Tony Zappia (Makin, Australian Labor Party) Share this | Hansard source

I'm pleased I was in the chamber to listen to the member for Kennedy because, unlike on other occasions, on this occasion I pretty much agreed with most of what he said. After the 18 May election, it was my expectation that a priority of the Morrison government would indeed be to continue its attacks and pursue the ideological destruction of unions and worker organisations in this country. My expectation has proven to be correct. We saw it as one of the first issues on the agenda a couple of weeks ago when we debated some other industrial legislation, and now this legislation goes to the heart of attacking unions in this country.

It's an attack which began under the Howard government in 1996, and I can well recall the waterfront saga in 1998 and then the Work Choices legislation prior to the 2007 election. It was clear to me from both of those events and, in particular, the Work Choices legislation that the Australian people are not fools. They understand fairness and unfairness when they see them, and this legislation is another example of unfairness.

The attack on trade unions continued in 2013 when the coalition was re-elected under former Prime Minister Abbott and we had the Heydon trade union royal commission. That was a deliberate attempt to look for reasons to change the laws relating to the operations of unions in this country. Regrettably for the coalition, that royal commission didn't deliver the findings that the coalition had hoped for. But this government, in order to justify its anti-union agenda, is relying on the Heydon royal commission to bring into parliament legislation which goes well beyond what the Heydon royal commission had recommended. I have to say that whilst the Fair Work Laws Amendment (Proper Use of Worker Benefits) Bill 2019 includes tougher accounting controls and restrictions on worker organisations—the Heydon royal commission might have alluded to some of those matters in their recommendations—it seems to differentiate between the laws that should apply for unions in this country and the laws that apply for industry organisations in this country. Indeed, the laws that will be implemented if this legislation goes through the parliament are much more onerous than the obligations that are placed on industry in this country.

Whilst that doesn't surprise me, it does concern me. It concerns me for this reason: we had a royal commission into the banking sector in this country, which handed down its recommendations. The lack of enthusiasm by this government to implement the recommendations of the banking royal commission, when contrasted to its enthusiasm for implementing recommendations of the Heydon royal commission, where it goes beyond what the commissioner recommended, is very clear to us on this side of the House. While the government puts the blowtorch on unions—and, in doing so, weakens them—the real losers in this legislation become the men and women whose primary protection of their income and their entitlements comes from the worker organisations that represent them. What this government is really doing is not attacking the unions but indirectly attacking the men and women workers of this country, because they are the ones who stand to lose the most.

I will go to some of the detail in this bill. The bill amends the Fair Work Act to make changes to the regulation of worker entitlement funds. Those changes put additional requirements on the governance, financial reporting and financial disclosure requirements of worker entitlement funds. They place limits on when a worker entitlement fund can become or stay registered, including what sort of organisation can operate the fund, the make-up of the board of the fund and the way in which the assets of the fund can be used. The bill also amends the registered organisations act to introduce new rules and penalties around financial records and reporting for all unions.

Worker entitlement funds exist to protect workers' entitlements and provide services to workers, such as training and counselling support. Often, the funds operate in industries where there are high levels of phoenix operators and unfunded entitlements. Whilst the government will make it sound like these changes are to benefit workers, they are in fact burdensome regulations aimed at making it more difficult for unions to achieve better pay and conditions for their workers.

If the Morrison government is so concerned about protecting workers, then why isn't it doing more to stop employers who are underpaying their workers or taking advantage of them in so many other ways? Recent very high-profile examples of underpayment by employers demonstrate that much more needs to be done. Yet, for all the high-profile cases, there are many more which don't make the media. In one example that my office was contacted about, a young worker was employed for a short period of time. She received pay slips which, as expected, detailed the withholding tax and superannuation payments. Her pay arrived in her bank account. However, the first sign of something not being right was when she didn't receive a group certificate. When trying to lodge her tax return online, her pay details from the employer did not automatically download. It seems highly likely that the employer didn't pay the withholding tax to the Australian ATO and didn't pay the superannuation contributions either. My understanding is that, in these cases, it's the employer's responsibility to meet those obligations, not the employee's, and the issue of the tax debt is a matter that the Australian tax office should be pursuing. Nonetheless, the loser in this case is the young employee who works for a short period of time and then, when she attempts to lodge her tax return, is unable to do so. In the process, it's clear that she has lost her super and that she will get no tax refund that she probably would have otherwise been entitled to.

In a different situation that I'm also aware of, a small number of employees stayed on for a short period after the rest of their colleagues were terminated in a particular industry in order to help complete the wind-up of a business that was undergoing liquidation. It was a big business. As a consequence of remaining and the date of their termination being when all other employees had left, the business was then reclassified as a small business because it only had a handful of employees—the ones who stayed on to finalise the liquidation of the business. This meant that, unlike their colleagues, those remaining workers who had stayed on to wind-up the business did not receive the full benefit of the Fair Entitlements Guarantee because the business was reclassified as a small business. They lost thousands of dollars.

I raised this matter with the government. In his response, Minister Porter indicated that there may be an opportunity to consider the application of this rule as part of the government's broader review of industrial relations law. I look forward to the government's consideration of this matter because, as I've pointed out, the workers lost thousands of dollars for doing the right thing and staying back to wind-up the company. I suspect that this might have been an unintended consequence of the current industrial law.

In May this year it was reported that Fair Work inspectors had undertaken an audit in New South Wales, Victoria and Queensland of almost 1,400 businesses. The audit found more than one in five of those businesses underpaid their workers. In its submission for the inquiry into wage theft in Queensland, the ACTU argued that wage theft has become a business model, with workers in large businesses being routinely exploited. It is a sad fact that often it is the lowest paid workers, who can least afford it, who are the ones ripped off the most. There are numerous ways that workers are being ripped off. Some of those mentioned in the ACTU's submission include: failing to pay superannuation, failing to pay for breaks, failing to pay overtime, the compulsory use of employer provided staff accommodation to claw back wages, withholding of wages on the basis that it will put visa status at risk, not paying for trial or training periods, misclassifying workers as independent contractors, deliberate employee misclassification, not paying annual or paid leave, not paying appropriately for higher duties, phoenixing-type activity—where a firm goes into liquidation or administration to avoid having to pay employee entitlements and re-emerges under a different legal structure but with the same or related individual control—and failing to deduct or remit taxation amounts.

In the short time left to me, I want to relate another case of how this government is supporting the demise of working entitlements and conditions in this country—that is, its support for outsourcing, subcontracting, the loss of penalty rates and the like. One SA government worker told me only last week how his work within the South Australian government got outsourced. It has subsequently been outsourced from one entity to another on several occasions. He made it very clear that every time a new entity takes over the work that was previously done under direct employment of the South Australian government, this person loses entitlements. He either loses wages or has to work longer in order to get the same wages. It's a clear case of the person's working conditions and income being slowly eroded as a result of the outsourcing that took place. His example is typical of what is happening to workers around the country.

If this government is serious about protecting workers' benefits, these are the issues that it should be focusing on. There are many of them out there. They have been brought to the attention of this House time and time again, and I'm sure that the government is well aware of them. I say to members opposite: if you are serious about improving workers' benefits and you want to treat them the way that you would like to be treated then this legislation isn't the way to do that.

Debate interrupted.

See this speech in context