SOCIAL SECURITY LEGISLATION AMENDMENT
(WORK FOR THE DOLE) BILL 1997
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CHAPTER 3 - POTENTIAL DISPLACEMENT OF EMPLOYED PEOPLE
3.59 Although the criteria for project selection, as noted above, include
projects that represent additional work and do not displace existing or
planned activities, and projects that represent additional jobs and do
not displace existing workers, some organisations still expressed concern
at the potential for sponsoring organisations to use participants in the
Work for the Dole scheme to either displace existing workers or subsist
for employees or contractors that may be taken on in the future. There
was a perceived risk that the scheme could provide a cheap, alternative
form of labour. Reference was made to experience with overseas programs
which had either displaced paid jobs or made it more difficult to create
paid positions. [80] Claims were made
in evidence of direct experience of displacement having occurred in Victoria.
It was alleged that following the downsizing of organisations and the
reform of local government, full-time employees were put off only to be
replaced with participants from labour market programs. [81]
3.60 ACROD believed it was likely that the kinds of jobs in industry
that may be designated as Work for the Dole positions could be the same
kinds of jobs that agencies target for people with disabilities. ACROD
was concerned that `there is a risk that these positions may be permanently
removed as vacancies from within the labour market as employers refill
the position with a new work for the dole person each time the position
becomes vacant'. [82] Concerns were
also raised at the scheme's potential to affect many part-time, permanent
part-time and casual employees and that existing volunteer workers could
be displaced by work for the dole participants. [83]
3.61 A number of groups proposed similar measures to ensure displacement
would not occur. They suggested that criteria for the selection of projects
should include potential sponsors providing an assurance or demonstrating
that no existing paid employee would be at risk as a result of the project.
There should also be a provision to ensure that the participants in the
project would be `additional' to permanent members of staff and that the
project may not have occurred if not for the Work for the Dole scheme.
Regular project monitoring should occur with the provision to renegotiate,
terminate or not renew the contracts of projects found engaging in the
practice of displacement. [84]
3.62 However, it was DEETYA's contention that displacement of existing
workers would not be a major issue with regard to work for the dole. Previous
experience with funded programs had shown that `if the program is in the
private sector, the issue of displacement is one that has to be monitored
and carefully watchedHowever, with regard to the community sector, our
experience has been that displacement does not occur'. [85]
3.63 DEETYA was adamant that `there is no potential for this initiative
to displace existing paid employment' and allayed the concerns which had
been expressed to the Committee by stating `projects that are selected
will need to demonstrate that no displacement of existing paid employment
will occur'. [86]
Access to superannuation entitlements, workers' compensation, occupational
health and safety and industrial relations protections
3.64 The specific exclusion provision in the Bill that participation
in the Work for the Dole scheme would not give rise to an employer/employee
relationship for the purpose of various Commonwealth legislation provoked
a mixed response, even though participants would have access to protection
in respect to occupational health and safety, compensation and related
issues provided by the Commonwealth.
3.65 ACOSS claimed that by not providing participants with the benefits
and protections of employment through the denial of an employer/employee
relationship, both participants and potential supervisors of participants
could be opened to considerable risk and disadvantage. [87]
Others argued that the community has an obligation to protect participants
in community work in respect of normal measures such as compensation against
injury, health and safety protection, and industrial rights and that alienation
of participants from these basic industrial protections was not likely
to engender a positive attitude towards work. [88]
AYPAC submitted that young people's health and safety could be jeopardised
by excluding them from basic worker conditions and protections. [89]
3.66 ACOSS referred to previous labour market programs in which government
had offered participants personal accident and injury insurance, and claimed
that these programs had demonstrated that such policies were insufficient.
ACOSS advocated that if the scheme proceeds the Government `must ensure
that all participants are adequately insured, [requiring] the stipulation
of a satisfactory minimum standard of insurance to be taken out for all
participants'. [90]
3.67 Reference was also made to experience with previous labour market
programs (of which Work for the Dole is not) which found that the refusal
to recognise the relationship between sponsor organisation and participant
as an employer/employee relationship was open to challenge under common
law. The Committee was informed that several program participants injured
while undertaking work experience under a previous program had sought
legal advice on their employment status with the intention of gaining
access to workers' compensation. Departmental negotiations were held with
State and Territory Work Cover Authorities to determine if participants
were entitled to workers compensation under various State and Territory
legislation. The status of certain program participants under some jurisdictions
was apparently never fully resolved. It was claimed that the Work for
the Dole scheme as currently envisaged would be open to similar uncertainty.
[91]
3.68 The question of whether unemployed people involved in programs akin
to Work for the Dole would be regarded at common law as being employees
was discussed at some length by Mr David Thompson, CEO, National Skillshare.
The question is crucial for such participants in determining whether they
are entitled to the benefits of industrial award coverage and workers
compensation coverage. Mr Thompson referred to advice from Mr Richard
Tracey QC which indicated that it was highly likely that participants
in unpaid work experience undertaken by Skillshare would be regarded as
employees of the organisation providing the work experience placement.
Mr Tracey advised Skillshare that the best solution `would be the passing
of uniform State and Federal legislation which defined the status of trainees
and made provision exclusively and exhaustively for the mutual rights
and liabilities of the trainees and the companies which provide them with
placements'. Mr Thompson added that the problems associated with the legal
uncertainty in this area have existed for many years. [92]
3.69 In relation to the Work for the Dole scheme, Mr Thompson asserted
that, other than for unemployed people engaged in unpaid work experience
as an adjunct to training programs, it was likely that participants `will
be regarded for the purposes of, inter alia, State/Territory Workers'
Compensation and industrial relations legislation, as being employees'.
[93]
3.70 DEETYA advised the Committee that the legislation had been drafted
to ensure that participation in Work for the Dole did not create an employment
relationship at common law and that advice from the Attorney-General's
Department supported this interpretation. [94]
In addition, the Government intends seeking at Ministerial level the States
and Territories' support to amend their legislation to ensure consistency
with the proposed Commonwealth legislation. A successful outcome to this
process would appear to overcome the concerns raised by Mr Thompson and
others. It is therefore crucial that the States and Territories support
the Commonwealth's approach to amend their legislation.
3.71 There was also strong support from some organisations for the decision
not to establish an employer/employee relationship within the scheme.
The Shoalhaven Area Consultative Committee wrote:
It is our view that the scheme does not and should not establish
an employee/employer relationship. Therefore issues such as superannuation
and industrial relations protections do not apply. Workers compensation
in relation to income support can be addressed via appropriate public
liability insurance. OH&S issues remain a shared responsibility
between the Sponsor, Service Provider and the Participant. Relevant
and timely training is required to address this issue. [95]
3.72 The Australian Local Government Association also supported the development
of mechanisms to ensure that participating Councils would not be liable
for employer/employee responsibilities for the purposes of the relevant
Commonwealth legislation. However, as many of the employees in local government
operate under State legislation, ALGA stressed the need to ensure that
the arrangements apply under State jurisdiction. [96]
3.73 The Government has recognised a responsibility for protection for
all participants in Work for the Dole projects, but not as employees.
This is because it is not appropriate for the Commonwealth, nor any other
body to be an employer in these circumstances. Participants are unemployed
people supported not paid by the Commonwealth. [97]
3.74 DEETYA has confirmed that while the participants are not employees,
they would still have the right to protection in respect of occupational
health and safety, and compensation and related issues. This will be covered
by insurance that the Commonwealth will organise and fund, in a similar
fashion to the coverage currently available for participants of nominated
labour market programs. Project sponsors will also be required to be covered
by public liability insurance and will be responsible for occupational
health and safety issues involved in any project. This will cover any
essential training in occupational, health and safety matters, training
in the skills necessary for performing the jobs involved and clothing
and footwear that might be required in the pilot projects. [98]
3.75 DEETYA gave very firm commitments in relation to the protection
of participants in the pilot projects. In noting that the legislation
provides that a person would not be required to participate in a project
that would involve them performing work which would constitute a risk
to personal health or safety or would contravene any Commonwealth, State
or Territory occupational health and safety law, DEETYA gave the following
undertakings:
we will not contract with any organisation to manage a work for
the dole project if they are not prepared to sign a contract which duplicates
that statutorily based requirement into a practical effect in terms
of how the project is managed and, in particular, that they give some
induction training involving some basic occupational health and safety
relevant to the work that they are asking participants to undertake
as part of conducting the project.
clearly in monitoring the projects and the department intends
to monitor these projects as it does all its other contracts with provider
organisations we would of course seek to withdraw from any contract
where there were clearly contraventions of these sorts of provisions
through the conduct of the project. [99]
Outcome measurement and scheme evaluation
3.76 Organisations proposed that there needs to be a clear understanding
of the goals and objectives of the Work for the Dole scheme before appropriate
outcome indicators can be developed to objectively evaluate the progress
and outcomes of the scheme. Indicators should relate to all aspects of
the scheme, addressing success from the job seeker, employer, community
and government perspectives. [100]
3.77 A range of outcome indicators were suggested by a number of organisations,
including the scheme's ability to link young people with jobs an employment
outcome, the extent of workplace training or experience which is of value
in the labour market, task outputs of community benefit, aspects of personal
development and the level of administrative time and costs to ensure effective
use of resources. Proposed timeframes for evaluation varied from an initial
3 month review, with longer projects having quarterly review. Participants
should be followed up 6, 12, and 18 months after completing their participation
to effectively evaluate the longer term implications for the job seeker.
It was also suggested that evaluation against a control group of unemployed
young people not participating in the scheme would provide valuable outcome
information. [101]
3.78 DEETYA confirmed that an agreed set of outcome indicators by which
success of the scheme would be measured will be based on the scheme's
objectives which have been described earlier and are listed in Appendix
3. DEETYA advised that the evaluation will be developed in two stages.
Stage 1 in late 1997 to early 1998 will `help identify the best way to
administer the scheme and the extent to which the scheme should be expanded
beyond the pilot stage, including the scope for expansion into different
regions and across different categories'. Stage 2 will be `a more rigorous
assessment of the effectiveness of the pilot projects' with results available
by the end of 1998. [102] The second
stage will include a survey of participants three months after they have
completed the projects. Evaluation reports from both stages will be made
public.
Need for a `sunset' clause
3.79 Comments in relation to the need for a `sunset' clause were closely
linked to the evaluation of the scheme. The contention was that because
the scheme was a trial or pilot project, this should be reflected in the
legislation. AYPAC summed up this argument when it wrote that:
a pilot project, by definition, is a limited initiative that
is designed to trial a methodology or concept. Work for the dole should
not be enacted as an open-ended program; its effectiveness in meeting
its objectives should be evaluated and analysed before a decision is
made to implement the scheme on an on-going basis and/or expanded to
a larger portion of the unemployed.
A sunset clause allows Parliament to review its decision vis-a-vis
work for the dole after it has had an opportunity to operate for a specified
period and be evaluated. AYPAC supports this oversight responsibility
and believes it provides a valuable mechanism for review. [103]
3.79 DEETYA used the process of evaluation argument to reach a different
conclusion, advising the Committee that any decision to extend the scheme
would depend upon the results of Stage 1 of the evaluation which would
be considered in the 1998-99 Budget context. `Therefore a “sunset
clause” is not required' concluded DEETYA. [104]
4. RECOMMENDATION
4.1 The Committee reports to the Senate that it has considered the Social
Security Legislation Amendment (Work for the Dole) Bill 1997 and RECOMMENDS
that the Bill proceed.
Senator Sue Knowles
Chairman
June 1997
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Footnotes:
[80] Submission No.7, p.7 (BUYT); Submission
No.19, pp.2, 10 (MET); Submission No.33, p.5 (MCC).
[81] Transcript of Evidence 18.4.97,
p.165 (Mr L Hubbard, Victorian Trades Hall Council).
[82] Submission No.25, p.1 (ACROD).
[83] Transcript of Evidence 18.4.97,
p.162 (Mr D Cochrane, Australian Services Union); Submission No.24, p.15
(ACOSS); Submission No.11, p.18 (ACSWC).
[84] Submission No.5, p.4 (SACC); Submission
No.7, p.7 (BUYT); Submission No.18, p.4 (The Salvation Army); Submission
No.24, pp.19-20 (ACOSS); Submission No.28, p.6 (Mission Australia); Submission
No.40, p.4 (ACTU); Transcript of Evidence 18.4.97, p.138 (BSL and
Anglicare).
[85] Transcript of Evidence 7.5.97,
p.2 (DEETYA).
[86] Submission No.34, p.8 (DEETYA).
[87] Submission No.24, p.15 (ACOSS).
[88] Submission No.18, p.3 (The Salvation Army);
Submission No.20, p.4 (Anglicare); Submission No.30, p.4 (LCLC).
[89] Submission No.27, p. (AYPAC).
[90] Submission No.24, p.16 (ACOSS).
[91] Submission No.24, p.16 (ACOSS); Submission
No.28, p.4 (Mission Australia).
[92] Transcript of Evidence 18.4.97,
pp.152-156 and Submission No.35 (National Skillshare). The Tracey opinion
is attached to the Skillshare submission.
[93] Submission No.35, p.1 (Skillshare).
[94] Transcript of Evidence 7.5.97,
pp.2, 12 (DEETYA).
[95] Submission No.5, p.3 (SACC).
[96] Submission No.13, p.2 (ALGA).
[97] Submission No.34, p.3 (DEETYA).
[98] Submission No.34, p.7 (DEETYA); Transcript
of Evidence 7.5.97, pp.2-3 (DEETYA).
[99] Transcript of Evidence 7.5.97,
pp.5-6 (DEETYA).
[100] Submission No.18, p.4 (The Salvation
Army); Submission No.24, p.20 (ACOSS); Submission No.27, p.8 (AYPAC);
Submission No.28, p.6 (Mission Australia).
[101] Submission No.5, p.5 (SACC); Submission
No.9, p.3 (NQJB); Submission No.15, p.4 (YACVic); Submission No.20, p.5
(Anglicare); Submission No.26, p10 (WRC); Submission No.30, pp.5-6 (LCLC).
[102] Submission No.34, p.9 (DEETYA).
[103] Submission No.27, pp.8-9; see also Submission
No.18, p.4 (The Salvation Army); Submission No.24, p.21 (ACOSS).
[104] Submission No.34, p.9 (DEETYA).