Lee Rhiannon (NSW, Australian Greens) Share this | Link to this | Hansard source

I will not be proceeding with the Greens amendments on sheet 8088.

Doug Cameron (NSW, Australian Labor Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

by leave—I move opposition amendments (1) and (2) on sheet 8173:

(1) Clause 2, page 2 (table item 3, column headed "Provisions"), omit "3 and 4", substitute "3, 4 and 5".

[protecting take -home pay for all workers]

(2) Page 19 (after line 23), at the end of the Bill, add:

Schedule 5—Protecting take -home pay for all workers

Fair Work Act 2009

1 At the end of Division 2 of Part 2 -3

Add:

135B Protecting penalty rates

(1) A penalty rate in a modern award cannot be varied to make the penalty rate lower than that in force under the award on 30 June 2017.

(2) From the commencement day, a determination of the FWC made on or after 22 February 2017 that would reduce a penalty rate in a modern award so that the penalty rate would be lower than that in force under the award on 30 June 2017 has no effect.

(3) In this section:

commencement day means the day on which Schedule 5 to the Fair Work Amendment (Repeal of 4 Yearly Reviews and Other Measures) Act 2017 commences.

2 At the end of section 193

Add:

Effect of removing or reducing penalty rates—award covered employees

(8) Despite anything else in this section, an enterprise agreement that is not a greenfields agreement does not pass the better off overall test under this section if:

(a) a penalty rate under the relevant modern award for an award covered employee, or a prospective award covered employee, is removed or reduced under the agreement; and

(b) because the employee usually works, or will usually work, on a day in relation to which a penalty rate is payable under the relevant modern award, the removal or reduction in the penalty rate disproportionately affects the employee as compared with employees who do not usually work on that day.

Effect of removing or reducing penalty rates—prospective award covered employees

(9) Despite anything else in this section, a greenfields agreement does not pass the better off overall test under this section if:

(a) a penalty rate under the relevant modern award for a prospective award covered employee is removed or reduced under the agreement; and

(b) because the employee will usually work on a day in relation to which a penalty rate is payable under the relevant modern award, the removal or reduction in the penalty rate will disproportionately affect the employee as compared with employees who will not usually work on that day.

3 Application of item 2

The amendment made by item 2 of this Schedule applies in relation to enterprise agreements made on or after the commencement of the item.

I see the minister is trying valiantly to get her mojo back, but it won't be that easy. Labor will do everything within our power to stop the cuts to penalty rates that this minister and this Liberal government support. Because of this government, 700,000 people already had their penalty rates cut on 1 July this year. These same people, some of the lowest paid in Australia, who are already feeling the impact of wage stagnation and the increased cost of living, face a pay cut on 1 July every year for the next three years. This place supported Labor's private member's bill to prevent the cuts to penalty rates now and into the future; unfortunately this lousy Liberal government is using its numbers in the House to frustrate the will of this place and the Australian people. Labor will not give up.

These amendments effectively mirror the private member's bill introduced into the House by Mr George Christensen. The effect is to restore penalty rates to the level they were at before the cuts commenced on 1 July. The commencement date of these amendments has the effect of restoring penalty rates from the date this bill comes into operation. This means there will be no back-pay liability for businesses who, in reducing the penalty rates they have been paying since 1 July, have been following the law. We cannot restore the wages that have been lost to workers between 1 July and now because of this government's refusal to support my penalty rates bill, which did pass this place in time to stop the cuts. These amendments give this parliament the chance to stop the cuts now and going forward.

It's interesting to note that we have support in the lower house. Mr Christensen, the member for Dawson, said:

… I am breaking ranks with the government, and I do so for a number of reasons. First of all, legislation concerning people's livelihoods and their ability to put food on the table should be considered very carefully. It must be fair and it must be fair for all.

Mr Christensen and I would disagree on a whole range of things, but we would certainly agree on this—that it is an important issue that people who depend on penalty rates can have those penalty rates maintained in order to continue putting food on the table.

Mr Christensen went on to say:

Penalty rates exist in awards for specific reasons. They recognise the fact that Saturdays and particularly Sundays are not like other days of the week. These are the days when children are not at school. These are the days when children participate in sporting, family and other activities.

He went on to say:

These are the days when the majority of working Australians take time off.

Mr Christensen said:

Weekends are important.

He went on to say that he believed the Fair Work Commission had got it wrong. Labor have been saying that for some time. Any decision of the Fair Work Commission that the commission itself concedes creates hardship for working families is not a decision that we will support. It is a decision that was wrong. It is a decision that puts the impact on ordinary Australians, Australians battling to make ends meet under this government.

This is the last chance for the Senate to make sure that Sunday penalty rates can be restored this year. This year, Christmas falls on a Monday. For many Australian families, Christmas Eve is the time they truly celebrate Christmas, but for members of many of these families Christmas Eve will be a workday or a work night. We have always said that penalty rates are compensation for working arrangements that are unfriendly to family life. Nothing could be more unfriendly to family life than working on Christmas Eve, which is the time when one's family come together to celebrate a special time of the year.

The Senate has the opportunity now to restore the compensation laws workers are entitled to. I am asking those senators who supported the bill I put forward to stop the cuts to penalty rates to support these amendments. And I would also be asking Mr Christensen to support what we are adopting here, which is fundamentally his bill. There are no excuses for Mr Christensen in the lower house. He should accept the bill as it comes forward from this place—that is, in the form I am confident it will because the majority of senators in this place do understand the importance of penalty rates. They are not about trying to attack workers and their unions every time they stand on their feet, as this minister does—this minister who has no credibility in this place, who has misled this place on at least five occasions and who is about trying to stop any legitimate questions about her activities. This is a minister with no credibility; this is a minister that should resign. This minister should get out of this place as soon as practicable and let workers get decent rates of pay and decent penalty rates. That's what my amendments are. I support the amendments.

Lee Rhiannon (NSW, Australian Greens) Share this | Link to this | Hansard source

The Greens do support this amendment. We must ensure that penalty rates aren't traded off for other conditions, and that's what we can achieve here. This is an incredibly important moment. We know that wages growth is at a record low and that the workers who receive penalty rates really depend on them. They are absolutely essential for so many workers—we've had the evidence before parliamentary inquiries and we know it from our own experience. So many of the workers who depend on penalty rates really have their backs against the wall, at the moment, with the way things are going in Australia.

There is a very useful study that's come out from the Australia Institute. Their Centre for Future Work released a report that warned that at current levels of wages growth it would take 17 years for higher base wages for retail workers to offset penalty rate cuts. There is an idea that penalty rates are just an add-on to the base rate that workers get, but that base rate is not delivering the living standards people have a right to expect. That's why we need to ensure that penalty rates are not traded off for other conditions.

We believe that the parliament should also reverse the Fair Work Commission's decision to cut penalty rates for some of the most insecure and low-paid workers. Ensuring workers are properly compensated for working unsociable hours really goes to the essence of how we should work in this place. Yes, we at times have unsociable hours, but at the end of the day it is only for a few weeks a year. For some workers, this is what their work is like every day. As the previous speaker, Senator Cameron, set out, we're on the eve of Christmas, when we have some of the biggest public holidays in this country, and, because Christmas Eve falls on a weekend, the hardship that will bring will be enormous. There will be some people who will not see their families that weekend because of Saturday and very late-night shopping. This is very savage and a reminder why we need to protect these conditions.

The Australian community continually sees this place passing laws that benefit just a small section of wealthy people in this country. We have an opportunity here to right some of those wrongs—to ensure that penalty rates are protected and locked in the law.

Michaelia Cash (WA, Liberal Party, Minister for Women) Share this | Link to this | Hansard source

The government opposes Labor's amendments. These amendments undermine the independence of the Fair Work Commission and have serious implications for enterprise bargaining. The government's position has always been clear—setting minimum pay and conditions is the job of the Fair Work Commission. The amendments would prevent the commission from ever varying a modern award to make a penalty rate lower than those applied under the award as at 30 June 2017. This ties the independent Fair Work Commission's hands, making it impossible for the commission to make sure modern awards are a fair and relevant safety net for Australian employees and employers.

The commission said that its decision is expected to deliver an increase in the level and range of services in both the retail and hospitality industries, with a consequent increase in employment—that is, more hours of work for existing employees or the engagement of new employees. Its decision means that small business will be able to compete on a level playing field with big business, which has done deals, as I've already articulated in my summing-up speech, with unions to reduce Sunday penalty rates through enterprise agreements. The Department of Employment's submission to the Senate inquiry into penalty rates found that around 65 per cent—70 out of 108—of a sample of large enterprise agreements covering 200 or more employees, which identified the fast food, retail, hospitality or pharmacy modern awards as their parent award, already cut penalty rates for at least one group of workers. Fifty-five of these 70 agreements covered at least one union. Why is it that Labor does not want to allow small business to be able to better compete and gain the benefits the full bench of the Fair Work Commission said would result from its decision? Those opposite clearly do not want to support small business.

In addition, Labor's amendments would not allow penalty rates to be reduced or removed in an enterprise agreement if it would disproportionately affect employees who work on days where penalty rates are payable as compared to other employees. Just how this would be operationalised remains a mystery. It would be very difficult to determine whether someone usually works on a specific day and what is meant by 'disproportionately affects'. The amendments would significantly reduce the scope available for parties to bargain—and I refer to recent figures: the negotiating outcome of at least 65 per cent of a sample of large agreements involved some change to Sunday penalty rates.

Enterprise bargaining allows employers and employees to tailor the conditions of employment to their business, supporting productivity and economic growth. The amendment would stop bargaining in its tracks. The Fair Work Commission already has to compare all the conditions, including pay an employee would receive under the relevant award including casual loadings and penalty rates, when applying the better off overall test. Currently, employees are able to trade off some allowances and penalties for conditions they value more highly or a higher base rate of pay. The amendments would significantly impede this flexibility and undermine the traditionally bipartisan intent of facilitating bargaining and productivity at the workplace level. On that basis, the government does not support the amendments.

Sarah Hanson-Young (SA, Australian Greens) Share this | Link to this | Hansard source

I, of course, stand in support of this amendment. I think it's absolutely essential that we get it through the Senate today and we get it through the parliament this week. We are in the last sitting week before the Christmas break. While those of us here, in this place, will be able to go home and spend time with our families, we know that there are thousands and thousands of workers, right across the country, who will miss out on spending Christmas with their families because they are working.

In my home state of South Australia, we know that there are 270,000 South Australians who rely on some form of penalty rate. Most of those people, of course, are single parents who struggle every day, week in, week out, to provide for their kids and to put food on the table and rely overwhelmingly on those penalty rate wages to pay for the meals, the rent, the school uniforms and—heavens above!—some school holiday activities while they are at it.

We know that overwhelmingly penalty rates are relied on by women more than men, which is why, with the change by the Fair Work Commission, this amendment is absolutely essential to ensure we protect female workers across the country. Single mums, single parents and female workers rely over and over again on these penalty rates. Let's not forget about the thousands and thousands of young people right across the country who can't get full-time work or enough work to pay for their living costs and so rely, week in, week out, on those Sunday penalty rates.

It is just remarkable that, when we hear the government talk about doing the right thing by Australian workers, when we hear the government saying everybody should go out and get a job and do what they can and be as ambitious as possible, here we have them lining up with the Grinch of Christmas to strip penalty rates on Sundays and to not work with the Senate to fix this. Malcolm Turnbull has a choice. We're three weeks out from Christmas. Is he going to work with the Senate to make sure we protect penalty rates or is he going to allow workers on Christmas Eve to be stripped of decent pay? Will Malcolm Turnbull be the Grinch of Christmas or won't he? It's going to be his call once the Senate passes this amendment.

Richard Di Natale (Victoria, Australian Greens) Share this | Link to this | Hansard source

I also rise to speak in support of this amendment—to the Fair Work Amendment (Repeal of 4 Yearly Reviews and Other Measures) Bill 2017—to protect penalty rates. It's really important we look at this in its broader context. When you look in this place at any public policy, what you see is a government—and, indeed, it must be said this also happened under previous governments—that is continuing to let down and fail young people, people living at the margins and people who are vulnerable in our country.

Let's look at the way we tax profits from selling assets. The way we tax those profits is we give people discounts. And yet, when we look at the way we tax income from work, we know that people who are simply earning an income through paid work rather than through assets have a greater tax burden. We know that older Australians who own vastly more assets than younger people see a tax system where the odds are stacked in favour of older Australians against young people. Just look at the indexation rate for the pension. We're not saying for a moment that the pension is something that allows people to live a particularly comfortable life. Indeed, we would like to see the pension increased. But we've made a decision in this country to index the pension at a higher rate than we index support for young people when they receive youth allowance, further exacerbating the gap between younger people's incomes and older people's. We have great intergenerational inequity occurring here in Australia and this change to penalty rates, unless we put in protections, will further increase that great intergenerational gulf that seems to be growing year on year.

We have people in this place who benefited from free education seeking to impose huge debts on young people through TAFE and university fees. So, basically, we have young people in this country starting out with massive personal debt. It eats into their discretionary income. They have a tax system that is stacked against them. We know that that is manifest through our negative gearing laws. We have created a whole asset class of older property investors. It's generally younger people who pay rent to them—again, another transfer of wealth from the young to the old. These are young people who start their careers with massive education debt and who then have a tax system weighted against them and are priced out of the property market. They can't afford to buy their own homes and, through rent, are transferring wealth across to older generations.

Just look at the great intergenerational theft that exists with the lack of action to address global warming. We've got a generation that has benefited from consuming and polluting with impunity. Now, because we have governments that don't have the courage or, indeed, the foresight to transition our economy away from polluting industries to sustainable industries, we risk turning what is already marginal farmland to unproductive land. We risk losing major tourism assets. We're seeing the slow decline of the Great Barrier Reef through those unprecedented bleaching events. We're seeing public infrastructure suffering as a result of the extremes of weather. We have a younger generation in this country that is being screwed over by people who had it pretty bloody good, who had free education and who were able to consume and pollute with impunity at a time of high wage growth and at a time when we recognised that our prosperity was built on the back of people who worked hard to contribute to their country.

That is why we will be supporting the proposed amendment to protect penalty rates. We will support any measure that seeks to address many of the structural problems that exist in our economy. Indeed, before the last election, we were the only party to go into that election promising to legislate to protect penalty rates. We are pleased that the Labor Party is now taking the opportunity to join us and reverse the Fair Work Commission's ruling. We absolutely, unequivocally support this amendment. We do need to do something about the fact that we are seeing young people lumbered with massive debt. We also need to recognise that, according to the Australia Institute, if this were to go ahead, it would take 17 years until higher base wages for retail workers would offset the lower penalty rate cuts—17 years to address the inequity created by this change.

Far too often parliaments act in the interests of the wealthy. They act in the interests of their big corporate mates, they act in the interests of big business and they act against the interests of regular people. We need to do everything we can to make life easier for future generations. Again, we have to ask ourselves the question when we make a change: who benefits and who pays? At a time of stagnating wage growth, at a time when the gulf between those who have assets and those who don't is growing, at a time when we are seeing the first generation in history who will be handed down worse living conditions than those that we enjoyed, it's time for those of us in this parliament to act and to act quickly. This amendment goes some small way towards doing that—it's why we'll support it—but we have to do so much more.

David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Link to this | Hansard source

I oppose Labor's amendment. It prevents a regulated penalty rate from being reduced—ever. So, in the wisdom of Labor, the Greens and the Nick Xenophon Team, the penalty rates in force from 30 June 2017 are perfect for all time. I would like to pose a quiz to Labor, the Greens and the Nick Xenophon Team, and I will make it multiple choice. What is the perfect Sunday penalty rate for hospitality workers: 150 per cent, 175 per cent, 200 per cent or 225 per cent? The correct answer is 175 per cent. Let's try again. What's the perfect Sunday penalty rate for retail workers: 150 per cent, 175 per cent, 200 per cent or 225 per cent? The correct answer is 200 per cent.

We have a recent example of a country where democratically-elected politicians did the electorally popular act of putting a floor on wages and a cap on prices. It is called Venezuela. A country that should be one of the richest in the world is now filled with untold misery, where the price of bread is regulated but there is no bread for sale, and wages are regulated at generous levels but great swathes of the population are unemployed. Socialist price-fixing may be popular but it is the most irresponsible thing you could do. Senators planning to support this recommendation should hang their heads in shame.

Rex Patrick (SA, Nick Xenophon Team) Share this | Link to this | Hansard source

As I was not able to contribute to the second reading debate on the Fair Work Amendment (Repeal of 4 Yearly Reviews and Other Measures) Bill 2017, I wanted to make some brief remarks about the position of the Nick Xenophon Team on the penalty rates amendment moved by Senator Cameron. At the outset I want to make it clear that NXT is on the record as opposing the Fair Work Commission's decision to cut penalty rates to low-paid workers. It is the formal position of the Nick Xenophon Team that workers should not have their pay rates cut at a time of low wage growth. The NXT also supported a bill by the member for Dawson, Mr George Christensen, which seeks both to stop those cuts and to put an end to sweetheart deals between big unions and big business to avoid paying penalty rates through a distortion of the enterprise bargaining agreement process—something small business cannot do.

This amendment replicates the private member's bill moved in the House of Representatives by Mr Christensen and seconded by my colleague the member for Mayo, Rebekha Sharkie. It also gives effect to a recommendation made by former Senator Xenophon in the Education and Employment References Committee inquiry into penalty rates. This amendment goes one step further than the bill by the opposition. It overturns the decision of the Fair Work Commission but also ensures that workers are not penalised by enterprise agreements which seek to trade away their penalty rates.

The practice of trading away penalty rates, usually by the Shop, Distributive and Allied Employees Association, is why former Senator Xenophon moved for an inquiry. This inquiry heard important evidence about the practice of trading away penalty rates engaged in by major retailers and the SDA, which leave many workers worse off than if they were employed under relevant modern awards. I want to make it clear that trading away a penalty rate for another benefit, such as a higher base rate of pay, may not be objectionable practice as a general principle, so long as the individual worker is in fact better off. It becomes an objectionable practice when a worker who benefits and relies on penalty rates, when predominantly working evenings, weekends and public holidays, loses out because of a higher base rate that has been secured for a traditional Monday-to-Friday, nine-to-five worker.

Unfortunately, it appears that enterprise agreements where many workers are not better off overall are all too common, especially in the fast food, hospitality and retail sectors. These deals have negatively affected hundreds of thousands of workers, and it has been estimated that each year these deals cost approximately 250,000 employees more than $300 million collectively. This amendment would put an end to those deals. While the ACTU has labelled the bill moved by the member for Dawson as counterproductive and warned that it could make workers worse off, introducing a dangerous distraction that will potentially threaten the take-home pay of an entirely new group of workers, I take comfort in the fact that the opposition has decided to adopt the bill. If the proposal moved by the member for Dawson were to put these workers at risk, I'm sure the opposition would not be moving it.

Before I conclude, I would like to address the claim that around 700,000 people would have an effective pay cut because of the penalty rate decision. This figure has been repeated by the Leader of the Opposition, Mr Shorten, many times. On ABC TV's Q&A program on 26 June, 2017, the opposition spokeswoman for justice, Clare O'Neil, said:

… on Sunday, in fact, this penalty rate cut will take effect – 700,000 of the poorest-paid people in the country are going to have an effective pay cut.

The great team at RMIT ABC Fact Check looked into this claim and their verdict was that it was fanciful. In a piece for The Conversation,The University of Melbourne's Dr Josh Healy applied Australian Bureau of Statistics estimates of people who work on Sundays and/or on varying days and came up with the figure of 355,000 people potentially affected. Professor Mark Wooden of the University of Melbourne tells Fact Check:

Given the broad assumptions made, the 700,000 figure is not credible and far too high, but no one really knows what the net effect will be.

Although there has been some debate about the numbers, what is known is that there will be a large number of workers who will be negatively affected by the decision of the Fair Work Commission to cut penalty rates. This amendment will protect not only these workers but workers who end up worse off because of deals between unions and big business that trade away penalty rates without any real benefit.

The CHAIR: The question is that opposition amendments (1) and (2) on sheet 8173, moved by Senator Cameron, be agreed to.

Senator Collins did not vote, to compensate for a vacancy caused by the resignation of Senator Nash.

Senator Canavan did not vote, to compensate for a vacancy caused by the resignation of Senator Kakoschke-Moore.

Senator Brown did not vote, to compensate for a vacancy caused by the resignation of Senator Parry.

Sue Lines (WA, Deputy-President) Share this | Link to this | Hansard source

The question is that the bill, as amended, be agreed to.

Senator Collins did not vote, to compensate for a vacancy caused by the resignation of Senator Nash.

Senator Canavan did not vote, to compensate for a vacancy caused by the resignation of Senator Kakoschke-Moore.

Senator Brown did not vote, to compensate for a vacancy caused by the resignation of Senator Parry.