a decision that they need to get out and often that they need to look after dependents to get them out as well, there are already so many pressures making that decision part of it. We have removed one. We have removed one of those pressures, and while the principle that you should not have to choose between safety and pay should not be controversial, not only did it take the Labor Government for this to be dealt with in Australia. But what we have done is world-leading and world-leading on something where the first workplace to do it was done at Surf Coast Council in negotiations with their union, where the mayor was Libby Coker, who's now the member for Corangamite, a Labor Member of Parliament.
These sorts of reforms will help so many people. So I wanted to start with that in terms of awards. We've made many more impacts on awards than that. Obviously, the decision that was made during the election campaign, when then, as we then knew him, Anthony Albanese answered that one word, "absolutely", with respect to whether or not the lowest paid workers should be protected from going backwards in the annual wage review caused the new Government to make a submission which the previous government never would have made. In fact, they argued at the time that it was deeply irresponsible for a government to care that the lowest paid in Australia should not go backwards.
We then made the submission to the aged care inquiry, once again a submission that would not have been made had there not been a change in government. In the Secure Jobs Better Pay Bill, while most of the arguments were about the changes in bargaining laws, two changes to awards will have a lasting impact. The first is that job security is now an objective of the modern awards. When the review of modern awards takes place that I've committed to, the commission will have to be looking at the awards and asking, now there's a new objective, to what extent do they deliver on job security? We've always had to take flexibility into account. Now job security stands alongside it.
Gender equality has never been an objective. A large part, not the whole story, but a large part of the gender pay gap has been the presumptions of what work value is that has fed its way into the award system. Having gender equality there as an objective that must be met will feed into the review that's conducted of the awards. You can't have a situation where the awards were established without these two objectives of gender equality and job security, do a review without having to check - where do we now need to bring them up to date?
It will make a really significant difference, but a whole lot of people, a whole lot of workers, will see those changes to the award system and it will be nothing to do with their workplace. Because one of the loopholes that has arisen over the years, is we've gone to a system where if you meet the definition of the employee-employer relationship, a whole lot of rights are assigned to you - I'd argue not enough - but a whole lot of rights are assigned to you. If you fail to meet that first test, all of those rights fall off a cliff.
They fall off a cliff, in particular, in an industry like road transport, setting standards in road transport can be about survival. Survival of transport workers whose workplace is the road, survival of families who share those roads, and survival of an industry integral to our economy. In all corners of the industry, unregulated supply chain pressures and the seismic insurgents of the gig economy have caused the perfect storm, which is taking lives, jobs, and businesses. We've had too many stories of horror from every sector of transport where cost-cutting and unrealistic deadlines have gone unchecked. Whether it's the fire fuel tanker crash in Mona Vale caused by only two of twelve brakes that were operational, two people killed, the out-of-control Cleanaway garbage truck on the South Eastern Freeway, also with faulty brakes and driven by someone who wasn't properly trained, two people killed. Since 2017, in the food delivery industry, eleven riders killed. Eleven people, including two truck drivers killed in the last two weeks.
Because in that industry, there's often a situation, not always, but often a situation of we don't have an employment relationship. A whole lot of principles that would otherwise be there, fall off that cliff. What we're aiming to do this year is to turn that cliff into a ramp. Some people have said, well, why can't you just make everyone an employee? That doesn't work and often it's not what the workers themselves want. Often people want some of the ways in which these industries work in terms of being able to dip in and dip out at different points. There are – I’m not pretending there aren’t – people across the board who want more secure jobs than they can currently get. Absolutely, that's true, and we are delivering on that - but we also don't want to fall into the trap of pretending that everybody who is not an employee wants to be an employee. That decision, though, should not mean we accept the current circumstances where if they don't want to be an employee, somehow, they're volunteering for no rights at all.
I never again want it to be a situation where the hardest question that can be asked of a Prime Minister during a debate was the question that was asked of Scott Morrison by Anthony Albanese when he said, "Shouldn't any worker, shouldn't every worker be paid at least the minimum wage?" That should not have been a hard question to answer, and yet it was the one that completely stumped Scott Morrison, both during the debates, during the election campaign, and in the Parliament. His previous ministers got to the point of saying, "Oh, well, it's complicated."
There are many reasons why people want different levels of flexibility in non-employee circumstances. Nobody makes that decision because they are yearning to be paid less than the minimum wage. So we will be expanding the capacity of the Fair Work Commission to close that loophole. To close the loophole that awards that are meant to set minimum standards, somehow create a situation where if you're not an employee in an employee relationship, there are no need for any minimum standards at all. The Commission has the flexibility then to be able, for example, with the gig economy, to set minimum standards to make sure that we don't have a complete race to the bottom, to be able to close that loophole.
Because there is a direct line between the food delivery rider who is receiving sometimes as little as $10 an hour, when the minimum rate is much more than double that, if you're in a permanent job, casual rate, you're looking at more than triple, which is effectively what they're working. When a food delivery rider is earning as little as $10 an hour, there is a direct line between the rate of pay and the risks they are taking on the road. If you have to race to make ends meet, you run red lights to make ends meet. You drive between lanes of traffic to make ends meet, with every kilometre knowing that at any moment, if someone opens their door on you, instead of riding between the lines, you are lying along them. This has been allowed to emerge in a way that I'm not critical of the concept of the industry. I use the various Uber and different apps. I just don't mind the concept of paying enough so that people have some minimum standards and some minimum rates. I will say I'm very pleased with the discussions that have been happening with the providers, the platforms themselves, in terms of constructively engaging with government to work this through. One company decided they didn't want to engage constructively. They have now left Australia. That's on them. That's on them. I don't particularly want to put out the welcome mat for businesses that believe their business model can only work if there are no minimum standards.
Similarly, if we talk about the gig economy, we also talk about gigs, and for people who are arts workers, they have a different set of challenges. Often, even if there is an employment relationship, the employment relationship is intermittent. It's the way so many of them ended up being excluded from JobKeeper – that they will move from workplace to workplace. The challenge often in terms of safety for arts workers has been the threat, if you kick up a fuss about harassment, about bullying, you will never work again. That's why in the cultural policy we've established, or will be establishing by legislation, the Centre for Arts and Entertainment Workplaces, so we can set minimum standards together in a tripartite way with workers and industry, set minimum standards and for businesses that choose to not meet the minimum standards of safety, don't come knocking on the door for government grants. Don't come knocking on the door for government assistance. The very least arts workers can expect is to be treated with the dignity of being workers.
But it's not only in the undercutting of awards that we are seeing circumstances where there are loopholes. The second sort of loopholes I want to refer to go to how people have tried to gain enterprise bargaining. There's been a bit in the media about the Mantle Group. I've been waiting for someone to ask me to comment on the Mantle Group. No one has. Here I am.
You'll be aware the Mantle Group is a major hospitality employer with venues in Brisbane and Sydney. They have workers now in Secure Jobs Better Pay. One of the things we did was get rid of the zombie agreements. These are enterprise agreements in AWA, some from the Howard era, which still existed and which people were still being employed under. The Mantle Group had workers still covered by a zombie agreement that had started in 1999 with no penalty rates. It took an employee with the support of the United Workers Union to apply to terminate the agreement in 2022. Mantle Group had been enjoying a massive windfall not having to pay penalty rates for 22 years. In one of the most scathing Fair Work Commission decisions I've ever read, Commissioner Hunt confirmed that, and I quote, "the effect of this employer having the benefit of an agreement made in 1999 without the payment to employees at penalty rates, at least in the last decade, is a disgrace." It went on to say, "I consider it necessary for a light to be shone on these kinds of archaic arrangements." Secure Jobs Better Pay means that the automatic sunsetting of zombie agreements like Mantle is now law.
Unfortunately, what did Mantle then do, seeing that this loophole had been closed? In applying to have what the replacement enterprise agreement might be and should be approved, Mantle Group relied upon a new genuine agreement that they put forward. The genuine agreement was between the company and four highly paid managers who approved the agreement, none of whom would ultimately be covered by the agreement. This replacement enterprise agreement: Hot Wok Food Makers saw workers not receiving penalty rates for voluntary additional hours worked. Its approval by the Commission was based on the so-called genuine agreement of four senior employees in the statutory declaration of the HR Manager. The end of this probably won't be the end, but the next chapter of this sorry saga is that the HR Manager has now been referred to the Australian Federal Police for possible criminal prosecution after the Fair Work Commission found he deliberately provided false or misleading information.
If the Mantle Group treated their food the way they have treated their workers, the Health Department would have shut them down years ago. They are proof that closing loopholes will not simply be a job for this year, that some businesses have decided their entire business model will rely on finding the next loophole. But the principal loophole that needs to be shut down this year is where you have an agreement in place, which gives employees an above award payment. The employer has agreed to it, is part of it, it’s law, and then the employer simply says, "I'll get a labour hire firm in, different employer, and those workers can go back to the award", and the entire agreement that had been made no longer matters. You end up with the same workers doing the same job for technically different employers, and therefore for radically different rates of pay. The loophole needs to be closed. It'll be closed this year.
What we did last year in raising the floor – raising the floor on how the minimum wage is assessed, raising the floor on the award system, raising the floor of what bargaining will mean, only works if we also act to close the loopholes that take so many low-paid workers out of the award system completely and that allow labour hire to be used for an illegitimate purpose. Not its legitimate purpose of a specialised staff or a surge workforce, which is completely reasonable. Labour hire and outsourcing should never be used where the pure objective is to undercut the rate of pay at the workplace. We need to do these things if we are to be able to get wages moving. As I said, with Mantle, groups will then try for the next loophole. But there is a change now in how we deal with workplace relations in this country.
For years, there have been thrilling pieces of legislation called the Tax Law Amendment Bill number 1, 2, 3, 4, sometimes straight to 8. These pieces of legislation are principally to protect Government revenue. There'll be a court case, there'll be a new loophole that hits the revenue of Government and so we take legal action in the Parliament to change the law to close the loophole. As long as I've been in the Parliament, we have done that to protect the revenue of Government. We now have a Government determined to do the same to protect the revenue of every Australian worker. We now have a Government where we don't only close the loopholes that affect how much money comes into Treasury, but where we close the loopholes that affects how much money goes into the bank account of every worker in Australia.