DAVID SPEERS, HOST: Tony Burke, welcome to the program.
TONY BURKE MP, MINISTER FOR EMPLOYMENT AND WORKPLACE RELATIONS, MINISTER FOR THE ARTS: Happy Father's Day, David.
DAVID SPEERS: And to you, and to all the dads. Look, there are several parts of the legislation you're going to introduce tomorrow on workplace reform. Let's start with criminalising wage theft, the tougher penalties that are being talked about in the papers this morning. How would deliberate underpayment of workers be determined as opposed to accidental underpayment?
BURKE: The same way the courts always deal with intention. At the moment if you intentionally – as a worker – take money from the till, it's a criminal offence, and it should be. But if the employer intentionally withholds money from your pay, it's not a criminal offence.
That's a simple loophole, it should be logically simple to close. I'm surprised it's even been controversial. The objective here is not to send people to gaol, the objective is to make sure that people are paid properly, and so there's a combination of the changes we're making with the prison terms being there, which I do think will sharpen the minds of the very few people who've engaged in this intentionally.
SPEERS: Is there any threat of jail at the moment for wage theft?
BURKE: No. Sorry, in Victoria and Queensland laws exist
SPEERS: At a state level
BURKE: but in the rest of the country, that's not the case, and so it needs to be shut down. But the other thing has been the fines – if you take a case like 7 Eleven which is probably the most celebrated case that people were aware of. The total underpayments across a range of franchises there amounted to $173 million in underpayments. The fine that was applied – less than $2 million.
We don't have a situation where someone robs a bank, and we say, “All you've got to do now is just give the money back and maybe pay one per cent extra on top of it.”
The big shift we're doing with the fines – there’s a shift to the maximum fine, but the big thing is that the fines will now be able to be multiples of what the underpayment was, so you get a direct relationship between how much has been underpaid and what the courts are ultimately able to order, up to three times the amount of the underpayment.
SPEERS: So, in order to find where this is occurring, will your laws make it easier for union delegates to be able to enter workplaces to inspect the books?
BURKE: There's two changes in terms of trying to get to these issues earlier. One of the striking things about the big cases of wage theft that we've seen hasn't just been the quantum, it's been how many years it's gone on before we've got to it, so there's changes both for union delegates and right of entry for union officials.
SPEERS: So what are they?
BURKE: Union delegates already work in the workplace, so they're people who are already employed, and we've got a provision there to be able to have them trained, so that they get some rights to be able to represent their fellow workers, and to also make sure they're trained so you've got someone in the workplace who knows what their rights are.
SPEERS: And would that delegate in the workplace be able to then look at the payroll to see what everybody's getting paid, including non union members?
BURKE: No, it doesn't give them that sort of access. But it allows them, when issues are raised, to be able to help represent people.
The access for union officials goes to what you've raised there, where at the moment the Fair Work Commission has the power to order that someone with a right of entry can visit a workplace without 24 hours' notice. Normally you have to give 24 – in one particular circumstance – which is if they think there's a risk of documents being shredded, or documents being destroyed. In which case, given the 24 hours' notice, by the time you get there, what you're looking for is not there.
The Fair Work Commission already has that power. We're adding one extra ground, which is they'd also be able to do that in cases where the Commission believes there's a risk of underpayment occurring.
The reason for this is sometimes in underpayment cases all the records are impeccable, because, for example, people are clocking off and being told after you've clocked off, you've got to come back and keep working.
The only way you get to uncover and establish that that is in fact happening is if you arrive without the notice, but that would be entirely in the hands of the Commission in granting
SPEERS: So they wouldn't have to suspect documents are going to be destroyed, but they would have to suspect there's some underpayment going on, and then the union official can be granted the right to hold a snap inspection.
BURKE: That's right, with whatever rules the Fair Work Commission applies. There's some restrictions there that we're not changing. There's already a restriction in – I think it's section 483AA or something of the Act, that deals with non union members, we're not changing that at all.
SPEERS: Okay. So would the union official be able to see what everyone's paid including non union members?
BURKE: No, we're not making any change to the rules for non union members, no change for that at all --
SPEERS: If a non union member's worried that a union official's going to come in and see what they're being paid
BURKE: No, that won't happen. I've seen the fear campaign that we were going to change those rules. We're not changing them at all; not at all. That section remains exactly as it already is. There's also been a fear campaign about something about residential premises. There's a ban on right of entry being used for home businesses and residential premises. That remains completely unchanged as well.
SPEERS: Will there be any exemption for small business from this, or will this apply to small business as well?
BURKE: The big shift for small business – what I referred to for the training of delegates, that doesn't apply to small business. Similarly, COSBOA, the small business organisation, asked for there to be a code, so even though we're limiting it to intention, to have a small business code where there's just a document that's produced that says, “If you follow these rules you are guaranteed that you're okay.” We'll be putting in the legislation that that code has to be produced as well for small business, and if they choose to follow it, it's not an extra compliance, they don't have to, but if they choose to use the code as their guide, they're guaranteed that they'll be on the right side of the ledger.
SPEERS: Look, employers sometimes point out one of the reasons for underpayment can be the complexity of all the different award rates that they're meant to be paying different workers; why don't you fix the complexity of the award system, have some simplification. Is that something we can expect any time soon?
BURKE: There's a review of the awards being undertaken by the Fair Work Commission, so that work's being undertaken. But I've got to say, when we're talking about the crime being for intentional wage theft, that's where someone knows the rules; they know exactly what they're doing.
It's the cases where somebody knows that someone is meant to be paid more, and they don't care because they think they can get away with it, and they know that up until now the worse they'll have to do is just pay the money back at a later point in time. Wage theft has nothing to do with complexity. It's about theft.
SPEERS: I don't doubt that it is a serious problem where it's happening. But award complexity is a real thing as well, and some, particularly smaller and medium sized businesses really struggle with this. So you're saying it's entirely up to the Fair Work Commission to sort that out?
BURKE: The Fair Work Ombudsman has been providing support, and that support's increased in terms of
SPEERS: But you're not going to
BURKE: for small business. People often use the term “complexity” as a way of trying to say, can we give workers fewer rights. That part of it I'm not interested in.
SPEERS: Well, sometimes though
BURKE: No, that's
SPEERS: they genuinely are
BURKE: and if you I just said that part. The other part of it is the review that's being undertaken by the Fair Work Commission. That's the appropriate body to do that because they're the ones that ultimately have to make rulings around the awards. We initiated that as part of the agreements with the crossbench last year.
SPEERS: On the gig economy, now you want to give the Fair Work Commission the power to set some minimum standards, including pay. Just explain to us, how would minimum pay for an Uber driver or delivery rider, for example?
BURKE: The starting point here is, at the moment, the Fair Work Commission asks, "Are you an employee?" If you're an employee you've got a whole lot of rights, if you're not an employee all of those rights fall off a cliff. The power that we're giving the Fair Work Commission here is to basically turn that cliff into a ramp, so for people in the gig economy who are considered to be employee like, you can have some minimum standards. Not all the minimum standards that you'd get as an employee, but some, and rate of pay is probably one of the key examples.
It’d be for the Commission to work out what was the appropriate way to do it for each different form of
SPEERS: How would you envisage that working, because
BURKE: It's reasonable to presume that you wouldn't be able to do it through an hourly rate for jobs that happen for 15 minutes, or ten minutes sometimes, or even a briefer period of time. It's reasonable to presume that for a delivery rider, for example, they might do something like a per five minute or per minute rate or something like that.
SPEERS: But only when they're actually doing a delivery, they're not going to be paid when there's no work in that hour?
BURKE: You couldn't possibly pay someone just for being on an app. Remember, most of these delivery riders will be on two to four apps at the same time. If you're being paid just for being on the app, it would effectively break the technology.
SPEERS: So a minimum, for example, five minute payment for delivering the food?
BURKE: That's the sort of concept that is how the Fair Work Commission would ultimately make these decisions.
SPEERS: If they're still being paid per delivery though, that's not going to get around the problem of them racing around, taking risks to do as many jobs as they can during those couple of hours they're working?
BURKE: There is no doubt, when people are ultimately receiving really low wages, then making ends meet is tougher, and that puts extra pressure on you to take risk.
SPEERS: And that risk will be there still.
BURKE: Every rider – sorry. Every driver has seen what's happening with people running red lights, with people forming an extra lane between the parked cars and the traffic, knowing at any moment if a car door opens, instead of riding between the cars, you're lying along beside them. This is real. Riders have spoken to me about it, and they say quite specifically that part of the desperation is, you're just not earning enough to make ends meet. Now
SPEERS: So apart from pay, what about minimum standards on superannuation, or even annual leave?
BURKE: Leave entitlements are harder to work out when you're working on multiple apps. It's possible the Commission could. You could end up with systems where you have portable entitlements or something like that. Anything like that would be a long way coming
SPEERS: What about super?
BURKE: Superannuation would be something they’d possibly be able to work through.
SPEERS: That could be a significant extra cost then
BURKE: And we
SPEERS: -- at 11 per cent
BURKE: If you look at the rates of pay, the Victorian Government a few years ago actually made an assessment of what's the difference between what these individuals would be getting as employees to what they're getting now. That inquiry came out saying it's roughly between $3 to $4 an hour difference, which to us might not sound like a lot, but when you're on those base rates of pay, that's a really significant amount of money.
SPEERS: But bottom line, you don't really know at the moment, it would be up to the Commission to decide if pay increases, if they then get super, if they then get some leave entitlement as well. It could be more than just the tiny bit extra that you've talked about.
BURKE: Certainly it can't be anything that interferes with the nature of the engagement. That's why overtime wouldn't work, that's why rostering wouldn't work. But if you do the maths on the difference being something in the order of $3 to $4 an hour, you know that people do between four to six deliveries in an hour usually. You can do the maths pretty quickly, it makes a huge difference to them, but is a very modest difference to someone. It’s a smaller difference than whether you add anchovies to your pizza.
SPEERS: Alright. What about in the care economy. You've said these changes will capture the disability care site Mable, but not sites like Airtasker used predominantly by tradies. But some aged care and disability service providers also use Airtasker. What makes that different to Mable?
BURKE: The difference isn't based on the title, the difference is based, and the test is done on the workers. This is what I explained later on in the question time at the National Press Club.
SPEERS: But they're often the same workers using both sites.
BURKE: No, that's what I'm saying.
BURKE: It's not that Airtasker itself has some magic exemption, it's most of what we understand to be Airtasker in terms of tradies, in terms of the people you'll get to fix stuff around your house. I've often used the site myself. That sort of work wouldn't satisfy the test to be employee like. It's three things that you need to satisfy to be employee like – that the Commission will looking at in working out. They'll look at whether or not you have low control over your work, they'll look at whether or not you have low bargaining power, and they'll look at whether or not you're being paid less than what you would be paid if you're an employee
BURKE: That does apply
SPEERS: Just to be clear
BURKE: to the care economy, so
SPEERS: So if you're providing cleaning or
BURKE: If they make a ruling about the care economy, would that apply to someone who is care economy under Airtasker? Yes, of course it would.
BURKE: But most of the jobs that people use Airtasker for are effectively like the Trading Post. You wouldn't be table to suddenly do the exact same work for a lower pay and undercut by hopping under a different platform. The decision’s to be made
SPEERS: But it is a little confusing
BURKE: about the workforce.
SPEERS: So if you were booking someone on Airtasker under the NDIS to do cleaning in your house, for example, gardening, that could have minimum standards applied, but if you're booking them to trim the hedges, that wouldn't attract those minimum standards?
BURKE: If you look at the test, the minimum standards where it's pretty clear you'd be able to be in are food delivery, ride share, and the work that's being done in the care economy.
SPEERS: But does that include cleaning
BURKE: I find it hard to see that people in those sorts of businesses -- where you just look at the way they're structured, I find it hard to believe that they would be covered here.
SPEERS: So some of those who advertise on Airtasker for cleaning services for aged care or disability care recipients, they're out.
BURKE: The question is, do you satisfy those three? Do you satisfy those three examples?
SPEERS: And do they?
BURKE: It's not impossible for the Commission to look at a situation where someone's giving cleaning services and it becomes standard across platforms that cleaning services people are only being paid $10 an hour, to be able to say, “We need to get in there and”
SPEERS: Okay, sorry, just checking, for cleaning services then, in or out of this new minimum standard
BURKE: The issue goes to whether the workers for minimum standards have any of those three characteristics. Now
SPEERS: And do cleaners?
BURKE: Most cleaning services that you'll see on Airtasker, particularly, or any of those different platforms, pay well above what they're being paid as an employee.
SPEERS: Okay, so they're not going to be applying minimum standards.
BURKE: You don't need minimum standards if you're already being paid more than what the minimum would be if you're an employee.
SPEERS: All right. So, okay, just
BURKE: The problem we've got at the moment, David, and let's just get back to the actual problem we're trying to solve
SPEERS: I'm trying to get to a specific answer here, for a cleaner who's on the Mable platform or the Airtasker platform, they're fine, they're not going to have these minimum standards applied?
BURKE: The test is are they being paid less there than they’d get if they were an employee.
BURKE: If they're being paid less than what Australia has already decided are the minimum standards we need to have, then the Fair Work Commission would have the power to be able to say, “We're going to put some minimum standards here too.”
We don't want to become a nation where you have to rely on tips to make ends meet.
BURKE: That's where, for all of these different examples you can give, you go through them and simply ask, “If someone was an employee there would be minimum standards, is this something on top of that, or is it seriously undercutting it?” If it's undercutting it, we need to act, because Australia should be a nation where minimum standards apply.
SPEERS: Alright. Just quickly, a couple of things: the right to disconnect some unions have talked about this the right to turn off your phone and not answer calls and emails from work once you've clocked off. You've expressed some support for this over the recent months. Is that going to be in the Bill or not?
BURKE: No, it won't be in the Bill. Conceptually I’m interested in it. Obviously an employer needs to be able to call if they're looking for somebody, if there's a shift, someone's sick, things like that. But this concept where some people are constantly expected to be answering emails, answering questions when they're not being paid, I've got a bit of sympathy for the argument.
SPEERS: Okay. So not in this Bill. On the process here we had Allegra Spender on the program last year worried about last week worried about how much time Parliament will have to consider this, how much time will Parliament get?
BURKE: We'll have a full four weeks of debate in the House of Representatives before we send it to the Senate. I'll be introducing it tomorrow, the debate will then start on the Tuesday after the parties have had their chance to have their party room processes, and then the Senate obviously, it's in their hands. But we don't need to get it to the Senate until we've had our full four weeks.
SPEERS: Okay. And just finally, business worried this is going to hurt jobs, it's going to drive up costs. Is there any analysis that you've done around that, the whole package I'm talking about what impact there will be on cost and jobs.
BURKE: Yeah, so the full Regulation Impact Statement's attached as a separate document at the
SPEERS: And what does that say?
BURKE: back of the Bill. The impact is really minor, and here's why
SPEERS: Positive or negative.
BURKE: Here's why. Really minor. There are some people who will have to pay more, yeah, there are. But the reason it's a minor impact is all we're talking about is closing loopholes where we already have a standard. We have a standard for what people should be paid. Wage theft is when that's being undercut. We have standards in award systems for employees. But the gig economy is undercutting that.
SPEERS: So higher priced
BURKE: The hire loophole, the labour hire loophole is where people are being paid less than the enterprise agreement rate that has been agreed to. All this Bill does is says, when we already have standards in place, you shouldn't be able to undercut them.
SPEERS: Okay. And the impact on jobs?
BURKE: The impact on jobs will be positive.
SPEERS: Okay. Tony Burke, thank you for joining.
BURKE: Great to talk.