Ricky Muir (Victoria, Australian Motoring Enthusiast Party) Share this | Hansard source

I rise to speak on the Building and Construction Industry (Improving Productivity) Bill 2013 (No. 2) and the associated transitional bill. First, I want to take this opportunity to raise some issues that I think have been lost amongst the ideological battle of words across the chamber and in the media. In 2012, the Labor Party had the numbers to completely abolish the ABCC and send a message to the Australian people that the government does not single out construction workers. But they did not. Instead, the Office of the Fair Work Building Industry Inspectorate, also known as FWBC, was created. This office, which singles out the construction industry, was established by an act of parliament and it was passed by the Australian Labor Party.

The Education and Employment Legislation Committee of the previous parliament—the 43rd Parliament, that is; not the first session of the 44th—stated at page 8 of its report:

While the bill would abolish the ABCC, it would maintain separate legislative arrangements for governing the building and construction industry.

The previous government significantly changed the laws by introducing additional safeguards for compulsory examinations and removing the higher penalties that applied to the construction industry. However, despite calls from the union movement, they did not abolish the ABCC. This was mainly because of the findings of the review conducted in 2009 by Mr Murray Wilcox QC, which were debated at length during the 43rd Parliament.

I think the government has muddied the waters of this debate by throwing around allegations of corruption, connections to certain motorcycle clubs and criminal behaviour within the construction industry in order to justify the return of the ABCC. There may be instances of corruption and third-party standover tactics in the construction industry—there are a lot of colourful characters, I am sure—but this bill does not address these issues. I have lost count of the amount of times I have heard that the ABCC legislation should be extended to other industries or that with the flick of a pen this legislation could be turned into a national ICAC. These statements reflect a poor understanding not only of the policy issues behind the legislation but also of the legislation itself, and they also reflect the way the government has presented the legislation. I have publicly stated that the ABCC is not an anticorruption body but a body that enforces Australian industrial relations in the building and construction industry. It has nothing to do with tackling criminality and corruption but it seems this point has fallen on many deaf ears.

I want to make it clear that I am a proud supporter of unions and the union movement. As almost everyone is aware, I was a shop steward for the forestry division of the CFMEU in Victoria. Unions have played a critical role in ensuring that workers' rights are protected and that workplaces are safe, and they will continue to do so in the future. However, I cannot ignore the overwhelming number of court cases where the CFMEU has been found to have broken the law, or where they have admitted that they have broken the law. Since 2005 around $6 million in penalties have been issued against the CFMEU in cases initiated by the Building Industry Taskforce, the ABCC and FWBC.

I want to speak about the two concessions I wanted the government to make in order for me to support the legislation. During negotiations with the minister, I advised that I wanted the ABCC to investigate and prosecute complaints about wages and entitlements and sham contracting. Under the leadership of Mr Leigh Johns, the ABCC and the current regulator, FWBC, used to handle wages and entitlement matters relating to the building and construction industry. It did a great job, recovering over $2 million for over 1,500 workers. When the current director, Mr Nigel Hadgkiss, took over, he cited a need to return FWBC to what was called 'core business'. This includes coercion, unlawful industrial action and right of entry issues. In the agency's 2013-14 annual report, Mr Hadgkiss stated that, when he took over, more than 40 per cent of investigations related to wages and entitlements. To me, this seems like there was a problem with complaints about underpayments in the building and construction industry and that there was a regulator doing a pretty good job at rectifying that problem. For the period from 2013 to 2015, over $577,000 in penalties were imposed on companies for wages and entitlements and sham contracting contraventions as a result of FWBC litigation. Throw this on top of the couple of million bucks it recovered for construction workers and it is looking pretty good.

I have heard the argument that the Fair Work Ombudsman is the expert and is the appropriate agency to deal with these matters. The Fair Work Ombudsman does some fantastic work recovering wages from exploited workers in retail, hospitality and other industries, but I believe the ABCC would be best placed to pursue these matters in the construction sector. An industry update from FWBC in 2012 highlights why I think the ABCC should return to being a full service regulator. The following quote is from the November 2012 edition of the industry update, which is currently available on the FWBC's website. It quoted the chief executive, Mr Leigh Johns:

"FWBC's efforts in relation to underpaid building and construction workers have been more successful than when the FWO—

the Fair Work Ombudsman—

did this work for building and construction workers.

"Building and construction workers know now where to go to get assistance," he said.

Mr Johns stated that FWO did a "great job" but FWBC has had such great success because it deals specifically and exclusively with the construction industry.

The decision to take on investigations into the recovery of wages and entitlements was consistent with the recommendation of Royal Commissioner Cole, that the industry specialist regulator should "assist building and construction workers in the regulated community to recover under-payments when they seek our assistance."

How could the ABCC return to investigating and prosecuting matters relating to wages and entitlements and sham contracting? Under clause 17 of the bill, the minister may, by legislative instrument, give written directions to the ABC commissioner specifying the manner in which the ABC commissioner must exercise the powers or perform the functions of the ABC commissioner under this act.

There has been a lot of criticism that the ABCC will only focus on unions and will ignore the conduct of employers who are engaging in unlawful practices. I tried to seek an agreement with the minister that, if the ABCC is established, she will direct the commissioner to investigate and prosecute matters relating to wages and entitlements and sham contracting under the Fair Work Act 2009. In my opinion, a properly resourced unit within the FWBC which can investigate employers who underpay workers as well as investigate possible sham contracting arrangements will ensure that there is a more even-handed approach to tackling the problems of unlawful conduct in the building and construction industry. I believe the ABCC could be suitably resourced to undertake this additional work so that complex underpayment and sham contracting investigations would not diminish the capacity of the ABCC to investigate or prosecute the specific offences in the Building and Construction Industry (Improving Productivity) Bill 2013. I have it on good authority that there are some good people at the FWBC, and I am sure they can continue the great work in recovering underpayments for workers in the building and construction industry and protecting workers from exploitation. The ABCC is all about enforcing the rule of law on Australian building and construction sites, but the rule of law does not just apply to unions. There are some unscrupulous employers operating in the building and construction industry, and a well-resourced, 'tough cop on the beat' will be best placed to tackle them as well as the unscrupulous union officials who continue to ignore the law.

Unfortunately, I was not successful in reaching an agreement on this matter. There is no political will to do this and the excuse that it will distract from the ABCC's core business is a poor excuse and reflects the ideological battleground that this policy has been fought on. If the government were serious about improving productivity in the building and construction sector, it would see the merits of the ABCC being a full service regulator. Being a full service regulator is not an indulgence; it works—it takes a lot of effort, but it works. Perhaps the government prefers policing to regulating because it tends to involve less accountability to the public.

We know the building and construction industry is unique. This is why there needs to be an industry-specific regulator to enforce the rule of law, but it seems this government is only serious about enforcing the rule of law on construction sites when it comes to unions and does not really care about the workers who are being exploited. The Fair Work Ombudsman can do that, the government would say. They are the experts, the government says. How hard could it be to set up a specialised unit within the ABCC that focuses on wages and entitlements and sham contracting? The ABCC and Fair Work Ombudsman should not be siloed on this issue. The ABCC will be on the ground and, to use the government's own words, 'a tough cop on the beat'. I have strong doubts that the restoration of the ABCC would solve the problems facing the construction industry. If you added up the millions of dollars spent on the building task force, the ABCC, the FWBC and royal commissions and compared it to the fines secured against the CFMEU, you would have to conclude it has been a very poor return on investment. Of course, if, in addition to these fines, those millions of dollars had resulted in a change in the CFMEU's behaviour, then the public value could be established—but that has not happened.

As a public policy measure, the so-called 'cop on the beat' has been a failure for the past 15 years. Only the head contractors and employers can change the industry. They need to change their business model and government needs to empower them to do so. The only measure that has worked in the past 15 years was the Howard government version of the building code. It made it economically unviable for employers to do deals because to do so locked them out of work. They could say to the CFMEU, 'If we do that deal, we will be prohibited from tendering, we won't get the job and you won't have members on the job.' The CFMEU got the message. The use of procurement policy had a more effective impact on employer—and, consequently, CFMEU—behaviour than the ABCC-FWBC regulatory model ever has. The current 2013 version of the code is weak, so perhaps the only thing that is needed is a revised building code. I understand that there are some issues and concerns with the proposed building code, but, if the government is serious about changing the culture of the building and construction industry, it should make that its focus.

I also wanted to reach an agreement with the government on some amendments to the ABCC's coercive powers. The agency that currently exists, the FWBC, was established by the Labor Party in 2012, and it has coercive powers. The legislation setting up the FWBC contains provisions that make it a criminal offence not to cooperate and also provides for a maximum penalty of six months imprisonment if somebody is found guilty of failing to cooperate. The opposition leader, Mr Bill Shorten, at a media conference on 15 April 2016 said that this legislation takes away rights from construction workers, giving them fewer rights than ice dealers and terrorists. I should not need to remind the opposition leader of this fact, but he was the Minister for Employment and Workplace Relations when FWBC was established. On 16 February 2012, the then Minister for Employment and Workplace Relations, Mr Shorten, said the following:

The bill retains coercive powers, as indeed Murray Wilcox QC recommended. I acknowledge that many in this place have put strong personal views about this element of the bill. I want to stress to those who are concerned about coercive powers that this bill also includes important safeguards recommended by Justice Wilcox for those who seek to use the powers and those who may be subject to them. The bill also contains a sunset on the use of these powers after three years, but only after a review. Together, these elements are measured and appropriate.

Yes, there were safeguards, but the substance of the coercive powers has not changed. Construction workers could be forced to answer questions—with the threat of imprisonment if they did not—under a Labor government, and the same can be said for a coalition government. For Mr Shorten to claim that somehow these coercive powers are a creation of the coalition government and to attach outrageous claims to it reflects exactly what is wrong with public policy debate in this country.

Currently, FWBC has compulsory examination powers, but examination notices are issued by a nominated member of the Administrative Appeals Tribunal, the AAT. I think this is an important safeguard, and one that was recommended by Murray Wilcox QC.

I am of the view that the current legislation should be amended so that examination powers of the ABCC reflect what they currently are under the Fair Work (Building Industry) Act 2012. At a minimum, section 47, which relates to the AAT issuing examination notices, should be adopted into the current legislation. I also think that it is important that a review into the use of these powers be undertaken within 12 months of the ABCC being re-established.

There is also one other minor issue that I want to address, which relates to outrageous claims being made that distract from having a factual, evidence-based debate on policy. This issue relates to claims that, when construction workers are forced to give evidence, they will not have the right to legal representation. I have heard this on more than one occasion. A quick glance at the bill shows it clearly states the opposite. Clause 61(4) of the bill states:

A person attending before the ABC Commissioner, or before an assistant, as mentioned in paragraph (2)(c) may be represented by a lawyer if the person chooses.

This may be a minor point, but if the senators in this chamber and the Australian public are not getting the correct information from senators debating it, how are they meant to?

I know I have previously stated that I would support the second reading. However, I have not been able to reach an agreement with the minister on these two concessions, so I do not see much point in continuing this debate. If the government will not even consider what I believe to be reasonable amendments—at least worthy of debate in this chamber—then let us get this bill, as it is presented, to a vote. Then the government can proceed with what it wants—an early election.