Doug Cameron (NSW, Australian Labor Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

Labor opposed this bill because there are significant problems with the bill as it is placed before the Senate. A number of amendments will be moved by Labor to try and make this bill a more acceptable bill, a fairer bill and a more reasonable bill. We will be seeking in our amendments to extend the application of the prohibition of unreasonable demands for money by employers to prospective employees. That's an issue that we are very concerned about. We want to put the AAT and the ombudsman oversight into the compulsory questioning powers. We've got lots of experience with the work of the Fair Work Building Commission and the ABCC and the misuse of compulsory questioning powers and the bias that has been applied by the Fair Work Building Commission and the ABCC over the years. There is lots of evidence about problems in that area, and the need for oversight is essential.

We want to extend franchisor liability to labour hire and supply chains and reverse the onus of proof. All of the principled issues that you've heard that are supposedly applying only to franchisees and franchisors apply to many companies using labour hire companies to steal wages from workers. We don't believe that we should limit this to franchisors and not deal with the wider issue across industry that does the same thing which leaves workers with their wages stolen. Whether it's done by franchisors or by a farmer using labour hire companies to rip off workers in the farm industry, it doesn't matter. Whether it's Caltex or that well-known one, Baiada; whether it's Myers, whose labour hire companies were ripping workers off; whether it's the fruit producers who allow labour hire companies to have some organised crime figures in there ripping migrant workers off, we think that it should be dealt with and we think this is far too narrow.

Our view is supported by submissions from the Australian Industry Group and from the Australian franchisors themselves who ask why they should be picked out and narrowed out in this bill. We agree with those employers that it should be wider. If stealing a worker's wages is a problem in the franchise industry, it's similarly a problem in areas like Caltex, Baiada, Myer and fruit producers. It should be dealt with more widely. Reversing the onus of proof is essential, and I'll go to some of those issues when I go to the amendments in detail.

We want to reverse the onus of proof and claims for unpaid wages where the employer has not kept or produced wage slips. One of the great victories that the minister was boasting about in the last term of parliament was that she was going to make sure that employers kept wage slips. Employers are not keeping wage slips. Some employers are still ripping workers off, mercilessly. We've got a range of amendments that we want to deal with in the second reading. By leave—I move items (21), (24), (27) and (35) on sheet 8144 together:

(21) Schedule 1, item 17, page 12 (lines 19 and 20), omit paragraph (i), substitute:

  (i) subsection 325(1) (which deals with unreasonable requirements on employees to spend or pay amounts);

  (ia) subsection 325(1A) (which deals with unreasonable requirements on prospective employees to spend or pay amounts);

(24) Schedule 1, item 22, page 15 (after line 8), after subsection 325(1), insert:

  (1A) An employer (the prospective employer) must not directly or indirectly require another person (the prospective employee) to spend, or pay to the prospective employer or any other person, an amount of the prospective employee's money if:

  (a) the requirement is in connection with employment or potential employment of the prospective employee by the prospective employer; and

  (b) the requirement is unreasonable in the circumstances; and

(c) the payment is directly or indirectly for the benefit of the prospective employer or a party related to the prospective employer.

Note: This subsection is a civil remedy provision (see Part 4-1).

(27) Schedule 1, item 26, page 16 (lines 24 to 25), omit paragraph (i), substitute:

  (i) subsection 325(1) (which deals with unreasonable requirements on employees to spend or pay amounts);

  (ia) subsection 325(1A) (which deals with unreasonable requirements on prospective employees to spend or pay amounts);

(35) Schedule 1, item 57, page 30 (line 15), omit "Subsection 325(1) of the amended Act applies", substitute "Subsections 325(1) and (1A) of the amended Act apply".

These amendments are dealing with the issue of extending the application of the prohibition of unreasonable demands for money by an employer to prospective employees. The bill introduces a new civil remedy offence of unreasonably requiring an employee to spend or pay an amount of their money in relation to the performance of work. The Senate committee inquiry revealed stakeholder concerns that this new offence will not cover unreasonable demands made by employers to prospective employees as a condition of employment. Submissions to the inquiry identified the behaviour allegedly engaged in by a Domino's franchise where sponsorship for a working visa and a job was offered on the condition of payment of $150,000, as an example.

While it would appear that that particular pre-employment requirement for an upfront payment linked to the provision of a visa may be prohibited by other legislation, other unreasonable pre-employment requirements are not. These amendments extend the application of the new offence to prospective employees. So, Minister, could you take me to why these amendments are not reasonable amendments and why you would have unreasonable demands still being available to employers? We think the amendments that we put forward strengthen the bill. I'd like to hear your views as to why that wouldn't be a legitimate and reasonable approach.

The CHAIR: Before I call the minister, Senator Cameron, I'm just checking: so we are looking at opposition amendments which are in the fifth box down. But I draw to your attention: it says 21 and then 24 to 27?

Yes. I'm sorry. To clarify—there's 21, and 24 to 27. I'm sorry, that was my—

The CHAIR: Yes, so that's the fifth box down.

Yes, and 35 together.

Michaelia Cash (WA, Liberal Party, Minister for Women) Share this | Link to this | Hansard source

They would be the prospective employment—

Doug Cameron (NSW, Australian Labor Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

Yes, that's the prospective employment.

The CHAIR: Just to be clear, leave is still granted?

Michaelia Cash (WA, Liberal Party, Minister for Women) Share this | Link to this | Hansard source

Yes.

The CHAIR: Minister, I call you now.

In the first instance, in responding to the amendments, could I just explain what a cashback scam is for the benefit of the Senate. A cashback scam is a request from an employer that an employee pay back part of their wages to the employer or a third party. What this effectively does is let the employers undercut the safety net while appearing, at face value, to comply with workplace rules. It is particularly difficult to prove as vulnerable workers are unlikely to make a complaint and there is often no paper trail. The cashback scam was most notably used by some 7-Eleven franchisees, but the scam also emerged during other investigations undertaken by the Fair Work Ombudsman. In the most severe cases, employers have threatened to revoke visas and have employees deported if they spoke about the maltreatment.

In terms of what the bill, as currently drafted, actually does, the bill addresses cashback scams by making it clear that it's unlawful for an employer to demand an employee pay a proportion of their wages back. Cashback scams may attract the higher penalties which apply to serious contraventions under the act. The provisions only prohibit unreasonable requests to spend an amount, not legitimate requests for overpayments to be returned, because there may well be legitimate circumstances in which an employer requests that money be paid back to them.

In terms of the amendments that have been moved by the opposition, this amendment would extend the prohibition on unreasonable requirements on employees to spend or pay an amount, which is referred to as the cashback provision, to include requirements made of prospective employees to spend or pay an amount in connection with their prospective employment. The government is opposing Labor's amendment, as moved by Senator Cameron, that extends the prohibition on unreasonable requirements to spend to prospective employees. The effect of the amendment, as it is currently drafted, would extend the cashback prohibition to include requirements for prospective employees to spend or pay an amount in connection with employment.

The government is unable to support this amendment for two reasons: the provisions, as they are currently drafted—and it may just be very bad drafting on behalf of the opposition—are incredibly broad and are more than likely going to lead to unintended consequences; and the unacceptable conduct the amendment is trying to deal with may often already be unlawful under other laws.

In terms of the unintended consequences—and, again, it may just be very bad drafting—there are many reasons why an employer might require a prospective employee to spend an amount of money. Employees, often required to be located near their workplace, may be willing to relocate to take up a job offer. If an employer tells prospective employees about job location requirements, is it reasonable for the worker to ask the employer for their relocation costs? While this might be negotiated between the parties, it would be unreasonable to create a legal requirement around this. What about asking a worker to pay for their own travel costs to attend an interview face to face? Again, this is captured by the amendment that is being moved on behalf of the opposition.

Whilst I'm sympathetic to some of the cases identified by the Melbourne based community legal centre WEstjustice in their Senate committee submission, I also point out that many of these instances that they themselves describe would likely be captured by other existing laws which come with some very serious sanctions. For example, there was the migrant worker who was allegedly asked to pay a $2,500 cash bond for the use of a work vehicle and to access a building site. The job never eventuated, and the prospective employer disappeared. This sort of conduct is, of course, completely, totally and utterly unacceptable, and it is almost certainly an offence under criminal law. I would encourage anyone who believes that they are the victim of this type of theft or fraud to contact the police.

In terms of vulnerable migrant workers paying for a visa outcome: in 2015, under the coalition government, civil and criminal penalties were introduced under the Migration Act for people who ask for, receive, offer or provide a benefit in return for a visa sponsorship or employment that requires a visa sponsorship outcome. These changes came out of a review into the integrity of the 457 visa program that I announced in 2014 when I was the Assistant Minister for Immigration and Border Protection. I also understand that this issue has been raised in the context of 417: working holiday makers spending money in relation to the 88-day regional work requirements in order to secure an extension to their visa. This continues to be a complex issue, and it is one that I will request the Migrant Workers' Taskforce to consider.

Just by way of further background: in March 2016 the Federal Court handed down penalties against a company that offered vulnerable migrant workers training and sponsored employment in the cleaning industry that would supposedly lead to permanent residency. Many of these workers paid in excess of $10,000 each. The court found that the company never had any cleaning jobs available, and, in any event, cleaning jobs would not have met the skill requirements necessary for permanent residency under the relevant visa requirements. I understand that the fines that were handed down were approximately $700,000 for the employer and $300,000 for the director, so that was a total of $1 million in fines.

Again, in terms of the cashback provisions that the bill seeks to address, these types of scams are wrong, and they need to be stopped, and the bill does that. But in terms of the extension of the cashback provision to prospective employees, in particular in the sloppy drafting that has been presented to the Senate, the government cannot support the amendment, because of the very serious unintended consequences by way of the fact that the provisions presented by the opposition are incredibly broad.

Doug Cameron (NSW, Australian Labor Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

This is typical of Senator Cash and this government: go some way to try and deal with an issue but don't actually deal with all of the circumstances that are required to be dealt with. Senator Cash has indicated that she thinks this is incredibly broad and will have unintended consequences. I'll tell you what is broad, and that is the stealing of workers' wages across the economy. And it's not just in franchising; it's in a whole range of areas. The unintended consequence of where we are at the moment is that some of the most vulnerable workers in this country end up having their wages stolen, not being able to feed their family and not being able to put a roof over their head. And people are getting away with it.

This bill sets out the principle that if you are in employment then there is a prohibition on unreasonable demands for money. The same principle should apply if a prospective employee is seeking employment. I know the minister is still a bit embarrassed after the fiasco we had with the last fair work bill we had here, because of the demonstrably sloppy drafting. The minister had to accept amendment after amendment after amendment because the drafting from the government was so bad. That's why tonight we're getting a bit of payback, a bit of rhetoric and a bit of rubbish from the minister on this issue.

What we say in these amendments is that it has to be unreasonable in the circumstances. It is defined, it is qualified and it goes to making sure that we don't have prospective employees accepting a job on a condition of employment that is unreasonable in the circumstances. This is probably where a worker is actually more vulnerable—when they're a prospective employee and they're not on the job, especially if the job has a union on the site. If you are rolling up for a job then this is a bit like the old Work Choices era, where a prospective employee is given a demand by the employer and they either sign or just go because they don't get the job.

This is where workers have specific vulnerabilities. I don't think that restricting this to where the minister wants it restricted to actually deals with the wage theft that is out there. The principle of 'unreasonable demands' remains the same whether you are a prospective employee or an employee. You should not be subject to unreasonable demands. That's the point we are making tonight. That's why we, Minister, think that this is the way to go. This would protect prospective employees. It has to be unreasonable in the circumstances. Minister, have you got a view in relation to 'unreasonable in the circumstances'?

Nick Xenophon (SA, Nick Xenophon Team) Share this | Link to this | Hansard source

I want to ask questions, firstly, of Senator Cameron as the mover of these amendments. The minister made the assertion that this could apply to a prospective employee and that a business could be sued or could be subject to prosecution if it relates to something such as the travel costs of going to a job interview. As I read the legislative regime that this seeks to amend, I'm just trying to understand whether Senator Cameron is saying that that's what these amendments are purporting to do. Under what circumstances does he say this will operate? Could I get clarification from the minister about whether it would be that broad, because that would seem surprising in the context of the legislative framework for this bill.

Doug Cameron (NSW, Australian Labor Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

I thank Senator Xenophon for the question. What we are saying is that the demand has to be 'unreasonable in the circumstances'. That's the test. We are not saying it is unreasonable for somebody who is going to a job interview to actually have to jump in the car, put petrol in the tank and drive through half-a-dozen tolls, as you would in Sydney. That's not 'unreasonable in the circumstances'. But it would be 'unreasonable in the circumstances' for the employer to say, 'I'll give you a job, at minimum rate, but for you to get that job you'll have to pay me a fee of $500.' That's what would be 'unreasonable in the circumstances'. That is an issue that is clearly an unreasonable proposition. And that's why we say that, if the principle of 'unreasonable demands' applies to those who have a job, you must make sure that prospective employees also don't face unreasonable demands. We are saying the demands have to be 'unreasonable in the circumstances'. That would be the test. It would be tested by the Fair Work Commission; you could go there and say you had an unreasonable demand put upon you. We think it is appropriate to have these circumstances dealt with—that you cannot unreasonably demand money from a prospective employee. That's a problem people have faced.

Nick Xenophon (SA, Nick Xenophon Team) Share this | Link to this | Hansard source

Thanks for that clarification. I guess one aspect of this is how 'unreasonable' would be determined, because there is an element of subjectivity. Senator Cameron gave an example that involved toll roads—and I get that. But what happens if the job is in Sydney, the applicant is in another state, the prospective employer says the interview can be done on Skype, the prospective employee is willing to travel to Sydney at their own expense and the employer says they would like them to come over but will not cover their expenses? Does that get into the realm of 'unreasonableness'? I'm not trying to be difficult. I think I understand what Senator Cameron is trying to achieve here, but I want to understand the circumstance in which it would work.

The legislation committee inquiry into this bill did hear evidence of one franchisee who was apparently offered a working visa and a job on the condition of the payment of $150,000. Now, that was a prospective employee, but I don't think there would be any question that that would be not just an unreasonable demand but an outrageous demand that ought to be the subject of heavy penalties and sanctions. I'm trying to understand how this would be delineated. Time permitting, could the minister clarify why we wouldn't want to cover those situations where someone is saying they'll give you a job and a visa to stay here, but they want a kickback. That would clearly be outrageous, and I don't think anyone in this chamber would countenance that.

Doug Cameron (NSW, Australian Labor Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

Take out the visa, because the visa is covered by other laws, and just have a claim of: 'We'll give you the job if you give us 150 grand'—or $50 or $500. If the minister thinks the language we are using is so bad, I draw your attention to the fact that that is the language used in the bill—'unreasonable in the circumstances'. All we are saying is that if the principle of 'unreasonable in the circumstances' applies to an employee then it should also apply to a prospective employee. I want to make the point that wage theft is rife in this country.

Through you, Chair: you've been on the inquiry, Senator Xenophon. You've seen some of the rip-offs that take place around this country. And we are only seeing the tip of the iceberg. We believe, strongly, that the principle that applies in the body of the bill to an employee, using the same words that are in the body of the bill to define it—that is, 'unreasonable in the circumstances'—should be applied to a prospective employee because, and I say it again: when someone is at their most vulnerable is when they are actually applying for the job. That's when they're at their most vulnerable.

We think your concerns should be covered by the position where the government's bill talks about 'unreasonable in the circumstances'—that's the language in the bill. We think you simply apply that to prospective employees. Put your mind back to WorkChoices, where workers were fronting up for a job and being told, 'Sign or go away'—sign away penalty rates, sign away annual leave loading, sign away minimum rates. That's what this government justified under WorkChoices. And this is another example of how we should be protecting prospective workers when they are at their most vulnerable: that is, when they are in a very powerless situation—trying to get a job—and when some of the most ruthless employers in this country would try to rip them off and steal from them. They should be protected.

Malcolm Roberts (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

I've got a question here for Senator Cameron. It's pleasing to see that Senator Cameron now seems to know what the word 'reasonable' means, after the last debate. Senator Cameron says that this only goes some of the way. Well, the Labor Party went none of the way. Now he says wage theft is rife around the country. Why did Senator Cameron and the Labor Party not do anything about this issue when they were in office for six years? Perhaps his focus was on protecting union bosses feathering their own nests?

And why would the Labor Party support the stealing of workers' take-home pay in the form of higher energy prices due to the Labor-Greens climate and energy policies? That has really hurt workers and exported jobs, making more workers vulnerable. This is where all workers are most vulnerable. How can we, let alone vulnerable workers, trust this man and this party and their coalition with the socialist Greens, which is destroying this country?

Doug Cameron (NSW, Australian Labor Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

That was almost as intelligible as most of your contributions to this place! Through the chair, when you go back to the obscurity where you came from, after you're found not to have met the provisions of section 44 of the Constitution, then maybe we will get a focus on the real issues that are important for working people in this country.

Alex Gallacher (SA, Australian Labor Party) Share this | Link to this | Hansard source

Senator Xenophon on a point of order?

Nick Xenophon (SA, Nick Xenophon Team) Share this | Link to this | Hansard source

I think it happened in the other chamber yesterday with a very senior member of the coalition, but I am sure there is a standing order that says you can't pre-empt what a court will decide—in this case the High Court, sitting as the Court of Disputed Returns.

Lee Rhiannon (NSW, Australian Greens) Share this | Link to this | Hansard source

The Prime Minister does!

Nick Xenophon (SA, Nick Xenophon Team) Share this | Link to this | Hansard source

I think that's what I said. The Prime Minister seemed to try to pre-empt it. It is very unsafe to do that. Insofar as there is a standing order saying that we shouldn't be pre-empting the ruling of a court, then I think that Senator Cameron should withdraw that.

Doug Cameron (NSW, Australian Labor Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

I won't withdraw anything I've just said—

The TEMPORARY CHAIR: Sorry, Senator Cameron—hang on a sec. Senator Xenophon, I'm advised that there is no point of order, but I do caution all senators with respect to the High Court or other legal proceedings.

Thanks. Obviously, I have been a bit interested in this issue that has just been raised. I didn't find it really difficult, Senator Xenophon, to actually rescind my citizenship. All I did was follow the rules, take the advice from the ALP national secretariat, be professional, make my application in duplicate to the foreign office and have my application acknowledged by the High Commission. I think it was about three months later—

The TEMPORARY CHAIR: It being 7.20 pm, the debate is interrupted.

Progress reported.