Kate Ellis (Adelaide, Australian Labor Party) Share this | Hansard source

In rising tonight to speak on the Independent Contractors Bill 2006 and the Workplace Relations Legislation Amendment (Independent Contractors) Bill 2006, I would like to take the opportunity to express my fierce opposition to this legislation. Let us all be absolutely clear that this legislation will hurt ordinary working Australians. Ordinary working Australians like drivers, cleaners, clothing outworkers and electricians—whom this government is already slugging with interest rate rises and who are already suffering because of higher petrol prices—are well and truly in the government’s sights with this legislation.

In my contribution to this debate, I would like to outline my general opposition to these attacks, speak with particular reference to this nation’s owner-drivers, and then outline my support for the amendment which has very sensibly been put forward by the member for Perth. We have heard from several other speakers about the main implications this legislation will have if passed—particularly the distressing social and economic impact that it is likely to have. In particular, we have heard that this legislation must not be seen as a single attack on Australian workers but as a part of the Howard government’s wider agenda of extreme changes to Australia’s industrial relations system. I will speak further on this later in my contribution.

I would like to thank the other members from this side of the House who have spoken on these bills with a high degree of passion and with a very detailed understanding of the implications that they are likely to have for many Australian workers. I also take the opportunity to point out the very limited contribution by government speakers to this debate. Very few members of the government have bothered to even enter the chamber and advocate in favour of these proposals—which leads one to wonder whether they are actually unable to defend the indefensible and whether they too recognise that this legislation is fundamentally flawed and must not be supported. It certainly appears that way. If that is the case, I would urge those government members who do not have the courage to come in here and advocate in favour of these changes to have the courage to stand up with the Australian Labor Party and vote against them. I will not hold my breath that I will see this sort of courage.

The report of the Senate Employment, Workplace Relations and Education Legislation Committee’s inquiry into these bills made a constructive contribution to the legislative process. However, the fact that the Minister for Employment and Workplace Relations, Mr Kevin Andrews, commenced debate on these extreme laws in the House of Representatives before the committee’s report had even been concluded confirms the government’s arrogant, out-of-touch attitude to the Senate committee review system. It shows that they are being driven not by a view towards providing good public policy for the Australian people but by their own ideological obsessions.

Sadly, there are many problems with this legislation, and I will expand on some of them. This legislation makes our complex industrial relations system even more complex. It is confusing and it adds to an overburdened small business sector which is already being swamped in red tape. This legislation also overrides all existing deeming provisions contained in state industrial legislation which deem certain categories of independent contractors to be employees and it overrides provisions granting employee related entitlements to independent contractors.

Further, independent contractors will no longer be able to access state unfair contracts laws. This is something that I think is absolutely outrageous. Where are the protections for these people? Overriding state unfair contracts legislation could further water down protections for consumers and for many of our small businesses. These bills will do little to protect outworkers without the proper application of state based outworker legislation. As drafted, the legislation will have the effect of significantly weakening outworker entitlements.

According to research from Melbourne University, up to 40 per cent of workers said to be contractors actually work for only one principal employer and are therefore dependent contractors, not independent contractors as the government has claimed. In essence, these changes mean that if you are classified as a contractor, you will fall outside of the government’s minimum standards. That means, for you, that there are no minimum standards at all.

These proposals will allow genuine employees to be pushed out of the employer-employee relationship and to be treated as independent contractors. This means reduced entitlements, conditions and protections. This is a point which was recognised in the Labor senators’ minority report. The report states:

The basic policy aim of the Independent Contractors Bill is to turn as many employees as possible into contractors. In the Government’s view, and more particularly in the view of employer organisations close to the Government, industrial relations are greatly simplified by arrangements which put employees onto either Australian Workplace Agreements, or turn them into contractors. Work Choices is intended to encourage the first of these trends, and the Independent Contractors Bill is intended to encourage the latter development.

The minority report goes on to say that this bill:

… is intended to turn natural employees into unnatural contractors.

This exercise smacks of a readiness to misuse and misdirect labour skills across the workforce at a time of skills shortage. What is more, because the legislation does not seek to define the term ‘independent contractor’ beyond its meaning under common law, these employees will be subject to the added burdens that normally fall under the responsibilities of an employer, such as the burdens of superannuation, taxation arrangements and workers compensation. At common law, employees are engaged under a contract of services, whereas contractors are engaged under a contract for services. This means that an independent contractor is generally a person who is engaged on a labour-only contract, usually determined as a one-off flat rate. Typically, the independent contractor will be burdened with a range of responsibilities that usually fall on the employer.

Professor Andrew Stewart, who is very well versed in these matters, has aptly identified the practical limitations of the common law in stating that the definition of ‘independent contractors’ under common law means that they will be exempt from:

... a wide range of regulation which is typically applicable only to employees, such as industrial awards, registered agreements, leave and superannuation legislation, and unfair dismissal laws.

This legislation further fails to address occupational health and safety issues, which were the subject of recommendations in the Senate inquiry.

What is more, this legislation introduces even more confusion into our industrial relations system. It makes things even more complicated. These bills will have a negative impact upon many workers, including outworkers, owner-drivers and other contractors deemed by relevant state and territory legislation to be employees. In addition to the removal of the state unfair contracts legislation, unfair contract matters will now be tried in the Magistrates Court, a much more formalistic jurisdiction. Some of the key problems that arise with removing unfair contracts jurisdiction from the state system include the expense, length and complexity of arguments and the exposure costs to order.

This legislation does nothing to address the increase in use of independent contractors by employers but strips independent contractors of access to protections under state legislation, such as superannuation and workers compensation. It allows employees to be reclassified as independent contractors and thus reduces the entitlements of employees and the financial obligations of employers. As the Australian Workers Union has acknowledged, the incentives for abuse are too great and the legislation fails to act as a reasonable deterrent to such abuse.

I would like to focus further upon the impact this legislation will have on owner-drivers. It is a very sad fact that, as has been reported, at least two truck drivers are killed each week, with accidents largely due to overdriving and the misuse of stimulant drugs. These statistics are appalling and are something which the government should be employing its legislative power to try and prevent. But instead, for these small business people or contractors in dependent contract positions, this legislation will take away access to laws which protect against unfair contracts and remove employee-deeming provisions that ensure protections for small businesses and contractors from a range of state jurisdictions. Many of the state based protections will be stripped away by this legislation, as well as many conditions, entitlements and protections.

Owner-drivers are a particular group who are likely to feel the impact of these bills. Owner-drivers are single vehicle operators, the vast majority of which perform work exclusively for a single transport operator. They are often highly dependent upon those with whom they contract. Such dependence leads to an inequality of bargaining power and the associated potential for exploitation. To the economists out there, owner-drivers represent price takers, not price makers.

The Transport Workers Union have run a very effective campaign to represent their members and have managed to achieve an exemption for owner-drivers in New South Wales and Victoria. While I think the government must be criticised for not going far enough to protect South Australian owner-drivers, I note that as a result of the Transport Workers Union’s campaign owner-drivers in New South Wales and Victoria will maintain a critical system of safe and sustainable rates, without which driver and public safety would be threatened, and the protection of the owner-driver small business model, which provides security to these unique small business operations and industry stability. These protections for owner-drivers in the New South Wales and Victorian legislation are in the public interest. They contribute to a stable, sustainable and productive industry, and there is no evidence that the New South Wales or Victorian systems which contain these protections are less competitive or productive.

I will refer once more to the Labor senators’ minority report, which stated:

... the bill still falls significantly short of delivering assurance for owner-drivers. While the vulnerabilities of owner-drivers have been recognised nationally, the bill as presently drafted ignores this fact. It will have the effect of overriding the operation of the pending WA and ACT laws and preventing any state from enacting future legislative protections.

The fact that the government is to review the exemption for New South Wales and Victorian owner-drivers opens the possibility that either before or after the next federal election the exemption for New South Wales and Victorian owner-drivers will be ceased. This means that the only part of this legislation which has not completely made a mockery of protections for owner-drivers could be stripped away. On the evidence that I have seen so far, I have to say that when the government says that they are going to review something just after an election it normally means that they are going to do something very unpopular.

We will certainly be working very hard to make sure that the government do not win the next election, because there is a whole host of things that they want to force upon the Australian people at that point. They would be very busy just after the election. Today, the sale of Medibank Private has been added to the list of the things that they seek to do after the next election. Many people can be forgiven for feeling cynical about the fact that the government also seeks to review this particular exemption at that time.

Transport Workers Union spokesman Tony Sheldon has said:

We have higher incidents than all other industries, including mining. Drivers have had enough. We need to take the economics out of long-distance driving by giving them minimum safe rates.

I absolutely agree with Mr Sheldon on this point. The member for Watson, who joins me in the chamber, has also been very passionate in his defence of owner-drivers and in his belief that we must do everything that we can to ensure the safety of these professions. I find it very disappointing that the government, in contrast, is being so insensitive. Minister Kevin Andrews has admitted that truck drivers have ‘particular vulnerabilities’ and thus need ‘special protection’. So why are we heading down a deregulation path that looks as though it will inevitably cut wages and encroach on vital security measures? Despite government assertions that the legislation is intended to protect independent contractors, the legislation does no such thing. When are we going to see some honesty and integrity from this government? When is their war on Aussie workers going to end?

I have already spoken about the safety concerns owner-drivers face every day. I believe that as a parliament we must ensure that these concerns are alleviated. We must do everything in our power to ensure the safety of owner-drivers and other drivers on our roads and highways. This legislation is not just about industrial relations, although it is clear that the passage of it will culminate in reduced wages, conditions and entitlements for Australian workers; this is once more about the government and their obsessions.

In defending this legislation the government has once again gone back to the argument that it is about choice. We see very clearly in this legislation that this is not about choice at all. Where is the choice when people are able to be represented by lawyers and employer associations—in fact, it would seem by just about anybody—but not unions. Under this legislation these people do not have the power to make the choice to be represented by a union. I think that is an absolute disgrace and shows very clearly just how false this government’s claims that it is doing this for choice really are. I am one person who is not particularly surprised by this. I have seen this in the government’s industrial relations reforms across the board.

In fact in my own electorate at the moment we have an ongoing industrial dispute which arose after the government introduced their so-called Work Choices legislation, which they say is about giving employees more choice as well. In my electorate there are currently 16 Radio Rentals employees who are being locked out of their place and denied any pay for the next month because they have decided that they would like a collective agreement. Where is the choice in that? Where is the choice for workers to try and pursue a fair collective agreement? Not under this legislation, it seems, at all.

I would also like to take a moment to commend the very sensible amendment put forward by the member for Perth. This amendment recognises a large number of the flaws in this legislation. It also notes that this bill follows on from the government’s extreme industrial relations changes, which are a massive attack on living standards and conditions, and that it removes rights, entitlements and conditions of Australian employees. This amendment also notes that this bill treats the Senate Standing Committee on Employment, Workplace Relations and Education reporting on these matters with contempt by dealing with the legislation prior to consideration of its report. But, again, this is something that we should not be surprised by. It is quite in line with the form of this government.

This government has absolutely no respect for the Senate committees or, in fact, any of the processes which have traditionally been set up in this place to ensure good public policy. This government does not seem at all interested in pursuing what is best for the national interest. Instead, rather than even seeking to hear what these inquiries have to say about this legislation, it is content to pursue its own ideological obsessions. I think that is incredibly sad. It is incredibly sad for the people of Australia that they do not have a government with their best interests at heart. They have a government that is so drunk on its own power, following the Senate election results, that it is doing everything it can to get rid of and attack unions and attack ordinary working Australians. I think it is outrageous and a disgrace. I will continue to argue both in this chamber and outside of it that this legislation should be defeated.

In introducing these so-called independent contractors laws, the government has only one message for Australia’s workers, and that is: ‘You’re on your own now. Don’t expect any of the protections that you are used to. Don’t expect to have any of the rights which most Australians would argue are what this country was built on. You’re on your own now.’ That is exactly the way this government wants it. That is exactly the reason they have included in this legislation that you cannot be represented by a union. They want all the workers on their own. They want the balance of power firmly with big business and not with ordinary working Australians. That is something that I will never stand for. It is something that the Australian Labor Party will never stand for. And I wish that it was something that not a single member of this House would support.

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