Mr Tony Burke (Watson, Australian Labor Party, Shadow Minister for Immigration) Share this | Hansard source

I have to concede: when I watched the policy launch of the Liberal Party at the last election campaign, I did not see it coming. I heard the announcement from the Prime Minister where he explained that there would be independent contractors legislation. I sat there and thought: ‘That’s probably politically clever—putting legislation forward that no doubt will do something to improve the rights of independent contractors.’ I am sure that is what the Australian people all thought. None of us saw it coming. The position of independent contractors is extraordinarily important. It very much is the new economy, the new workforce. So many people who used to be in employee-employer relationships are independent contractors. But we have ended up with legislation before us that actually does one thing that independent contractors do not call for.

Independent contractors will tell you many things that they want to happen. They will tell you about the need for less paperwork. They will tell you about the irritation that comes with the various tax forms they are constantly filling out. They will tell you about the frustration for many of them when they were transferred—and many of them were transferred—from an employee situation to an independent contractor situation and told, ‘You’ll be so much better off.’ There is a frustration that a whole lot of the tax provisions that were in place at the time of the transfer were very rapidly cut off within a couple of years of those transfers taking place. The lucrative nature of the transfer at the time it was made from employee to independent contractor ended up not lasting for more than two tax returns for many of these individuals. They will tell you about frustration after frustration when dealing with the head contractor—particularly independent contractors who deal with one head contractor and one head contractor only and who have no choice but to do so, given the branding of the vehicle, whether they are tradespeople, drivers or whatever their independent contracting relationship is. When they are effectively dealing with one head contractor there is frustration about all the power of that one person.

There is one thing that I do not think any of them call for. I do not hear any independent contractors saying, ‘What we absolutely need, the fundamental thing that we demand from the Australian government, is to be able to earn less.’ I do not hear cries from independent contractors saying, ‘The fundamental thing that we need is the right, when it comes to negotiation, to have the floor of the bottom rates cut from under us.’ That is the entitlement this bill gets them. There is nothing more to it—the legislation before us is actually that simple. Independent contractors are to be given that fundamental contracting right: to earn less. Curiously enough, the Prime Minister never put that in his speech. At election time, in the campaign launch, that was the one detail that the Prime Minister decided that he did not really need to refer to.

And I tell you this: without this legislation there are enough independent contractors who are earning less already. There are enough of them who are already earning less because they carry significant debt, they carry a mortgage over their vehicle and a mortgage over their equipment, whatever that equipment might be, and they have been hit by seven back-to-back interest rate increases. It is not simply owner-drivers who have been hit by petrol prices. Petrol prices are a significant cost to business—and do not think independent contractors were not irritated when they were all told by the Treasurer: ‘The one thing business must not do is pass this on.’ Obviously, none of us wanted the business costs to be passed on to consumers, but the impact of that was that they were worn by independent contractors. So they have had to put up with the interest rate hikes, they have had to put up with a reduced income through the impact of the petrol price increases—and now they get a new opportunity from the government: the fundamental right to earn less. They get told they are on their own. And while the number of protections for independent contractors has always been fewer than for employees—even in deemed situations they have never received the full package—now they end up with less protection. They end up with that being stripped from under them.

Who gets to keep them? The ones that get to keep some basic levels of entitlement are the ones who ran the biggest campaign—the ones who were the most unionised of the workforces and who ran a very effective television and, particularly, radio campaign which the government decided they had to listen to. If you ever wanted an argument for the power of trade unions, if you ever wanted an argument for trade unions being able to deliver a result, it is the government’s behaviour on this one. But do not pretend that the government are actually trying to deliver anything long term because, for the review of those provisions, from the moment this legislation is carried the clock starts ticking—and the clock starts ticking and does not stop ticking until after the next election.

Owner-drivers were in a particularly harsh situation. But look at the arguments that were run and ask yourselves: why was it that the government did not make an exemption on the basis of where those arguments apply? Why did they make a specific exemption for the situation of owner-drivers? The arguments are arguments of safety. The arguments are arguments of goodwill. When people purchase a business in the transport industry they do not just pay for the value of the truck; they do not just carry a mortgage over the value of the truck, or the vehicle if it is a courier business. They also carry a mortgage over the goodwill because they pay for the goodwill that goes with the relationship with the head contractor and the client base. So all of that gets packaged up at the time that they take it on, and all of that is a debt that they carry throughout the business and is a cost to business the whole way through—a debt that then costs them more every time they get one of these back-to-back interest rate increases.

The second thing that is a carry-on effect for people in the transport industry is the safety issue. There is a very serious safety issue which, interestingly, the government think is only a safety issue if you are travelling between New South Wales and Victoria.

See this speech in context