Meryl Swanson (Paterson, Australian Labor Party) Share this | Link to this | Hansard source

I move:

That this House:

(1) notes that:

(a) on 1 July 2019, 700,000 Australians had their penalty rates cut again;

(b) according to the Council of Small Business Australia, cuts to penalty rates have not created one single job;

(c) penalty rates are not a luxury, they are a necessity for millions of Australians to cope with the rising cost of living;

(d) cuts to penalty rates disproportionally effect women, young people and those without a tertiary education; and

(e) reinstating penalty rates would allow low income and highly casualised industries to invest more money into the economy;

(2) condemns:

(a) the Government's failure to protect penalty rates and the millions of Australians who rely on them; and

(b) Government members and senators who called for, or supported, cuts to penalty rates; and

(3) calls on the Government to:

(a) join with the Opposition in making a submission to the Fair Work Commission, arguing that penalty rates should be reinstated; and

(b) exercise some economic leadership and stand up for low paid workers.

I'm pleased to propose this private member's business about penalty rates. On 1 July 2017, penalty rates across several casualised industries were cut for the first of many times. This included industries like hospitality, pharmacy, fast food and retail. The following year, on 1 November 2018, casual workers had more cuts to their wages, leaving them around $77 per week worse off. On 1 July 2019, just weeks ago, the next round of penalty rate cuts were introduced, and on 1 July next year it will be the same story. By the time these cuts are fully implemented, on 1 July next year, some workers will be up to $26,000 worse off. Just let that sink in—$26,000. The Prime Minister probably doesn't know what it's like to be $77 a week worse off, but many people do. First as Treasurer and now as leader of our country, the Prime Minister has presided over the lowest wage growth since records began. That's an astounding claim, and it's true. Yet he and the Liberals and Nationals voted eight times in parliament to cut workers' take-home pay.

When the Fair Work Commission recommended the parliament cut penalty rates in 2017, they did so under the belief and impression that it would create jobs, and that's a fair enough assumption. While recognising these cuts would affect low-paid workers and vulnerable workers, the Fair Work Commission stated the decision would 'increase employment and have a number of positive effects on business'. Like a lot of my colleagues, I disagreed with that. Although the national unemployment rate is alarming—and even more so in regional areas like my seat of Paterson and the Hunter region more broadly—the solution to this crisis should not and cannot be at the expense of our lowest-paid workers. After countless attempts to stop them, the Turnbull-Morrison government again voted to introduce penalty rate cuts in full.

According to the Council of Small Business Organisations Australia and reported in The Australian on 26 April this year, not one single job has been created. And there's the real rub. We thought that, yes, as a trade-off, there might be some jobs created if the penalty rates were cut. We doubted it, and we were right to doubt it. Not one single job has been created. Two years and three penalty rate cuts later there is not one single job. The Liberal-National government has got it so wrong, and low-paid people are suffering and paying because of it.

At last count there were 12,462 people in my electorate who had been affected by cuts to these penalty rates. Across the Hunter region more broadly, that number rises to a staggering 34,900 people. Contrary to what the government might believe, these are real people with real families who rely on their penalty rates to raise their families; pay their mortgage, if they can afford to have one; pay their rent; pay their electricity bills, which are crippling because of the government's inaction; buy food and pay every other cost that needs to be covered. And we know that those costs go up; you just need to go to the supermarket to see things randomly going up and up and up. People in my community rely on that sum—that penalty rate—to pay for the things they need to survive. When everything's going up except for your wages, the last thing that people need is another cut to their take-home pay.

I want to point out one exception to this. I want to thank those employers and businesses who see fit to pay higher penalty rates. They understand the value of those employees and they turn their backs on these cuts and say, 'No, no. We understand the value of these employees and we want to remunerate them according to that important value.' I want to thank those employers who are doing that, because that is such an important thing. But I want to condemn this government. You've failed to protect our most vulnerable. You want to make a dollar by taking from those who can least afford it. It is a sham. You've not injected anything into the economy for at least the last six years, and we really need that injection. It's time that this government exercised some economic leadership and stood up for the low-paid and vulnerable people who are really relying on them to govern and not just wedge.

Sharon Bird (Cunningham, Australian Labor Party) Share this | Link to this | Hansard source

Is the motion seconded?

Matt Thistlethwaite (Kingsford Smith, Australian Labor Party, Shadow Assistant Minister for Financial Services) Share this | Link to this | Hansard source

I second the motion and reserve my right to speak.

Tim Wilson (Goldstein, Liberal Party) Share this | Link to this | Hansard source

When you stand at the podium of the Federation Chamber and you speak on the importance of key economic issues, the foundation on which your speech rests, the substance of the narrative that you seek to progress and, in particular, the motion that you table should be based on one simple expectation: that you tell the truth—that you reflect honesty. When you think about the lack of trust that many Australians have in their political system today, you only need to look at the motion that sits on the table before us now to know why that trust is in decline. What you have is an opposition that gets up and perpetuates an image and an idea that the government has robbed Australians, when the only thing that stands as a marker is their own legacy of how they created the very situation that they now complain about.

Let's not misunderstand: most people wrongly think that politics is about the answers people give—the choice between one type of vision for Australia or another that we want. That is not true. Politics is a choice between the types of questions that people want to ask. Yes, you can have questions like: how do we create a working environment where those people who work enjoy the maximum benefits available to them? Or you can ask: how do we create an industrial relations system to secure maximum employment?

Now, let's not be under any misunderstanding: the opposition has always been in the former camp. How do they maximise the benefits for those people who donate to their cause?

They always work towards not the worker but the union member and those who feather their nests, turn up to their polling booths, and game the political system as much as possible for themselves, versus the alternative—which is how we always look at it, as Liberals: how we are going to maximise the number of Australians who can stand on their own two feet, who are in the best position to be able to take care of them and their families and secure the gains of this country for every Australian.

That's why we have a record number of Australians working under this government. It's not an accident. It's because it goes to the core of our sense of purpose—why we are in this place: because we want the best, not just for those select few, as the opposition would have it, but for everybody.

But the dishonesty at the heart of this motion is the fraudulent argument that what they are complaining about is the burden of the government. What they're complaining about is that the Fair Work Commission—that they established, with the rules that they wrote and the commissioner that they appointed—made a decision on the reference they requested and it didn't turn out the way they wanted. And that is the heart and the nub of the matter. And what they want in response is an unconstitutional proposition—that the government gets involved in wage setting. It might make for good social media, interviews and speeches, for the member proposing the motion to get up and speak and show an empathy to constituents who have to suffer the consequences of Labor's commission and Labor's rules under Labor's commissioner, under the decision that they requested. But it's not honest, because they are put aside and cast aside. And to suggest that the pathway is simply to introduce unconstitutional legislation to set wage prices is ridiculous.

And of course the trade-off is on trust. We know that it's not just the basis of the motion that they've got wrong; it's almost everything that they've got wrong!

The unions and the opposition have claimed that 700,000 employees are affected by the commission they requested, the rules they wrote and the commissioner they appointed—and, of course, the review they requested, and was found wrong by none other than the RMIT/ABC Fact Check. In March 2017, the department estimated that the cuts to Sunday penalty rates were nowhere near what they claimed they would be. It's time for the truth. (Time expired)

Matt Thistlethwaite (Kingsford Smith, Australian Labor Party, Shadow Assistant Minister for Financial Services) Share this | Link to this | Hansard source

Australian workers' wages are being hammered. Everything is going up, except the wages and incomes of Australian workers. And one of the principal reasons behind that phenomenon is this government's support of cuts to penalty rates for some of the lowest-paid workers in Australia. In Kingsford Smith, over 13,000 workers in the retail, fast-food and hospitality sectors saw their penalty rates cut again on 1 July this year. It's a cruel cut that comes at a time when wages aren't keeping up with the cost of living for many families in our community. And it's not only a blow to them; it's a blow to our national economy as well.

The Reserve Bank, in their latest board minutes, stated that wages growth had remained low overall and GDP growth had been well below the trend over the year to the March quarter. One of the reasons for this was that growth in household disposable income had remained low, and this had contributed to low growth in consumption, which was well below average. So weakness in the Australian economy is further proof of the need for the Liberals to stop these ridiculous cuts to penalty rates.

The recent Deloitte Business Outlook also said that entrenched underperformance of wages under the Liberals isn't going to be disappearing anytime soon. And, as Treasurer and now as Prime Minister, the member for Cook has presided over the lowest wages growth since records began. That's not a record that I would want as a Treasurer or a Prime Minister—the lowest wages growth in Australian history since records began. Is it any wonder that Australian families are struggling and not keeping pace with the cost of living?

And what has been the Liberals' policy response to sluggish wages growth? It has been to further cut penalty rates for some of the most vulnerable workers in our country. Of course, their theory has been that the reduction in penalty rates would generate more jobs in the economy. The theory, as Labor warned, has not been proven. It has actually been proved wrong. The Council of Small Business Australia acknowledge the fact that cutting penalty rates has not created a single job. When the small business community is admitting that cutting penalty rates has not created one single job in the economy, then you have a problem. The chief executive of the Council of Small Business Australia, Peter Strong, is on the record as saying:

There's no extra jobs on a Sunday. There's been no extra hours. Certainly, I don't know anyone (who gave workers extra hours). It's been just a waste of time.

No new jobs, zip, zero, zilch—that's the reason why there's only been one speaker willing to put their name on the list to come in here and defend the cuts to penalty rates. He's the Chair of the Standing Committee on Economics. I wouldn't mind betting that he was forced to come in here and defend the government. Not one other member of the government is willing to stump up here in the Federation Chamber and speak in support of cuts to penalty rates, because they know how unpopular the cuts are in the wider community and that all this is is a shameful attack on Australian workers. It's clear that this was always going to be the case, because this government will always put ideology before evidence.

Penalty rates aren't a luxury. They're a necessity for millions of Australians to cope with the cost of living in this country. These cuts disproportionately affect women, young people and those without a tertiary education. The cuts mean lower wages for those in a job where they rely on penalty rates to make ends meet. Coupled with increasingly insecure work, this is leaving too many Australians struggling to keep pace with the cost of living. It's simply not fair that many are now earning less each Sunday than they would have before 1 July. That's why Labor condemns this government's failure to act and protect penalty rates for millions of Australian workers who rely on them. The government members and senators who called for or supported those cuts to penalty rates stand condemned.

We call on the government to join with us in making a submission to the Fair Work Commission arguing that penalty rates should be reinstated. Reinstated penalty rates would ensure that industries with a low-income and highly casualised workforce allow their workers to be paid a fair amount and, indeed, have more disposable income so that they can invest in our economy and we can begin to grow the economy at a trend rate and create more jobs for Australian workers. These cuts to penalty rates make no sense. It's been proven that they haven't created extra jobs. The government stands condemned for supporting them.

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

Cutting penalty rates is a government-sanctioned form of wage theft, pure and simple. It is something that we should resist and fight against. We cannot support seeing the wages of ordinary Australians, the wallets and purses of ordinary Australians, being squeezed to facilitate this form of wealth transfer. Its supposed benefits cannot be supported by the facts.

Two years ago, under the coalition government's watch, casualised industries, particularly hospitality, pharmacy, fast food and retail, had penalty rates cut. In November 2018 we saw more casual workers cop a cut of $77 per week. In July this year we had the next round of penalty rate cuts, impacting 700,000 workers all-up. Between Mount Druitt and Blacktown, nearly 12,000 workers will feel the impact of penalty rate cuts. An estimated one in six workers in my part of western Sydney has felt a cut to penalty rates.

All this, according to some business groups, did not create a single job. The supposed benefits are not being delivered. There is no economic benefit that has been seen as a result of this, not a job created. Worse still is what we are seeing in some of the industries that were supposed to have benefited from these cuts. Big W in Western Sydney has started the process of closing down stores, even after penalty rates were cut. Stores are closing down in places like Chullora, Auburn and Fairfield. So, again, all we have seen is ordinary workers lose out and no benefit to the broader economy.

It's all because the coalition, in an ideological war against people's wages, decided this through its ginger group. It has also started on superannuation, I see. The same ginger group that argued for this cut and then disappeared, because they won't have any speakers on their side back this, is now saying people's super shouldn't be increased as well. The coalition and some business backers are trying to brainwash others to say this is good for the economy. The facts don't support squeezing money out of pay packets and seeing profits grow at the expense of the wages share within our economy.

Something is happening in our economy. Underemployment is a big issue. People don't get the type of work they want. They're not getting full-time work. I think of the woman in Plumpton who grabbed me by the arm and said: 'I can't keep working a part-time job. I don't have a part-time mortgage.' Or I think of the people not getting a wage increase. Wages are hardly growing. If you look, for example, at wages growth, it was 2.2 per cent per annum in the five years to December 2018, but it was 3.3 per cent for the five years leading up to December 2013. Under the coalition's watch, wages are down. Real wages as measured by average weekly ordinary time earnings for adult employees working full-time adjusted for inflation grew only half a per cent per annum in Australia in the five years to December 2018.

It is unbelievable that this is happening, and some of the commentary around this is equally unbelievable. Last week we had this in The Australian. According to Michael Roddan's interpretation of some Treasury research:

Stubborn employees who refuse to move into more productive companies are a major cause of the nation's record-low wages growth …

In the Financial Review the same day an article was titled 'Don't expect pay rises, warn 40pc of CEOs'. We can't have a situation in the economy where some people will benefit and others won't. We need to be able to work together to ensure that growth and productivity increase but that everyone benefits from this. This has to be a priority. The only way to boost growth and productivity is to have that cooperative mindset.

The government do not have a clue how to fix this. Their track record based on the stats shows they will not fix this. They can only cut penalty rates, which is wage theft and which is robbing ordinary workers. We need to rethink the rewards system in our economy, get people focusing on this issue and coming up with a solution to this that grows the economy and make sure people's wages rise and that we do not see the economy only grow because we robbed the wages of ordinary Australian workers. It's not good enough.

Susan Templeman (Macquarie, Australian Labor Party) Share this | Link to this | Hansard source

I'm very pleased to support this motion. Thanks to this government, and this Prime Minister, 700,000 low-paid workers in retail, the fast food industry, hospitality and pharmacies are being paid 10 per cent to15 per cent less. Some workers are going to be up to $26,000 worse off by the time these cuts are fully implemented next July. I hate to think about the impact that's going to have on families and small businesses in the Blue Mountains and the Hawkesbury. Because of the Liberals, these already low-paid workers are increasingly finding it harder to pay their rent, cover their electricity bills, fill their tanks and look after their families. Because of the Liberals, these workers won't be buying an extra coffee to kickstart their morning. They definitely won't be making all those appointments at the hairdresser and their cars are just going to have to wait a little bit longer for a service. That means the local coffee shop won't be as busy, the corner store will have fewer customers and business will be slowing down at both the hair salon and the mechanic. It will ripple across local economies like those in the Blue Mountains and the Hawkesbury.

The Liberals need to understand that less money in weekend workers' pockets doesn't mean there is automatically more money in someone else's. There is no evidence that these penalty cuts have produced a single job, as the Prime Minister promised they would. Even the Council of Small Business Organisations Australia admits new jobs have not been created. Peter Strong, the chief executive of COSBOA said:

There's no extra jobs on a Sunday …

There's been no extra hours. Certainly, I don't know anyone (who gave workers extra hours). It's been just a waste of time.

That's the quote—there have been no extra jobs and no extra hours. But there is less income, and that means less to spend. People will struggle more and they will spend less. Pharmacy workers won't work any less hard, but they'll earn less. Young people who bookend their school or uni day and study with paid work in hospitality feel the brunt. Their parents talk to me about their dismay that not only do they not get penalty rates anymore but some employers fail to pay a fair rate at ordinary time. But the young person is so desperate for their first job and to get a foot in the door that they'll take whatever terms are offered.

Cuts to low-income workers through their penalty rates is not the policy to have at the same time as stagnant wages and an ever-rising cost of living, but it seems the Liberals are happy to see low-paid workers cop another blow to kick off this financial year. On the one hand, the government says the economy needs a boost from tax cuts, yet weekend workers need to work less. So, in some sort of deranged riddle, they stuff one pocket of the low-paid worker with up to $1,000 extra while they take $5,000 out of the other pocket. These cuts to penalty rates continue to be unfair. Penalty rates are not a luxury. Fair pay is not a luxury.

In the Blue Mountains, the penalty rate cuts are just one of the issues undermining our industrial relations system—low wage growth, wage theft and worker exploitation. In the news, jewellery chain Michael Hill underpaid staff by $25 million, chef George Calombaris has had to back pay $7.8 million in wages and super to staff, and the underpayment at Sydney's Shangri-La Hotel comes at the same time we have allegations in the Blue Mountains that a hotel group has exploited migrant workers. It's appropriate that Fair Work is investigating these allegations revealed by The Sydney Morning Herald by Anna Patty. We need to hear the outcome not only of that inquiry but also the audit last year by Fair Work into businesses' compliance in the Blue Mountains with workplace laws, including in the accommodation and food services industries, after a high number of reports by young workers of workplace disputes.

Every business that underpays its workers is creating an unfair playing field for the many other businesses who do the right thing. I commend the members of the Blue Mountains Union Council for their ongoing work in raising awareness about worker exploitation in the region. If the actions by this or any other employer are found to be illegal, they should face the full force of the law. If the actions are not found to be illegal, then questions must be asked about the adequacy of existing laws to protect all workers from exploitation, whether they are Australians or here on work visas. Regardless of the findings by Fair Work, I expect this case will yet again highlight the inadequacy of current employment protections and provide even more reason for the rules to change.

Maria Vamvakinou (Calwell, Australian Labor Party) Share this | Link to this | Hansard source

There being no further speakers, the debate is adjourned and the resumption of the debate will be made an order of the day for the next sitting.