Coalition Senators' dissenting report
Contents
Background The Inquiry Process Wage Growth Productivity The Impacts on the Mining States Competitive Tendering Impacts on Women The Bill Independent Contractors The Fair Work Legislation Amendment (Closing Loopholes No. 2) Bill 2023 Casuals Road Transport The secret competition law loophole created by the Labor-TWU bill Gig Economy The Cost & Flawed Economic Modelling (RIS) The Government’s Amendments Labor-Green amendments to ‘intractable bargaining’ Conclusion
1.1The Fair Work Legislation Amendment (Closing Loopholes) Bill 2023 was introduced in the House of Representatives on 4 September 2023, and referred to the Senate Education and Employment Legislation Committee on 7September 2023, with a report due on 1 February 2024.
1.2On 7 December 2023, the Government with the support of crossbench Senators, Lambie, Pocock, Thorpe, and Tyrrell, split the Fair Work Legislation Amendment (Closing Loopholes) Bill 2023 into two parts. The second bill is titled the Fair Work Legislation Amendment (Closing Loopholes No.2) Bill 2023.
1.3The Fair Work Legislation Amendment (Closing Loopholes) Bill 2023 waspassed by the Senate on 7 December 2023. The House of Representatives agreed to 20Senate amendments on the same day.
1.4Coalition Senators did not support the original Fair Work Legislation Amendment (Closing Loopholes) Bill 2023 (Bill).
1.5Whilst we support the non-contentious aspects of the original bill including the anti-discrimination measures, work, health and safety measures, presumptive legations relating to post traumatic stress disorder, and changes to the small business redundancy exemption in insolvency situations, we were unable to support the Bill as a whole as it contained new powers for the Fair Work Commission (FWC) to make ‘same job same pay’ orders for labour hire workers, new workplace delegate rights and protections, and loosened right of entry rules for union officials.
1.6In the lead up to the 2019 federal election, and again during the 2022 federal election, the Australian Labor Party made various claims about the industrial relations changes it would seek to introduce should it be elected to government.
1.7After the Australian people rejected Bill Shorten’s radical agenda at the 2019 election, Mr Albanese rarely talked about industrial relations issues during the election campaign.
1.8Following its election in May 2022, later that year, the Albanese government passed its Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022. This first tranche of radical industrial relations laws flagged the Government's true intent for industrial relations policy in this country.
1.9Not only would the Government go beyond what it had previously flagged, it became apparent that its real underlying motivation was to strengthen trade union involvement in the Australian workplace, regardless of the wishes of either the business or its workforce. This was highlighted by the multi-employer bargaining and single stream provisions included in that bill, which were never part of the Government’s election policy, and which ignored the loud warnings of many stakeholders of the ramifications to the economy should that bill pass.
1.10The first proper indication of the Government's second tranche of industrial relations changes came when the Minister for Employment and Workplace Relations, the Hon Tony Burke MP, gave an address to the National Press Club on 31 August 2023.
1.11The Minister was light on detail and sought to portray the upcoming changes in the Bill as ‘industrial relations housekeeping’.
1.12In a speech delivered in a manner that sought to belie the damaging caveats contained in the Bill, crucially Mr Burke did not detail the cost impact of the Bill and mentioned ‘trade unions’ only once. In doing so the Minister neglected to highlight the expansionist power this Bill gave to the trade union movement.
1.13Playing down the impact of the Bill at the Press Club when it was finally introduced in Parliament. Once tabled in the House of Representatives on 4September 2023, the ramifications of the Bill became abundantly clear.
1.14Coalition Senators note the extremely concerning reaction to the Bill from stakeholders across a broad spectrum of the Australian economy. These are the actual job creators of our economy.
1.15The Australian Industry Group (Ai Group) described the Bill as:
A union recruiting tool which has massive implications around how businesses manage their relations with their workforce. This affects anyone who is eligible to be a union member so this will impact on non-unionised workplaces. It's not minor, it's major and we'll be fighting it tooth and nail. Employers are quite frankly aghast at this… it's all about increasing union rights, union power, union influence and union membership in workplaces.[1]
1.16The Business Council of Australia (BCA) said:
The Bill is unnecessary, will return Australian workplace relations to an age of unnecessary conflict and low productivity, and does not respond to key challenges for jobs, enterprises or Australians facing rapidly increasing costs-of-living. The Bill is complex, unworkable, has not been demonstrated to achieve its policy aims, and in most areas is not based on clearly articulated or properly evidenced need for change.[2] By the government's own admission, measures in the Bill are likely to lead to higher prices for consumers at a time of intense cost-of-living pressures on Australian households.[3]
1.17The Australian Chamber of Commerce and Industry (ACCI) said the Bill:
Overall, the legislation will hinder, not help, efforts to boost productivity. It will inhibit future wage growth by increasing the rigidity, risks, and costs of employing people, thereby damaging labour market outcomes. It will undermine the growth and viability of businesses. All of these outcomes are contrary to the purported economic objectives of the Federal Government as outlined in the Employment White Paper… This has real and pernicious consequences for Australian businesses.[4]
1.18The Minerals Council of Australia (MCA) said:
Extending union delegate powers will be a further hit to the nation’s flagging productivity, taking valuable time and resources out of businesses when they need all hands-on deck. Why should workers, the majority of whom are not union members, have to cover for the special treatment and time off for select union delegates? Given the scope of the powers, including the fact delegates will be able to demand such powers even if they are the only unionised member of staff, clearly the unions are having a laugh at the expense of hardworking business owners.[5]
1.19BHP, which represents over 600,000 Australians holding retail shares said:
By undermining labour market efficiency and arbitrary baking in uncompetitive labour arrangements, SJSP will fundamentally damage the nation's competitiveness. It's an outcome Australia can ill afford."[6]
1.20BHP further said, correctly, that ‘the government isn't closing loopholes as they claim to do with this Bill, they are tying businesses in knots’.[7]
1.21Rio Tinto said:
Fundamentally, we are deeply concerned that the amendments proposed by the Bill will likely undermine fair and agreed outcomes between employees and employers, create an ambiguous future that will lead to increased levels of workplace disputation as stakeholders work their way through the inherent complexity, and will add cost; all without addressing productivity which is central to Australia's prosperity. Ultimately, we believe these factors will have a negative impact on job creation, wages growth and business investment."[8]
1.22The National Farmers’ Federation said the Bill:
Will expand the reach, power and role of unions at a cost to business… most alarmingly, unions will have enhanced rights to enter farms unannounced, potentially intruding on personal privacy and creating biosecurity, animal welfare, and health and safety risks.[9]
1.23The Pastoralists and Graziers Association said:
The Government is proposing nothing less than a radical rewriting of Australia's workplace relations system, and that the cost impacts of the Bill, which will hit employers, employees, and consumers, will be significantly higher and wider ranging than claimed. These costs will touch nearly every business in the country in some way, affect millions of employees and, by the Government's own admission, drive up prices for consumers in the middle of a cost-of-living crisis. The only real winners will be the unions, who will get significant new powers and protections for their officials and shop stewards.[10]
1.24The Australian Meat Industry Council, the peak body representing red meat and pork retailers, wholesalers, processor, and smallgoods manufacturers in Australia, and that also employs ‘tens of thousands of people’, said:
We are concerned that ‘Closing the Loop’ implies small incremental tidy ups or changes to laws, whereas in proper reading, it reveals much more or a large, sweeping, and costly change that could have significant effects on our Meat Industry members. Further to this, the large-scale change seems to be at odds with boosting productivity and investment, workforce flexibility, workplace productivity and local issue resolution, and instead increases Union powers (noting current low union membership within our industry), compliance burdens and discourages employment and investment…Whilst businesses of all sizes, but especially our small business members, ‘butchers’ are struggling to make ends meet, they are having to, and will continue to have to, invest more and more resources ‘just to keep up’ with each tranche of IR changes.[11]
1.25Master Grocers Australia (MGA) said the Bill:
Represents a fundamental increase to the complexity of Australia's industrial relations law…is concerned this added complexity will lead to compliance uncertainty and result in ceased and unnecessary litigation… these industrial relations reforms are amongst the most significant that Australia has seen in recent times and will fundamentally complicate business operations. [12]
1.26The Recruitment, Consulting and Staffing Association (RCSA), an industry that employs over 700,000 Australians, said:
This Bill has been developed with a focus on delivering outcomes to the union movement, not on evidence, and business and workers will simply become collateral damage to that pact if it passes the parliament. The flaws and negative consequences of the proposals are so broad, deep and pervading that amendment is not an option to ameliorate their impact".[13] "The Bill's proposed changes to casual employment will have significant consequences for businesses and workers should they become law. They threaten to reinstate the uncertainty that existed before the previous government legislated to provide certainty in engaging casual workers… The outcome will make casual employment more uncertain and higher risk for business, which will in turn make casual work less accessible for workers.[14]
1.27Master Builders Australia (MBA) said:
For the otherwise vibrant and innovative residential building sector, it simply means more disputes, higher costs, lower productivity and fewer small residential builders, tradies and specialist contractors - all in return for higher construction costs and less new homes for Australians.[15]
1.28The Civil Contractors Federation Australia said the Bill:
Is more far-reaching than it is intending to be, and this Bill cannot be passed without more consideration of the consequences of the industries that will be caught up with the use of such broad language".[16] "We note that the emotion garnered towards the idea of "closing loopholes" does not actually line up with the intention of the agenda behind it. There is a difference between closing a loophole and creating such a broad and far-reaching legislative framework that the "loophole" is not addressed as its root cause, but simply overshadowed by more oppressive loopholes that will appear if this Bill is passed in its current form.[17]
1.29Uber said:
At a time when cost of living is increasing and the opportunity to earn supplemental income is beneficial to so many, this vital earnings opportunity should not be reduced by legislative reform… Platform work also helps hundreds of thousands of Australians earn extra income… Done poorly, the flexibility valued by platform workers is at risk as well as the services millions of Australians rely on.[18]
1.30Menulog said:
The employee-like provisions do not properly recognise and account for the inherent value exchange within the gig economy i.e. additional benefits for contractors such as the freedom to work when, where or how they like, including for multiple platforms simultaneously (i.e. 'multi-apping').[19]
1.31The National Electrical and Communications Association (NECA) said:
NECA does not support the Closing Loopholes Bill 2023 in its current form and emphasises that there are only negative consequences for employers in the Electrical and Communications Contracting Industry with little to no discernible benefit.[20]
1.32The South Australian Wine Industry Association said:
It would be an understatement that the Bill adds greater complexity to an already complex and legalistic workplace relations system. 278 pages of the Bill and an Explanatory Memorandum of 521 pages, substantially expanded powers for the fair Work Commission, new definitions and new penalties is not what struggling businesses need at this point in time.[21]
1.33Coalition Senators note the editorial of theAustralian Financial Review was also of the view the Government's bill was wide of the mark in what the economy needed at this moment:
A fair dinkum workplace reform agenda would help squash inflation, maintain the near 50-year low jobless rate, and arrest Australia's post pandemic productivity stall. Instead, Mr Burke is doing the political bidding of Labor's union paymasters, including by making the operation of the flexible gig economy of the 21st century subject to the antiquarian rigidities of a workplace system born out of the capital verses labour class struggle of the early 20th century.[22]
1.34Unsurprisingly, the Australian Council of Trade Unions (ACTU) was thrilled with the Government's bill. According to the union’s president:
From the unions' perspective, look, it's very good. Finally, we have turned the corner in terms of this relentless, really 30 years of either going backwards and clawing things back, to now actually going forward, and that's a positive thing. Of course we would want more, but honestly the government has responded to problems that are there and they campaigned on, such as job security.[23]
1.35Unions WA were also on message with their comrades at the ACTU, enthusiastically describing the changes are ‘modest goals’ that ‘is largely concerned with restoring balance and fairness to the industrial relations system’.[24]
1.36University of Adelaide professor, and one of the nation's leading workplace relations law experts, Andrew Stewart, said:
I think when you total up all the changes there is a really significant recalibration going on and, yes it's in favour of employees and unions… I don't think there's any doubt it's a pretty significant shift… But I think at some point the debate is going to move on to the union delegate provisions. That's something that is genuinely new. It's just not something we have ever seen, too my knowledge, formally enshrined in law.[25]
1.37Coalition Senators note the principal beneficiary of this Bill will be the trade union movement. This is despite the continued decline and fall in trade union membership in Australia over the past fifty years.
1.38There is, of course, a profound distinction between the level of trade union power and the actual interests of the workers that trade unions purport to represent. This distinction has never been more obvious than in the provision of this Bill. Whilst the institutional power of unions will be enhanced, the interests of actual workers themselves will be damaged, in terms of fewer job opportunities, less new investment, less innovation and lower real wages as inflation becomes worse.
1.39According to the Australian Bureau of Statistics (ABS) trade union membership currently stands at only 12.5 per cent.[26] This is even less in the private sector which stands at 8 per cent.[27] Overall trade union membership has collapsed from 61 per cent in 1976, to 34 per cent in 1995 and 15 per cent in 2016.[28] The National Farmers’ Federation notes that in the agricultural, forestry and fisheries sector trade union membership was 1.3 per cent in 2022.[29]
1.40Regarding the Bill's unconcealed attempt to strengthen union authority, the Australian Meat Industry Council noted:
This Bill provides the Unions more power and even less regulation than employers are enduring. It certainly appears that Closing the Loopholes provides for the union to create their own loopholes to bud on memberships, union revenue and remain largely unchecked during the process. This relaxation seems to place unions take on a regulatory role that would normally be reserved for government bodies/agencies. This will place significant unrest in industry and how we progress as an industry moving forward.[30]
1.41The ABS statistics demonstrate that what the Albanese Labor government is attempting to fix is not a ‘loopholes’ problem in the current industrial relations framework, but a declining trade union membership problem. The Albanese Labor government have quickly released the influence of the trade unions in the modern workplace has become so inconsequential, this bill is a blatant attempt to prop up its relevancy.
1.42As it did with Secure Job, Better PayBill 2022, the Albanese government again deliberately combined in an omnibus bill non-contentious provisions with controversial provisions.
1.43The Government deliberately combined non-controversial issues that have bi-partisan support with damaging industrial relation proposals that are against the national interests. Such is the toxic political thinking of the present Australian Labor Party. It certainly flies in the face of the undertaking the Prime Minister gave at the infamous Jobs and Skills Summit that he was about building consensus between employers and employees, and to ‘carry the conversation to the common ground’.[31]
1.44Another obvious design feature of this Labor government is to mitigate scrutiny, transparency, and rigorous examination of its industrial relations bills by ensuring the Senate process is circumvented to the maximum extent possible.
1.45No one has forgotten the farce of a legislative process related to last year's Secure Jobs, Better Pay Bill 2022, when the Senate Education and Employment Legislation Committee (EELC) had just 22 days to conduct public hearings and report back to the Senate, while the Budget Estimates process was concurrently running.
1.46It was only because the Albanese Labor government was blocked by crossbench Senators, who voted in support of a Coalition motion, that the government was prevented from ramming both bills through the Senate in late 2023, as it did with the Secure Jobs, Better PayBill 2022. It was clearly the Government’s intent to do so.
1.47By contrast, Coalition Senators note the timeframe given to the Senate Standing Committee on Education and Employment to deal with the Fair Work Amendment (Supporting Australia's Jobs and Economic Recovery) Bill 2020 under the previous Coalition government. From the time the bill was referred by the Senate to the committee for inquiry (10 December 2020) to the time the committee reported back to the Senate (12 March 2021) was four months.
1.48The original version of the Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Bill 2020 was 111 pages. A stark contrast to the mammoth 284 pages of the Fair Work Legislation Amendment (Closing Loopholes) Bill 2023 and the 521-page Explanatory Memorandum.[32] Additionally, when the Fair Work (Registered Organisations) Amendment (Ensuring Integrity) Bill 2019 came before the Parliament, there was a period of three and half months from the time the Senate referred it to the committee (4July 2019) to when the committee reported (25 October 2019).
1.49From the outset of the EELC inquiry, the Coalition put forward an ambitious program of 14 public hearings. Given the Bill is 284 pages, it was a proportional response to ensure the inquiry got to hear from as many stakeholders as possible in as many metropolitan and regional locations across the country as was logistical feasible.
1.50Once again, the Government sought to minimise the number of public hearings originally proposing just six. This was only one more than was afforded to the Secure Jobs Better Pay Billinquiry in 2022 – when that bill was half the size of the Closing Loopholes Bill. It took a formal direction from the Senate for a seventh public hearing to be incorporated into the inquiry program.
1.51Following this direction from the Senate, a seventh public hearing occurred in late January.
1.52As with the Secure Jobs, Better Pay Bill 2022, this inquiry covered a supplementary budget estimates week, thus ruling out the opportunity of further hearings that week. Additionally, this inquiry covered the period of the summer recess.
1.53Coalition Senators note the typical custom of the Albanese Labor government amending its own bills soon after they are introduced. The Minister for Employment and Workplace Relations has turned this into a procedural artform. However, it reflects a scurried and poorly executed drafting process—which the Government directs and controls. The reasons for this habit seem to be either ineptitude in managing legislative detail, a desire to avoid scrutiny by introducing amendments at the last minute, or a combination of the two. Either way, these reasons are contrary to notions of integrity, transparency, and proper process.
1.54Against a backdrop of an economy still recovering from a once in a hundred-year pandemic, the Albanese Labor government resolved that what the Australian economy did not need was an improvement of economic parameters that would benefit all Australians, but instead a supercharging of trade union involvement in the workplace, particularly in the business sector.
1.55The Secure Jobs, Better Pay Bill in 2022, followed by—less than 12 months later— the Closing Loopholes Bill 2022, emphasises this Government's absolute hyper-fixation on increasing trade union powers to the maximum extent it can.
1.56These bills are an outright repudiation of the three-decade old enterprise bargaining system that once helped to put Australia at the forefront of economic prosperity. Rather than seeking to enhance the successful enterprise bargaining system, the Albanese Labor government has instead sought to take Australia back to the economic calamity of the 1970s, with economically reckless trade unions again playing a central role.
1.57With bi-partisan political support, the repudiation of industry-wide wage setting, and the expansion of the enterprise bargaining framework contributed enormously to the wealth and prosperity experienced in Australia since the mid-1990s. It should be noted that from 1996 to 2022 the Australian economy (GDP) grew from $401 billion to $1.675 billion.[33]
1.58During that time the Australian economy experienced ‘the longest period of growth without a recession for a developed country since the System of National Accounts was introduced internationally following World War II’.[34] This period of economic prosperity was only broken by the coronavirus pandemic, in which every major developed country in the world fell into recession, including Australia. Global economies suffered the worst recession since the Second World War, ‘ending 28 consecutive years of economic growth’ in Australia.[35]
1.59Coalition Senators note that the Government has repeatedly used the mantra of ‘getting wages moving’ as the rational for introducing its two tranches of radical industrial relations bills.
1.60Despite their promises, real wages are going backwards under the Albanese Labor government.
1.61Other than pretending wages ‘are moving’when real wages are actually going backwards, the Albanese Labor government appears to believe it should only drive-up wages to the detriment of everything else in the economy, rather than in tandem with taming rampant inflation and increasing labour productivity. Wage increases without productivity increases are, by definition, inflationary. This is a fundamental issue ignored by the Government.
1.62This echoes an eerily similar rationale applied by the failed Whitlam Labor government of the 1970s, who thought that wages needed to keep pace with high inflation, which had such catastrophic consequences to the national economy that it ushered in a decade of stagflation.
1.63Australian Financial Review economics editor John Kehoe has made the observation:
… the [Whitlam} Labor government used public sector unions for "pace setter" wage rises that resulted in a wage explosion. Stagflation arrived with inflation surging to 15 per cent in 1974 from 3.5 per cent in 1970, and the jobless rate jumping to 5 per cent by 1975 from just 1.6 per cent.[36]
1.64Labor historian Troy Bramson has acknowledged:
… the failure to deal with a wages explosion, caused by generous public sector wage increases and catch-up claims by unions in the private sector, was damaging.[37]
1.65Coalition Senators note that over the past 12 months, the Reserve Bank of Australia (RBA) has repeatedly warned the government the pace of wage growth can only be sustained if labour productivity also increases simultaneously. In its October 2023 decision to keep interest rates on hold, the RBA said, ‘wages growth has picked up over the past year but is still consistent with the inflation target, provided that productivity growth picks up.’[38]
1.66Similar evidence to the RBA's advice was heard from the ACCI during the first Canberra hearing:
Senator O'Sullivan: I don't know if you have seen the Reserve Bank's report today. They point to figures that say real wages are going backwards and are not keeping up with inflation, essentially. Without that productivity dividend in the economy, what will it mean for wages going forward?
Mr McKellar: Certainly, if you don't have the productivity growth underpinning any future wage increases, it's very difficult to sustain. It's much the same as a government saying, 'We can create more wealth by printing money.' It needs to be backed up with real economic activity - real productivity. Otherwise, the risk is that it's simply adding into costs, and businesses are not able to make up the shortfall in output. Therefore, you run the risk of inhibiting profitability, or you have a situation where they have to push that through to consumers. You're adding back into inflation, and those wage increases are being simply chewed up - gobbled up - by higher inflation.[39]
1.67So rather than addressing rampant inflation, the Albanese Labor government has sought to address only one lever of the economy while isolating other key economic indicators, namely increasing productivity, reducing fiscal spending and getting inflation under control. In 2022, labour unit costs increased by 7.5 per cent, which was one of the largest increases in decades.[40]Wage growth without labour productivity will only lead to further upwards pressure on inflation.
1.68Since coming to office in May 2022, the Albanese Labor government has done nothing to address the productivity decline this country is experiencing. Currently productivity is at a seven-year low. Australia isn't just in a cost-of-living crisis, it is experiencing a productivity crisis.
1.69Declining productivity should be a concern to all, including the trade union movement, because productivity has been one of the principal forces of Australia's high standard of living.
1.70As business groups say - there is one slogan that has been missing from the government’s rhetoric and that is ‘fix our lagging productivity’. The word productivity has hardly been mentioned as a desired outcome of the government’s measures.Business groups and employers say that the proposed IR changes will smash productivity, investment, and job creation.
1.71As Jennifer Westacott, former Chief Executive of the BCA, said:
Australians should have safe jobs, well paid jobs and rewarding jobs, but the government’s radical shake-up of the industrial relations system will not deliver that…
These changes will create confusion and extra costs for consumers, make it harder to hire casual workers and create uncertainty for employing anybody.
Any government that’s serious about cost of living would not do this.
They should not add cost and complexity at a time when people are struggling to pay their bills.
The government needs to go back to the drawing board, so we are clear about the problem we are trying to solve and we’re clear about the ramifications.
We need a system that takes us forward not backwards.
We need a system that drives productivity, not stifles it, because that will stifle wages growth.
The case has not been made for this radical shake-up.[41]
1.72Coalition Senators note that the former Governor of the Reserve Bank, Dr Phillip Lowe, had been sounding the alarm on Australia's sluggish productivity for some time. In his final appearance before a parliamentary committee, Dr Lowe said:
It's a really critical issue. Labour productivity over the past year has declined, but in the year before that it increased a lot… If that were to continue it would mean lower growth in the economy, it would mean smaller gains in asset values, it would mean real wage increases would be very difficult, and it would mean a smaller pie for government to provide the services that the community wants. I think it's the No. 1 medium-term economic issue.[42]
1.73Later during the same testimony, Dr Lowe reiterated the hazards involved when rising unit labour costs were left isolated, and the impacts on inflation:
We're now moving into the next phase of getting inflation down. It will involve slower growth in unit labour costs. At the moment unit labour costs are increasing very rapidly, because that's the difference between nominal wage growth and productivity. Our sense is that, for inflation to come back to two to three per cent, we're going to have to see some moderation in growth in unit labour costs. This is why the pick-up in productivity is so important.[43]
1.74Yet despite all evidence to the contrary, against all reasonable economic logic, the Albanese Labor government's Closing Loopholes Bill mentions productivity only twice. The Explanatory Memorandum mentioned it only few times more. And the Minister's own Second Reading Speech mentioned it zero times.
1.75Is it any wonder business journalist Robert Gottliebsen concluded:
… forget productivity, this is all about cementing in high inflation and low productivity. In the end, this means less wealth. Accordingly, the standard of living we are to offer less prosperous people, including the disadvantage, will suffer.[44]
1.76And again only a few months later Mr Gottliebsen wrote:
… if anything like the complexity of the proposed legislation passes the parliament it will dramatically lower productivity in Australia. And that lower productivity will start at the base of household contract services and extend through transport, IT, banking and manufacturing to mining. [45]
1.77The concerns with low productivity not being addressed by the government's proposed legislation were echoed by the Ai Group, who asserted:
… the proposals will not create a single job, do nothing to boost productivity, and will stifle innovation and create insecure work for tens of thousands of Australians who are currently comfortable with their employment arrangements.[46]
1.78These sentiments were reiterated by the BCA who said:
… the Bill will drive uncertainty into our workplace relations system, stifle productivity, restrict innovation, limit the ability of workers to choose their own way of working, and return to an outdated system of centralised wages setting and decision making.[47]
1.79During the first inquiry hearing, hosted in Sydney, the BCA reinforced this position during questioning from Coalition Senators:
Senator O'Sullivan: In relation to productivity, which has been raised a couple of times today, with current record low levels of productivity, and certainly for a long time - a seven year low - what impact will this bill have on productivity? We know that if wages are just chasing inflation and there's no productivity dividend then we're just going to keep chasing the tail and we won't get real wages growth. What impact do you think that will have on productivity across the economy?
Mr Reed: I think it will have a negative impact. The question is about the qualification of that. I haven't read everything that the Minister has said, but I've not heard the government challenge or mount a case in any way that this will have a positive impact on productivity that will drive better productivity. The reasons for the negative productivity will be, again, uncertainty, which in any business gets priced in - the more uncertain something is the higher the return required to make an investment. This bill brings in significant uncertainty. This bill will make it a more complex place to do business, which makes it more difficult to attract capital. It is the combination of productive, harmonious workplaces leveraging capital efficiently that drives productivity. So, on both of those two input factors, when you think about productivity, this will have a negative consequence.[48]
1.80The National Retail Association, representing a sector that is a $420 billion industry, employing over 1 million retail workers, claimed:
aspects of the proposed Bill are poised to inject uncertainty into our workplace relations framework, impede productivity, curtail innovation, and curb employees' autonomy to define their own work methods. [49]
1.81Even one of the Government's own witnesses conceded, during the inquiry's Melbourne public hearing the Bill, would have minimal effect on improving productivity:
Senator O'Sullivan: Do you believe this bill will result in better productivity, higher productivity?
Professor Wright: …The evidence suggests, if anything, it will have seemingly a minor positive impact upon productivity.[50]
1.82The actions of the Albanese Labor government to date, coupled with its introduction of the Closing Loopholes Bill, underscores this Government’s complete lack of seriousness in addressing the inflationary and productivity challenges this country faces.
1.83The Closing Loopholes Bill also appears at odds with the Government's own Employment White Paper, which featured productivity as an important component in promoting strong sustainable wage growth:
In the long term, real wage growth depends on productivity growth, a dynamic and competitive labour market and effective wage-setting institutions.[51]
1.84Indeed, Coalition Senators note the Government's own department readily concedes the importance of productivity. In the Department of Employment and Workplace Relations (Department) regulation impact statement (RIS) for the Australian Jobs and Skills Summit, it said:
Labour productivity and real wages growth have historically been highly correlated, with labour productivity considered to be one of the key drivers of real wages growth in the long term. If workers are more productive relative to their cost to firms, it allows employers to pay higher wages and take on more workers due to the overall increase in income. This, in turn, places upwards pressure on wages. Real wages growth, which is wages growth after accounting for inflation, is an important indicator of living standards.[52]
1.85Ironically the RIS also highlighted the benefits of enterprise bargaining, the very framework which the government is attacking with its two tranches of industrial relations bills:
… there is capacity to build on the existing framework to reverse the decline in enterprise bargaining and to ultimately influence real wage growth. Without reversing the decline, fewer employees will be covered by an enterprise agreement and therefore will miss out on the benefits that bargaining can provide… Enterprise agreements can also provide certainty about regulations and minimum standards, providing a system that can assist bargaining parties to navigate complex and adversarial processes.[53]
1.86Western Australia is the resource powerhouse of this country. Undoubtedly, the provisions in this bill represent a clear and present danger to the future prosperity of all Western Australians.
1.87This Bill is a direct attack on the interests of Western Australia. The Bill takes a direct aim on the mining sector which has largely underpinned this state's success since the 1970s. Every Western Australian should be dismayed by what the Albanese Labor government is attempting to do with this Bill.
1.88The Chamber of Commerce and Industry, Western Australia was blunt in its assessment of what the impact would be for Western Australia. It told the Perth public hearing:
It's no overstatement to say that these changes pose a significant threat to WA's economic prosperity. Our state is at a crossroad. We are rich in the critical minerals that will power the green revolution, like lithium, nickel, copper. But having these minerals in the ground isn't enough. In the race for global capital we need to be competitive. Aspects of this bill, combined with already onerous regulation and more to come, risk putting Australia in the too-hard basket for global investors. There is just so much at stake for Western Australia.[54]
1.89According to the Chamber of Minerals and Energy of Western Australia (CME):
The resources sector drivers the WA economy and substantially contributes to our nation's prosperity. It provides jobs and livelihoods, supports local businesses, communities and regions, and contributes significantly to providing government services at both the state and national levels.[55]
1.90In Western Australia, the hotels and hospitality industry employ around 100,000 people. According to the Australian Hotels Association (WA) (AHA (WA)) these workers ‘play a critical role in the state's economic success and are an essential component of the communities in which we live’.[56]
1.91Reflecting the concerns of its members, AHA (WA) said of the changes to the casual employment definition in the Bill:
We believe the amendments fundamentally change and negatively impact the way casual employment is used in the hospitality sector in Western Australia. Casual employment is critical for the effective operation of most accommodation and hospitality businesses in WA. Fundamental changes to the definition will detrimentally impact both employers and importantly, those workers who seek out such employment arrangements.[57]
1.92In addition to the changes to the casual definition, AHA (WA) also point out the peril involved with the introduction of section 359A, which introduced new penalties for ‘misrepresenting’ a casual employment arrangement:
We submit any ‘misrepresentation of casual employment’ should only apply to intentional and/or reckless behaviour and only to those industries where this has been identified as an issue. The proposed definition, coupled with the introduction of section 359A makes it almost impossible for an employee to engage a causal employee in a meaningful way without exposing themselves to the real risk of being found to have reached the ‘misrepresentation’ section.[58]
1.93This Bill’s complexities and uncertainties unfairly and disproportionately impact Western Australia, and target's the prosperity which many Western Australians have gained, particularly from the mining industry.
1.94According to South 32, a company domiciled in Perth:
… the Bill is overly complex, creating unnecessary uncertainty on a range of issues…these proposed amendments introduce unprecedent complexities and are expected to undermine productivity outcomes and increase the cost of operating within Australia, thereby reducing the ability of our Australian-based businesses to compete internationally.[59]
1.95Perenti Group, a 35 year plus Western Australian company that employs over 5,500 people and ‘are one of the largest private sector employers of apprentices and trainees in Western Australia’[60], said:
If the Bill is passed with the current proposed amendments, the Mining industry, and in particular service contractors will be severely impacted which is not in the best interests of employees, shareholders or the broader economic health of Australia.[61]
1.96Coalition Senators note the very real benefits the resources industry provides to Western Australia. According to CME:
In 2021-22 the WA resources industry generated $186.8 billion in gross value added, accounting for almost half of WA's economic activity. The industry's exports totalled $233.6 billion, accounting for 95 per cent of WA goods exports and 66.1 per cent of national resources exported.[62]
1.97In its submission, Roy Hill confirmed similar contributions saying that ‘last financial year Roy Hill directly injected more than $1.6 billion into the Western Australian economy and a further $1.26 billion into the rest of Australia's economy’.[63]
1.98BHP reports that in FY2023 the company expects to pay approximately 8 per cent of the total Australian company tax. Additionally, BHP operated projects has contributed ‘10% and 11% of all revenue (excluding grants) in Queensland and Western Australia respectively’.[64]
1.99In FY2023 BHP said that it:
… spent more than $477 million with local suppliers either directly or indirectly or through the Local Buying Program in Western Australia. In the past decade BHP has contributed more than $19 billion in iron ore royalties to the Western Australian government.[65]
1.100This is now all at risk because of Labor's risky industrial relations bill.
1.101In Western Australia, the resources sector employs around 157,000 people, putting it second to only the state public sector as the state's biggest employer. In fact, in 2022, ‘employment in the resources sector rose 6 per cent from the previous financial year… and about 56,000 jobs behind the public sector workforce in 2020-21’.[66]
1.102CME underscored this in its submission, saying:
Employment in the WA resources industry grew by 40 per cent between February 2020 (pre-COVID) and May 2023, accounting for around 70 per cent of growth in national resource sector employment. Modelling based on CME's 2023-22 Economic Contribution Survey indicates spending by the WA resources industry supports at least 493,235 additional full-time jobs across Australia, including 259,959 full time jobs in the state.[67]
1.103Ironically, given the drastic implications of Labor'sClosing Loopholes Bill, the Western Australian Government Minister for Mines and Petroleum had previously highlighted the mining industry's job importance to the state:
How anybody could turn strong employment into a bad news story is beyond me, it is unmistakably good news for all West Australians that the mining industry, which is the core element of [the state's] economy continues to go from strength to strength.[68]
1.104Though opponents of the resources sector like to demonise the industry's role, its significance as a driving force to the national economy and foundation for this country's prosperity over the past several decades cannot be disputed.
1.105According to Roy Hill, over the past decade as a company it has:
… has contributed more than $6.4 billion in taxes and royalties to state and federal governments, at a time when government debt is at record levels and revenue is needed to fund critical initiatives and public infrastructure.[69]
1.106CME highlighted the risk the Australian industry confronts in their submission:
… our sector faces considerable challenges in the form of intense global competition for investment capital, geopolitical tensions, rising costs, persistent skilled labour shortages and weak productivity growth. Further, lengthy and duplicative approval processes and recent changes and uncertainty regarding regulatory policy decisions at both state and federal level threaten WA's relative attractiveness to highly mobile global capital. We need the State and Federal Governments to work with us to ensure the industry's continuing global competitiveness and contributions.[70]
1.107Coalition Senators note that in relation to the uncertainty and risk posed by the bill, Roy Hill believes:
The bill proposes complex changes to Australia's industrial relations laws…. Is ambiguous, unclear and will add compliance costs and commercial uncertainty to most businesses. It would impose ambiguity on one of the most challenging labour markets our industry and the Western Australian economy has faced. As drafted, the Bill creates uncertainty that can only be resolves by litigation, which is counterintuitive to the goal of the legislation.[71]
1.108Testimony was heard during the inquiry from the MCA about how this Bill could jeopardise Western Australian projects:
Senator O'Sullivan: …As a Western Australian myself, I'm keen to understand what, if any, chilling effect this might have on resource projects, particularly in Western Australia. Obviously, we're not the only continent that has minerals, and capital is competitive internationally, so what impact do you believe this might have?
Ms Constable: Western Australia in particular have enjoyed a period of time where they haven't had to worry too much about industrial relations issues. The companies have had a very good relationship, across the board, between the employers and the employees. As I have said in Senate committees before, we have very highly skilled, highly paid workers within our industry in Western Australia. Across the board, the average wage is $151,000. When a company makes decisions about investment around the world, whether they are a multinational or not, they will decide on a number of issues: what sort of taxation they might be paying; what sort of labour hire arrangements are in place; what the environmental considerations are; what sort of infrastructure might be available for their projects. We've already heard from a number of companies - publicly, privately and in other Senate committees - that investment is at risk. Critical minerals projects are at risk… They would have numerous issues to consider: whether they are a host company, how their supply chains work, how arrangements would relate to those whole supply chains. This particular bill will fundamentally affect our industry in particular, and we believe that we've been targeted through arrangements such as same job same pay.[72]
1.109It is disturbing that UnionsWA have dismissed the legitimate issues raised by the agriculture, transport, and resources sectors in Western Australia as ‘alarmism and self-interested objections’.[73]
1.110UnionsWA have described these concerns as ‘misleading propaganda attack on the modest goals of this bill, the content of which is largely concerned with restoring balance and fairness to the industrial relations system’.[74]
1.111Coalition Senators note that UnionsWA submission does not mention how the bill intensifies union delegates powers in the workplace, broadens delegates powers, and seeks to vastly increase trade union influence in a state that largely has a non-unionised workforce in the resources sector.
1.112UnionsWA are a beneficiary of this Bill and yet they fail to mention this in their submission, just as the Government made no such mention of these measures prior to the last election.
1.113Moreover, why is UnionsWA so meek and not standing up for the causal jobs that play such an important role in Western Australia's hospitality sector? How is removing casual employment opportunities for thousands of workers ‘restoring the balance and fairness to the industrial relations system?’.
1.114UnionsWA spends its time attacking job growth and small business prosperity when it should be doing the opposite and standing up to the glib talking points of the ACTU and defending single parents and university students who chose to work casual, prefer the 25 pre cent loading and enjoy the flexibility that casual work affords.
1.115Why is casual employment important to Western Australia's economy? As AHA (WA) stated:
Western Australia is home to several distinct tourism regions that are highly susceptible to seasonal fluctuations. Hotels and hospitality businesses in these regions require additional staff during the peak periods to meet increased demand… When tourist arrivals surge, casual workers provider essential support in hotels, restaurants and other hospitality businesses.[75]
1.116Technical Resources, a Western Australian recruitment company, said:
… the government has failed to make a case for the need around changes to casual employment. Instead, it has, without justification, proposed to re-create a substantial problem that was addressed effectively by legislation and High Court decisions in recent times. The changes make it exceedingly difficult to engage casual employment with any sense of certainty or confidence.[76]
1.117Echoing similar sentiments expressed by AHA (WA) about the new casual definition, Technical Resources said in its submission that:
The Closing Loopholes Bill will inject greater uncertainty and complexity into Australia's already complex industrial relations system. The Bill creates new and unnecessary challenges for both business and workers and will negatively impact wages and job creation… The casual changes also have significant implications for the workers our business engages. Once in operation, this Bill will force casual workers to either accept a substantial reduction in take home pay, or have regularity and certainty stripped from their working hours.[77]
1.118It was during the Perth public hearing that AHA (WA) highlighted the ‘lottery-style’ nature of applying the new casual definition the Government was proposing.
1.119In its opening statement, AHA (WA) said:
The bill's changes to the 'casual' definition make it operationally impossible for businesses to engage a casual…The only way a business could be compliant with the new casual test is to use lottery-style rostering software that would randomise casual employees for a given shift. A lottery system is the only way that we could comfortably advise our members to remove the argument of predictability and a regular pattern of work. This is operationally insane for our business.[78]
1.120Given how the casual changes were ‘operationally insane for business’ Coalition Senator's wanted AHA (WA) to explain how this ‘lottery-style’ system would function in practice for Western Australian employers and the impact for workers who wanted to work casual:
Senator Cash: Hold on. Go back to the single mother. What are you telling the single mother who can only work for you on certain days for certain hours because she - or he, s single father - has responsibilities with their children? What are you telling me you are going to say to them?
Mr Woods: That the changes to the law prevent us from being able to offer that expectation or that understanding of predictability.
Senator Cash: Okay. So they have no job - is that what you're actually saying now?
Mr Woods: Effectively it will remove the ability for employers to pass any test so they don't breach 359A to have casual employees who have an expectation - unless, as I said, it's a lottery-style rostering system where you find out over breakfast in the morning that you're going to have a shift that day.
Senator Cash: If you did invest in your lottery-style system - and I like the lottery. I never win it though; that's the only problem. Or if I do, I win $7.50 and it's not quite enough to invest in my next ticket.
Chair: I always find scratchies a little bit better.
Senator Cash: Well, you could invest in scratchies. But this is actually really serious. So you invest in the lottery system. Again, I am the person wanting to work casual. What does that do for me?
Mr Woods: Well, it stuffs up your lifestyle. It stuffs up your family arrangements. It destroys the expectation of a student being able to go to university and know that they're going to have a part-time income on an irregular basis, because everything has to change and shift - because they'll only find out on the day of the roster.
Senator Cash: That doesn't suit me.
Ms Grubor: Senator, it may not suit you, but unfortunately if the provision was to go through as it is currently proposed, that's what it will mean for you. Now, the other option for the employer in that scenario would be a potential offer of part-time employment.
Senator Cash: I want the 25 per cent loading.
Ms Grubor: Unfortunately it's not an arrangement that can be satisfied under the casual provisions anymore.
Mr Woods: And employers are happy to offer that flexibility and the 25 per cent loading at the moment, but that is proposed to be taken away.[79]
1.121Unsurprisingly the new casual definition was not just going to be confusing for employers to understand, it was also puzzling to some members of the government:
Ms Grubor: The issue with respect to the casual conversion is a separate issue with respect to the definition. Under the current definition -
Chair: Sorry, I just want to be clear: I gave you the time to think about the converting point. You're saying that no-one wants to convert - that's from the survey's you've got.
Ms Grubor: Yes
Chair: I can't work out what you're worried about on that particular question.
Ms Grubor: Because the proposed definition of 'casual employee' will see a fundamental and dramatic shift to how employees are currently engaged and operate in the hospitality industry.[80]
1.122From a survey of its members, CCIWA reported that ‘a total of 39% of survey respondents indicated these proposed changes would have a damaging impact on their business, while an additional 35% said the changes would be extremely damaging’.[81]
1.123Instead of fleshing out survey findings like this, Coalition Senators note the government's tactic was to first denigrate, and then bulldoze through any research an employer member body had dared undertaken, whether it be small or large, as though the size of an organisation mattered to the material impacts from the Bill.
1.124Coalition Senators note early in the inquiry process, the government sought to minimise the effects on Western Australia, primarily based on what it erroneously perceived to be a low level of enterprise bargaining in the state's resource sector. This view was expressed by Minister Burke in an interview on 27 October 2023:
Some businesses came to the Senate inquiry in Western Australia from the mining sector saying ‘oh this will be a disaster for them’ and when they were asked ‘do you have an enterprise agreement’ they said ‘no’ and then acknowledged it wasn’t going to affect them at all.[82]
1.125This is not correct and does not reflect the evidence provided by multiple businesses and their representatives during the inquiry.
1.126The fallacy that Western Australia would be no worse off was shown to be false by several witnesses, including the MCA, which in November 2023 published an analysis of enterprise agreements in the WA resources industry in, which it noted:
106 enterprise agreements currently applying in the WA mining industry;
42 enterprise agreements currently applying in the WA oil and gas industry.[83]
1.127These agreements apply to both ‘host’ business and contractors. All could conceivably by captured by the Same Job, Same Pay regime in the Bill.
1.128Several Western Australian stakeholders have highlighted the disruption and risk to productivity this Bill presents in relation to trade union rights of entry and union delegates powers. This has alarmed many companies, especially in the resources sector, which operate in Western Australia.
1.129In its submission, Lynas Rare Earths said:
The Bill dramatically modifies the right of entry safeguards that are currently in the Act by introducing an exemption from providing the minimum notice period on the new ground of suspected underpayment. Concerningly, the threshold to access this exemption is extremely ow and leaves it vulnerable to abuse and misuse, raising the prospect of workplace conflict and operational disruption.[84]
1.130Specifically, on the new provision of delegates rights, Lynas Rare Earths said:
The Bill will enshrine a new workplace right to be a 'workplace delegate' and impose compulsory and onerous 'delegates' rights on every employer. These rights are framed in broad and unrestricted terms and there is no limit to the number of workplace delegates per employer. This could lead to reduced productivity and operational challenges. The Bill provides that a workplace delegate is entitled to represent the industrial interest of current and potential union members. This would mean that, in a workplace with single union member (who was appointed as a delegate), the employer would be obligated to negotiate with them as if they represented all other workers who are eligible to be (even if not actually) members of their union, and to provide them with access to all other staff, even if those other staff had exercised the right not to join the union.[85]
1.131In a survey of its members the CCIWA said ‘results show just over two thirds (67%) of WA businesses view the proposed changes to delegates rights as damaging, with 35% reporting this will be extremely damaging’.[86]
1.132This was the view shared by stakeholders representing Western Australia's agriculture sector. Evidence was heard during the Perth public hearing from stakeholders on how the completely unbalanced rights of entry provisions would affect this critical sector:
Senator Cash: Could I ask the National Farmers Federation about your attitude towards the new right-of-entry without notice provision in the bill?
Mr York: My understanding is that there already exists the capacity for access without notice, if it can be demonstrated that there is a high likelihood that there's underpayment going on. I don't see the necessity to have open access, because if it is suspected that this is happening they can already have that access at short notice. Why add any more? It creates more uncertainty in the workplace if we're going to have the risk of this instruction.
Mr Mahar: This is hugely concerning proposal. Entry without notice creates such a significant risk, for a couple of reasons. Often farms are places not only of work but where people live. These are people's homes. They work very closely between home and the farm itself. The suggestion that people can just wander in, unannounced, and have rights of access is offensive. It's dangerous. It is incredibly risky. It has biosecurity risks. It has animal welfare risks. Farms are dangerous places to work if people are uninitiated and unaware of the situation on farms. I have to say that this is an incredibly dangerous and concerning suggestion that people would be able to have an increased ability to turn up unannounced, wander around farms, households, have access to areas that can put them in harm, can put other people in harm and can put animals in harm. It is an incredibly concerning and incredibly offensive suggestion.[87]
1.133Increasing trade union power in the mining sector, particularly in Western Australia where it predominantly has a non-unionised workforce—is a prominent feature of the Government's Bill:
Senator O'Sullivan: Can I go to union power? You address this in your submission, and you've mentioned it here as well. In relation to the union delegate provisions, will the mining sector be captured by this provision, even though, as you've stated Ms Constable, it's largely - particularly in Western Australia - a non-unionised sector?
Ms Constable: Yes. Some of the industry, of course has union representation, particular on the east coast, with the coal industry, and they currently have quite established rights. Delegates have quite established rights, and so do union officials. This particular legislation would allow delegates and union officials to have almost instant access to the mining industry, to a workplace, without any sort of notice being given. If those orders are made by the fair Work Commission because there is just a suspicion that there is an underpayment, then the fair Work Commission will rubber-stamp that order and allow that access.
Senator O'Sullivan: They're not required to test it?
Ms Constable: That's correct. In Western Australia it doesn't have to be unionised worksite, a unionised workforce, so we would expect that we will see arrangements indeed start to occur in other places that are non-unionised.
Senator O'Sullivan: can you see any provision in the bill that would prevent the abuse of this system?
Ms Constable: Absolutely. I think that, as I said, just the mere suspicion that there might be an underpayment allows -
Senator O'Sullivan: Just to clarify your evidence, my question was: do you see that there's any provision within the bill that would protect against abuse of this?
Ms Constable: I don't think so.[88]
1.134As the Bill is silent on the number of union delegate training days that businesses will be forced to pay for, Coalition Senators naturally sought to clarify this question during the Perth public hearing on 6 October while questioning the CFMMEU:
Senator O'Sullivan: … I'll go to the delegates then. How many CFMMEU delegates do you believe can be appointed per workplace under this arrangement?
Mr Smith: There isn't a rule of thumb to that.
Senator O'Sullivan: there's no limit?
Mr Smith: Well, there are practical limitations, obviously, but it would vary from the nature of the worksite, from state to state, also the complexity of the project. Some projects are staged over multiple stages. Civil and infrastructure projects can include roads that might go for 10,20 or 30 kilometres, in which case there'd be multiple elected delegates. The nature of our industry is such that there is no rule of thumb as to the number of delegates…
Senator O'Sullivan: With regard to delegate rights provisions in some workplaces, how much time off work for training does the CFMMEU anticipate will be necessary for the average workplace delegate?
Mr Smith: The CFMMEU's position on time off for training varies from state to state because it's matter hat is subject to bargaining, which our union conducts on a state by state basis. Again, it's not possible for me to give you one clear-cut answer…Generally, if I was to give you a standard across our industry, five paid days a year per delegate would be the standard.[89]
1.135During the same public hearing, Coalition Senators also questioned the Australian Manufacturing Workers Union (AMWU) to determine how many delegates each workplace would have, and how much time off employers would need to pay for to cover union delegate workplace training.
Senator Cash: …How many AMWU delegates can be appointed per workplace?
Mr McCartney: Usually, if we can, we try to get one in every section, to make sure they look after that section where they are working. So, if there were four different sections inside a workplace, we would have a delegate elected in each workplace, if the members so requested it. Then we would have a formal process to make sure that happens.
Senator Cash: What do you define as a 'section'?
Mr McCartney: A section would be, say, if people were working in a specific area, such as the pipe-welding shop.
Senator Cash: So it is per section; you put in your delegate depending on how many sections are in a particular workplace.
Mr McCartney: You can also have subcommittees that talk to a broader committee, which might be a group of eight or 10, depending on the size of the industry you are talking to.
Senator Cash: Understood. How would that work then, say in a small business?
Mr McCartney: In a small business, the members would decide ultimately whether they had enough representation with one or two and, obviously, with occupational health and safety. But that would depend on the size of the workforce and the members' needs at the time.
Senator Cash: If it were a small business with, say 10 people, how would it work there? I am trying to work my head around big sections and small business.
Mr McCartney: If you had 10 people and they were all working together - you would assume they would be working together of there were only 10 people - then you would have a deputy and a delegate.
Senator Cash: So there would be two. I assume there is provision for you to put in more if you wanted to; if other people said, 'We would like more.' So there would be the deputy and the delegate; I understand that.
Mr McCartney: It is usually a fairly reasonable process.
Senator Cash: As for the proposed training entitlement, how much time off work for training do you anticipate will be necessary for the average workplace delegate? Perhaps you could go through small, medium and large business because depending on the size of the business, you will have different needs.
Mr McCartney: Your delegate training usually would be between four and five days.
Senator Cash: Is it then done and dusted after that four or five days and you don't do any more, or is it once a year to make sure you are up to date with the training?
Mr McCartney: Especially lately, with the rules changing regularly, we would ensure that they had a yearly update, if possible.[90]
1.136Given the Government's guesswork on the economic modelling of the Bill, Coalition Senators are grateful for the frankness of the CFMMEU and the AMWU that no precise number of elected delegates in each workplace and the time off needed for training is known.
1.137Moreover, the absurd rationale of this new provision seems even more ludicrous, given the fact that only 8 per cent of the Australian private sector workforce are union members. Therefore, the government wants the trade unions to be empowered to speak for the 92 per cent of the workforce who choose not to be union members, and for every business to pay for them to do so.
1.138Coalition Senators note that the CCIWA emphasised this latter point in its submission, which stated:
… this part of the Bill will give union officials new rights and protections and it will mean that union officials have greater rights than non-union affiliated employees who have exercised their right to freedom of association and decision not to join a trade union.[91]
1.139The proposition of union officials purporting to speak for 92 per cent of the workforce, who have freely chosen not to be in a union, is absurd. Additionally, Coalition Senators reject entirely the notion that ‘sensible regulation in the form of the bill is desperately needed’.[92] If anything, the Bill glaringly shines a light on the real purpose of this bill—the desperate desire of unions to rectify their ailing membership by forcibly expanding their power the cover of legislative instruments.
1.140On workplace disputation, CME said the Bill was:
… a complex and onerous piece of legislation that will significant and unnecessarily increase compliance costs for employers, introduce uncertainty and reduce labour market productivity… there is also a risk the extent and nature of this Bill's proposed reforms will increase the likelihood of industrial action and workplace disputes in Australia… Modelling commissioned by the Minerals Council of Australia (MCA) found that a 5 per cent reduction in mining sector labour productivity would reduce gross domestic product by nearly 0.4 per cent and real wages by more than 0.2 per cent.[93]
1.141Coalition Senators note that the modelling conducted by the MCA in relation to this bill is likely to be more robust and contains more depth in its analysis then the shambolic Regulation Impact Statement the government claims inform stakeholders of the actual costs.
1.142Perenti Group commented that:
… the direct cost impacts are unknown, and there will be tremendous uncertainty when tendering for work, as companies such as Perenti would not be able to quote with any certainty as to the rates that will need to be incurred.[94]
1.143CCIWA reflected on this in their submission:
… the consultation over the Bill and its significant reforms of the FW Act and other employment and workplace relations legislation has lacked transparency and detail, impeding analysis and evaluation. The four-week period from the date the Bill was introduced to Federal Parliament on 4 September 2023 to the final date for submissions on 29 September 2023 was far too short, given the Bill's numerous reforms span diverse and complex areas of employment and workplace statutory laws.[95]
1.144The lack of modelling and its impacts, particularly for Western Australia, is troubling. How can Western Australians have any confidence that what the Albanese Labor government says will be the impacts will be the impacts when its own RIS was so poorly ill-conceived and does not stand up to any level of rigorous scrutiny?
1.145The absence of proper data was highlighted by the BCA in the Sydney public hearing:
Senator O'Sullivan: …What is the BCA's assessment of the likely impact of the changes of this bill on wages, on prices and on security and sustainability of jobs?
Mr Black: The short point with respect to the costs and the impacts of the bill on families across the country is that it's very difficult to say and impossible to define by reference to the government's regulatory impact statement. That statement doesn't include the type of detail that anybody would be looking for in a bill and change of this magnitude. It contains numerous statements to the effect of there is insufficient information available, there is insufficient data that we can rely upon, assumptions need to be made and so forth. In our analysis alone, we've identified over 47 instances where there's an incapacity to provide the type of data that is necessary to make certain assumptions, and that is an important point because, in the absence of this data, we just don't know what the impact of this bill is going to be and the government doesn't know what the impact of this bill is going to be.
It's one of those key reasons why we need to go back to the drawing board…In those circumstances, our question is this: Why add to the uncertainty that we're all facing? The bill leaves so many questions unanswered and that's in the context of a 500-page explanatory memoranda, 270 pages of legislation. There are legitimate, genuine questions that we see unanswered—the security of work for casuals, the viability of labour hire, the cost implications of digital platform work, and can that industry continue to thrive? What's the real cost of these reforms to productivity and what's the real cost of these reforms to families? Our position is that the onus must be on the government to demonstrate that its reform will add to certainty and outcomes for families across the country. As senators, our position is: if you're not satisfied that the government's addressed those critical questions then don't vote for the bill.[96]
1.146Interestingly, CME noted regarding increasing union power ‘through DEWR's public consultation process there has been no discussion and no case for expanding union powers’.[97]
1.147So, would the changes in the Bill to workplace access for trade unions improve workplace harmony and productivity? According to CME's submission:
Allowing third-party delegates can disrupt workplace safety and productivity, making processes unnecessarily adversarial. In itself, right of entry requests create logistical, administrative and supervisory burdens for remote worksites in WA… The industry has enjoyed a mutually beneficial and harmonious industrial relations environment for decades, resulting in a higher-paying and more productive industry. As currently drafted, the proposed changes could detract from this mutually beneficial environment. Significant rights and protections for engaging in industrial activity already exists. Providing greater protection or immunity to union representatives for bad and disrespectful behaviour risks increasing disputation and undermining the focus across the industry on improving respectful behaviours.[98]
1.148As the public hearings progressed it was evident that the Government had realised it had not adequately demonstrated why increasing the powers of union delegates was even needed in the first place. It responded ostensibly by having existing workplace delegates appear at public hearings, who then presented evidence that was tenuous at best, and which did nothing to reinforce the government's case. Instead, it only served to further underscore this Bill was only to aid and albeit trade union powers.
1.149Regarding the impacts on the farming and agriculture sector in Western Australia, one myth dispelled about this Bill is that it would have little significance to or impact on the sector:
Senator Cash: What do your industry groups say to the suggestion that the farm sector will not be affected by the closing labour hire loopholes changes?
Mr York: We completely reject the fact that there won't be an impact on the whole agricultural sector with the proposed changes to labour hire companies doing the same job in the same way. The labour market is supposed to be a market. You are supposed to have a range of opportunities. If it is a competitive market, you will draw people to where they are most needed in the economy. It is also a very highly paid Australian workforce. So we are not talking about minimum standards and people in labour hire companies being underpaid—if they are underpaid, we should get rid of that, but I don't say that is the case…
Mr Rogers: The idea that the changes will be quarantined to the big operators is ludicrous. The use of enterprise agreements is relatively low in the farming sector, although not as low as some might claim; there are problems with some of the data. But the idea that it will not be spread across the client base of the labour hire operator and that increases in charges will only impact the farms where those orders are in effect is ludicrous. The idea that increased costs will not extend up and down the supply chain is ludicrous. Vertically integrated businesses, for example, will feel it across their base, across their employment costs. The idea that it will be quarantined to just the big operators and will not have a big impact on agriculture is ridiculous.
Mr Mahar: It demonstrates a complete lack of understanding of the farming or agriculture industry.[99]
1.150The changes to the definition of casual employment, the changes to rights of entry powers for trade union officials, and the increased capacity of union delates in the workplace all potentially jeopardise jobs in Western Australia and pose a risk to future investment in the state. As one Western Australian stakeholder observed:
… these changes lack the critical understanding of the current employment market, and their likely outcome will be the exclusion of people who are no longer able to access work that works for them.[100]
1.151Even half-hearted attempts to intervene by Western Australian Labor Premier Roger Cook were ignored. As reported by the Western Australian newspaper, Mr Cook wrote to the Prime Minister on 20 October 2023 to remind him that Western Australia was the ‘engine room of the nation's economy’.[101] According to the report:
Premier Roger Cook is pleading with Prime Minister Anthony Albanese to ‘carefully consider’ the potential damage his planned shakeup of industrial relations laws could inflict on the State's mining industry. In a major intervention that threatens to create tension between the State Labor Government and its Federal counterpart, Mr Cook has written to Mr Albanese to highlight the WA resources industry's serious concerns with the proposal. Mr Cook has told the prime minister that the legislation must strike the right balance to ensure the State's mining sector - which accounts for almost half of Australia's exports - can continue to power the nation's economy.[102]
1.152In its submission, and in testimony to the Rockhampton public hearing, BHP reiterated what effects the Same Job Same Pay provisions could potentially have on its capacity to provide training to its future workplace. According to the mining company:
If an order were made in relation to OS [Operations Services], SJSP will threaten our ability, through OS, to create new jobs. In addition, SJSP will leave the future of BHP's FutureFit training program highly uncertain. FutureFit academies were established in Western Australia and Queensland under the auspices of Operations Services, to train talent up to join this new business unit. FutureFit is essential to enabling BHP to achieve our gender and Indigenous employment goals in Australia. In 2022, 80 per cent of FutureFit students were female, 20 per cent Indigenous and retention was more than 83 per cent. As a result of the government's legislation, BHP's continued FutureFit investment, and the opportunities it is providing to a new wave of Australians to enter the resources industry, may become unfeasible.[103]
1.153Unlike much of the Government's Bill which incorporated many assumptions and guesswork on the cost impact, BHP told the Rockhampton public hearing what the specific cost would be for Western Australia:
Senator O'Sullivan: …I'm from Western Australia. Lots of us are employed in Western Australia by the mining industry. What's the potential adverse impacts in my home state of Western Australia if this bill were to pass?
Mr Bishop: Of the $1.3 billion or the up to $1.3 billion that was outlined, around a quarter of the impact is in Western Australia.[104]
1.154Federal Labor does not understand Western Australia or our resources sector. Otherwise, why would it attack the one sector which is punching above its weight in contributing to economic growth in this country?
1.155This was a point emphasised by the Perenti Group when describing the actual industry, they understand and operate in:
It is worth noting the Australian mining industry is a lot more than a small number of very large mining companies. It is an ecosystem spanning the full mining value chain - small explorers, mine developers, small and mid-tier miners, large miners, all supported by a vibrant Mining, Equipment, Technology and Services (METS) sector. The METS sector employs over 300,000 people directly and contributes nearly 100 billion to the Australian economy.[105]
1.156Coalition Senators note that in the Bill's drafting, one of its numerous flaws was that it overlooked the effect it would have on competitive tendering. This was a point asked by Coalition Senators during the public hearing in Rockhampton:
Senator O'Sullivan: Can you talk to me about what this bill might do to the function of competitive tendering, Mr Reid?
Mr Reid: That's a really big problem because, as I mentioned earlier, a contractor will not be able to tender for a service contract with certainty that the labour rates that are part of the matrix of what their contracted rate is will be the rates incurred and the rates passed on to the client. So, in the resources and energy sector, even if you put labour hire to one side, you have got hundreds, thousands, of specialist-service contracting businesses and they just won't be able to tender with any level of certainty. The behaviours there from the principals may well be that perhaps they don't seek an opportunity to grow their mine site or the production of their offshore oil and gas platform - whatever it may be. It will have, in our view, an impact on innovation growth.
Senator O'Sullivan: So it's not a regulatory issue, it's a practicality issue?
Mr Reid: It'll drive a reaction from the market that won't be good. It'll disrupt longstanding principles around competitive tendering.[106]
1.157When the Albanese Labor government introduced its amendments in late November, further provisions were included, in essence, that would encourage anti-competitive behaviour in the competitive tendering process. This is because proposed section 306EE(2) says:
… the regulated host must ensure that, from the start of the tender process, all prospective tenderers are advised, in writings, that if one or more tenders are successful in the process.[107]
1.158Coalition Senators note the thoughtful submission made by the Entrepreneurial and Small Business Women Australia (ESBWA) about the negative impacts this bill will have on women, particularly Parts 15 and 16 of the Bill.
1.159According to a media release from the small business platform Xero, 36 per cent of small businesses in Australia are female led.[108] Henceforth ESBWA has concluded that:
… the changes to the definition of employee-like roles impact numerous independent contractors and micro businesses in Australia, with a large proportion of these being women. The changes will prevent women from growing their businesses and building financial independence.[109]
1.160Data published by the Australian Small Business and Family Enterprise Ombudsman (ASBFEO) reveals ‘self-employment allows 1.6 million Australians to earn a reliable income while preserving autonomy and choice. Census data suggests that self-employment is particularly attractive to older people and women’ with 68 percent of female owner manager of non-employing businesses work part-time, compared to 47 per cent of female employees.[110]
1.161Additionally, as ESBWA points out in its submission:
Many female independent contractors appreciate the flexibility offered by gig or contract work. This flexibility often comes with the benefit of higher pay rates along with greater autonomy over working hours.[111]
1.162The Bill's employee-like provision's effect on self-employed Australians was also emphasised by the ASBFEO. In its submission to the inquiry, it stated:
Ensure that the 'employee-like' provisions avoid capturing self-employed Australians who use digital platforms to provide them with flexibility and choice as to how to make a living, either through a default exclusion from the definitions of ‘employee-like’ worker and ‘digital labour platform operator’, or ability for such self-employed Australian to request to be excluded.[112]
1.163While the Minister for Employment and Workplace Relations tenuously proclaims that of the ‘85 per cent of the new jobs created are full-time’from last year's Secure Jobs Better Pay bill,‘55 per cent of the jobs that have been created are women full-time’, he fails to realise the pernicious impact his Closing Loopholes bill will have on female participation in the workforce.[113] This relates to the cause and effect the bill has on the role of independent contractors, a point ESBW highlighted in its submission:
Many independent contractors, including women, often collaborate with other sole traders on key projects. If additional costs and complexities arise from changes in regulations, such collaborations may become financially prohibitive, impeding the growth of these micro-businesses. This limitation on growth could have detrimental effects on women's financial security, as many rely on such business arrangements to generate income.[114]
1.164Given ‘females ownership is trending up and now accounts for 35 per cent of all small business owners in Australia - almost double the rate from the 1970s’ the Albanese Labor government should be encouraging greater female participation and entrepreneurship, while enhancing the parameters of self-employment for women, not less, as this Bill will do.[115]
1.165A solution put forth by ASBFEO to give better safeguards for independent contractors was:
… to clarify the protections contained in the bill to protect independent contractors below the contractor high-income threshold, the bill should expressly replicate section 15 of the Independent Contractors Act 2006, which empowers the Federal Court of Australia" to give consideration to certain matters including bargaining positions and unfair tactics.[116]
1.166On 7 December 2023, the final parliamentary sitting day of 2023, the Government announced it had reached a deal with some Cross Bench Senators that enabled the original bill to be divided into two separate bills. The Fair Work Legislation Amendment (Closing Loopholes) Bill 2023 was introduced and passed by the Senate later that day. Elements of this bill included the Same Job, Same Pay—Labour Hire provisions.
1.167According to an article by David Marin-Guzman published in the Australian Financial Reviewon 30 May 2023:
The ACTU wants the Albanese government's upcoming same job, same pay laws to target major companies such as CIMC, Qube, BHP and Qantas for using labour hire-like structures to push down pay. The union peak body named the construction, stevedore, mining and airline giants in research released on Tuesday that found Australia's largest dozen labour hire providers now ranked in the country's top 30 largest commercial employers with combined revenues of about $20 billion.[117]
1.168As reported by the Sydney Morning Herald, Mining and Energy Union general president Tony Maher had lofty expectations of what he wanted to see from the Bill, saying:
BHP is right to fear that same job, same pay will lift their wages bill because they have been exploiting labour-hire mine workers for years. Along with other big mining companies, they have exploited weak laws allowing them to avoid paying the wages and conditions achieved through genuine enterprise bargaining. Same job, same pay laws will close this loophole.[118]
1.169Coalition Senators note that given the sentiments included in statements like ‘fear’ and ‘exploited’ emanating from union officials, and the fact they will now be further empowered through rights of entry and delegates powers, it is hardly fostering an environment for a productive, dynamic, and harmonious workplace at mining sites anytime soon.
1.170According to BHP's submission:
These new industrial relations laws are not, as the Government claims, as simple resolution of 'loopholes'; they are the most significant and far-reaching change to Australian workplace relations since WorkChoices…The Government has simply not made a substantive, evidence-backed case that SJSP is necessary. It is a solution looking for a problem, with the likelihood of visiting serious harm on the Australian economy. All SJSP will do in the resources sector is arbitrarily drive-up wages in a sector which is already Australia's highest paid. It will create further drag on productivity and will harm Australia's global competitiveness.[119]
1.171In relation to regulated labour hire arrangement order (RLHA Order), BHP's submission said quite pointedly the impact this would have for the resources industry more generally:
SJSP locks in a reverse onus of proof. This means that if an employee or union successfully applies to have the SJSP provisions apply then this will be the default position. It will force business to litigate in the FWC to seek to demonstrate they should not be covered by the SJSP rules. Any such litigation will be lengthy, complex, costly and highly uncertain. The laws introduce a list of factors that the FWC must consider in deciding (at its discretion) whether SJSP should apply to a particular business, but it does not provide any clarity on how the FWC should or will consider these factors in making a decision. The default position is that the FWC must impose SJSP on a business, unless that business can satisfy the FWC that it is not 'fair and reasonable' to do so. In effect, the Bill will require labour hire and service contractor employers, who have already complied with the four existing regulatory layers to contend with a RHLA order potentially overriding all of these.[120]
1.172Would Same Job, Same Pay only affect larger miners, or would it impact the entire scope of business services? On this BHP believe:
It is easy to see how a labour hire or a service contractor business having to manage compliance with potentially hundreds of RLHA orders would become so overwhelmed by these provisions of the Bill that they would elect to stop operating. This would be particularly onerous on small and mid-sized resource industry suppliers, including Indigenous suppliers, who will face additional barriers and compliance burdens and unsustainable wage costs as a result of the Government's legislation.[121]
1.173This evidence was supported by Western Australian mining services company Perenti Group:
There is no definition of 'labour hire' or 'service contracting' within the current bill. While the Fair Work Commission is directed to consider various factors in ascertaining whether it would be 'fair and reasonable' to make an order, there is no clear exemption for genuine service contractors. In effect, genuine service contractors would be required to demonstrate why an order should not be made against them subject to a reverse onus of proof, if they were subject to an application.[122]
1.174During Supplementary Budget Estimates in October 2023, Coalition Senators interrogated the Government about the service contractor’s provision. The Government’s evidence became even more crucial following the government ‘deal’ with the Australian Resources and Energy Employer Association (AREEA) the following month
Senator Watt: And, of course, it is worth recognising that Australian Resources and Energy Employer Association has been involved in discussions around resolving those issues in the way that has just been explained.
Senator Cash: I'm going through the minister's comments that, yes, they are specifically excluded. There is no strict provision. There is a test that has to be worked through, and an application would need to be defended.
Senator Watt: We would say they are excluded via the commission having the power to consider those matters.
Senator Cash: So there is no strict provision is the answer to the question, though?
Senator Watt: No, but they are excluded because of the matters that have just been explained.
Senator Cash: No, they are not, because that is obviously a decision for the Fair Work Commission. There is no strict provision is the answer to the question. There is no specific exclusion, because, if there was, we would be currently working through a particular section of the bill.
Senator Watt: Yes, but the intent is to exclude those types of businesses via the Fair Work Commission's discretion.[123]
1.175What is revealing in this exchange is that service contractors are not excluded, as stakeholders had said, because it is the FWC which has the powers to consider those matters, not the legislation. The Minister says the ‘intent’ is to exclude, but ‘intent’ is meaningless unless the plain words of the Bill actually reflects such an intent, Otherwise, it is left to interpretation by the FWC based on its appraisal – its ‘discretion’ - of the multi-factorial test.
1.176The trouble with the multifactorial test is, as the MCA correctly observed, ‘the discretionary factors are also open-ended and could cover an infinite range of scenarios and outcomes’.[124] So rather than addressing it directly in the Bill, not with ‘intent’ but with actual words, the Government outsourced this responsibility to the FWC. Naturally, this was done with deliberate design intent to appease the trade unions.
1.177This becomes even more apparent after the Government introduced its amendments to the Bill in late November. That revealed the Government’s word play with the amendments. Simply put, an applicant will need to litigate to avoid capture. Otherwise, they play the lottery with the FEC ‘discretion’ as the Minister indicated during budget estimates.
1.178On an ideological front, the Same Job, Same Pay also underscores how the Government believes the Australian labour market should operate in the 21st century, while ignoring how the workplace itself has evolved since the 1970s.
1.179It also reinforces a view held by elements of the Labor Party, and shared by the union movement, they just do not like labour hire work because it does not conform to its one-dimensional view of some bygone era command and control formula in the workplace. This was evident during the Sydney public hearing with testimony from RCSA:
Senator White: If you've highlighted these problems with the existing situation, surely changing it is a god idea.
Mr Cameron: Not changing it for the worse, no.
Senator White: Isn't it that you don't want casual conversions? You want to have a large number of casuals. That's your best-case scenario. You'd be happy if there were no awards.
Mr Cameron: That's absolutely not the case. There are a large number of our members who actually have preferential models around on-hire permanent employment. They retain the individual. Their margins actually improve. Their ability to manage that workforce and keep it is far greater. It's far more profitable. The reality, though, is that most clients actually look to engage labour hire, staffing and locums because of their operational requirements, the market variations, the environmental variations and otherwise. There's a whole heap of insecurity in business that doesn't get considered here either…
Senator White: Do you support the principle that workers should receive at least the same pay rate as their directly employed while doing the same work?
Mr Cameron: I don't think that it's as simple as that. I think that's a one-dimensional consideration of this. There are so many different variations. It depends upon contracts. It depends upon scopes of work. It depends upon skill. It dependents upon experience. I don't think we can - excuse me for saying this - dumb it down to that level where's it's imply that everyone who does the same job should get the same pay. I don't think we live in a world where we can actually be that simplistic.[125]
1.180In a media release the MCA said:
Any amendment that does not include a complete removal of service contractors from being exposed to "same job same pay", and a proper definition of "labour hire" would merely be tinkering at the edges, and an attempt to hoodwink parliament and the public… From the outset, all service contractors are captured unless they can litigate their way out via the multi-factor test, with the Bill stacking the odds against them. Tinkering with the test doesn't alter the fact that all service contractors will still be captured till they can litigate their way out, at great cost to themselves. Amendments to the multi-factor test are not a credible solution. More litigation is not the solution to the problem.[126]
1.181MBA said the Minister was ‘attempting to create his own minor loopholes for a couple of specific industries while still leaving the economy high and dry’.[127]
1.182When it came to the small business sector, the Bill offered little clarity to those who operated in this all-important part of the economy. Evidence was taken from the Tasmanian Small Business Council that in relation to their sector the bill did not specific who was included in Same Job, Same Pay, or the labour hire provisions of the Bill:
On labour hire and on same job, same pay: although the notes say that this measure will not apply where the host is a small-business employer with fewer than 15 employees, it is not immediately clear whether, in the event that, say, a vineyard with a standing staff of four employees utilises a labour hire company and 20 of their staff to pick grapes for a three-year or four-year period, that is still a small business for the purpose of the legislation. It does exceed the FWA definition of 15 employees. Will the farm owner need to pay the same rate as he pays his standing employees, all of whom receive a bonus wage rate as a result of loyalty, skill, longevity and trustworthiness? Let's hope that sense will prevail. Even the simplest information is confusing because the employment law chooses to use a numerical specification of small business different to the Australian Bureau of Statistics definition.[128]
1.183The MCA summed up the Government's method as ‘unfortunately, this is the modus operandi for Minister for Workplace Relations Tony Burke. Find a soft target, get them to support your amendments sight unseen and then portray the problem as solved. No one should be fooled by such tactics’.[129]
1.184How the Bill captured independent contractors was an obvious concern to many stakeholders. This included those that particularly operate in the building and construction industry where there are over 260,000 independent contractors and self-employed tradies. During the first Canberra public hearing Coalition Senators heard how the Bill created confusion and complexity for independent contractors:
Senator O'Sullivan: As has been said many times in relation to this bill, it's very complex and very comprehensive. It covers a whole range of issues. One of the issues that we haven't had a lot of time on so far in the hearings is the independent contractors. That's where I want to focus most of the time I've got now. I'll go to the HIA. On page 14 of your submission, it says that there should be 'a definition of ‘independent contracting’ as opposed to the adoption of a definition of employment'. Can you elaborate on this regarding the complexity of the current bill with the worker status?
Ms Adler: Our view is that the better starting point, as outlined in our submission, is to define what an independent contractor is as opposed to defining employment as outlined in the bill. Our submission also details how we would propose to do that. We would propose to use the Independent Contractors Act, which, as has been discussed or as a part of these reforms, is a long-standing piece of legislation that's very familiar and to use an income tax legislation approach called the alienation of personal service income test, which, again, is a long-standing test. It is based on a self-assessment of the independent contractor, who can then carry out that self-assessment based on three factors, which, again, are outlined in the submission, and then come to a certain conclusion as to their status and then proceed on that basis. What the bill proposes is unfamiliar and complex and adds, as we've said in the submission, yet another test of worker status to add to the plethora that the industry already has to deal with and carry out assessments on regularly. So we see that what we proposed in the submission is a more sensible and certain approach that would give all of the independent contractors in our industry the certainty they need to get on with the job of building people's homes.
Senator O'Sullivan: You talk about the 'plethora' of other elements that you need to comply with. In your submission you talk about how, if there were a definition of 'independent contractors', that would deal with the issues that you have around states and territories, who, as you have put it, have muddied the waters with their own interpretations. Is that what you were referring to? Can you just elaborate a little bit and help me understand what it's like in that regime that you're talking about with other states and territories?
Ms Adler: What independent contractors are faced with now is tests of their status at both a federal level and a state level. We've got tax and superannuation, for example, at a federal level. Then, at a state level, as outlined on page 15 of the submission, work health and safety legislation has another different test. Workers compensation has another test. There is payroll tax, antidiscrimination legislation and then long service leave as well. As you can see, there is a list of different regulatory frameworks that our members need to consider when they're engaging independent contractors.
Senator O'Sullivan: And you're contending that, if it were defined, it would help deal with that uncertainty and complexity?
Ms Adler: Our best-case scenario would be one definition of who an independent contractor is that the industry could point to and say, 'We've satisfied that test; therefore we've satisfied all of these other different regulatory frameworks for the purposes of being an independent contractor.[130]
1.185Coalition Senators note that MBA describes independent and subcontracting within the industry as ‘long-standing and legitimate method of engagement’:[131]
Senator Cash: In the summary of your submission, you say the independent contracting part of the bill attacks flexibility and independence: Independent contracting is not only a critical element of building and construction work, but also provides people with the flexibility they need to juggle family responsibilities … Could you expand on the attack on flexibility and independence?
Mr Schmitke: It's in a number of areas. Obviously, there are the changes to the casual provisions but also the changes to the definition of "employee' and a whole raft of areas, which I think we've covered off. The concern that we have in building and construction is that 40 per cent of the potential future available labour force don't want to be part of building and construction, and that is because they are women. We have a very small proportion of women in our industry. That is something that we need to address, and we're trying to address it. We have a significant forecast skills shortage, particularly for trades labour. We need to have broader access to a broader workforce, and we need to have a more inclusive and diverse workforce in building and construction so that we look like other workplaces and other industries. At the moment we don't look like that. Taking away people's options for flexibility, taking away people's opportunities to say, 'Maybe I might give a construction job a go, because I can still manage all these other responsibilities'—that's something that we're very serious about trying to achieve, and it's not a feature of our sector. In fact, the reverse is the approach. The feature in our industry is patterned enterprise agreements, very rigid hours of work and very few opportunities to get around those hours of work.
1.186And later during the session with the same witness:
Senator Cash: So subcontractors in the building industry are actually included in this legislation?
Mr Schmitke: Yes.
Senator Cash: What's the impact, then, of the inclusion on your industry?
Mr Schmitke: … The capturing of this for our industry is a complete nightmare from a complexity perspective and a cost perspective and a risk perspective. Perhaps I can explain it this way. An average residential house, when it's being built, will have a builder and probably anywhere between 15 and 25 specialist service contractors that will come through throughout the various phases of that build. If we're captured by these laws, that will mean that, every time a subcontractor goes through a particular site, they will have to make sure that they're compliant with this obligation if they're caught by a regulated labour hire arrangement order.[132]
1.187Coalition Senators also note this Bill will further drive-up costs in the building and construction industry. Consequently, it will make housing affordable in the residential sector even more expensive than it already is. And who will bear the brunt of this?
Senator Cash: It adds to costs, did you say?
Senator Cash: Where do the costs go, again?
Mr Schmitke: Back to the client.[133]
1.188The impacts to independent contractors were not just confined to the building and construction industry. It is similarly directed at the care and support sector, including providers like Mable, which the evidence shows the Government clearly had in its sights.
1.189According to Mable:
These reforms could result in less flexibility for independent contractors and their clients in reaching mutually agreeable terms tailored to their unique individual preferences and need. This might include prohibitions on working in certain ways (such as for less than two hours in a shift) and added complexity from having to navigate award-like standards (when support providers are already able to set their own rates and terms, negating the needs for such an intervention)."[134]
1.190The Government does not seem to understand how these platforms functions. Mable is a horizontal platform, like Airtasker and Expert 360, and so it has an instant dislike to them because Mable is a disrupter in the marketplace it operates in and not a traditional form of employment.
Senator O'Sullivan: Is it correct that the government has said that all those people working on Facebook and Gumtree are not captured by this legislation?
Mr Scutt: I'm aware they've said that directly and have indicated that people operating via Facebook are clearly not employee-like.
Senator O'Sullivan: And why not?
Mr Scutt: I don't understand that point because it's quite evident the same independent contractor can be providing the same services to the same end participant in the same way via Facebook or via Mable. It's just that Mable comes with an offering around administrative benefits and safeguards for both sides of the platform. If people value those, they choose Mable. If not, they go to Facebook. That's one of the issues around employee-like legislation. It seems to be linking employee-like to the use of a digital platform in your business. So, if you're an independent contractor connecting via the Coles noticeboard, you're not covered.
Senator O'Sullivan: Not the Trading Post or—
Mr Scutt: Or the Trading Post or Facebook—as soon as you use digital tech in your business you're suddenly treated differently.[135]
1.191As with everything else connected to this Bill, should this Bill become legislation there will be a cost increase for clients of Mable, which include those on the NDIS. In their submission Mable state:
… it is likely that Mable's platform fees will have to increase as a result of this legislation, impacting both clients and support providers. The Mable platform is not operationally similar to ride share and food delivery platforms. There is not a single service offered via the platform, and Mable does not control the rates and terms for providing the service.[136]
1.192Evidence from Mable on this cost increase was heard during the Melbourne public hearing:
Senator Brockman: If the employee-like reforms proceed, and it's clear that you are targeted to be dragged into them, what will the impact on clients and support providers be?
Mr Scutt: I think there could be a range of impacts because we're still not certain what minimum standards will be set. But it will likely be that people will pay more for their support than they otherwise would, particularly if there was, for example, a two-hour service minimum that's been talked about. Whereas people with a disability have a legitimate need and older people for an hour service; if you can connect somebody locally that is willing to do that because it's convenient and they can price it appropriately, that produces a better quality of life for a person with a disability at 25 who wants to go to bed at 10 o'clock, not 6 pm. Also, Mable is not a rideshare or food delivery platform. We don't have a single service. We have a wide range of diverse services, and being able to apply minimum standards across those services when two individuals are agreeing the terms and nature of those services has potentially significantly more costs for Mable that will result in potentially higher platform fees that both sides of the platform will pay. I know there was talk about portable entitlement schemes. We note people on our platform already put money aside for leave. They have the ability to earn more to do that. So there's a range of unknowns. I think the NDIS is going to be critically dependent on people being able to find the support to live a good life, and anything that's undermining the choice and control of both sides of the platform to find mutually successful relationships I think can result in a less effective care economy.[137]
1.193Small business operators who engage various independent contractors were also troubled at what the bill was proposing. One small business proprietor who provided a Name Withheld submission wrote:
It is my view as a small business owner that the Government, with this proposed bill, is trying to discourage the use of independent contractors. It is proposing a policy to reverse union court defeats and effectively saying to the economy that ‘unless you employ someone part time or full time, all methods of engagement are invalid or unwanted’ - the bill is trying to classify more contractors as employees. There is no other conclusion you can make.[138]
1.194In their evidence presented during the first Canberra public hearing, the National Electrical and Communications Association (NECA), whose members are mostly small electrical businesses with less the 20 employees, provided a solution to fix the Government’s mess:
… to simply, clarify and remove confusing, open-ended multifactor tests and onerous compliance requirements that will impede the efficient operation of small businesses. Further, the ambiguity of the relationship of this bill to independent contractors is a real concern to NECA and its members. We request that the government give serious consideration to explicitly carving out independent contractors from the bill.[139]
1.195It is important to start off this section with acknowledging that it was the Coalition who legislated for the first time, a clear and reliable statutory definition of a casual employee.
1.196The definition was focused on the offer and acceptance of employment and draws on common law principles.
1.197However, the proposed changes put forward by the Labor Government to S15A(1) fundamentally re-writes this definition and what was reaffirmed by the High Court of what the definition has been all along under the FW Act.
1.198Every employer group and business organisation that appeared before the inquiry, or made a submission, said that the changes to the definition of casual employment would not only add further complexity to an already complex industrial relations framework, but would restrict choice, upend established judicial precedents, and add further stress to the viability of many businesses who are already being weighed down by the economic mismanagement of the Albanese Labor government.
1.199This point of overturning judicial decisions in which union parties did not get their way was noted in several submissions, including the MCA:
A concerning feature of the Bill is that in several measures it is designed to overturn High Court decisions on employment and industrial law.
The High Court of Australia is comprised of the finest legal minds in the country. The Court’s landmark employment and industrial decisions in recent years have comprehensively addressed several key legal concepts in the workplace relations framework.
Several elements of the Bill are at odds with the established legal framework and run the risk of creating significant uncertainty and imbalance.
It is fundamentally inconsistent with the role of an ‘umpire’ for any government (or any union) to simply legislate to overturn its decisions when they do not go their way. Business, government and unions all speak of the need for a ‘balanced’ workplace relations system. But ‘balance’ requires all sides to accept the decisions of umpires, whether or they like them or not. It is inherently unbalanced if one side simply reverts to legislation to overturn an umpire’s decision if they do not like the outcome.[140]
1.200On the new definition of casual, there was a concord of agreement that the Government had not demonstrated in any why there was even need for a change, beyond the trade union movement’s prejudices against this form of work.
1.201Pinnacle People, an organisation that employs ‘more than 7,000 casual workers’ said in its submission:
The government has failed to make a case for the need around changes to casual employment. Instead, it has, without justification, proposed to re-create a substantial problem that was addressed effectively by legislation and high court decisions in recent times. The changes make it exceedingly difficult to engage casual employees with any sense of certainty or confidence.[141]
1.202What the evidence exposes is that trade union leaders simply have a deep prejudice this form of worker engagement in the Australian workplace framework. Like most prejudices, there is no logical explanation for it. It was the trade unions that were calling for this change to the casual definition, and the Albanese Labor government, acquiesced.
1.203Writing in The Australiannewspaper, business columnist Robert Gottliebsen also identified the unions’ agenda with casual work:
When the government and the ACTU comment on the 784-page business blueprint, which goes under the misleading tag of ‘closing the gaps’ in industrial relations, truth is often simply ignored. The proposed legislation aims to wipe out most casual employment and replace it with full or part-time employment. The ACTU claims casual employment will not be wiped out, but they clearly have not read the wording of the proposed legislation, which makes it dangerously complex to classify anyone as casual… If the legislation goes through, this will represent a massive contraction of the Australian economy and lead to many under mortgage and rent stress throwing in the towel.[142]
1.204The other myth propagated by the trade union movement, and the Labor Party, is that casual work is on the rise. It is simply not the case and again highlights that it is the unions that have the government fixing a purported loophole that just does not exist.
1.205The Coalition Senators note that the Government has argued that its proposed changes to casual employment arrangements is to combat ‘casualisation of the workforce’. This is despite all evidence showing the rate of casual has been broadly the same over the past 25 years.
1.206A study of the facts reveals that casual employment has steadied, if not decreased. Figures from the Australian Bureau of Statistics show casual workers comprise 22.2 per cent of the workforce. This has declined in comparison to what it was in 1998, when it was 25 per cent.[143]
1.207Since the changes that were legislated in 2021 changes, which inserted a right to casual conversion in the National Employment Standards for the first time, less than 4 per cent of casuals have elected to convert.
1.208Coalition Senators note the trade unions, and the Albanese Labor government, erroneously believe because there has been a low take up with casual conversion, there must be something wrong with the current definition of casual employment. Alternatively, if the Government made conversion even easier (noting that employer groups said that current conversion laws were not an obstacle) there would be a mass take up of the permanent conversion.
1.209Specialist recruitment company Hays, who has almost 16,000 on-hire workers in its employ, noted:
… the current casual conversion laws provide strong evidence that most people working regular hours as casual employees for extended periods do so through their own choice. For instance, under the current arrangements less than 1 per cent of workers have elected to convert.[144]
1.210International recruitment, HR, consulting, and labour hire company Brunel, which engages over 1,000 workers, expressed similar sentiments in their submission regarding how the present conversions rules were operating.
Current casual conversion laws provide strong evidence that most people working regular hours as casual employees for extended periods do so through their own choice. The changes to the Fair work Act that brought about the changes to casual conversion have demonstrated that the workers that choose to work through our business have little to no interest in becoming permanent employees of our organisations Since September 2021 less than 6.5% of those offered permanent employment have elected to become permanent employees…Ultimately, what the data tells us is 93.5% of Brunel's employees who qualified for casual conversion chose not to do so.[145]
1.211The actual new definition of causal work itself is fundamentally flawed; a point repeatedly emphasised by stakeholders during the inquiry.
1.212Employer peak body the Ai Group said:
… the definition of a 'casual employee' in the Bill ignores the realities of the Australian labour market and the preferences of a very large number of employees. It is beyond contention that a very large number of employees in Australia prefer to work on a casual basis, and prefer to work regular hours.[146]
1.213Additionally, Coalition Senators note the Ai Group specified how the new casual definition was seriously flawed. It is worth detailing these here in full for the benefit of this report:
The definition of a 'casual employee' in the Bill:
Is inconsistent with the common law definition;
Is inconsistent with the High Court decision in Workpac v Rossato;
Is based on the flawed approach in two Federal Court decisions that the High Court strongly criticised and overturned;
Is inconsistent with the longstanding orthodox approach to determining whether a person is a casual employee under most industrial instruments;
Is risky and uncertain;
Is bound to cause major problems for both employers and employees;
Will reduce employment opportunities for employees and lead to an increased level of unemployment;
Ignores the fact that around a million casual employees work regular hours and have been with their current employer for at least 12 months;
Is inconsistent with the outcomes of various casual employment test cases in federal and state industrial tribunals;
Is inconsistent with the definition of 'long term casual employee' in the FW Act; and
Will encourage litigation, including class action claims.[147]
1.214The BCA points out that in some instances, it is the unions themselves who have been requesting that workplace arrangements are regular to provide certainty for workers. According to the BCA:
The Shop Distributive and Allied Employees' Association is currently pressing that rosters, including for casuals, are to be made available four weeks in advance, despite casual employees being engage by the hour.[148]
1.215The ACCI in its submission draws attention to the Government's new definition as being possibly contrary with other provisions of workplace laws. ACCI states ‘the FW Act 2009 explicitly recognises the notion of "regular casual employees", who are casual workers employment "on a regular and systematic basis”’.[149] Yet the Government was now trying to unwind established precedence with its new definition.
1.216Coalition Senators note the widespread concern from stakeholders with the new casual definition, how it is contrary to judicial precedents, the risks posed by the misrepresentation provision, and why the government was aggressively motivated to changing the existing casual definition in the first place.
1.217Employers have been clear. The change to the definition of casual will have an injurious effect on the Australian economy, including on productivity, workplace flexibility and job growth.
1.218Coalition Senators note that mid-sized Australian labour-hire company Collar, reflected in their submission that:
… the introduction of the new definition, alongside the implementation of civil penalty provisions for misrepresentation casual employment, greatly heightens the risk associated with engaging casual workers who may have consistent weekly hours or shifts.[150]
1.219In response to a question on notice, Clubs Australia provided an excellent example of what the impact would be for small businesses by the change to the casual definition:
… with few employees, a casual conversion will have a proportionally greater employment costs impact on a small club. Suppose a small club has two permanent employees and two casual employees, with the casual employees supporting the club to mange fluctuations in business. Converting a casual employee to permanent employment would disrupt the labour mix, increase employment costs and limit the club’s opportunities to scale up and down their operations in line with demand.[151]
1.220During the Rockhampton public hearing, evidence was heard from Master Grocers Australia on the direct implications the casual changes would have for them in the supermarket sector:
Senator McDonald: In the National Retail Association's submission, at page 2, it asserts that this bill will inject uncertainty into our workplace relations framework, impede productivity, curtail innovation and curb employees' autonomy to define theirown work methods. What kind of conversations will your members need to have with their employees about the lack of casual employment they will have as a result of this bill? I assume some of them will be university students or women who prefer to work casually while children are at school. How do you think that will work?
Mr Stirling: The ability to offer casual employment is essential to some communities, and it is essential to some workers. Mr Slaughter, who is appearing here alongside me, is not only a non-executive director at MGA, but he is also the owner and operator of a grocery business. Mr Slaughter may be able to speak to some of the benefits of casual employment in this business.
Mr Slaughter: Certainly the casual component of our business is such an important element. As we all know, customers are not regular. There are ebbs and flows in customers as they come through the store. Outside that, even the logistics of getting groceries to any given supermarket isn't regular either. We need that casual component to be able to put that stock away at any given time. That's more evident these days, obviously, since COVID. The whole logistic framework has almost been turned upside down. It's vital that we have that flexibility in our workplace.[152]
1.221Outdoors NSW & ACT, the peak body in active recreation, outdoor education, and adventure tourism, said the new rules on casual conversions would conflict with business operational requirements:
Casual employment is often used by businesses to meet fluctuating work demands. Allowing employees to choose permanent status could limit the organisation's ability to adapt to changing needs. This could result in overstaffing during slow periods or understaffing during slow periods or understaffing during busy times leading to possible business closures.[153]
1.222On the Bill's provision relating to casual conversion, Collar stated:
The existing laws governing casual conversion offer compelling evidence that individuals who consistently work regular hours as casual employees over extended durations do so willingly as a result of their choice having regard to their own circumstances. Under the present conversion requirements, we send a monthly notification to employees, and remarkably, not a single employee has ever expressed a desire to transition to a permanent employment. The right to request conversion every six months requires employers to provide detailed reasons if refused and outputs a significant administrative burden when the nature of casual work is dynamic rather than static in nature.[154]
1.223During the Launceston public hearing, evidence was taken from the Tasmanian Small Business Council who remarked:
The proposals in the bill ignore the needs of a significant cohort of employees. The rush to make every employee full time or part time is short-sighted and demonstrates a lack of research on behalf of the proponents of the legislation. A significant reason why so many employees are casual is that they choose to be so. Legislation has been in place for long enough now to show that the percentage of employees choosing to take up full- or part-time employment, as opposed to remaining in casual arrangements, is low—in fact, in single digits. Many people consciously choose to work casual hours to meet their family's or their personal circumstances or needs. Inferring that they are missing out by not being part- or full-time employees will preclude possible employment elsewhere, severely impact their lives and livelihoods and effectively reduce the available labour force when there are acknowledged shortages across Australia because they may well choose not to engage.[155]
1.224In his Second Reading speech when introducing the Bill, the Minister said ‘most casuals who are eligible won’t want to convert. Most will prefer to keep their loading’.[156] And yet the Government has a mammoth bill to fix a ‘loophole’ which the Minister readily acknowledges those it applies to ‘won’t want to convert’.
1.225It was during this same speech the Minister also said the new casual definition was about ‘providing certainty to business’.Yet in submission after submission, witness after witness, the Government heard how the new casual definition would provide everything but ‘certainty’ for businesses and that there was no ‘loophole’ to fix, as the uptake to permanent conversion was low under the provisions the Coalition government passed in 2021.
1.226This is a point reiterated by medical recruitment labour hire firm, Wavelength, who submitted:
the government has failed to make a case for the need around changes to casual employment. Instead, it has, without justification, proposed to re-create a substantial problem that was addressed effectively by legislation and high court decisions in recent times. The changes make it exceedingly difficult to engage casual employees with any sense of certainty or confidence. Coupled with the recent restrictions on fixed-term contract engagement, the changes will mean that in scenarios where work hours are regular, but placements have the potential to be extended, such as long-term sick or maternity leave fill roles, it will be near impossible to employ a worker at all.[157]
1.227The Albanese government and unions increasingly object to casual work as part of a campaign against ‘insecure work’. It is clear what lies behind this motivation: casuals are less inclined to join trade unions. Casual jobs are legitimate jobs. Many people, like students, enjoy the choice, flexibility and higher rates of pay associated with casual work.
1.228If the Government’s Bill passes as proposed, workers/employees will be unable to receive both a 25 per cent loading and predictable hours of work despite the promise by the Minister. These workers be forced to accept a pay cut/loss of casual loading or lose the stability of their roster/hours.
1.229The Government is ignoring the significant impacts the Bill will have on road transport, supply chains and contractual obligations and it has dismissed the concerns that have been raised about the impact on competition and inflation as a result of the cartel and price-fixing conduct that the Bill would make legal.
1.230The Albanese Labor government has repeatedly sought to deny the new Road Transport Advisory Group and ‘expert panel’ of the FWC is not a new reiteration of the failed Road Safety Remuneration Tribunal, which had a devastating touch on the industry and was abolished by the former Coalition government in 2016.
1.231Coalition Senators note that, alarmingly, the Bill goes even further and will introduce something even worse than the failed RSRT. The Bill gives the FWC wider powers to include setting conditions for the road transport industry then what already currently exists in the modern award system or the failed RSRT.
1.232Disconcertingly, the Bill empowers the FWC to issue orders to regulate payment times, deductions, working time, insurance, consultation with unions, union delegates (including compulsory delegate training leave) and cost recovery. Moreover, the FWC will have the new ability to investigate the application of unfair contract terms, despite not having the business knowledge and competition law expertise on these matters.
1.233Even more worryingly, it will extend into contract driver arrangements and into the supply and contract chains. This capacity to enable the FWC to make orders on contractual chain participants is deeply troubling. It is an attempt by the government to misuse the workplace relations system to regulate commercial arrangements that are, rightly, regulated by other laws. This reflects the longstanding ambition of the Transport Workers Union to ‘set and enforce’ its own chosen forms of regulation in the sector.[158]
1.234The very clear intent of the Government and the TWU is to use this Bill to create an enormous legislative loophole that would enable them, via their new version of the RSRT, to bypass competition and commercial laws that exist to protect consumers and prohibit anti-competitive conduct by big businesses and big unions. This is the biggest loophole of all, and something that the government and TWU are attempting to sneak through as part of an omnibus bill without scrutiny or transparency.
1.235The issue of price collusion and anti-competitive behaviour potentially cascading into the transport, freight, and supply industry generally, evident under the previous RSRT, defies comprehension. It is so concerning that Coalition Senators consider it appropriate to dedicate a specific chapter of this report to this matter alone.
1.236The Road Transport provisions of the Bill include several far-reaching aspects that risk pushing up inflation in key markets including groceries, fuel and building supplies. In a once-in-a-generation cost of living crisis, the last thing that Australian households and businesses need is higher inflation.
1.237These provisions will create new loopholes that will legalise anti-competitive conduct in the road transport industry. This conduct is otherwise treated as a serious criminal offence subject to multi-million-dollar penalties under the Competition and Consumer Act 2010.
1.238If passed, the Bill’s changes will push up prices for everything transported by road. Competition law has a direct and significant impact on prices, as recently stated by the Treasurer Jim Chalmers:
For consumers and workers, the implications are simple: a less competitive market means higher prices, less choice, worse products and services, and lower wages growth.
Other businesses also suffer from unfair practices and higher business costs. Less competitive markets reduce the incentives and opportunities for businesses to invest, grow and innovate.[159]
1.239And similarly, the Assistant Treasurer and Assistant Minister for Competition, Andrew Leigh, recently said:
Competition encourages productivity gains that can be passed through to consumers for lower prices, more choice of higher quality products and it helps workers gain higher wages.[160]
1.240This is the exact opposite of what fellow minister Tony Burke is proposing. His changes would shatter competition in the road transport industry – the largest component of Australia’s transport industry, which is the second largest contributor to GDP after mining.[161]
1.241The Bill will create this loophole by introducing a new type of agreement – a so-called ‘collective agreement’ that can be made between a union and a major company and applied to their road transport supply chain. There only needs be agreement between the union and head contractor with no involvement from the participants in that chain, or their employees, and with no allowance for them to object to or avoid those terms.
1.242The Bill also adds to this loophole by creating ‘minimum standards orders’ which can set compulsory terms that are imposed by the new version of the RSRT on any participants in the road transport industry, simply on the application of a union, a single company involved in the industry, or even the Minister!
1.243Alongside these new impositions is a provision that explicitly authorises conduct that would otherwise be a restrictive trade practice under the Competition and Consumer Act2010(clause 536JT). This includes authorising:
Price fixing,
Bid rigging,
Making agreements that substantially lessen competition,
Misusing market power, and
Setting minimum prices for goods transported by road.
1.244Anything done in making, registering or complying with a collective agreement or a minimum standards order is given this exemption from competition laws.
1.245It is no surprise that such TWU-friendly terms are included in the Bill. Minister Burke has made no secret of the fact that parts of the Bill were practically written by the TWU. In a speech to TWU delegates in August 2022, Minister Tony Burke said:
This idea of giving a flexible power to the [Fair Work] Commission was developed really closely in consultation with Michael Kaine [TWU National Secretary]...[162]
1.246The Bill is an attempt to legislate much of the TWU’s wish list. It poses enormous risks and costs for all Australians - who rely every day on road transport to provide for their essential needs. It is a guaranteed formula for higher prices and higher inflation.
1.247Whilst these provisions may benefit the TWU and certain large corporations, they will damage every Australian business and thousands of small businesses, who will no longer be protected from predatory and anti-competitive conduct by big business and big unions.
1.248The TWU, it has long campaigned for higher and more restrictive pay arrangements for contractor (owner) truck drivers.[163] This TWU campaign is run on the false pretext that such rates are ‘safe rates’ that should be applied across the industry to improve road safety. However, extensive literature reviews in 2014 and 2016 examined the relationship between higher rates of pay and road safety and found no conclusive link.[164] The failed RSRT was based on this false pretext. Coalition Senators note with concern the statements of the Committee Chair, Senator Sheldon, in his first speech to the Senate, in which he pledged to restore the failed RSRT:
I vow that I will not rest until this parliament restores safe rates into this country.[165]
1.249The Bill stands to benefit the TWU and big business in several ways, all of which will be at the expense of Australian consumers already struggling with high inflation and cost-of-living pressures.
1.250The ‘collective agreement’ provisions of the Bill would—amazingly—allow for the TWU and one large employer, such as Coles and Woolworths, to impose the terms of this ‘agreement’ on all road transport industry participants in their supply chain. This could devastate smaller trucking businesses and owner-drivers, who would be either forced to accept uncommercial terms or go out of business. This was, of course, the outcome of the one ‘payments order’ issued by the failed RSRT, which Senator Sheldon and the Labor Party fought so desperately to retain and are now committed to reinstating.
1.251This obvious motivation for creating this loophole is the preference of the TWU for employee-drivers, particularly those hired by large employers, who are easier to unionise. This could be simply done by the TWU negotiating one ‘collective agreement’ with one big corporate and then using the loophole to impose it across all of its commercial contracts.
1.252For major logistics corporations, such as Toll, Linfox, ACFS Port Logistics, Ron Finemore and FBT Transwest, such arrangements increase their market share by eliminating competitors and simplifying their dealings with the TWU. Predatory conduct such of this is currently illegal under competition law, but under the bill, these big businesses can take advantage of the loophole and exempt themselves, simply by signing up to a ‘collective agreement’ with the TWU.
1.253The TWU also stands to reap enormous financial benefits from this loophole, by including terms in ‘collective agreements’ that will provide it with lucrative tax-free income streams and then imposing them onto every smaller business who is captured by the ‘agreement. The TWU has already inserted such terms into many current EBAs with major logistics companies that illustrate what might seek to include in a collective agreement or minimum standards order and how these may be unmanageable for smaller operators. These include:
(1)requirements to obtain training and licensing through the TWU or associated organisations such as TEACHO (the Transport Education Audit Compliance Health Organisation);
(2)forcing workers to use TWUSuper as the default superannuation fund;
(3)forcing contributions to be made into TWU-linked income protection and insurance funds, requiring payments to be made into TEACHO; and
(4)paying for the TWU to give ‘inductions’ to all new employees promoting union membership.
1.254It is easy to foresee how this loophole will be abused. For example, Coles and Woolworths or Ampol, Shell and BP could all agree to enter into TWU ‘collective agreements’ in the same terms in order to simplify their logistics arrangements and push up consumer prices and their profits. This would currently be an illegal misuse of their market power under competition law but would become lawful under the government and TWU loophole created by the bill.
1.255No submission was received from the Australian Competition and Consumer Commission (ACCC) to this inquiry; however, Coalition Senators note that in the ACCC’s submission to the 2022 Productivity Commission’s inquiry into Australia productivity performance, it said:
Competition is essential for markets to function well. Competition engineers a process of creative destruction where more productive firms replace less productive firms. It also drives innovation and the adoption of cutting-edge technologies and processes.[166]
1.256Inexplicably, the during the consultation and drafting phase of the Bill, the Government largely neglected the input from the ACCC, meeting them only once, in 2022. This was ascertained by Coalition Senators during Supplementary Budget Estimates (25 October 2023) and during the first Canberra public hearing (10 November 2023) when officials from the Department were questioned:
Senator Cash: Going back to the department's engagement with other agencies, I want to turn to the impact of collective agreements and supply chain changes. Did the department seek and/or obtain the ACCC's views in relation to the effect of those provisions on competition or competition law?
Mr Hehir: I'd need to check whether we spoke to the ACCC. We did speak to the policy agency—
Senator Cash: In the ACCC or—
Mr Hehir: No. Treasury is the policy agency. So, yes, we have engaged with Treasury around that.
Senator Cash: About this particular part of the bill?
Mr Manning: We did different consultations on different parts, and Mr Jones might speak to the minimum standard orders and the road transport safety orders consultation.
Mr Jones: I might just try and find my briefing on that, but we certainly spoke to Treasury a number of times. I'd have to take a second to look through my notes to see whether we spoke to the ACCC.
Senator Cash: Thank you; I appreciate that. I'll also ask: did the department engage with the Productivity Commission in relation to the effect of the legislation on productivity?
Mr Manning: There was a conversation with the ACCC.
Senator Cash: Fabulous. When did that occur?
Mr Manning: November 2022.[167]
1.257The Department was again question on this subject at the first Canberra hearing:
Senator McKenzie: Did the department consult the ACCC—and, if so, in what capacity—on the development of the legislation?
Mr Jones: We did consult with the ACCC.
Senator McKenzie: How?
Mr Jones: In terms of the capacity, it was early on in the process and we consulted with them about the policy parameters of it. We also—
Senator McKenzie: Was the ACCC aware that you'd be exempting price-fixing, cartel behaviour and anticompetitive behaviour particularly within the transport sector?
Mr Manning: There's not an exemption for some of that behaviour, like cartel behaviour, but we had multiple meetings with Treasury, as the responsible policy agency, in relation to—
Senator McKenzie: The ACCC is our independent competition regulator for a good reason—so that big governments, big unions and big corporates can't collude against average Australians. There is a great level of concern about specific powers, particularly under section 45 of the Competition and Consumer Act, that are being exempt and pulled out of this bill.
Mr Manning: The Treasurer is the minister responsible for that legislation, so we consulted his agency.
Mr Kerr: Senator, I might just quickly describe the competition carve-out that I think you're referring to in section 536JT—
Senator McKenzie: I have limited time. I just wanted to know, 'Did you consult with the ACCC about stripping out the power around price-fixing, cartel behaviour or other anticompetitive behaviour?' and I'm getting, 'We consulted them early in the piece about policy parameters.' I understand what that means, Mr Kerr, and I understand that it won't mean the specifics that are now in front of the Senate.
Mr Jones: If it assists—and I'd have to take the detail on notice—my recollection is that we likely did flag with them that there may be a competition carve-out at some point in the legislation.
Senator McKenzie: Did you seek feedback from them?
Mr Jones: In that meeting, yes.
Senator McKenzie: And was that feedback provided?
Mr Jones: I'd have to take that on notice.[168]
1.258In relation to that Question on Notice, the Department’s response was:
The department met with the Australian Competition and Consumer Commission (ACCC) on 3 November 2022 to discuss competition policy matters relevant to the Government’s commitment to introduce minimum standards for employee-like workers and the road transport industry. During discussion the department sought feedback from the ACCC about the collective bargaining process for independent contractors under the CCA that it oversees and how exemptions from the CCA operate in that context. The ACCC provided feedback at the meeting.[169]
1.259Unbelievably, the ACCC was consulted only once—in November 2022—well in advance of the April 2023 stakeholder consultation paper released by the department. Given the previous anti-competitive activities that occurred under the first incarnation of the failed RSRT, it was imperative the ACCC be consulted—not just prior to the Bill’s drafting, but once the details of the bill had been established.
1.260Based on the timeline established by Coalition Senators during budget estimates and the first Canberra public hearing, the ACCC was not privy to the draft bill. Therefore, the ACCC could not possibly have had the opportunity to provide advice to government on whether provisions of the Bill were anti-competitive, irrespective of the caveats the government placed in the Bill to circumvent competition policy.
1.261Therefore, Coalition Senators strongly encourage the ACCC to maintain a watching brief on the road transport provisions contained in this bill should it become legislation. History has proven that rigorous oversight is needed. A repeat of the anti-competitive behaviour in 2016 deserves a strong and decisive response from the ACCC, notwithstanding that its powers to enforce its own legislation will be removed as a result of the loophole in the bill that will exempt ‘collective agreements’ and ‘minimum standards orders’ from this legislation.
1.262Coalition Senators note the contribution made by the Australasian Convenience and Petroleum Marketers Association (ACAPMA), the national peak body representing the petroleum distribution/wholesaling and petrol convenience retail industry. In their submission, ACAPMA raised specific concerns with part 16 of bill, specifically:
… the ramifications of the Bill extend well beyond that scope of this stated objective – and risk creation of significant adverse consequences for market competition and future freight costs.[170]
1.263Instructively, ACAPMA suggested that Division 2 parts 40D and 40J be amended to include a ‘requirement for explicit prohibition of damage to freight market competition and duplication of regulation’.[171] Whilst doing so could potentially ameliorate some of the anti-competitive effects, the loophole in the bill that exempts the application of competition laws is so pernicious that Coalition Senators recommend it not be enacted in any form.
1.264Interestingly, ACAPMA speculates in its submission that ‘it is unclear why the transport sector is being singled out for special application of Unfair Contract terms Laws in Australia – or whether the Australian Government intends to extend the powers of the FWC in all other areas of Australian industry’.[172]
1.265In its opening statement at the Perth public hearing, the Livestock and Rural Transporters Association of Western Australia said:
… the proposed changes, as they relate to the road transport companies, will add complexity, increase compliance risk and compliance costs and have a negative impact on the confidence in using small to medium businesses where one of the principal drives one of the vehicles. It is our contention that unique circumstances apply to the rural transport sector that make the application of the proposed laws to the sector problematic. The rural transport sector should therefore be exempt from the application.[173]
1.266According to the Pastoralists and Graziers Association of Western Australia:
… the road transport industry is facing what is another attempt to establish an industrial tribunal to set new prescriptive rules around terms and conditions for truck drivers. The last time an initiative like this was implemented the livelihood of a vast number of owner drivers looked set to be destroyed as they were priced out of work and the government abandoned the system in 2016.[174]
1.267In its submission, the National Farmers’ Federation pointed out the extraordinary new powers that Minister Burke was granting himself in the Bill in relation to supply chains:
More concerningly, the Minister can make regulations which apply to ‘road transport contractual chain participants’ — which may include granting the Fair Work Commission power to confer rights and impose obligations on the supply chain. That is, the Commission may be empowered to make decisions beyond the direct commercial relationship at issue and into other commercial dealings.[175]
1.268These concerns from stakeholders about the changes to road transport and the contractual chain were fully explored by Coalition Senators during the Perth public hearing. The questioning was lengthy, but given its importance to the inquiry the transcript is provided here:
Senator Cash: In particular to the Livestock & Rural Transporters Association: with the changes to the road transport provisions, could you elaborate on your concerns about owner-drivers and the impact on them? Then for both of you: do the Rural Transport Industry and farmers, et cetera, have concerns about being able to satisfy the resource requirements of these new laws?
Mrs Cooper: Firstly, turning to the impact on owner-drivers: as we have described, rural transport is a reasonably unique sector in that you might be a prime contractor and a subcontractor on the same day. As Mr Bairstow said, on the outward journey you might be a prime contractor. It is not a simple case. You are working, you have two or three contracts on foot in any one journey. It is difficult to see how this could be easily applied to that sector without introducing significant compliance risk to small business operators who, let us face it, have a lot to do in trying to keep their heads above water as it is.
Mr York: From past experience with the Fair Work Commission, there was an attempt to try and establish something like this a number of years ago. We just don't believe that the Fair Work Commission can acquire the expertise and be reliably capable of fully understanding the complexities of that transport supply route. The evidence is that they misunderstood it. If nothing else, this bill, if it passes, will provide plenty of work for new and for more Fair Work Commissioners. I can't see any other effect. They might spend a lot of time trying to work out how a supply system operates without fully understanding it. We don't think they have the capacity to do it.
Senator Cash: If these supply chain agreements are imposed on the chain, should those in the chain be consulted before this is imposed on them?
Mr York: Yes.
Senator O'Sullivan: Why?
Senator Cash: Why? What is the impact if they are not?
Mr York: They won't be able to arrange their structure and their schedules, et cetera. They need to be aware of what is going on and what their charges are allowed to be in a range. If you are constrained to choosing to only charge a certain rate, there are probably missed opportunities to backload and make a supply line work efficiently.
Senator Cash: Mr Rogers and Mr Mahar, do you have any comments?
Mr Rogers: It is inherently problematic to impose orders or decisions on the supply chain if they are not consulted. You are asking people to comply with orders where the commission hasn't been informed about the impact of those orders upon them or whether they can comply. The orders have been made in a context in which they don't have all of the information. So that would be outrageous.
Mr York: If one of the drivers here is about safety and the implication that some people, particularly in the road transport industry, are operating under too much stress, there are already fatigue management processes established around the country that are in place to prevent those sorts of things. From a safety perspective, I can't see that this will add anything to what is already in place.
Senator O'Sullivan: Can I ask of transport: in relation to the contractual chain orders, should the stakeholders be engaged? If so, can you explain why, and how important that is?
Mrs Cooper: It goes to the point we made earlier that it is counterintuitive to suggest that smaller operators further down the chain don't participate in decisions that are made about their own business operations. Having said that, I think the consultative process will be very complex and resource-hungry and will be extremely difficult for small operators to participate in fully. These are typified by mum-and-dad companies that are fully occupied in what they are doing. It will be difficult for them to take part in the consultative process to the full extent that is necessary. We all know the time that consultative processes take. I find it hard to accept that a small business operator could take part in that fully.[176]
1.269Of course, the changes to the road transport provisions were not just limited to the farming and agricultural sectors. Coalition Senators note that the retail sector also had concerns.
1.270The National Retail Association said in its submission:
Under the Bill, the FWC is given unprecedented powers to regulate the commercial arrangements affecting contractors in the road transport industry. This newfound power would enable the FWC to establish ‘road transport industry contractual chain orders’, which would impose rights and responsibilities on various participants within the supply chain of the road transport industry. The National Retail Association is concerned that retailers will be adversely impacted under these provisions. Tasking FWC with new powers to set conditions for contractors engaged in the road-transport industry and to potentially displace existing complex commercial arrangements in the road transport industry supply chain, are matters of significant concern for the National Retail Association. Retailers heavily depend on the efficiency of the supply chain and radical changes to the commercial arrangements underpinning that supply, will likely result in increased costs to retailers and consumers alike.[177]
1.271This statement was unanimously supported by the Australian Retailers Association, who said in their own submission to the inquiry:
Under this proposed legislation, the FWC would be given new powers relating to the road transport industry. They would be able to make ‘road transport industry contractual chain orders’ that confer rights and obligations on participants in the road transport industry supply chain. This is of concern to the ARA as retailers rely heavily on an efficient supply chain to ensure that the sector can continue to operate and support local communities, especially during times of disruption. This issue is likely to lead to substantially higher transport costs which will then be passed on to retailers, hurting small businesses and jobs. Equally concerning, these provisions would relate to drivers in the road transport industry as well as anyone who is ‘connected with the road transport industry’ or meets requirements prescribed in regulation by the Minister. This definition is too broad and has the potential for unforeseen consequences on costs and productivity. The RTAG would effectively re-establish the Road Safety and Remuneration Tribunal, which was abolished after being found by the Australian Small Business and Family Enterprise Ombudsman to have had grave social consequences for small businesses and assessed to be unable to increase road safety by two independent reports.[178]
1.272Evidence was provided by the Master Grocers Australia during the Rockhampton public hearing on how their members would be impacted, including cost increases, and the operation of the new road transport advisory group (RTAG):
Senator McDonald: How concerned is the MGA with the new road transport provisions? What impacts does it have for your members? Additionally, could it lead some of the larger supermarket companies to consider insourcing? Specifically, does the MGA anticipate having a seat on the new road transport advisory group? The TWU expect they should be on it. I understand that your members comprise 2,700 branded, independent grocery stores and a further 1,300 supermarkets trading under their own brand names. Surely you would get a seat at the table?
Mr Stirling: If we're invited to have an opportunity, MGA would certainly be interested in taking it up. However, going to your broader point, if there is going to be added uncertainty and added regulation which increases the cost of doing for our members, that is certainly going to be a detriment to them.[179]
1.273Even stakeholders that had signed up to the Labor government’s TWU road transport deal were not overly convinced that it would not have broad cost implications, or adversely affect owner drivers in the way the disastrous RSRT version 1.0 did:
Senator O'Sullivan: Now to part 16 of this bill. Do you think that the changes to road transport in part 16 of the bill are likely to increase or decrease the cost of transporting goods and services, or do you think it will have no impact? What do you think it will mean for prices and for anyone relying on transport as part of their business, including consumers?
Ms Harwood: I think it's a really big question, because there are all sorts of damaging aspects when cost recovery is not a factor within a transport chain anyway. Senator Lambie talked about businesses growing to provide services within Tasmania and then subbing them out because they haven't got operations on island, and then pulling out of that. There's damage done and there are cost implications along the way in terms of that type of environment. What we're really supportive of is there being viable and sustainable operators at all levels in the road transport sector so that these issues don't become ongoing cost pressures.
Senator O'Sullivan: As the bill stands at the moment, what risks does it potentially have for owner-drivers? Could they become marginalised by these changes? In answering this, can you guarantee to the committee that owner-drivers won't be adversely impacted by this bill?
Ms Harwood: I can't guarantee anything. I wish I could, but I think—
Senator O'Sullivan: But, on behalf of your members, you have supported this change, so—
Ms Harwood: We are satisfied that there are provisions within the road transport objective and also within the order making processes that go to the need to ensure that, for example, owner-drivers are not somehow turned into employers and that it preserves the structures within the industry. Our view is that we need owner-drivers, and we want them to be safe, viable and sustainable. They're a really important part of our industry.[180]
1.274During a cost-of-living crisis, the Albanese Labor government is lumping consumers with more additional costs to their grocery items and everyday family budgets through this proposed legislation. The cost impacts run right through the supply chain, and ultimately it will be the customer paying more at the checkout.
1.275Coalition Senators note with concern that on 25 January 2024, one week prior to this report being released, the Prime Minister announced that he would direct the ACCC to conduct an inquiry into ‘pricing and competition in the supermarket sector’. The terms of reference for this inquiry include, amongst other things:
Factors influencing prices along the supply chain, including the difference between farmgate and supermarket prices;
Any impediments to competitive pricing along the supply chain; and
Other factors impacting competition…[181]
1.276It should be incomprehensible that the government could announce an ACCC inquiry into supermarket prices and competition in supply chains at the exactly the same time it is desperate to pass legislation that would remove the powers of the ACCC to enforce competition laws in those supply chains, and which will guarantee higher prices and the destruction of competition.
1.277In light of the Government’s announcement of the ACCC inquiry, and its supposed concern for competition in supermarket supply chains, it must now commit to pausing the consideration of all elements of the bill relating to road transport matters and refer those elements to the ACCC to consider as part of its inquiry. It should also commit to not attempting to pass those elements of the Bill through the Senate until the conclusion of this inquiry. Anything less would be a complete betrayal of the interests of Australian consumers and would once again illustrate the governments complete cynicism and lack of concern for them. Any ACCC inquiry into competition and supermarket supply chains will be a sham inquiry and a complete farce if it cannot consider what is currently the single greatest threat to competition and consumers in this crucial sector of the economy.
1.278In relation to then new RTAC, should this body proceed, it must contain a diverse range of board representation, including appointments from the small business, farming, agriculture, retail, mining, and livestock industries. This is a point advocated by ACAPMA who said:
… legislative requirements pertaining to the composition of the road Transport Advisory Group such that it not only stipulates good representation of employer and employee organisations, but also includes representatives with specialist expertise in the diverse nature of the Australian Road freight market (i.e urban, regional, rural. Interstate, dangerous goods, agricultural, construction and resources).[182]
1.279Despite the Minister downplaying the effects on the gig economy in his National Press Club speech in August 2023, the proposed legislation contains much broader changes, which would affect all participants in the gig economy. Whether the complete non-existence of accurate economic modelling was deliberate by the Government remains to be seen. Nonetheless, it is troubling and likely unprecedented. According to DoorDash, the ‘Explanatory Memorandum confirms that the Department met with no individual citizens when consulting on the draft Bill’.[183]
1.280Considering the Government’s modelling and consultation for the Bill was fundamentally flawed, this is not unexpected.
1.281In its submission DoorDash asserts that:
We are concerned that the Explanatory Memorandum is based on flawed and outdated assumptions which fail to properly consider the real flow-on effects the Bill will have not only for platforms, but also on consumers and small businesses. It is troubling that the Government has embarked on such unprecedented reform without fully understanding the impacts it might have not only on workers but also the industry and broader economy.[184]
1.282This is concerning. Inadequate modelling has been undertaken and the true cost impacts on the gig economy are unknown. As DoorDash indicated, the Government ‘also severely underestimates compliance costs of only $7,018.20 annualised over 10 years’. Moreover, the ‘data used for underlying assumptions on economic impact in the Explanatory Memorandum is out-of-date’.[185]
1.283Menulog also evaluated its own cost modelling in preparation for its submission to the inquiry. According to the platform provider:
Menulog estimates the increase in cost could be as high as $15.13 per delivery (which would be an increased rate of $39.47 if calculated per hour as in the EM) which would have a significant cost for businesses and customers and thus, an impact on opportunities for couriers. Further to this, Menulog estimates an implementation cost that is 400% greater than what has been outlined in the EM, which again would require a significant cost to be distributed across the network.[186]
1.284In its submission, Uber cautioned the government that if the Bill is ‘done poorly, the flexibility valued by platform workers is at risk as well and the service millions of Australians rely on’.[187] Noting that hundreds of thousands of Australians use the Uber platform to earn additional income, Uber said ‘at a time when cost of living is increasing and the opportunity to earn supplemental income is beneficial to so many, this vital earnings opportunity should not be reduced by legislative reform’.[188]
1.285As with the other two platforms, Uber sensibly undertook its own impact modelling, which revealed ‘rideshare and delivery fee prices across the country could increase by 60% and 85% respectively. Higher prices will make rideshare and delivery services more expensive for consumers’.[189]
1.286These findings directly contradict the Minister's assessment at the National Press Club when he said it will cost ‘a tiny bit extra you pay when your pizza arrives to your door’.[190]
1.287When asked by a journalist at the National Press Club ‘what can we expect in terms of the change for that delivery rider?’ the Minister responded, ‘it's inappropriate for me to give you a figure here—simply because it’s the Fair Work Commission that would be doing it, and ministerial direction on that would be really inappropriate’.[191]
1.288Coalition Senators note the irony of the Minister's ambivalence given it is he who is proposing to grant himself new powers to expand the 'employee-like' definition and the road transport contractual chain provisions, and that it is he as the responsible Minister who is proposing this uncosted and ill-defined bill.
1.289Uber operates in 43 cities across Australia and states that it has ‘created an estimated $10.4 billion in economic value for the Australian economy and produced $6.6 billion in consumer surplus in 2021, which is equivalent to 0.35% of GDP’.[192] So, when the Minister speaks of a pizza costing ‘a tiny bit extra’, the Government completely downplays what the true economic impact will be for the country.
1.290In summary, Coalition Senators note with concern the statement in Uber’s submission that the bill's changes will damage the gig economy because:
… rather than providing a sufficient degree of certainty for both business and workers, the legislative overriding of the recent High Court decisions is likely to be a catalyst for a return to greater disputation and litigation regarding the precise legal status of a worker. This uncertainty will have the effect of discouraging businesses from innovating and providing certain benefits to workers because of lack of clarity about their employment or non-employment status.[193]
1.291As with horizontal providers like Mable, the rideshare and delivery platforms challenge the very notion of Labor and the trade unions’ concept of traditional employment. They challenge their 20th century prejudices of what are acceptable and unacceptable ways of working. And as with casual employment, this government is seeking to effectively remove it from the labour market landscape by deliberate design.
1.292The Australian Labor Party’s struggles with the evolving labour market landscape was observed by David Marin-Guzman of the Australian Financial Review, who wrote:
… gig workers' choice to accept to work or not and to decide when they want to work was something to be celebrated, albeit with certain standards. It appears part of the bill is Labor reconciling itself with this mode of work over its historical preference for traditional employment. But it's the gig worker laws that may have just opened the door for Labor to radically shape what an independent contractor looks like across the economy.[194]
1.293Not unexpectedly, the Ai Group summarised that ‘there is no Australian precedent for how the regulation of contractors outside the road transport industry will operate. It is an extremely novel proposal’.[195]
1.294The risk to gig workers from the bill’s changes is not lost on them. As included in Menulog's submission, one courier is quoted as saying: ‘you raise prices, people won't order. If people don't order I won't have work. There's a knock-on effect. That is why I think nothing is particularly broken about the system now’.[196] Sage advice the Minister should heed.
1.295Coalition Senators note that another issue with the Bill's provisions is the challenge the bill has with 'multi-apping'. In an article featured in the Australian Financial Review, it reported:
Menulog managing director Morten Belling said the bill needed to remove comparisons with employment conditions and enshrine the value of gig work, such as the freedom to use multiple apps to do several deliveries at the same time. He said surveys found 75 per cent of Menulog's couriers were ‘multi-apping’, and those earnings needed to be considered in setting any minimum rate. ‘We don't feel the benefit of that as an employee-like worker is captured in the bill’ he said. ‘There's a risk that you're going to see quite a big load of costs on the industry if we're not putting enough guardrails in place on the commission’.[197]
1.296The economic modelling for this Bill is fundamentally flawed. The evidence shows that the Government has underestimated the cost impact and not used any fresh data, instead relying on limited and outdated data and old reports and formulae used in those studies that are unrelated to this bill.
1.297Coalition Senators believe that had new data been produced by the Government, it would reveal the true cost of this bill and its substantial fiscal impact on every sector of the Australian economy.
1.298Coalition Senators note the views of three of the major employer peak bodies on the flawed modelling:
Evidence relied upon to support the government's proposals in the Bill has been derived from small sample surveys and was subject to acknowledged data limitations.[198]
The Bill, as framed, needs to be fundamentally reconsidered. The legislation has been rushed and must not be rubberstamped by the Parliament. We are also concerned at the lack of any meaningful justification for many aspects of the Bill or analysis of their impact. The Regulatory Impact Statement that supports the legislation is vague, incomplete and often completely unhelpful. So riddled is it with the inability to actually quantify the impact of what is being proposed, the document is useless as the basis for any realistic modelling of the economic impact of the measure.[199]
There are clear deficiencies in the Government's own regulatory impact statement (RIS), which should clearly set out the costs of the proposed changes on business. The Government itself repeatedly admits throughout the RIS that the data has degrees of uncertainty or is the subject to significant limitations.[200]
1.299Given the lack of costings and modelling, Coalition Senators naturally sought answers from the relevant department during the Supplementary Budget Estimates process.
1.300It was firmly established that the RIS was, at best, cobbled together guesswork that even Treasury would have had difficulty coming to grips with the same ‘data limitations’ in trying to establish what the Bill will cost Australians:
Senator Cash: I want to ask some general questions on the department's engagement with Treasury to advise on the economic productivity and jobs impact of the measure. I know that, obviously, the closing loopholes bill will implement changes across the economy. The explanatory memorandum on the regulatory impact statement provide no whole-of-economy modelling. Is that something that Treasury was asked to do. Is it something that was considered to be done in terms of the ultimate impact on GDP, sectoral growth, jobs growth, productivity, real wages et cetera?
Mr Hehir: I'd probably need to take that on notice. I know we had discussions with Treasury; I just need to take notice the detail of those discussions. In general, Treasury have the same data limitations that we do, so it's quite difficult. The actual across-the-economy impact in terms of the transfer between a business and their employee—I'm not sure how that actually works. The vast majority of this is estimated to be a business paying a worker more, so there's still the same amount of cash in the economy overall. That is, the regulatory costs are quite low for this.
Senator Cash: Is that based on all the qualifications and the assumptions that are in —I know we'll pursue this in other hearings, but is that based on what the assumptions are in the regulatory impact statement?
Mr Hehir: That's correct.
Senator Cash: Did the department consider undertaking any economic modelling of the proposed measures?
Mr Hehir: We did not for economywide modelling. We looked at what the impact was in particular sectors, and it's largely that transfer between what a business is charging and what a business has to pay the worker. In terms of the actual impact on total spend across the economy, it's difficult to see an impact.[201]
1.301It is alarming that the cost impacts from the largest industrial relations changes in decades are based on ‘assumptions’, and that no ‘economy wide modelling’ was performed. One can only conclude that to do so would result in a conclusion being reached which the Government did not want.
1.302Stakeholders appearing at public hearings were unequivocal about the lack of information contained in the RIS:
Senator's O'Sullivan: The Minister for Workplace Relations estimated the costs to be in the order of $9 billion and has indicated that it's a headline that is completely in the interests of working people and poses no threat to the Australian economy. Minister Burke has also refused to acknowledge costs could be higher than this estimate. You've pointed out that the RIS doesn't actually sufficiently detail what the costs might be and in fact says that it can't quantify it. Do you agree that there is no threat to the economy from these changes? And where does the BCA see this bill leading to additional costs?
Mr Black: Just to address a couple of points that you've raised in your question, we do see significant challenges in the assessment process that has been undertaken for the purpose of preparing the government's regulatory impact statement. As I mentioned before, there are numerous deficiencies in relation to the data that is relied upon, or, rather, the data that is not available, so any assumption that certain costs can be drawn out as a consequence of certain steps that are taken within the RIS or a logical flow to reach a conclusion are necessarily flawed. As I said before, in our early analysis we've been able to identify no fewer than 47 instances in which the government says there is insufficient data or there is information lacking. That necessarily means that there is a cost component that can't be quantified.[202]
1.303In the sixth public hearing, hosted in Canberra, Coalition Senators scrutinised the Government’s costing with the ACCI:
Senator O'Sullivan: I wanted to go to that because you do cover that quite extensively in your submission. You say that there are serious deficiencies in the government's own regulatory impact statement I think it quantifies it at about $9 billion. So you'd contest that? Given the information we have, you actually couldn't quantify it? It's so complex that it—
Mr McKellar: We'd say it's well underestimated…
Mr Alexander: We regard the very premise of the regulatory impact statement as flawed because it presupposes that which it is seeking to establish. It's a classical logical fallacy. Its starting point is that there's a so-called loophole, when that very point is what is in contention. So to start from that point means that the rest of it is going to be erroneous. Everything there is tainted by the assumption in downplaying costs and claiming benefits. For a little bit more detail: the RIS does rely heavily on the findings of previous inquiries, but those previous inquiries, themselves, were heavily contested, strongly disagreed with, with dissenting reports and disagreements by government senators at the time. Regarding labour hire, the RIS admits to huge uncertainties about the assumptions. It says calculations regarding the labour hire workforce 'contain a high degree of uncertainty' due to 'significant limitations' on the available data.
Regarding casuals, the RIS admits that 'there is not an explicit alignment between the statutory provisions' in the bill and the data used to estimate the number of casuals who will be affected by the changes. Let me go to one key assumption of the RIS, regarding the extra compliance burden for businesses regarding the new criteria for casuals. The RIS estimates that, under the current system, where there's one criterion, the compliance time for business is 10 minutes per employee. One criterion takes 10 minutes. For the proposed system, which includes 15 criteria, the compliance time for business is estimated to be 15 minutes: one criterion per minute. These criteria are very complex terms and conditions to get through. They're lawyerly and jargonistic. No small-business person—and no normal business person—would look at this and think, 'I'm confident that I can address each of those points in those criteria.' So we regard that as completely unrealistic. Even those 15 criteria are, themselves, an understatement because some of those criteria assume a knowledge of other elements of other bills or this bill. It refers to division 4A of part 2-2. What's a small-business person going to think? They're not only going to have to cover the 15 criteria but they're also going to think, 'What's that? There's another section that I've got to look after.' It refers to section 66MA or 739—so, all of a sudden, you've got a rolling series of conditions and criteria.[203]
1.304During the Sydney public hearing, the MCA highlighted how the data limitations underestimated the true impact relating to labour hire, noting that labour hire is one of the fundamental reasons why the government initiated the Bill:
Senator O'Sullivan: The EM mentions that only a small proportion of labour hire workers will be impacted. However, given your submission and your statement just now, you believe that the analysis is flawed. Why do you say this in your submission? Why do you think that it could actually be even greater?
Ms Constable: I think it's guesswork that we're seeing. We haven't seen a proper cost-benefit analysis relating to this particular proposal. It would suggest that just a cursory look at labour hire arrangements has occurred. It hasn't taken into account service contractors across industries. It only counts labour hire workers. The methodology for estimating the number of workers covered simply averages out important details. It doesn't consider the efficiency effects of the proposal. That's why we want to see a proper cost-benefit analysis done across the economy, not just the single industries. The figure of 66,000 workers is completely shallow in terms of the numbers. It is much greater than that.
Senator O'Sullivan: So you're saying that figure's understated?
Ms Constable: It is well and truly understated. It is very simplistic, and it really doesn't include any reference to the economy-wide efficiency impacts or behavioural response on workers or businesses.[204]
1.305The Government has indicated that they will accept amendments introduced by the Australian Greens in relation to intractable bargaining which would prevent the FWC from ever exercising its powers in an arbitration in a way that could diminish an existing condition in an agreement that a union considered favourable.
1.306This amendment received predictable and emphatic criticism from a range of quarters, most notably from the Labor Treasurer of the government of Victoria, Mr Tim Pallas. In January 2024, Mr Pallas wrote to Minister Burke and a number of peak business bodies expressing his concern at these amendments:
I believe that the Bandt Amendments undermine intractable bargaining. I have enclosed a proposal that should meet the policy intent of the amendments without having the adverse impacts I fear will ensue from the current proposal.
…
The ‘no less favourable test’ as supported by you in the Bandt Amendments removes the incentive for unions to reach an agreement as they know that they will be no worse off on a clause by clause basis as against a current enterprise agreement. The amendment also seems at odds with how bargaining works – that is, that it’s a package and during the course of bargaining trades offs are considered and made. The Bandt Amendments treat bargaining as if it’s a clause by clause process and each clause stands alone.
In respect of the effective retrospective nature of the Bandt amendments we would say that retrospective legislation should only be passed on an exceptional basis and that no justification is given or could be given for applying these amendments with effective retrospectivity. The Bandt amendments would have the effect of changing the law that applies to parties currently in the midst of litigation…[205]
1.307Coalition Senators commend Mr Pallas for calling out the fatally flawed nature of these amendments.
1.308Coalition Senators note that ACCI said that in the Government supporting the Australian Greens’ amendment it ‘will wipe out any form of give and take in bargaining negotiations’.[206]
1.309Moreover, the ACCI were of the view that ‘the amendment, which seeks to change a law that only came into effect a matter of months ago, will mean that unions can drag out a bargaining dispute, unilaterally force a matter to be arbitrated by the FWC, and because of the government-backed greens change, the employer will be worse off than before’.[207]
1.310The amendment is yet another blow to productivity, which is already lagging under the Albanese Labor government, and which this bill along with these new amendments will only contribute to a further decline.
1.311Which is why the ACCI said that ‘we will see fewer agreements being made between parties and more unilateral decisions by the Fair Work Commission—further destroying productivity in our workplaces’.[208] Additionally, Ai Group said the amendments ‘make a bad bill worse’ and they ‘certainty won't be sufficient to meet concerns the overall proposals will cost jobs, remove worker-desired flexibility and put a further handbrake on productivity’.[209]
1.312No case has been made for these amendments, which are nothing more than another ambit claim from the union movement, which no previous Labor government has ever granted, and which the Victorian Labor government knows will be disastrous. They should be abandoned by the Government and not passed by the Senate.
1.313This Bill should be opposed. It is bad for jobs; it is bad for workers, and it is bad for employers.
1.314This Bill was fatally flawed from its conception. As has been demonstrated in this report, this Bill will do nothing to fundamentally rectify Australia's lagging productivity, which is already hovering at a seven-year low. It will be a jobs killer and increase unemployment. And amidst a cost-of-living crisis, overwhelming evidence has been presented which shows this Bill will drive-up costs further on everyday items for consumers and increase inflationary pressures.
1.315The Albanese Labor government is calculatingly and misleadingly light on details with this Bill to ensure the Bill has enough steam to reach the government's own narrative. During a time of great economic and international uncertainty the Bill only adds to that insecurity. When businesses and employers are asking for clarity and concise definitions, the Government cheerfully delivers them the exact opposite.
1.316The Bill reverses four decades of bipartisan reform away from industry-wide wage setting towards an enterprise-based system. It imposes an absurd level of red tape on which should be straightforward business decisions, such as employing a casual worker or engaging a sub-contractor or supplier.
1.317We can only speculate what former Labor luminaries from the Hawke and Keating governments, not to mention the more economically literate union leader of that era, must think this government is doing with their industrial relations legacy, and the Albanese Labor government’s zealous attempt to return Australia to an arcane centralised wage fixing system.
1.318Rather than attempting to revitalise the enterprise bargaining system to reflect the trends of the current labour market, which for so longer benefited Australia, the Albanese Labor government seeks to demolish it layer by layer and return Australia to a centralised wage setting framework, simply to comply with the business case set forth by the trade union movement.
1.319This Bill represents a direct assault on the mining states, including Western Australia. The success of that state's resources sector is now under recurring fire from this government, as evident by the ham-fisted intervention by the state's inept Labor Premier who made belated representations to the Prime Minister.
1.320The Albanese Labor government’s handling of the passage of this Bill, which eventually became two bills—has been nothing short of a disgrace. Its actions have shown a complete lack of integrity and transparency. It has thumbed its nose at the Senate inquiry process, passing half of the original bill prior to the inquiry being able to report its findings before the Senate mandated due date, and the Senate’s role as the legislative body as the ‘House of Review’.
1.321The only clear beneficiaries of this Bill are trade unions who will see their influence and power disproportionately increase in the Australian workplace and will now include sectors it has previously had no presence. With union membership hovering below 10 per cent in the private sector, this Bill represents a manifest last-ditch attempt to salvage the rapidly declining union membership in Australia.
1.322Finally, in the Coalition Senators dissenting report for the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022, Coalition Senators wrote:
Coalitions Senators suggest as a priority the Albanese Government should be more focused on tackling the cost of living, including getting inflation under control and increasing productivity—key levers for real wage growth—and spend less time galvanising trade union membership in workplaces where they are not wanted. This bill will empower unions to be involved in small businesses, embolden them to increase militant behaviour in workplaces, and only achieve in returning Australia to the bad old days of the 1970s when trade unions wreaked havoc across the country and this nation was poorer for it.[210]
Recommendation 12
1.323That the Fair Work Legislation Amendment (Closing Loopholes No. 2) Bill 2023 not be passed by the Senate.
Senator Matt O'Sullivan
Deputy Chair
Senator for Western Australia
Senator Slade Brockman
Member
Senator Michaelia Cash
Participating Member
Footnotes
[1]Ewin Hannan, 'New 'power of one' gift for unions in IR reforms, business warns,' The Australian, 7 September 2023.
[2]Business Council of Australia, Submission 14, p. 24.
[3]Business Council of Australia, Submission 14, p. 5.
[4]The Australian Chamber of Commerce and Industry, Submission 130, p. 7.
[5]Ewin Hannan, 'New 'power of one' gift for unions in IR reforms, business warns,' The Australian, 7 September 2023.
[6]BHP, Submission 44, p. 10.
[7]BHP, Submission 44, p. 7.
[8]Rio Tinto, Submission 115, p. 2.
[9]National Farmers’ Federation, Submission 18, p. 6.
[10]Pastoralists and Graziers Association of Western Australia, Submission 94, p. 2.
[11]Australian Meat Industry Council, Submission 65, p. 4.
[12]Master Grocers Australia, Submission 84, p. 7.
[13]The Recruitment, Consulting and Staffing Association, Submission 47, p. 12.
[14]The Recruitment, Consulting and Staffing Association, Submission 47, p. 2.
[15]Master Builders Australia, Submission 19, p. 6.
[16]Civil Contractors Federation Australia, Submission 120, p. 12.
[17]Civil Contractors Federation Australia, Submission 120, p. 11.
[18]Uber, Submission 40, p. 1.
[19]Menulog, Submission 136, p. 1.
[20]National Electrical and Communications Association, Submission 167, p. 3.
[21]South Australian Wine Industry Association, Submission 102, p. 3.
[22]Australian Financial Review, ‘Brazen Burke's agenda is wrong workplace direction’, 3 September 2023.
[23]Ewin Hannan, ‘Power wings back to unions, workers under Labor’, The Australian, 9 September 2023.
[24]Unions WA, Submission 7, p. 1.
[25]Ewin Hannan, ‘Power wings back to unions, workers under Labor’, The Australian, 9 September 2023.
[26]Australian Bureau of Statistics, Trade union membership, August 2022, https://www.abs.gov.au/statistics/labour/earnings-and-working-conditions/trade-union-membership/latest-release
[27]David Marin-Guzman, 'Union membership in private sector shrinks to 8pc', The Australian Financial Review, 15 January 2023.
[28]Australian Bureau of Statistics, Trade union membership, August 2022, https://www.abs.gov.au/statistics/labour/earnings-and-working-conditions/trade-union-membership/latest-release.
[29]National Farmers Federation, Submission 18, p. 14.
[30]Australian Meat Industry Council, Submission 65, p. 8.
[31]The Hon Anthony Albanese, Prime Minister of Australia, ‘Opening of National Jobs and Skills Summit’, Media Release, 1 September 2022.
[32]Once the government’s amendments were tabled in late November, the size of the bill and explanatory memorandum further increased in size.
[33]Macrotrends, Australia GDP 1960–2024, https://www.macrotrends.net/countries/AUS/australia/gdp-gross-domestic-product.
[34]Greg O’Brien, Parliamentary Library Briefing Book: Key issues for the 46th Parliament, 27 years and counting since Australia’s last recession, www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/BriefingBook46p/LastRecession.
[35]Australian Bureau of Statistics, Australian System of National Accounts, 30 October 2020, https://www.abs.gov.au/statistics/economy/national-accounts/australian-system-national-accounts/2019-20.
[36]John Kehoe, ‘Let's not repeat the perilous mistakes of the 1970s’, The Australian Financial Review, 11 May 2022 (accessed 29 November 2023).
[37]Troy Bramston, 'Half-century on, Gough Whitlam's towering legacy remains', The Australian, 29 November 2022.
[38]Michelle Bulluck, Governor, Reserve Bank of Australia, ‘Monetary Policy Decision’, Media Release, 3 October 2023.
[39]Andrew McKellar, Chief Executive Officer, Australian Chamber of Commerce and Industry, Proof Committee Hansard, 10 November 2023, p. 52.
[40]Dr Philip Lowe, Governor, Reserve Bank of Australia, ‘A Narrow Path’, Address at the Morgan Stanley 5th Australia Summit, 7 June 2023.
[41]Jennifer Westacott, Chief Executive Officer, Business Council of Australia, ‘Radical IR shake-up will not deliver well paid jobs’, Media Release, 31 August 2023.
[42]Dr Phillip Lowe, Governor, Reserve Bank of Australia, Committee Hansard, 11 August 2023, p. 6.
[43]Dr Phillip Lowe, Governor, Reserve Bank of Australia, Committee Hansard, 11 August 2023, p. 8.
[44]Robert Gottliebsen, 'Union's secret agenda of its 'same work, same pay' slogan', The Australian, 30 May 2023.
[45]Robert Gottliebsen, 'Lack of certainty as to whether firms are obeying or breaking the law', The Australian, 12 September 2023.
[46]Ewin Hannan, 'Power swings back to unions, workers under Labor', The Australian, 9 September 2023.
[47]Business Council of Australia, Submission 14, p. 4.
[48]Tim Reed, President, Business Council of Australia, 3 October 2023, Proof Committee Hansard, p. 89.
[49]National Retail Association, Submission 45, p. 2.
[50]Associate Professor Chris F. Wright, Proof Committee Hansard, 10 October 2023, p. 3.
[51]Department of the Treasury, ‘White Paper on Jobs and Opportunity’, 25 September 2023.
[52]Department of Employment and Workplace Relations, Enterprise Bargaining outcomes from the Australian Jobs and Skills Summit, Regulation Impact Statement, p. 13.
[53]Department of Employment and Workplace Relations, Enterprise Bargaining outcomes from the Australian Jobs and Skills Summit, Regulation Impact Statement, p. 14–15.
[54]Chris Rodwell, Chief Executive Officer, Chamber of Commerce and Industry Western Australia, Proof Committee Hansard, 6 October 2023, p. 10.
[55]The Chamber of Minerals and Energy of Western Australia, Submission 13, p. 1.
[56]Australian Hotels Association (WA), Submission 11, p. 1.
[57]Western Australia Hotels and Hospitality Association, Submission 11, p. 1.
[58]Western Australia Hotels and Hospitality Association, Submission 11, p. 7.
[59]South 32, Submission 109, pp.1 and 2.
[60]Perenti Group, Submission 91, p. 1.
[61]Perenti Group, Submission 91, p. 3.
[62]Chamber of Minerals and Energy of Western Australia, Submission 13, p. 1.
[63]Roy Hill, Submission 23, p. 3.
[64]BHP, 'Bringing people and resources together to build a better world', Economic Contribution Report 2023, p. 3.
[65]BHP, 'Bringing people and resources together to build a better world', Economic Contribution Report 2023 p. 10.
[66]Hamish Hastie 'Record number of people employed in WA's resources sector', The Sydney Morning Herald, 5 October 2022.
[67]The Chamber of Minerals and Energy of Western Australia, Submission 13, p. 1.
[68]Hamish Hastie, ‘Record number of people employed in WA’s resources sector’, The Sydney Morning Herald, 5 October 2022.
[69]Roy Hill, Submission 23, p. 3.
[70]The Chamber of Minerals and Energy of Western Australia, Submission 13, p. 2.
[71]Roy Hill, Submission 23, p. 1.
[72]Tania Constable, Chief Executive Officer, Minerals Council of Australia, Proof Committee Hansard, 3 October 2023, p. 77.
[73]Unions WA, Submission 7, p. 8.
[74]Unions WA, Submission 7, p. 8.
[75]Western Australian Hotels and Hospitality Association, Submission 11, p. 2.
[76]Technical Resources, Submission 20, p. 1.
[77]Technical Resources, Submission 20, p. 1.
[78]Bradley Woods, Chief Executive Officer, Western Australian Hotels and Hospitality Association, Education and Employment Legislative Committee, Proof Committee Hansard, 6 October 2023, p. 58.
[79]Western Australian Hotels and Hospitality Association, Proof Committee Hansard, 6 October 2023, p. 63.
[80]Bianca Grubor, Workplace Relations Lawyer, Western Australian Hotels and Hospitality Association, Proof Committee Hansard, 6 October 2023, p. 61.
[81]Chamber of Commerce and Industry WA, Submission 15, p. 3.
[82]Minister Tony Burke, interview on ABC Radio National, 27 October 2023.
[83]Minerals Council of Australia, ‘Impact of proposed Same Job Same Pay laws on the Western Australian mining industry’, November 2023, https://minerals.org.au/wp-content/uploads/2023/11/MCA-analysis-Impact-of-Same-Job-Same-Pay-legislation-on-WA-mining-industry_November-2023.pdf
[84]Lynas Rare Earths, Submission 10, p. 3.
[85]Lynas Rare Earths, Submission 10, P. 3.
[86]Chamber of Commerce and Industry Western Australia, Submission 15, p.9.
[87]Tony York, National Farmers Federation and Western Australian Farmers Federation & Tony Mahar, Chief Executive Officer, National Farmers Federation, 6 October 2023, Proof Committee Hansard, pp. 48–49.
[88]Ms Tania Constable, Chief Executive Officer, Minerals Council of Australia, Proof Committee Hansard, 3 October 2023, p. 79.
[89]Zachary Smith, National Secretary, Construction, Forestry, Maritime, Mining and Energy Union, Proof Committee Hansard, 6 October 2023, pp. 22–23.
[90]Steven McCartney, State Secretary, Australian Manufacturing Workers Union, Proof Committee Hansard, 6 October 2023, p. 42.
[91]Chamber of Commerce and Industry Western Australia, Submission 15, p. 10.
[92]Adam Walkaden, National Legal Director, Mining and Energy Union, Proof Committee Hansard, 6 October 2023, p. 2.
[93]The Chamber of Minerals and Energy of Western Australia, Submission 13, p. 2.
[94]Perenti Group, Submission 91, p. 2.
[95]Chamber of Commerce and Industry WA, Submission 15, p. 3.
[96]Bran Black, Chief Executive, Business Council of Australia, 3 October 2023, Proof Committee Hansard, p. 86.
[97]The Chamber of Minerals and Energy of Western Australia, Submission 13, p. 5.
[98]The Chamber of Minerals and Energy of Western Australia, Submission 13, p. 5.
[99]Tony York, National Farmers Federation and Western Australian Farmers Federation & Tony Mahar, Chief Executive Officer, National Farmers Federation, 6 October 2023, Proof Committee Hansard, pp. 49–50.
[100]Technical Resources, Submission 20, p. 4.
[101]Dan Jervis-Bardy, 'Roger Cook pleads with Anthony Albanese to 'carefully consider' potential damage from IR bill', The West Australian, 20 October 2023.
[102]Dan Jervis-Bardy, 'Roger Cook pleads with Anthony Albanese to 'carefully consider' potential damage from IR bill', The West Australian, 20 October 2023.
[103]BHP, Submission 44, p. 10.
[104]Dinesh Bishop, Vice President, Finance Operations, Minerals Australia, BHP, Proof Committee Hansard, 31 October 2023, p. 20.
[105]Perenti Group, Submission 91, p. 2.
[106]Tom Reid, Director, Industry and Advocacy, Australian Resources and Energy Employer Association, Proof Committee Hansard, 31 October 2023, p. 54.
[107]Proposed subsection 306EE(2), Fair Work Legislation Amendment (Closing Loopholes) Bill 2023.
[108]Xero, ‘Entrepreneurial Aussies to support small business boom with $370 billion boost over next decade’, Media Release, 26 April 2022.
[109]Entrepreneurial & Small Business Women Australia, Submission 54, p. 1.
[110]Australian Small Business and Family Enterprise Ombudsman, Submission 97, p. 4.
[111]Entrepreneurial & Small Business Women Australia, Submission 54, p. 2.
[112]Australian Small Business and Family Enterprise Ombudsman, Submission 97, p. 3.
[113]The Hon Tony Burke MP, Minister for Employment and Workplace Relations, ‘National Press Club Address 'Closing the Loopholes Bill'’, 31 August 2023.
[114]Entrepreneurial & Small Business Women Australia, Submission 54, p. 2.
[115]Australian Small Business and Family Enterprise Ombudsman, Submission 97, p. 4.
[116]Australian Small Business and Family Enterprise Ombudsman, Submission 97, p. 3.
[117]David Marin-Guzman, ACTU names companies in firing line over Same Job, Same Pay laws, The Australian Financial Review, 30 May 2023.
[118]Rachel Clun, BHP claims proposed labour-hire policy would cost company $1.3b a year, Sydney Morning Herald, 22 May 2023.
[119]BHP, Submission 44, p. 2.
[120]BHP, Submission 44, p. 6.
[121]BHP, Submission 44, p. 6.
[122]Perenti Group, Submission 91, p. 2.
[123]Supplementary Budget Estimates, Education and Employment Legislation Committee, Proof Committee Hansard, p. 45.
[124]Minerals Council of Australia, Proposed Government Amendments – Same Job, Same Pay, 28 November 2023, p. 2.
[125]Charles Cameron, Chief Executive Officer, Recruitment, Consulting and Staffing Association, 3 October 2023, Proof Committee Hansard, p. 69–70.
[126]Minerals Council of Australia, 'Government IR amendments hoodwink Australians', Media Release, 22 November 2023.
[127]Master Builders Australia, ‘IR Bill amendments band-aid on a burst pipe’, Media Release, 22 November 2023.
[128]Geoff Fader, Chairperson, Tasmanian Small Business Council, Proof Committee Hansard, 11 October 2023, p. 56.
[129]Minerals Council of Australia, Media Release 'Government IR amendments hoodwink Australians', 22 November 2023.
[130]Melissa Adler, Executive Director, Industrial Relations and Lega Services, Housing Industry Association, 10 November 2023, Proof Committee Hansard, p. 40–41.
[131]Master Builders Australia, Submission 19, p. 14.
[132]Shaun Schmitke, Deputy Chief Executive Officer and National Policy Director, Workplace Relations, Safety and Contracts, Master Builders Australia, 6 October 2023, Proof Committee Hansard, p. 82.
[133]Shaun Schmitke, Deputy Chief Executive Officer and National Policy Director, Workplace Relations, Safety and Contracts, Master Builders Australia, Proof Committee Hansard, 6 October 2023 p. 84.
[134]Mable, Submission 30, p. 1.
[135]Peter Scutt, Executive Director and Co-Founder, Mable, Proof Committee Hansard, 10 October 2023, p.21.
[136]Mable, Submission 30, pp. 7-8.
[137]Peter Scutt, Executive Director and Co-Founder, Mable, Proof Committee Hansard, 10 October 2023p.25.
[138]Name Withheld, Submission 170, p. 3.
[139]Lisa Carey, Senior associate, National Electrical and Communications Association, Proof Committee Hansard, 10 November 2023, p. 37.
[140]MCA, Submission 50, p. 46
[141]Pinnacle People, Submission 35, p. 1.
[142]Robert Gottliebsen, 'Let's talk about the hidden forces behind inflation, rate hikes' The Australian Business Review, 26 October 2023.
[143]Australia Industry Group, Submission 31, p. 8.
[144]Hays, Submission 81, p. 2.
[145]Brunel, Submission 154, p.3.
[146]Australian Industry Group, Submission 31, p. 16.
[147]Australian Industry Group, Submission 31, p. 9–10.
[148]Business Council of Australia, Submission 14, p. 7.
[149]Australian Chamber of Commerce and Industry, Submission 130, p. 11.
[150]Collar, Submission 80, p. 2.
[151]Clubs Australia, answers to questions on notice, 10 November 2023,(received 29 November 2023).
[152]Rockhampton Public Hearing, Proof Committee Hansard, 31 October 2023, p. 65–66.
[153]Outdoors NSW & ACT, Submission 138, p. 4.
[154]Collar, Submission 80, p. 2.
[155]Geoff Fader, Chairperson, Tasmania Small Business Council, Proof Committee Hansard, 11 October 2023, p.55.
[156]Hon Tony Burke MP, Minister for Employment and Workplace Relations, Fair Work Legislation Amendment (Closing Loopholes) Bill 2023, Second Reading Speech, 4 September 2023.
[157]Wavelength, Submission 73, pp. 1–2.
[158]Transport Workers Union, Submission 37, p. 15
[159]The Australian, ‘Nation’s productivity, growth demands fairness in merger process’, The Australian, 20 November 2023.
[160]Matt Bell, ‘New competition laws ‘to lower prices’’, The Australian, 29 November 2023.
[161]Australian Bureau of Statistics, ‘Australian Transport Economic Account: An Experimental Transport Satellite Account, 2010-11 to 2020-21 , 31 October 2023.
[162]Speech TWU Delegates Conference, Tony Burke, 26 August 2022, https://ministers.dewr.gov.au/burke/speech-twu-delegates-conference.
[163]For example, this campaign led to the creation of the failed Road Safety Remuneration Tribunal by the Gillard Labor Government and risked the livelihoods of many owner truck drivers: Inquiry into the effect of the Road Safety Remuneration Tribunal’s Payments Order on Australian small businesses, Australian Small Business and Family Enterprise Ombudsman. See also, TWU’s current so-called ‘safe rates’ campaign page: Safe Rates - Transport Workers’ Union (twu.com.au).
[164]Australian Small Business and Family Enterprise Ombudsman Inquiry, pp. 27–28.
[165]Senator Tony Sheldon, Senate Hansard, 31 July 2019, p. 1340.
[166]Australian Competition and Consumer Commission, ‘Productivity Commission Inquiry into Australia’s productivity performance’, April 2022, p. 1.
[167]Department of Employment and Workplace Relations, Supplementary Budget Estimates 2023–24, Committee Hansard, 25 October 2023, p. 51.
[168]Education and Employment Legislation Committee, Inquiry into the Fair Work Legislation Amendment (Closing Loopholes) Bill 2023, Proof Committee Hansard, 10 November 2023, p. 92.
[169]Department of Employment and Workplace Relations, answers to questions on notice, 10November 2023 (received 24 November 2023).
[170]Australasian Convenience and Petroleum Marketers Association, Submission 176, p. 4.
[171]Australasian Convenience and Petroleum Marketers Association, Submission 176, p. 4.
[172]Australasian Convenience and Petroleum Marketers Association, Submission 176, p. 5.
[173]Mr Daren Bairstow, President, Livestock and Rural Transporters Association of Western Australia, Proof Committee Hansard, 6 October 2023, p. 47.
[174]Pastoralists and Graziers Association of Western Australia, Submission 94, p. 3.
[175]National Farmers’ Federation, Submission 18, p. 16.
[176]Senate Education and Employment Legislation Committee, Inquiry into the Fair Work Legislation Amendment (Closing Loopholes) Bill 2023, Proof Committee Hansard, 6October2023, pp. 50–51.
[177]National Retail Association, Submission 45, p. 7.
[178]Australian Retailers Association, Submission 29, p. 6.
[179]Mr Martin Stirling, Head of Legal, Master Grocers Australia, Proof Committee Hansard, 31 October 2023, p. 65.
[180]Ms Michelle Harwood, Executive Director, Tasmanian Transport Association, Proof Committee Hansard, 11 October 2023, p. 41.
[181]The Hon Anthony Albanese MP, Prime Minister of Australia, the Hon Dr Jim Chalmers MP, Treasurer, and the Hon Andrew Leigh MP, Assistant Minister for Competition, Charities and Treasury, ‘Government to launch ACCC inquiry into supermarket prices’, Media Release, 25 January 2024.
[182]Australasian Convenience and Petroleum Marketers Association, Submission 176, p. 6.
[183]DoorDash, Submission 39, p. 2.
[184]DoorDash, Submission 39, p. 5.
[185]DoorDash, Submission 39, p. 5.
[186]DoorDash, Submission 136, p. 11.
[187]Uber, Submission 40, p. 1.
[188]Uber, Submission 40, p. 1.
[189]Uber, Submission 40, p. 9.
[190]The Hon Tony Burke MP, Minister for Employment and Workplace Relations, Q&A National Press Club Speech, Closing Loopholes Bill, 31 August 2023 (accessed 21 November 2023).
[191]The Hon Tony Burke MP, Minister for Employment and Workplace Relations, Q&A National Press Club Speech, Closing Loopholes Bill, 31 August 2023 (accessed 21 November 2023).
[192]Uber, Submission 40, p. 2.
[193]Uber, Submission 40, p. 7.
[194]David Marin-Guzman, 'Labor's gig worker laws are far more radical than they look', Australian Financial Review, 5 September 2023 (accessed on 5 September 2023).
[195]Australian Industry Group, Submission 31, p. 120.
[196]Menulog, Submission 136, p. 35.
[197]David Marin-Guzman, 'Menulog warns of $15 price rise unless value of gig work enshrined', The Australian Financial Review, 20 October 2023 (accessed on 9 November 2023).
[198]Business Council of Australia, Submission 14, p. 10.
[199]Australian Industry Group, Submission 31, pp. 4–5.
[200]Australian Chamber of Commerce and Industry, Submission 130, p. 9.
[201]Mr Martin Hehir, Deputy Secretary, Department of Employment and Workplace Relations Supplementary Budget Estimates 2023–24, Committee Hansard, 25 October 2023, p. 50.
[202]Mr Bran Black, Chief Executive, Business Council of Australia, Proof Committee Hansard, 3 October 2023, p. 86.
[203]Australian Chamber of Commerce and Industry, Proof Committee Hansard, 10 November 2023, p. 53.
[204]Ms Tania Constable, Chief Executive Officer, Minerals Council of Australia, Proof Committee Hansard, 3 October 2023, p. 77.
[205]Mr Tim Pallas, Treasurer of Victoria, letter to Minister Burke, BCA, AiG, ACCI and ACTU, 18 January 2024.
[206]The Australian Chamber of Commerce & Industry, Media Release, 'Sneaky Greens deal sells out productivity in our workplaces', 29 November 2023, (accessed 29 November 2023).
[207]The Australian Chamber of Commerce & Industry, Media Release, 'Sneaky Greens deal sells out productivity in our workplaces', 29 November 2023 (accessed 29 November 2023).
[208]The Australian Chamber of Commerce & Industry, Media Release, 'Sneaky Greens deal sells out productivity in our workplaces', 29 November 2023 (accessed 29 November 2023).
[209]Australian Industry Group, Media Release, 'A myriad of deficiencies remain after hurriedly crafted IR amendment', 28 November 2023 (accessed 29 November 2023).
[210]Coalition Senators' dissenting report, in Senate Education and Employment Legislation Committee, Fair Work Legislation Amendment (Secure Jobs, Petter Pay) Bill 2022, November 2022, pp 88–89.
Fair Work Legislation Amendment (Closing Loopholes No.2) Bill 2023
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