Julian Hill (Bruce, Australian Labor Party) Share this | Hansard source

I do not think that I am even going to try to top 'humble battler millionaire', but we will probably hear that again!

I have a few remarks on the Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017. This is a typically weak response from an out-of-touch government. In reality it will do little to actually address the outrageous exploitation of vulnerable workers across Australia. Every hour of every day in every state and territory across Australia, people with little or no bargaining power in the workplace are being exploited by unscrupulous employers.

This takes many forms. It is underpayment, below award or minimum wages. It is superannuation theft, not being paid—wage theft of a different kind. It is being forced to work unpaid overtime. It is being forced to pay kickbacks to employers or to pay other illegal charges for visa fees, tools or uniforms. It is being forced to work dangerously long shifts. Young people are especially vulnerable; they may not know their rights or have fewer options. People most desperate for work are afraid to speak up. And by far, in my view, the most vulnerable group of people in our country now are temporary migrants. The government no doubt hopes that this bill will make people think that they are doing something, 'There is nothing to see here; we really care.' But the truth is that it is about as little as they think they can credibly do and get away with. Something is better than nothing, which is why we will vote for it, but this bill is grossly inadequate. So what does it actually do? The two-word summary is 'not much'.

The title of the bill is Orwellian doublespeak, because it really does not do much to address all of the numerous issues which have been raised in parliamentary inquiries in recent years. It is a weak response that the government probably does not want to do, but which they have been publicly shamed into doing by the scandals at 7-Eleven and other franchises. There are a few increases in penalties for serious contraventions, which are probably hard to prove. There is a bit of a slap over the wrist for recordkeeping failures and there is a rule against requiring workers to pay kickbacks to their employer, which appears to be badly drafted and ineffective. And the bill purports to make franchisors and holding companies responsible for underpayments by franchisees, but even that drafting is flawed and weak and it will be easily avoided. In summary, it will not stamp out exploitation or go any meaningful distance to do so.

The government must be terribly embarrassed by the Senate committee report on the bill, which was released a couple of days ago. Even the government senators criticised the bill and recommended changes, having been forced to sit through days of hearings and hearing reams of evidence from businesses, from lawyers and from unions about the bill's deficiencies and the negative impacts on businesses. As drafted, the bill unfairly singles out franchisors and fails to cover other types of commercial relationships. As business after business said, 'We will just restructure to avoid these provisions. It is not actually going to work.' A proper bill that properly protects vulnerable workers would combat sham contracting. It would provide a national approach to license scam labour hire companies and it would stop companies phoenixing. Phoenixing is when companies are dissolved and do not pay their employees and they just pop up with the same people, the same directors and a different company name, but the directors are not responsible—apparently. A proper bill would make it easier for workers to recover their unpaid wages from employers and directors of companies.

You would think that it would not be a difficult or controversial proposition that the parliament would support laws to fix these things. I would put three simple propositions that, in my view, would pass the so-called 'pub test' anywhere in this country. Firstly, employers should pay their workers what they are owed and must act in accordance with the law. Secondly, if they do not then the law should be enforced by a strong, well-resourced regulator. Thirdly, if there are gaps in the law or the regulatory regime then this parliament and the government of the day—that is those people over there, who are the government, even though they do not often act like it—must actually act quickly and fix the gaps in the law.

Australians support fairness in the workplace and vote against extreme IR laws. Indeed, the only two prime ministers in the history of our federation ever to lose their seats in a general election—Stanley Bruce, who my seat is named after, and John Howard—lost their seats, in large part, because they tried to introduce extreme IR laws. So it beggars belief that whenever workplace issues arise the Liberals have to be dragged kicking and screaming to fix or enforce the law and give everyday, ordinary Australians a fair go.

I will make some remarks about a couple of aspects of the issue and the bill's deficiencies that hopefully will be addressed in a more sensible fashion in the Senate. The first and most substantive issue is temporary migrants. This is a weak bill that will do little to address the exploitation of vulnerable workers. There is overwhelming evidence that the worst exploitation in this country is happening to temporary migrants. Australia now has over 1.2 million people who are legally in this country on temporary visas with some form of work rights attached. There are hundreds of thousands of people in Australia who are here for years on temporary visas. They are people who pay tax and who try to follow the law. Many are making a life here and contributing to Australia but remain condemned to an insecure existence, hopping from temporary visa to temporary visa.

The truth is that they are a growing underclass in our society and they are vulnerable to the most appalling exploitation. Migration status and uncertainty is an enormously powerful threat to any worker. It is difficult for many of us who are born here to truly understand how terrifying this threat can be. In summary, they are told, 'Do what I say or I will dob you into immigration and you will be deported.' It happens to international students, it happens to working holiday makers who want a second year on their visa and it happens all the time to people on 457 visas who want an extension or sponsorship.

We have heard these reports firsthand from unions. Without a doubt, the worst issues which they see day in, day out relate to temporary migrants. There is a fine line, in fact, between slavery and severe exploitation. The old notion of slavery, of course, was forced restraint, but it is not far off to say in a modern context, 'I will take your passport,' or 'I will cancel your visa and deport you from the country.' Labour shortages are one thing, but, really, for many employers the issue is a shortage of exploitable labour. This quote sums up the attitude:

Visa holders are the best workers you can get as if they don't do what you want we'll put you on a boat and send you back.'

The 417 working holiday-maker visas are now a growing and significant issue—bonded labour, in many cases. People are reported to be paying employers to do the 88 hours of work in regional areas to get the second year on a working holiday-maker visa. These are not things we are making up; they are things that have been on TV and in parliamentary inquiries. This bill does not do anything about them. Unions also rightly point out that the focus of government and the media in the public narrative is always on the dodgy illegal workers—'We've got to crack down on the illegal workers.' Yet the reality is that there is supply, illegal workers, and demand, dodgy employers. I think we need more focus on unscrupulous, dodgy employers to provide a stronger deterrent and curb demand for exploitable and exploited labour.

We have heard reports for many years through the media about 7-Eleven and Domino's selling visas, Myer cleaning subcontractors being underpaid, and Pizza Hut drivers and Caltex outlet workers being exploited. We have heard reports of international students. We hear reports of 457 visa holders. The government has heard the reports through the parliament, most recently through the Senate Education and Employment References Committee report entitled A national disgrace: the exploitation of temporary work visa holders. It is shocking reading. It is noteworthy, though, that the government has not even bothered to respond to the report. We cannot find any evidence of the government implementing any of the report's 33 recommendations. Labor, of course, had legislation on the Notice Paper to address these issues 12 months ago. But, perhaps most appallingly, the government is actually set to make these problems worse with the half-baked immigration and citizenship changes.

Australia, our country, used to pride itself on being a permanent-settler-migrant society. Yet, over the last couple of decades, under both governments, we have seen incremental changes and we are now at risk of entrenching a guest-worker or serf class in our country. Minister Dutton's con job on 457 visas and citizenship changes stands to make this problem worse. As an aside on the 457 visa, fundamentally, whatever you rename it and whatever scam you pull on the lists, if there is no proper labour market testing it will be rorted, pure and simple. There is nothing in the budget papers that will implement proper labour market testing. For vulnerable workers, the topic of this bill, the new, two-year 457 visa—whatever it is called—has no pathway to permanent residence. This entrenches, in fact, an even larger guest-worker program in Australia. Even people on a four-year version cannot gain PR for at least three years, and then they have a four-year wait for citizenship.

I want to paint a picture of what will become a scenario under these changes. I used to run international education in Victoria and have quite some familiarity with these issues. We are trying at a national and state level to grow our secondary education high school market. Someone might come here as an international student to do years 11 and 12. Then they will stay on for three years and they will study and pay through the nose. They get a good return, quality education, but they pay for an undergraduate degree, so they have been here five years. Then they may look at these new arrangements and say, 'I'm going to have to do a master's. That'll take a year or two.' Let us say they have been here for six years. If you do a master's, you can have a crack at getting a 485 graduate visa and stay for three more years. You had better hope that in those three years you secure work in your chosen field for at least two years, because then you might be eligible to fill a skills shortage. We are up to about eight years, and with a four-year visa that is 12 years. After three years on that visa you might apply to be a permanent resident, so let us say you have been here for 11 years. After another four years, that is 15 years in this country. So, never having lived anywhere else in your adult life and having paid your way through education, paid taxes, complied with the law, and maybe married and had kids, after 15 years here you might be eligible to apply for citizenship. I have been hearing calls, in fact, that there is a need to explore fairer pathways to citizenship for people like this who live here all of their adult life and contribute, not make it harder. But that is a debate for another day.

Stepping back from vulnerable workers—what does this say about us as a society? If what you want is to set up a society with an exploitable vulnerable underclass then these policies to increase the number of temporary migrants makes sense. If you want to give up on building a cohesive, proud community of permanent settlers who create a life here then this makes sense. That is not the kind of society I want to see, but if that is what you want then ramping up a class of permanently temporary migrants and avoiding real safeguards against workplace exploitation is the way to go. Many people hear this as 'Oh, well, it doesn't really matter. It's some migrants. They're not me. They're not my family' but it has enormous impacts on the broader Australian community. My daughter is 21. Her generation knows perfectly well the impacts it has, because it massively changes the power balance to employers. They can prefer a cheap guest worker, a temporary migrant, to a local person with rights. As I said, it is an enormously powerful threat in the real world to withhold sponsorship over someone. There is an industry in kickbacks, deductions and so on.

The second but less obvious issue is that these non-wage incentives that are so powerful over temporary migrants have an enormous impact on everyday Australians, because wage growth for everyone else in the country is driven down by this underclass of desperate or vulnerable people who have no choice but to cop illegally low wages and awful conditions. This is a serious issue in an economy with low or stagnated wage growth. It is also noticeable—I think the shadow minister is here—in my reading of the government's announcements that the government is also refusing to index the minimum salary for temporary migrants. So, year on year, the value of it erodes, and this will open up the temporary migration scheme to lower and lower paid occupations, which makes this problem of exploitation worse.

The Fair Work Ombudsman is supposed to deal with these issues but it seems practically broken now in its enforcement. Migrants just give up. They probably leave the country by the time Fair Work might even get back to them on their case. Unscrupulous employers know they can just get away with it. There is a clear need to review and overhaul the Fair Work Ombudsman and provide it with proper powers and resources to do its job. We could have a look at that in a proper piece of legislation that is properly trying to deal with the issue of exploitation, not some little sham, fig leaf effort by the government. If the government were serious about protecting workers, they would provide a response to the Senate report about constructive improvements, such as Labor's legislation, which hangs around on the Notice Paper,to amend the Fair Work Act to make it clear that it applies to all employees, irrespective of their migration status, and implement complementary amendments to the Migration Act.

The other issue is penalty rates. The other group of vulnerable workers that the government does not care about but could use this bill to look after is people on penalty rates. We have heard about the impacts on people who are on fast food, hospitality, retail and pharmacy awards from general cuts. They are the lowest paid workers in the country. We are already seeing a flow-on effect to those on enterprise agreements and, more concerning, the potential for the penalty rate decision to set a precedent for other awards in Australia. It is a time to talk about it and at another time the legal advice which has been revealed, showing exactly why there is a risk of this decision flowing on to other awards.

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