Rebekha Sharkie (Mayo, Nick Xenophon Team) Share this | Hansard source

I commend the government for putting the Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017 before the House. Employers who systematically exploit their employees and who systematically seek to avoid their legal obligations for their employees should be held to account.

The Nick Xenophon Team has a strong history of standing up for those who do not have a voice. In its negotiations with government last year, the Nick Xenophon Team obtained a commitment for the introduction of expanded whistleblower protections. When legislated, whistleblower protections for employees will strengthen the operation of this bill, giving exploited workers the confidence to speak out against injustice. I also hope that this bill will be the first of many steps towards stamping out illegal treatment of employees. For instance, unpaid superannuation is a big issue in my electorate of Mayo. The current system of enforcement is ineffectual and a drain on the public purse because it forces employees to rely more heavily on the age pension when they retire, because they do not receive all of the money that is owed to them.

However, when talking about this current proposed bill before us, I think it is important to know that it is pro-business as well as pro-employee. Small businesses are facing the twin challenges of weak consumer demand and rising costs, and they should not have to face unfair competition from within their own business community as well. Whether they are small or large, when businesses do not follow the law they create an uneven playing field for the majority of businesses that are doing the right thing. This bill seeks to level the business playing field by making it untenable to systematically and illegally cut employee entitlements.

This bill is also pro business because it helps to restore public confidence in Australian businesses. In an age of rising scepticism about institutions, Australians are increasingly wary of the rise of self-interested corporatism. Sadly, this scepticism is not always misplaced. The systematic and illegal activity of the 7-Eleven franchise chain demonstrates that corporate abuse can be widespread and entrenched in some business cultures. Capitalism needs to be regulated and harnessed for the good of both its stakeholders and society.

Whether through fear, inaction or ignorance, many employees do not come forward to expose exploitative bosses. This is particularly true of younger employees, casual employees and foreign students, who are our most vulnerable people in the workplace. In the 7-Eleven case, a great number of workers were paid substantially below the award rate and payroll records were flagrantly doctored. Many employees on visas were threatened with deportation if they spoke up about the illegal practices of their employer.

Even after 7-Eleven's culture of illegality was uncovered and some of the stolen wages were repaid there were reports that some of the franchisees had terrorised their employees yet again by garnishing their returned wages, with unconfirmed reports of some employers even escorting staff to the ATM on payday. This 7-Eleven case demonstrates that it is entirely proper that franchisors share some of the responsibility and blame when their network of franchisees systematically engage in illegal conduct.

With great power over profit-sharing must come great responsibility when those profits have been generated. The government is to be commended for recognising the franchisor issue and for taking steps to address this. Cases such as the 7-Eleven case highlight the importance of extending whistleblower protections to employees and to subcontractors. Senator Xenophon and the Nick Xenophon Team have worked tirelessly to enhance and extend whistleblower protections. In our negotiations with the passage of the Fair Work (Registered Organisations) Amendment Bill in 2016 our team obtained a commitment from the government to include whistleblower protections for the corporate, not-for-profit and public sectors. I look forward to the recommendations on the implementation of these protections that will be contained within the report of the Joint Parliamentary Committee on Corporations and Financial Services, which I believe is due by the end of June this year.

These protections will grant exploited employees the opportunity to speak out with less fear of reprisal, and will help to smash these exploitative and abusive organisational cultures in Australia. The whistleblower in the 7-Eleven head office that confirmed the franchisor was wilfully turning a blind eye to systematic exploitation in its network of franchisees is exactly the kind of whistleblower we should be seeking to protect. It takes tremendous courage to stand up for the greater good of others.

Whilst the 7-Eleven case has been prominent in recent years, I want to be clear that the underpayment by employers of workers' salaries and entitlements is an issue that is all too widespread and far beyond the 7-Eleven case. I also want to highlight a workplace law that I continually and systematically encounter as being disregarded. As I mentioned before, that is unpaid superannuation. I am regularly approached by constituents, both young and old, whose superannuation remains unpaid by unscrupulous past and present employers. In some cases, this unpaid superannuation has been in the thousands of dollars.

It is not just an issue of the superannuation contributions, but also of the compounding returns of those contributions that the exploited employees then miss out on. Many companies then end up winding up insolvent and somehow manage to completely evade their superannuation responsibilities. More needs to be done to guarantee that superannuation is paid to employees, and to empower employees to recover that superannuation. In all too many cases, employees quite reasonably assume that when superannuation amounts are listed on their pay slips that they have been paid their entitlements. However, this is just how much superannuation employers owe for a particular period and not necessarily what they have been paid. To avoid this ambiguity the superannuation that has been paid into employees' superannuation funds should be reported on pay slips.

Employees do not have legal standing to recover unpaid superannuation underneath the Superannuation Guarantee (Administration) Act without the assistance of the Australian tax office. They cannot even lodge a claim through the courts. It is the Australian tax office that must lodge that claim and pursue the debt on their behalf. In my dealings, the Australian tax office has been very slow to pursue unpaid superannuation, and their rate of success in enforcing full repayment is nowhere near high enough. I have an example of two constituents who were with the same employer. They both had not been paid their superannuation. When they were paid amounts by the Australian Taxation Office they were getting $1 or $2 a year by the Australian Taxation Office, and yet they were owed many thousands of dollars. A quick calculation of their amounts owed deduces that it would take many centuries for these two individuals to recover superannuation payments that are rightfully theirs. Unfortunately, after several years of ineffective action by the Australian tax office, the company is now insolvent. One gentleman is ready to retire. He has worked his whole life and not been paid super for several years. One is a young man, who has very little in his superannuation account to take him through.

This leads me to my next point, which is that penalties for not paying superannuation must be real and substantial. The current ability of the Australian Taxation Office to enforce repayment is insufficient. So we must strengthen their means of enforcement, and we must ensure that the Australian tax office is adequately resourced to do so. There must be a real inducement for the employer to meet their superannuation obligations to their employees, and not consider this money, to one side, as part of their cash flow. I hope that this bill will at least start to catch and penalise some of those employers who are stealing their employee's security in retirement. Much, much more needs to be done.

I welcome the report of the Senate Economics References Committee, appropriately titled Superbad—wage theft and non-compliance of the superannuation guarantee. I, and my Nick Xenophon Team colleagues, look forward to working constructively with the government to act on many of the report's recommendations.

In conclusion, I support this bill. While this bill penalises systematic patterns of illegal conduct of employers, enforcement needs to be adequately resourced for the bill to be effective. Whistleblower protections, once legislated, will make employees more confident about speaking out against exploitation, yet more needs to be done to ensure that workers also have other paths of recourse to safeguard their workplace rights.

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