Jill Hall (Shortland, Australian Labor Party) Share this | Hansard source

The legislation before the parliament tonight demonstrates the core differences between the government and the opposition. The legislation is based on a philosophy that is immersed in the ideology of the Liberal Party, one that is determined to deny Australian workers a fair go. It is legislation that delivers to backers of the Liberal Party. It is anti worker, anti union and anti a fair go. It embodies the values of the government rather than the values all Australians hold dear. It is market driven. It is legislation that is pure Liberal Party rhetoric, a present to its backers. It is a blatant grab for power. It once again demonstrates the hatred of this government. It demonstrates the government’s determination to take control of all areas of government, to take power away from the states and to place control in its own hands. This is a government that is drunk with power, and this legislation fully demonstrates that.

The Independent Contractors Bill 2006 sets out a regime to recognise independent contractors as bona fide workplace relationships, overrides state laws which deem certain workers to be employees, creates a framework of protection for TCF workers, moves unfair contracts jurisdiction from the Workplace Relations Act and limits review to service contracts. This bill makes amendments to the Workplace Relations Act 1996 to provide penalties for employers seeking to disguise employment relationships as sham contracting relationships and misrepresenting employment relationships as contracting relationships.

The central principle underpinning this bill and the Workplace Relations Legislation Amendment (Independent Contractors) Bill 2006 is that independent contracting relationships should be recognised and supported and that the appropriate mechanism for regulation is commercial law not industrial law. Commercial law is based in the hands of the federal government, as opposed to industrial law, which is based in the hands of the states.

I draw the House’s attention to an inquiry into independent contracting and labour hire arrangements that took place in this parliament. The report was tabled in August 2005 and it made a number of recommendations. Recommendations Nos 1, 2, 5, 6, 7, 8, 9, 10, 11 and 13 were supported unanimously. There were 16 recommendations in this report, and a number of the recommendations that members of the government supported were not included in this legislation. There were also recommendations put forward by the committee members on this side of the House, and I will talk about them a little later.

But first I need to put on the record that the process undertaken by that committee was flawed. ‘Why?’ you might ask. It was flawed because the Minister for Employment and Workplace Relations released his discussion paper during the inquiry. He pre-empted a lot of the findings of the inquiry, and he sought to influence that inquiry. We on this side of the House are not shocked by that because it has become common practice. This government is about one thing and one thing only: it is about achieving its agenda and satisfying those backers who benefit from the legislation that we have before us today.

This legislation increases the complexity of an already complex industrial relations system. It is highly prescriptive and technical and introduces a confusing array of concepts. As the New South Wales government has identified, there are examples of pre-reform commencement contracts, continuation contracts, related continuation contracts, remedy contracts, test contracts and a contractor law test designed to clarify the continuing application of state contracting or deeming laws. That is highly prescriptive and creates a lot of confusion in the workplace. In addition, some types of contracts entered into after the commencement of the bill will be subject to relevant state laws while others will not, depending on the satisfaction of certain technical requirements. It is a situation that will be very confusing.

Whether or not a person is an independent contractor will simply be decided at common law. Issues that will be looked at are: the degree of control the worker has over the work; the degree to which the worker is treated as part of the principal enterprise; if the worker wears a principal’s uniform; whether the worker uses his own tools and equipment; whether the principal pays the employer; whether the principal has the right to dictate hours of work or if it is at the worker’s discretion to work and they can refuse them; the provision of leave, superannuation and other entitlements paid by the principal to the worker; the place of work; whether the worker has the right to delegate work to others; whether the worker provides similar services to the general public; whether the worker is provided with skilled labour; and whether labour requires special qualifications.

In the inquiry into independent contractors the government members of the committee were very supportive of whether an employee was an independent contractor being decided in accordance with commercial law. But the members of the opposition who were on that committee felt that that was not the best way to deal with this matter. It was felt that the Australian government should provide a new definition of employee. That definition of employee would be used to determine whether a person was in an independent contracting arrangement or whether they were an employee simply on the basis of looking at whether that person satisfied the definition of an employee. Members on the other side were not supportive of that. They supported the common-law position. They adopted components of the income tax assessment alienation of personal services income legislation to identify independent contractors. That was their recommendation, whilst we in the opposition said there would be no need to define an independent contractor if the proposed employee definition were adopted. I do not think there could be a more vivid example of how ideology has driven where this government has gone on this issue.

The bill overrides all existing deeming provisions contained in state legislation, which deem certain categories of independent contractors to be employees and contain provisions granting employees related entitlements as independent contractors. In New South Wales, the state that I come from, there are certain categories of workers that are declared to be employees. These include milk vendors, cleaners, carpenters, joiners, bricklayers, painters, bread vendors, outworkers in the clothing trades, timber cutters and suppliers, plumbers, drainers, plasterers, blind fitters, council swimming pool managers and supervisors, ready-mix concrete drivers, road and traffic authority lorry drivers and others prescribed by regulation. These provisions seek to redress an imbalance of power in those categories of workers which compromises their ability to negotiate fair and reasonable working conditions. The state laws recognise the vulnerability of those workers. It is because of their vulnerability that they have been deemed employees under the legislation. The Commonwealth seeks to override the state industrial relations legislation. There is to be a three-year transition period from the date of the commencement of the principal bill and the preservation of existing deeming protection for outworkers and owner-drivers. Textile, clothing and footwear outworkers are deemed to be employees under state laws. They will continue to be deemed so.

The bill provides independent contractors who have previously been deemed employees under state legislation a three-year transition period after the commencement of the legislation, to give business and workers time to adjust. Only deeming provisions in industrial relations laws will be overridden. That is very interesting, isn’t it? It is only deeming provisions in industrial relations laws that will be overridden. Occupational health and safety legislation and workers compensation legislation will remain untouched. I see this as an example of a government driven by its philosophy to override and change the face of industrial relations in this country. It is not about a fair go for the worker; it is not about what is best for Australia; rather, it is about delivering to their backers a system that they believe Australia should have. It is about maximising profits to the big end of town whilst ignoring the needs of the little person who is involved as an independent contractor—an area, I might add, that is growing. More and more people are working as independent contractors, and this government’s legislation is pushing people into those relationships.

The state deeming provisions, as I have mentioned, will apply for three years, and parties may leave this earlier if they wish, or they can enter into a reform opt-in agreement. The bill recognises that unforeseen circumstances may arise which will lead to the loss of accrued entitlements of independent contractors who have been deemed by state or territory laws to be employees. In other words, the workers will miss out. Once this comes into force, those workers who are deemed to be independent contractors under this legislation will lose their entitlements. I do not think that is good enough.

During the inquiry that I referred to in my opening comments—the Making it work inquiry into independent contractors—the committee was privileged to take evidence from members of the Transport Workers Union. I think that the evidence the committee received from those workers—those owner-drivers—was some of the best evidence that has ever been presented to a committee of this parliament of which I have been a member. We had many drivers there who gave evidence to the committee and told the committee their stories. They told how they struggled on a daily basis to meet the repayments on their trucks, keep their trucks in sound working order and meet deadlines that were placed on them by the contract they worked to. All of those drivers worked for one large carrier. They had the name of that carrier on their trucks and they were 100 per cent responsible to that contractor.

The TWU expressed concerns about the broad regulation-making power of this bill. Subsequently, they also have expressed concerns about unfair contract provisions that are inferior to those in New South Wales and Queensland and how they are being overridden, the sham independent contracting arrangements—and I will be talking a little later about those sham arrangements—and concerns that misleading representations have to be made to an individual to be prohibited.

This government has given an exemption to owner-drivers in New South Wales and Victoria until 2007. I am highly sceptical of this exemption because this government has a way of manipulating situations. This government has a way of changing once it has achieved its goal. I think its goal in this case is to win the next election. It is worried about the flak it will get if it does classify all owner-drivers as independent contractors. It is interesting to note that the member for O’Connor has been quoted as saying that the position of the Minister for Employment and Workplace Relations is arrogant and that the review of legislation proposed for 2007 is just a way to quieten the backbench. The minister is saying that he is legislating for an exemption because of threats from the TWU but he might then revisit it in a few months before the election, after some kind of review. Well, pigs might fly! I have my concerns about where the minister is going with this review.

I have talked about the common-law test and how I believe it is an inadequate way to determine whether or not a person is actually an employee or an independent contractor. I have also mentioned the state laws and the deeming provisions that this government seeks to override. The situation of workers in the TCF industry is another area about which I am very concerned, because this bill will do little to protect outworkers without the proper application of state based outworker legislation, which this seeks to override. Finally, the section reflecting on sham arrangements is inadequate and I think the government really needs to revisit it and look at other definitions of sham arrangements.

In conclusion, I would like to say that this is mean-spirited legislation introduced by the most mean-spirited government Australia has ever had: a government that panders to the wishes of its supporters as opposed to legislating for the good of all Australians. The legislation is bad legislation and it will impact on the most vulnerable workers in Australia. (Time expired)

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