House debates

Wednesday, 6 September 2023

Bills

Fair Work Legislation Amendment (Closing Loopholes) Bill 2023; Second Reading

11:13 am

Photo of Melissa PriceMelissa Price (Durack, Liberal Party) Share this | Hansard source

I rise today to speak on the Fair Work Legislation Amendment (Closing Loopholes) Bill 2023. This is very bad. This is a very bad bill. At the very least, it should have been referred yesterday, as we requested, to the Standing Committee on Employment, Education and Training for further consideration. This Albanese bill unashamedly is designed to take away the flexibility currently enjoyed by Australian gig workers, labour hire companies, tradies and other independent contractors and small businesses more generally. At a time when many parts of our economy are on their knees, the Labor Party's really big, innovative idea is to make it harder to earn a living in Australia. What a joke. Communities right across Australia are suffering because of the economic incompetence of those opposite. Under this government we have seen the highest inflation in decades, too many interest rate rises, productivity falling off a cliff, flatlining GDP growth and a year of real wage decline.

People in my electorate are not immune to the worst of this cost-of-living crisis. Durack is the largest electorate in Australia, ranging from Bullsbrook to the outskirts of Perth and the far north of Western Australia, at 1.4 million square kilometres. To put that into perspective, the Prime Minister's electorate is just 32 square kilometres. Despite the distance between all those many communities in Durack, the message I'm receiving is the same. Whether I'm speaking to farmers in the Wheatbelt—which I did recently at the wonderful Dowerin Machinery Field Days for two days last week—to the farmers and residents of York or Mullewa, or at Kununurra, it is clear that Western Australian families, communities, and businesses are all hurting. What are the government doing in response to the hardship being faced by families and businesses in Durack and the broader Australian community? They haven't addressed any of the economic pressures that are currently being faced by these Australians, and they've gone ahead and introduced this very bad bill.

Let's be clear: industrial relations reform is an important economic reform that is required to make Australia more productive and to create more jobs. So when changes are proposed to Australia's industrial relations laws, it's important, and they must get the focus right. Those opposite have failed. On this side of the House we believe that industrial relations must be designed to improve productivity, to grow wages and to enhance competition. Unfortunately, the government reforms will not deliver on these outcomes and will only make life tougher for Australian businesses by increasing costs, complexity and red tape, and they will likely lead to job losses.

It's not just the Liberal and National parties who understand the consequences of this bill. Business groups and employers all across the country agree that this bill will smash productivity, investment and job creation. As Jennifer Westacott, chief executive of the Business Council of Australia, 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.

As we know, the Labor government are not serious about addressing the cost-of-living crisis. They are intent on adding more complexity to the system, passing on cost to business, and delivering on the union movement's wish list. It is shameful.

The Fair Work Act, as it stands, is already 1,200 pages long. This is representative of Australia's absurdly complex industrial relations system, which our small businesses and employers have to deal with on a daily basis. These reforms will only legislate more complexity into the system. It's almost laughable that what is being proposed is an additional 200 pages, making the already difficult-to-manage system more complex and requiring businesses to dedicate more time, resources and money towards trying to understand and implement this new regime. Matthew Addison, the chair of the Council of Small Business Organisations, reflected:

At a time when small businesses are managing increased costs of supply, of rent, of power, of wages; we don't need changes that detract businesses from their sales and service delivery.

According to the government's own estimates, the changes in this bill will cost employers up to $9 billion over the next decade. This $9 billion figure includes over $5 billion in potential costs, assuming just 66,446 labour hire employees are covered by the new Fair Work Commission orders. The Minerals Council of Australia claims that the $5 billion labour hire estimate is much lower than what the actual costs will be for businesses, because the economic impact fails to take into account hundreds of thousands of service contractors and workers in related entity businesses which will be captured by this very bad legislation.

What this Labor government fails to understand is that every time it passes on an additional cost to business it is killing jobs and driving up the cost to the consumer. This should be common sense, even to those opposite. The Department of Employment and Workplace Relations said that business would likely be able to pass on the extra costs 'through higher prices for consumers or third-party businesses'. I agree with Andrew McKeller, the chief executive of the Australian Chamber of Commerce and Industry, when he outlined the chamber's opinion on this dreadful legislation. He said that this bill will be bad for productivity, for those wanting to be their own boss and for consumers struggling with the cost-of-living crisis. To quote Mr McKellar:

If you're in labour hire or want a casual job, prepare for unemployment.

…   …   …

If you are a service provider and want to advertise online, prepare for unemployment.

Of course, he is right. Putting up more barriers and driving up business costs is a recipe for unemployment and a decrease in jobs growth.

I would like to take the time now to highlight some of the most damaging elements of this legislation and why the Labor Party has chosen to go down this path. Labor talks about closing labour hire loopholes through its same job, same pay legislation. However, the truth is that the policy goes much further than just labour hire. In fact, the proposal does not define labour hire as a business that provides workers to another business who then work under the supervision of that business as part of that business. This is the standard definition, as confusing as it may seem, that is used in labour hire licensing legislation. Instead, Labor proposes to also cover service contractors who are engaged to provide a service, often utilising their own plant and equipment, their own expertise and their own management, as well as their own workforce. Any business that engages service contractors will be captured by this bad legislation.

Another issue that I have with the proposed legislation is its changes to casual employment. 'Casual' is a dirty word to those opposite and their union mates. But it is an essential employment type for businesses in my electorate and right across Australia. It is important to note that it is small business who employs some 80 per cent of Australia's casual workforce. Many of the farmers in my electorate rely on seasonal casual employment during harvest time, as they do across the whole of Australia. Likewise, tourism businesses in the north of my electorate simply cannot afford full-time employment for all of their staff due to the lack of business during the wet season. Through this bill the Albanese government will introduce a new definition of casual employment. The new definition will be three pages long and include 15 factors to determine if an employee is a casual. Honestly, this introduces even further complexity that needs to be managed by the employers of Australia. The definition of casual employee in the act will be changed to prohibit anyone from being engaged as a casual if they work regular hours. As a result a court can order that the employee was always not a casual from the time of their engagement.

For all of these reasons employers would have no choice but to force workers to move to a permanent role, losing their additional income and choice of hours. However, casual jobs will not magically be replaced by permanent jobs. Any claim that they will reflects a fundamental misunderstanding of why casual employment is both necessary and legitimate. The legislation will in effect discourage casual employment and make it too risky for many businesses to even consider. But we have to ask ourselves: why is Labor pursuing this reckless agenda despite the concerns of industry and business? It is clear that none of these measures are designed to improve productivity, to grow wages or to enhance competition, which, as we all know—and even those opposite understand this—are the ingredients for a successful economy.

The cynic in me believes that the main driver is Labor's commitment to deliver for their union mates. This is part of their 'you scratch my back and I'll scratch yours' relationship.

These measures are designed to reverse the trend of union decline in our country. What we are seeing is the government doing the union's bidding to grow union membership, and of course this legislation also seeks to increase union power and control of the economy.

One of the most troubling aspects of this legislation is the expansion of union power in workplaces. This bill will amend the Fair Work Act to enable unions to exercise right-of-entry powers without any notice whenever it relates to an allegation of wage underpayment. To gain immediate entry, the union only needs to assert to the Fair Work Commission that they suspect a case of wage underpayment. No evidence is required to make this case.

I'm particularly concerned about how this expansion will affect farmers in my electorate of Durack. The National Farmers Federation has raised its concerns that union representatives will be allowed to enter farms unannounced. Let's be clear: for most farmers their workplace is also their family home. We are talking about mum-and-dad business owners like the ones that I talked about earlier in Dowerin, York and Mullewa. Their farm isn't just their home; it's their kids' backyard and it's a place that they deserve to feel safe in. There are also important biosecurity concerns that union representatives may not be aware of. Union representatives should not have the right to just come onto their land unannounced.

The Labor Party has already tried to skate over all of the controversy surrounding this bill, saying it is about closing loopholes and addressing wage theft. But let me reiterate what I know many of my colleagues have already said in the House in this debate: the coalition acknowledges deliberate rip-offs of workers is not acceptable and that there should be serious sanctions, but these should only apply to intentional conduct, not to a mere mistake. We are extremely concerned that the new and confusing definitions around casuals and employment in this bad bill will only add more risk and complexity for businesses. It's my view that reforms around wage underpayment and theft should also come with reforms to simplify the system, not to make it more complex. We should simplify the workplace system to avoid underpayments in the first place. Instead, Labor is making this very bad situation worse.

In light of the significant concerns of small businesses and employers across the country and the detrimental impact this will have on workers across the country, I call on the government once again to reconsider this bill.

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