Julia Irwin (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

The current level of concern in the community over the government’s extreme industrial relations changes has focused on the plight of employees who have felt the brunt of employers’ cuts to wages and working conditions. But employees are not the only victims. As I related to the House on Monday, employers are being given advice to cut wages and conditions and to get in before their competitors do to give working conditions the chop. We are now seeing evidence that this is happening in the road transport industry, with devastating consequences. For one transport company based in my electorate of Fowler, the impact of the changes was felt when the head contractor—one of the largest freight companies in Australia—placed pressure on its subcontractors to cut rates or to at least not increase rates at a time when increasing fuel costs had made rate increases necessary. Large freight companies have been increasing the pressure on subcontractors for the last few years, but the rapid rise in fuel costs has left trucking subcontractors in a position where they would be losing money on every load unless they could cut costs.

As fuel costs have risen, reducing labour costs has been left as the only way that operators can keep their heads above water—and that has meant a race to the bottom for trucking operators. The only operators to survive are those which have cut hourly rates of pay for drivers, cut penalty rates for weekend work and reduced rest breaks and other conditions essential for the safety of all road users. In one case brought to my attention, an operator with a fleet of 24 trucks has had to close its doors after more than 20 years in business, because—and what this operator was doing was fantastic—it paid award rates and met essential safety requirements. It could not compete with operators prepared to cut wages and conditions. That has left 30 local drivers out of work and in the queue to work for operators paying much less than the award.

To give some idea of the pressure trucking operators are under, the contractor gets around $720 for a 20-tonne load return trip from Sydney to a regional centre but offers only $420 to the subcontractor to do the job. After fuel—which makes up over half the operating cost—maintenance and capital charges, that leaves an operator losing money if they pay award rates and even further behind if they pay penalty rates for weekend work. That leads to a race to the bottom, forcing drivers to work excessive hours just to make a living. That can only lead to greater danger for road users. And there is, of course, the added cost of failed businesses and losses to suppliers to the industry. This case is just the tip of the iceberg. For years the road transport industry has been a tough business. Payment of award rates across the industry at least gave operators an even playing field when it came to labour costs.

In the current environment, we can expect road transport operators to be at the front of the charge to cut wages and conditions for drivers. As more employers take the advice of experts and use AWAs to cut wages and conditions, the number of workers facing cuts will grow. It will not happen overnight, but it is happening at a faster rate than some members of the government are comfortable with. Given that there is another year-and-a-half to the next election—when everyone in this country will know of someone who has been forced to accept a rough bargain in an AWA and when thousands of small businesses that tried to do the right thing by their employees will have gone to the wall—faced with the choice of a government that created the nightmare and a Labor opposition that will tear it up and give real protection to workers and small businesses, the voters will definitely give this government a very fair dismissal at the next election.