James Paterson (Victoria, Liberal Party) Share this | Hansard source

I am pleased to have the opportunity to rise tonight to contribute to this debate on the Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017, although I must say that I am sad that it comes at the expense of watching what I understand is a fascinating episode of the Four Corners program tonight on the Greens political party. But I will look forward to downloading it later on iview and enjoying it in its full glory.

Before I turn to the main part of the bill tonight, I want to take the opportunity to respond to some of the observations that Senator Cameron made in his speech on the bill just then. I particularly want to focus on what I regard as his unfair and inappropriate attack on the character of Bruce Billson, the former minister and member in the other place, and also his implied criticism of the character of Senator Cash, the minister responsible for this legislation. It was a highly personal attack that made what I regard as very serious allegations and implications of corruption. I think he did even use the word 'corrupt' once in his speech. He certainly alleged that Mr Billson's advocacy on this bill was covert in some way, which I think is not supported by the facts.

It is certainly true that Mr Billson failed in his obligation to update his register of interests appropriately when he was a member of parliament. I take my own register of interests very seriously, as all senators and members should, and Mr Billson has apologised for what was an oversight, as he should. It's not acceptable to fail to update your register of interests. But to suggest that Mr Billson's appointment to the Franchise Council of Australia was in some way a secret flies in the face of the fact that a press release was issued, announcing his appointment to the Franchise Council of Australia. No-one was in any doubt about Mr Billson's involvement or interest in this matter, either in his final few months as a member of parliament before he retired or subsequently after his retirement from parliament and beginning his advocacy on behalf of the Franchise Council.

It was even less reasonable and even more unfair for Senator Cameron to go on to imply that Mr Billson had somehow had undue influence over the minister in the drafting of these laws. Senator Cameron has obviously missed the very strong criticism that the Franchise Council has made of the proposed laws—the very strong disappointment in these laws that the Franchise Council, along with some other business organisations, has made. There is no evidence in any way, shape or form that the minister was inappropriately or unduly influenced by the advocacy of Mr Billson. Of course, it is completely fair and appropriate for franchises or any other community organisations or business associations to have their views represented in public debate and to make the case for their point of view on the legislation, and for government to consider their point of view and, where appropriate and where the government agrees, to incorporate their point of view into the subsequent legislation. So I just want to underline what I thought was a very unfair and unjust personal attack on the minister and Mr Billson.

Senator Cameron also lamented that this bill does not reverse the onus of proof, as if that were a negative thing. I could not disagree more strongly. It is a foundational principle of the rule of law that one is innocent until proven guilty and not otherwise. As far as possible, and as often as we can, I think that principle should be upheld. If it is ever to be abridged in legislation I think it should require a very great and extraordinary justification, because it is an abrogation of the rule of law. My former employer, the Institute of Public Affairs, publishes a regular survey on the number of instances that this legal right has been overturned in the past by legislation, and it is a troublingly large number of occasions. I particularly point out that it is most often reversed in the context of workplace relations, and very often, within that context, is aimed—not exclusively, but predominantly—at employers, and I think that that is something which, as far as possible, we should strive not to do.

Turning now to the substance of the bill before us: this is yet more evidence that the Turnbull government takes very seriously the issue of exploitation of workers. Anybody who has read about or heard of or is aware of the exploitation of workers at a number of franchises—including 7-Eleven, most spectacularly, but also Muffin Break, Gloria Jean's, Subway, Caltex, Domino's and Pizza Hut—would agree that the laws which currently regulate this issue are inadequate and that they do not give sufficient capacity to the Fair Work Ombudsman, among others, to address this issue.

One thing was missing from Senator Cameron's speech—unless he made the point in his initial remarks that he was continuing tonight and I missed it, and I apologise if I have. But one thing that I didn't hear in his speech was the fact that of course this government is amending the previous government's Fair Work Act. These breaches have occurred under laws not drafted by this government; in fact, the laws were drafted over the objections of the party of which I'm a member. The laws were drafted by the former Labor government. They passed during the Rudd prime ministerial years, and were authored, I understand, by former Prime Minister Julia Gillard. It is under those laws that these contraventions have taken place. Laws that were authored for Labor, and with the benefit of union assistance, have allowed these breaches to take place. So for some unions and for some Labor senators—as they have in this debate—to imply that the failure of these laws, which has occurred on our watch, is in some way the coalition's fault rather than their own, given that it was they who authored the laws, I think is a great stretch and discredits them. They would do much better to admit that the laws which they drafted were inadequate, that the powers that they gave their Fair Work Ombudsman were insufficient, that these breaches have occurred due to their laws and not anyone else's, and that this government is taking the right and appropriate steps to address their failure to draft appropriate laws to prevent these instances of abuse of workers taking place.

Workers are of course the primary victims of underpayment, and perhaps the most sympathetic victims. They deserve redress. But of course they are not the only victims. Law-abiding businesses that pay their workers a fair and appropriate rate of pay are also victims, because they have to compete against businesses that are not complying with the law and are evading their legal responsibilities, and that makes it harder for those law-abiding businesses to exist and to thrive. This bill addresses not just those abuses of workers but the associated abuse of law-abiding businesses, and I think that is one of the reasons why the bill deserves strong support.

Of course taxpayers, in a sense, are also victims of this law. When workers are underpaid, they clearly won't be paying their full rate of tax, and that is an unjust and unfair thing for all of us to bear as a community. So there are many reasons why this issue needs to be addressed, and there are many reasons why the Turnbull government is taking action to address what is an abuse of power—as we have demonstrated we are willing to do. Whether it is union bosses or employers or anyone else intimidating people and failing to comply with the law, we will take action to address those contraventions.

There are a number of key elements of this bill—in particular, the increase in the number of penalties for serious contraventions of the payment related protections in the Fair Work Act. This applies particularly when those contraventions are systematic and deliberate. This is not intending to target accidental or inadvertent contraventions. But systematic and deliberate contraventions do deserve substantially increased penalties, and there will be a tenfold increase in those penalties.

Importantly, the bill will also target and increase penalties for record-keeping failures—failures to keep appropriate records. It is not sufficient for an employer who may not have been paying their employees the correct rates of pay to plead ignorance, or to plead that they have insufficient records and that they are unable to go back and check whether their workers were paid the right amount. It is a fair and reasonable thing to ensure that employers are keeping adequate and up-to-date records of their payments to their employees, so that, if allegations of systemic underpayment are raised in the future, those allegations can be appropriately investigated and acted upon.

This bill will also outlaw the practice of cash-back and other coercive behaviour by employers, where employees may, in essence, be paid correctly but, in reality, not be paid correctly because they are forced by their employer to repay part of their wages. It seemed to me a fairly extraordinary thing that this practice was not already unlawful, but this government is addressing this issue to ensure that it is unlawful. The bill will hold franchisors and holding companies responsible for underpayments where they should have known about them but failed to take reasonable steps to prevent them.

The bill strengthens the investigation of underpayments by giving the Fair Work Ombudsman effective evidence-gathering powers on par with ASIC and the ACCC and by outlawing the provision of false and misleading information or hindering and obstructing inspectors who carry out investigations into compliance with the Fair Work Act. It builds on a record of action by the Turnbull government to address these issues to protect other vulnerable workers, including the establishment of the Migrant Workers' Taskforce. It will boost funding to the Fair Work Ombudsman by $20 million to ensure that the regulator has the resources to investigate and prosecute employers who exploit workers.

The government established Taskforce Cadena in June 2015—a joint task force between Border Force and the Fair Work Ombudsman—to target and disrupt criminals who are organising visa fraud, illegal work, and the exploitation of foreign workers. The Senate Standing Committee on Education and Employment heard particularly disturbing evidence about these practices, and that's why the Turnbull government has taken action to address that. A valid pay slip, as a proof of paid work, will be required before a second working holiday visa will be granted to a temporary migrant worker. The bill outlaws the payments to sponsors of foreign workers through making it a criminal offence for employers and visa applicants to solicit and receive a payment in return for visa sponsorship. Finally, funding will be provided to enforcement bodies to ensure employers comply with obligations as sponsors of skilled visa holders.

I'm a member of the Senate Standing Committee on Education and Employment, and the committee has produced a very comprehensive and, I think, helpful report into this bill. I mention that not in any way to take credit for Senator McKenzie's excellent work as chair. As is always the case, she deserves the lion's share of the credit for a comprehensive report and for what, I thought, were some very reasonable and sensible recommendations as to how the bill could be improved to ensure that the words of the bill reflect the intention of the bill. The committee made a range of recommendations including that the government should consider amending the bill to ensure that the conduct which is being caught is the exact conduct which is intended to be caught and no greater. It does not impose unreasonable or unfair burdens on franchisors where they have a less direct relationship or less direct oversight over their franchisees.

I understand that there will be a number of amendments proposed, particularly by crossbench senators, which are in part inspired by the recommendations of the committee, that will seek to give effect to the committee's recommendations. I look forward to hearing about those amendments later on during the debate.

I'd just now like to turn briefly to some of the stories of exploitation that we've heard so far that have led the government to take this action to address this issue. I should, in particular, pay tribute to the journalists who have done an excellent job in uncovering, exposing and demonstrating the systemic nature of these underpayments. Particularly, I should note Adele Ferguson of the Fairfax papers, who has worked very hard to identify, expose, document and catalogue these abuses. It shows the very important role that investigative journalists play as part of a civil society. We cannot rely on government alone or, indeed, any other community organisation to ensure that laws are enforced and adhered to. A powerful fourth estate, if it fulfils its role, can contribute to that very successfully.

Ms Ferguson in conjunction with Mario Christodoulou exposed in a very powerful way in the Sydney Morning Herald recently, in particular detail, the systemic way in which Domino's Pizza underpaid and exploited its workers. No-one could think, having read this report, that these were accidental oversights, which I accept absolutely do occur, because complying with our industrial relations system is not a straightforward thing, particularly for small business. But for a large business or large franchise, such as Domino's, there is no excuse for not complying with the law, and exposing it being done on such a systemic basis was a great service by Ms Ferguson.

A recent report, again in The Sydney Morning Herald, by Anna Patty, catalogued just how extensive we now know the underpayment to be at 7-Eleven, in particular, noting that the compensation bill for 7-Eleven workers had climbed over $110 million. That is an extraordinary amount, which averages about $39,000 for each of the 2,832 claims made by workers who say they were underpaid. To have underpayment with that number of workers and on that scale is unconscionable and supports the action the government is taking to fix this law.

I look forward to hearing the contributions of other senators in this debate. I believe the government has struck the right balance in addressing what is clearly a demonstrated issue of concern to the community and to workers but also doing so in a way that is precise and targeted, addresses the issue at hand, and does not stray into wider issues or have unintended and inadvertent effects. So I commend the bill to the Senate.