House debates

Monday, 3 June 2013

Private Members' Business

Penalty Rates

10:41 am

Photo of Julie OwensJulie Owens (Parramatta, Australian Labor Party) Share this | | Hansard source

I am pleased to rise to stand on this important motion. I know that everyone on this side of the chamber believes that Australian workers should be able to lead a decent life, sustained by a fair day's work for a fair day's pay, and to have working conditions that allow for the building of a life with family and friends: to plan your finances, to spend time together and to build the things that matter in a good life—health, financial security, family and friends. The motion before the House reminds us of what a working life supports: that balance between home and work that allows for the formation of those family units—whatever they look like—and community networks that form the basis of a cohesive society.

When you work unusual and changing hours, a price is paid in lost time with family and friends, and penalty rates are one way that the price is shared between the worker, who pays the price, and business and consumers who benefit from it. Penalty rates are something that for over 100 years we recognised should apply in jobs and workplaces. They share that price out so it is not just paid by the worker. They have been examined, inquired into, tested by economists, argued about, negotiated, measured by statisticians, arbitrated by tribunals and so on for longer than taxation has existed in this country. Opposition to these rates is as perennial as the argument to support them.

I have a very pragmatic view. I believe that penalty rates are a genuine reflection of what Australian society expects as compensation for people who have to work at times when others are not expected to. We know that historically the opposition has not been a strong supporter of penalty rates. We have seen what they did with Work Choices, we have well and truly seen the ripping away of overtime and penalty rates and we have heard statements from the opposition since that time that they would go down that path again. I acknowledge that they are backing away a little in their rhetoric at the moment, but one can always expect them to revert to type.

If they did that—if they were in government again and did that—they would remove between nine and 11 per cent of the weekly take-home wages of people working in the accommodation and food sectors in my electorate. Similarly, they would reduce about seven per cent of the weekly take-home pay for people working in the retail sector. Of those people working in hospitality, 72 per cent are low-paid workers who work on weekends and on shifts, and in the food and accommodation industries it is 56 per cent—all heavily reliant on penalty rates for their family budgets. And I would have to say that there is not a lot of fat in those family budgets.

I read the economic data—the ABS figures and so on—and I have seen the analysis of costs and the share of wages and profits in those industries, and there is simply not a case to remove penalty rates. Employment has grown in these sectors, and the highest growth has been in small business. For six years, the net price of labour in those industries has risen by a mere 0.8 per cent, whereas income and expenditure on other items for small business in these sectors has risen from anything between eight and 25 per cent. Gross wages, including penalty rates, have not been a problem, but the loss of those penalty rates would be a major problem.

I have doorknocked tens of thousands of houses in my electorate—over 70,000 in total—but redistribution has moved about 40,000 of them into a neighbouring electorate. At least 30,000 of those houses are in my electorate, so I have a very good idea about the everyday lives of those people. I wonder at the thinking of those who would even consider the wiping out of penalty rates. How do they think the typical hospitality and retail and food service worker are going to get by if they lose up to 11 per cent of their weekly wage? If their children are at school from Monday to Friday, where is their weekend child care when they are working weekend shifts and how much does it cost? Where is their weekend or late-night public transport? When and where do they get quality time with their family and friends? What are irregular hours of shiftwork doing to their health and control of their lives?

These are real-life questions about the type of life the typical worker would have to face if penalty rates were lost and these are questions that we, as parliamentarians, must be mindful of. It does not need much spelling out: the removal of penalty rates would be a tragedy for many of the families and workers in my electorate, and I commend the resolution to the House.

10:46 am

Photo of Michael McCormackMichael McCormack (Riverina, National Party) Share this | | Hansard source

The member for Parramatta just spoke about there being not a lot of room in family budgets and I am sure, having doorknocked 70,000 homes in her electorate, she has been told that time and again. The reason there is not a lot of room in family budgets in this day and age is that day-to-day costs of living have been forced up and up and up, because of the policies brought down by this federal Labor government.

We heard in last year's budget speech by the Treasurer in the very first paragraph 'the four years of surpluses I announced tonight' and he went on. We all know that that is now no longer the case—more like four years of deficits. In this year's budget speech, the Treasurer referred in his second sentence 'to support jobs and growth in an uncertain world' as he talked about the need to consolidate the economy. Under his vision he thinks that jobs and growth are necessary, and he would get no disagreement from this side of politics. If we are lucky enough to form government, we will go about it. We will be far removed from the way he has gone about it in his years as Treasurer—because he has done nothing but produce debt and deficit. In the last two budgets the introductory remarks by the Treasurer belonged more in the fiction than the nonfiction section.

The Fair Work Commission is the industrial umpire with responsibility to make and vary modern awards—something which will continue under a coalition government. It is vital that the Fair Work Commission look objectively at these matters and reach a balance between the needs of workers, their employers and, most importantly, the national interest. Governments of all colours and creeds have conventionally made submissions in significant cases before that umpire, and it is something that will continue, as it has in the past, irrespective of the result of the 14 September election. If anything, under Labor, the government's intervention has been called out as being too one-sided, leading to the High Court criticising the Minister for Employment and Workplace Relations as meddling in an education union case as being 'not that of an intervener, but that of a partisan'.

The interaction between labour costs and job growth is something that the Fair Work Commission is required to consider under Labor's laws but, even the member for Batman, in his former capacity as the Minister for Tourism, publicly observed that penalty rates were a major obstacle for the industry in these difficult times, when he said:

I hope the bench of Fair Work Australia has given proper regard to the input of the tourism industry in this context because I understand that is the key issue to industry at this point in time.

This is about fairness and sustainability and, as the Treasurer noted, talking about supporting jobs and growth, you cannot have a job if the employer shuts the shop because the cost for that particular business owner are too high. Onerous workplace conditions impose great burdens on businesses, particularly in regional Australia.

Small towns have beautified their streetscapes, thanks to considerable investment by local councils, and they encourage weekend visitors, but, the way we are going, it is getting harder and harder to get a cup of coffee or a meal on a Saturday or Sunday or indeed a weekday night because of onerous workplace wages and conditions forcing the owners to work seven days and seven nights a week rather than employing people as they would have done in the past. If they go down that path, they are going to be working many, many hours. Their families miss out—because a lot of them have children—but, if they employ people and have to pay the higher and higher penalty rates, they simply cannot make a profit. Therefore what is the point of working for so many hours and paying the higher electricity bills due to the carbon tax and higher fuel costs—depending what business they own—due to the carbon tax, with all the other burdens that are being forced on them and prices which are going up and up under this Labor government?

This is about jobs and growth, and certainly nothing this government has done has ever helped those two important aspects of the economy: jobs and growth. We need to be very mindful of this particular resolution because what we need is fairness and equity and businesses to stay open. (Time expired)

10:51 am

Photo of Laurie FergusonLaurie Ferguson (Werriwa, Australian Labor Party) Share this | | Hansard source

Whilst the actual resolution deals with penalty rates, the previous speaker had recourse to significant bombast and rhetoric about the state of the overall economy. Therefore it is necessary to put on the public record a few realities. In fact, unemployment in this country, for instance, at 5.6 per cent, is strongly at variance with the Europe-wide average of 12 per cent and the United States rate of 7.6. He talked about inflation in this country and the pressures that is creating. He did not seem too concerned when the rate of inflation under the Howard government was 6.75 per cent, in contrast to the 2.75 per cent today. He did not say that the economy is 13 times larger than it was overall when this government came to power. He did not refer to the reality that the overall tax impost in this country is 22.2 per cent of GDP, as opposed to 24 per cent under Howard. Those are a few realities out there.

But the main axiom he came against was the question of the carbon tax, trying to somehow imply that the thing that really does affect people in this country, energy cost increases, is something overwhelmingly to do with the carbon tax. The fact of political life, the truth, is that the reason that energy prices are moving significantly in this country is that state governments, Labor and Liberal, disregarded the need to build infrastructure for decades, pretending to the Australian people that cheap energy could occur forever. Unfortunately, it has come home to roost. Infrastructure has to be renewed, it has to be replaced, and it is costing people a significant amount of money these days.

But the resolution before us today deals with the question of penalty rates. When I go to the Liverpool Titans football games or go to the South-West Sydney Tigers Aussie rules or the Campbelltown City rugby league games, I see a reality of this society: people working on weekends to keep society going, to keep the community having the option for people to play sports. When I go to the Country Women's Association, I see organisations that are struggling. In regard to RSL service organisations, Rotary and Lions around this country, we all know the truth that they are struggling because people have no confidence that each week they will be available, that they will be able to be there, that they will not be on call 24 hours a day for work and that they will not be required to work every weekend. That is a reality.

Penalty rates are about compensating people for the loss of family life, the fact that they cannot be with their children going to sport on Saturdays and Sundays, that they cannot be sure that they can do those sidelines, that they cannot be referees and umpires and people on the grounds, that they cannot help the ethnic school on the weekend at the local public school, that they cannot be involved in community radio because of the impact of the workforce changes in this country. That is what penalty rates are about. They are about compensating people for the loss of family life, for the loss of networks with their friends, their community, their society, their suburb.

And for those opposite, quite frankly, despite the attempt to be a small target before the next election, to pretend that nothing is going to change, the reality is as we have seen in Queensland. They came to power against an unpopular government that people wanted to throw out, and, once again, they were a small target; nothing was going to change, but we have seen in Queensland very significant attacks on society by the new state government. In New South Wales we have seen significant attacks upon the Public Service and also on workers compensation.

Of course, despite the fact that they are trying to pretend that not much is going to change—'We're going to be the same as Labor on industrial relations; don't worry'—the employers and the big end of town know what the reality is. We have seen it from two industries that the previous government speaker spoke about: the retail sector and the hospitality sector. These are places where there are very low-paid workers, earning a lot less than the people opposite who will be speaking in support of, basically, attacking penalty rates. Those people desperately need these penalty rates not only to compensate them for their loss of lifestyle but also to actually live. We have seen those industries come out in the last few weeks, after the opposition leader's budget reply, and they have said: 'We can see a way through. Even though you're saying that your industrial relations policy is not much at variance with the current government, we are sure that we can use your measures to attack penalty rates.' We know, of course, that the hospitality industry have joined retailers in enthusiastically embracing Tony Abbott's proposed workplace changes as a mechanism to extend trading hours without penalty rates. So what we see there is that despite Tony Abbott saying, 'Look, I love John Howard but I disagree with him so greatly in industrial relations. I found it hard to sit in the cabinet room. I was so opposed to my hero's moves on industrial relations. I won't resign; I'll be part of it'— (Time expired)

10:56 am

Photo of Nick ChampionNick Champion (Wakefield, Australian Labor Party) Share this | | Hansard source

It is just lucky I am prepared today, because we have one Labor speaker followed by another Labor speaker because the other side of the House, sadly, have not shown up for the debate. But I guess that is something we have come to expect on this. It used to be that they were like dragons. They were like monsters with Work Choices. We could not keep them under control, could we? In 2007 they were all for cutting penalty rates and people's job security. They were all for getting out there and giving the employer 100 per cent of what they wanted. But, of course, now they have gone completely silent. The proof is that, here in the chamber today, they do not even show up for the debate.

We know what happened under Work Choices, and I saw it first under the Reith legislation and then under the Work Choices legislation. It was a slow progression in the destruction of people's penalty rate clauses under awards, and the trade-off for that was sometimes pay rises in the order of 1c an hour. That was the trade-off: give up all your penalty rates for 1c an hour—hardly fair.

People in this building talk about cost of living. On both sides people talk about cost of living, and it is always an issue in the minds of our constituents. But, of course, the best defence against the cost of living is growing wages and a decent pay packet. We know that many people in retail, in hospitality and in cleaning who work unsociable hours do so to get the penalty rate. They work those unsocial hours so that they can pay the bills and keep up with the cost of living. We know how critically important penalty rates and growing wages are to that process of coping with the cost of living. Indeed, it is the only way of coping with the cost of living, because, sadly, we know that inflation is a fact of life.

We know that penalty rates are important to protecting people's community life. My state of South Australia is one of two places in the world to protect Christmas Eve and New Year's Eve. That was put in this year in a deal between unions and business. They came to the state government and said, 'We want to make sure that these two days are protected for community life,' and in exchange there were some trade-offs to work on public holidays for the retail industry. It was a very innovative and cooperative approach and the sort of approach that we would seek with business—that is, sensibly protecting community life while making sure we have a productive economy. The two things can be done at the same time. It is not the either-or proposition that is put by those opposite.

We know that so many people struggle with work-life balance. It is certainly a challenge for anybody in politics, but it is also a challenge for fly-in fly-out workers, for people in the defence community and for anybody who has to travel for work, such as truck drivers and people in transport and storage. Anybody who works antisocial hours struggles, I think, with the challenges of work-life balance. Sometimes that is spending time with your partner, or your wife or husband; sometimes that is, very importantly, spending time with children; sometimes that is spending time in the community, at the footy game, with your mates. I think a critical aspect of people's holistic lives is that we do not just spend time at work. Australians are some of the hardest working people on the face of the planet, but we want to make sure that we have the best community life as well.

There is a whole army of Liberals in the chamber now, lined up to tell us what their plans are, but we basically know what their plans are. They will go after the unions and, once they have finished with the unions, they will go after workers' wages. They will not be so, I guess, honest this time and say, 'We're going to take away your penalty rates.' What they will do this time is they will not say a word, they will just come for them in the dead of night and slowly but surely, using that cutting approach, whittle away all the things that have made this country fair, made this country decent and protected it, and protected working people in the process. (Time expired)

11:01 am

Photo of Sussan LeySussan Ley (Farrer, Liberal Party, Shadow Minister for Childcare and Early Childhood Learning) Share this | | Hansard source

It gives me pleasure to speak on this private member's motion about penalty rates. People listening to the debate might imagine that it is us as parliamentarians that are deciding right here, right now, what the penalty rates of Australia workers should be; that it is the subjective judgement that we bring to this chamber, the discussion that we are having, the poor quality example that we just heard from the member opposite. But, in fact, there is a body entirely established for this purpose, thankfully, that does not rely on the contributions of members of the government. I want to remind those members, including the member who brought this motion to the House, that it is the Fair Work Commission, as the independent umpire, that has the responsibility for reviewing all modern awards. This process is actually well underway, in line with the requirements in the Fair Work Act 2009 that a review be undertaken two years after the commencement of modern awards.

The Minister for Employment and Workplace Relations, Minister Shorten, has indicated, however, that the government will not tolerate any reduction in penalty rates, in essence telling the Fair Work Commission that their review must not recommend any reduction to penalty rates, even though we have spotted some dissension in the ranks, with the then tourism minister, the member for Batman, identifying that penalty rates were the bane of the hospitality sector—and we all know this is the truth—acknowledging that penalty rates could well force companies out of business. So we understand there is a balance and we have to find the right balance, but this is the task that the Fair Work Commission has been entrusted with. It is actually their job to consider the cases that are put them and find that happy medium. The government, in turn, should accept the decision of the Fair Work Commission.

We should bear in mind that the Fair Work Commission was a Labor creation. The membership is heavily dotted with former union officials. Those opposite still want to intervene and still want to manipulate the outcome, rather than saying to the Fair Work Commission: 'Examine the landscape in which we are all living, the economic environment that exists in Australia at the moment, the circumstances of businesses, the arguments of business, the arguments of employers, the arguments of unions, the arguments of the workforce, the arguments that come to light in here and in state parliaments and then make an informed decision, and we would then trust that outcome.' No, the minister has already stepped in and said: 'Do all those things, but don't do this.' I do not know why the government does not trust its own creation the Fair Work Commission.

We want to see a fair and balanced system. To this end, if we are elected in September, we have outlined our plan to build a strong and prosperous economy. Under our policy no Australian worker will be worse off and businesses will be supported to grow, contributing more jobs and revenue to the economy. Our plan will see the creation of a million new jobs within five years and two million within 10 years. We will offer real hope to unemployed Australians, helping them realise their dreams of paid employment.

The government is resorting to tired old class-warfare rhetoric—really tired, really outdated, really irrelevant. What the government should be debating is how to reduce unemployment, forecast to rise, and how to decrease welfare dependency in a country with an unacceptably high number of intergenerational unemployed young people, in a country where we cannot seem to get a policy that gets youths into a job. In every part of Australia, youth unemployment is between 20 and 45 per cent.

This is what we should be talking about today. We should be considering how we will give Australians a brighter future and an opportunity for meaningful jobs, and how we will reward them for their hard work. Instead, we are debating something that is clearly the responsibility of the Fair Work Commission to determine. I am disappointed that members of the government cannot come to an agreement on the role of the bodies that they themselves established.

We have to be so very careful that we do not lock out a group of Australian workers who are currently unemployed, losing their jobs and slipping out of the workforce disappointed and disengaged. We have to be careful that we do not create a system that looks after—fantastically well—those who have a job but does not acknowledge those who do not and does not provide a pathway for those outside the labour system to have a real chance in the real economy. That is what we have to be really careful of.

We have said we are happy with the Fair Work Commission. We just would like the minister to stop interfering with the process of that independent quasi-judiciary body and let it do its job.

11:06 am

Photo of Alan GriffinAlan Griffin (Bruce, Australian Labor Party) Share this | | Hansard source

I rise in support of the motion by the member for La Trobe and note the importance of penalty rates to ensure that many of the poorest workers in our society are able to make a living. We know the significance of penalty rates for part-time workers, students and young people trying to get a start in life. We know that those penalty rates are about compensating people for working at times that are outside the norm. It is fair to say that the norm, for some industries, has changed dramatically over the years, but if you expect people to work at night, on weekends and on public holidays there is a penalty you pay in terms of your living standards, the time you have to enjoy leisure activities and the time you have with your family. This is something that needs to be taken into account.

I have noted from this present debate, and the one in October last year when this motion was first debated, that the view from the other side is very much of two or three clear points. There is the question of flexibility and the need for flexibility from a business point of view to ensure that jobs can be created, workers can be employed and businesses can make a profit. Obviously, that is an important consideration—if there are no jobs there will be no workers. It is a very simple point. The point also is not what it says but what it hides—what it really means and has meant under those opposite.

The opposition leader is of the view 'You cannot believe what I say unless I write it down', and we found out last week you cannot even believe it then. When we go to some of the things that he has written down on workplace reform, we know that his record is very different to his rhetoric today and to the policy that the coalition is taking forth to the next election. We know that under Work Choices—and they now say that is not what they are about—that is not what happened.

We need to go back to Work Choices to understand what the Liberal Party has done. We saw agreement after agreement that was against the workers' needs and established conditions. One hundred per cent of AWAs cut at least one so-called protected award condition: 64 per cent cut annual leave loading, 63 per cent cut penalty rates, 52 per cent cut the shift-work loadings, 51 per cent cut overtime loadings, 48 per cent cut monetary allowances, 46 per cent cut public holiday pay, 40 per cent cut rest breaks, 36 per cent cut declared public holidays and 22 per cent provided employees with no pay rise, some for up to five years.

The Australian public needs to understand that that is the record of the coalition, and as much as they may try to move away from it, as much as they may say, 'That's not what we are about now,' that is, in fact, what they have been about, and when they had control of both houses of parliament that is what they did.

In terms of the walking away from it: let us go to the very words of the opposition leader with respect to this. In 2008 the opposition leader said about Work Choices:

… it was good for wages, it was good for jobs and it was good for workers. And let’s never forget that.

In 2009 he said that workplace reform was one of the greatest achievements of the Howard government. And in his book, Battlelines, in writing his policy manifesto Tony Abbott, 'Work Choices wasn't all bad'.

The fact is that quite a bit of it was. One of the interesting points is the difficulty we have on the other side to get speakers even to address these issues. I note the member for Farrer, who spoke previously—this is her second contribution to this debate. The member for McPherson spoke twice in October. They are not even interested in debating the issues; they are not prepared to. That is what is wrong with this motion when it comes to the— (Time expired)

11:11 am

Photo of Steven CioboSteven Ciobo (Moncrieff, Liberal Party) Share this | | Hansard source

I am certainly pleased to rise to speak to this penalty rates motion because, in many respects, like most things that Labor does this penalty rates motion looks great in the headlines but the stark reality for Australian workers is very different.

On the Gold Coast, in my electorate—an electorate built off the backs of hospitality workers, of which there are around 500,000 across Australia—we know that Labor like to herald the fact that they claim their legislation is great for Aussie workers. We see the Prime Minister and we see Bill Shorten consistently saying that they are all about Australian workers. In my city, Australia's sixth-largest city—a city where the single biggest employer is the tourism industry—the simple reality is that Labor's so-called penalty rates reforms have driven unemployment up.

Take, for example, a sandwich bar just down the road from my electorate office, which used to be open six days a week. With Labor's reforms, and as they introduced the penalty rates which were great for Aussie workers according to the Labor Party, the situation arose with that particular sandwich bar, which had three mothers working as part of the team employed by the sandwich bar owner, that for the store to remain open six days a week—Tuesday through Sunday—was no longer feasible. Because of the rates that had to be paid on a Sunday, the decision was made that it was actually better for the sandwich bar to be closed on Sundays than it was to be open. As the proprietor said to me: 'Why would I open to lose money? It actually makes more sense for me to enjoy a two-day weekend, rather than the one-day weekend I have had for the past four or five years.'

The consequence is that the workers in that particular small business, the people whom Labor claims they are going to help, ended up in net terms receiving less pay because they had fewer hours to work every week. And the amenity of the local area was reduced because there was one less small business available for people to frequent on the weekend. In a tourism town, it could not be more right or necessary for there to be flexibility when it comes to servicing the needs of today's tourists and, importantly, today's employers and employees.

The reality is that in a city like the Gold Coast there is a lot of demand for people to have flexibility. Some people do not want to work standard business hours because that is actually not consistent with what they need for their families. There are a lot of people who like the fact that they can get flexible work hours which enable them to work out of the home at a time when their partner is in the home, so that when one finishes work, the other can go to work. That is exactly the practice that we wanted to put in place. The overall test is always: is the employee better off? Now, Labor is great at headlines, and it is great at saying, 'This is about extra pay to recognise the fact that people are not with their families.' But in doing so they ignore the simple fact that for many families this is a positive choice that Labor denies them.

On public holidays on the Gold Coast, people now pay an extra 10, 15 or 20 per cent on the cost of going to a cafe or a restaurant or some other tourist operation—if it is even open. If you walk up and down the so-called glitter strip these days, chances are there are more places closed on public holidays than there are open. That is the great reform that the Labor Party has driven. This is not just for tourists but also for the community. We have seen, for example, many pharmacies which used to be open seven days a week now closed on weekends or on Sundays as a direct consequence of Labor's reform. Again, the straight-up-and-down translation: fewer services—some would argue, essential community services—and fewer work hours for the so-called workers that Labor is so concerned about. This is nothing more than a headline motion that disregards the fact that there are many positives that flow from increased labour flexibility.

The coalition is not about Work Choices; to quote the Leader of the Opposition: 'That is dead, buried and cremated.' And Labor member after Labor member can get up and run its pathetic scare campaign, but all Australians see right through that pathetic scare campaign. They know that the only puppet controlling the strings when it comes to that side of the House is Australia's trade union movement—and Labor's attempt to keep it a lockdown is part of the their desire to maintain power. (Time expired)

11:16 am

Photo of Alex HawkeAlex Hawke (Mitchell, Liberal Party) Share this | | Hansard source

I rise to speak on this motion and it is a pleasure to follow the member for Moncrieff's words and caution the government about what this will do to small businesses around the country. In a motion of this nature, once again we see the government undermining confidence in our economy by fruitlessly proposing unnecessary legislation in this parliament to do nothing for our economy except damage the confidence of our businesses. I think the shadow Treasurer put it best when he cited CEDA, the Committee for Economic Development of Australia, on the IMD World Competitiveness Yearbook results. He said: 'The competitiveness result is the worst result for Australia in 17 years. The rankings this year show that in labour productivity growth, Australia has dropped from number 26 in the world to number 51 of the 60 countries surveyed.' Former Labor Speaker of this House and one of your predecessors, Madam Deputy Speaker, CEDA Chief Executive Professor the Hon. Stephen Martin, could not have been clearer when he said:

The key issue is that we are seeing other countries … rapidly improve this measure of economic efficiency.

While they are not at our levels yet, they are catching up at a rapid pace and we need to look at productivity-enhancing reforms now rather than when we fall behind.

It is too late. We heard the member for Parramatta talking about industrial relations policy. I say to the member for Parramatta: unemployment in her electorate is at 7.2 per cent—higher than the national average. In Western Sydney, where my electorate is, youth unemployment is at 17 per cent. The member for Greenway is in the chamber—what is her plan to fix youth unemployment in Western Sydney? It certainly will not be helped by this legislating of inflexible things into modern awards. In fact, we take the view that we do not need legislation for all of these features of modern awards—we do not need to legislate the details. We do not need to legislate to take away flexibility.

We are very surprised to see that, once again, the unions have had the final say here. This amendment was not suggested by the Fair Work Review Panel that the government is proposing. This motion that we are debating today was not proposed by the Fair Work Review Panel Who did propose it? All of this has been proposed by Mr Dave Oliver, Secretary of the ACTU. Surprise, surprise! The member for Greenway has gone very silent.

Of course, we on this side want to see harmonious, productive, smart workplaces but I want it known out there that there are calls from industry and other sectors to explain what is going on with penalty rates in today's world. We have heard the restaurant and catering industry say that 10,000 new jobs could be created if they had more flexibility in their businesses—10,000 new jobs straightaway! Mr John Hardy is right about that: flexibility means more jobs. There are no wages for anybody when a business does not open on the weekend. The member for Moncrieff outlined that compellingly. cites a cafe and its cost of doing business from Monday to Friday compared to Sunday. The total cost, including superannuation, on a weekday with two wait staff, one dishwasher, one cook and one manager: $644—that is the cost of opening their cafe on a Monday to Friday. On a Sunday the cost of opening the cafe—Oli and Levi, a small family business—with the same number of staff: $1,239—almost double. The cafe's owner, Lloyd Smith—says if your labour costs are 50 per cent to 70 per cent more expensive on a weekend then it is not worth opening and is too risky. He then goes on to say, 'My staff are crying out for more hours and I'd love to be able to open on weekends, but I can't justify the expense.' That is the experience of the small business sector all around this country at the moment. That is what they are telling government, unions and this parliament: they need more flexibility, not less.

We may not be able to do anything about penalty rates; and we may not want to, because they are an enshrined part of our workplace relations system. But we do need to do more to have flexibility in our workplaces. We do not need fake motions from the government to create an issue for their re-election strategy, and motions which undermine confidence. We see that competitiveness is falling. We see that productivity is now at rock-bottom levels. If we are to have wage increases and legislate this sort of thing, we have to work on productivity increases. The flexibility of our labour market is vital.

We certainly see at the moment a government addicted to the unions. Labor is on track to have given about 160 special rights to unions. Unions now represent only about 13 per cent of workers in the private sector. Why should the unions get 160 special privileges? This motion is faked for the government's electoral advantage and we should vote it down.

11:21 am

Photo of Rob MitchellRob Mitchell (McEwen, Australian Labor Party) Share this | | Hansard source

I rise to strongly support this motion. In the seat of McEwen I represent over 37,000 people who work in industries affected by unsociable hours. This includes over 8,500 people who work in retail, another 8,000 who work in health care and social assistance and 3,700 workers in the accommodation and food services industry. Removing penalty rates, overtime, shift work allowance and public holiday pay is the introduction to around-the-clock work and lengthening the working day.

Why is it that the coalition think that it is not important for families to be able to sit around the table together, to share a meal and share some quality time? Working on weekends or in unsociable hours have penalty rates because those people working on the weekends and at night are missing out on what we value in Australia. We have penalty rates because weekends or working through nights is different, so we place different conditions on these times to reflect that, and to recognise those social differences.

There are many issues that shift workers face, such as health and wellbeing, and family and social disconnection. I know that from my own experience, when my father worked the night shift in the printing room of the Herald Sun for 35 years. He was unable to participate in what we term 'normal family life' because when we were getting up in the morning, he had just gone to bed after a full night's work. This meant that, due to his working commitments, on many occasions he would be unable to participate in family functions, school sports events or be there for other activities when a parent would like to spend time with their kids. I know from my experience when I was with the RACV, having to work on Christmas Day and doing weekend work on both day shifts and night shifts, how this had a big impact on family life and the loss of participation in special family occasions.

Penalty rates are also extremely important because industries like hospitality and retail have some of the lowest-paid workers in this country. For Australians working in insecure forms of work, penalty rates are more important than ever for casual and low-paid workers to help pay the bills. The Liberal leader has already said to a Liberal-organised community forum in Kingston that he thinks:

The best way forward, at least initially, is to try to ensure the award situation does maximise employment and at the moment we are not maximising employment by closing down businesses and preventing people from getting jobs.

He then went on to say:

I am confident that if the government were to back, for argument's sake, applications to the Fair Work Commission for adjustments in this area it may well be successful.

What he is saying is that an Abbott government would support the axing of penalty rates. It will use the Productivity Commission to drive greater use of individual contracts and attacks on workers' rights and conditions. The coalition's IR policy will legislate for the greater use of individual flexibility agreements, which for businesses and associations have been appalling. Only recently, the Australian Retail Association lost a Fair Work Commission case to slash penalty rates, and they have been very heavy in their praise of Mr Abbott. It has also been reported in newspapers that retailers and hospitality employees plan to campaign after the election for the relaxation of penalty rates after opposition leader Tony Abbott signalled support in such cases in the workplace tribunal.

Let us never forget that the key element of Work Choices policy was winding back penalty rates. It is in the Liberals' DNA to ensure that they hurt the lowest-paid workers in this country. We all remember their anti-worker laws which allowed retail giant Spotlight to try to impose AWAs on its workers by granting a two-cent-an-hour pay rise for removing all their penalty rates, overtime and holiday pay. When he was minister, Mr Abbott was quoted as saying:

… a bad boss is a little bit like a bad father … He might be a bad boss, but at least he's employing someone while he is in fact a boss.

I think that goes to the heart of his DNA. He does not particularly care how people in the suburbs or the community feel; he only worries about himself.

We heard a member before talking about how the IR policy will be no WorkChoices because it is written down. Last week we saw that his word is not worth the paper it is written on. During their time they removed penalty rates, breaks between shifts, minimum and maximum shift lengths and a cap on the number of consecutive days worked. You only have to read the FIFO report by the regional Australia committee to see how it impacts on families.

It is the Gillard government that will enshrine penalty rates into law to give workers greater certainty that they will be protected—whether it is those working on night shift, overtime, unsocial or irregular or unpredictable hours on weekends and public holidays. It is we who support shift workers, whether they are in manufacturing, hospitality or public safety, such as police and ambulance officers. It is about time that those opposite really went out and did the same. It is this side of the House that always stands up for workers; those on that side of the House that always want to stand on them.

11:26 am

Photo of Dennis JensenDennis Jensen (Tangney, Liberal Party) Share this | | Hansard source

The coalition supports individual flexibility arrangements—Labor's individual flexibility arrangements—but we want them to be more effective. Individual flexibility arrangements should not be excluded by enterprise bargaining agreements. Our position is clear, and has been stated on a number of occasions. I will state it again: the umpire, the Fair Work Commission, after hearing all submissions, should make the decision, balancing all considerations. The liberal parties are the true originators and protectors of the great Aussie notion of the fair go. There can be no better way of getting ahead than getting a job. The Liberal Party has always, and will always, work to ensure that jobs are our number one focus. A Liberal government will work to create the conditions for growth and make it easier to get a job. Cutting back on red tape and green tape will increase the pool of available jobs.

This motion aspires to a noble and worthwhile end, but adopts a misguided means laden with potentially unintended consequences. By this I mean that every single member of the coalition wants to see the quality of life of all Australians improve. However, the way to go about doing this is not to resort to outdated economic concepts like price floors. Unlike Labor, the coalition recognises that the world of work has changed and that the world in which we work has changed. Australia has to become more competitive. We compete every day with every country around the world. The work week is no longer nine to five, Monday to Friday. To deny the obvious changes in our way of living is as inane as to deny the internet, 24-hour shopping and banking and so on.

In 2009, noted New York Times columnist Thomas L. Friedman wrote The World is Flat. The book is a prescient reminder to Australia and all Western developed nations that we must adapt to the new reality of a globally-connected world, where intellectual services are traded easily, or die. One has only to look at Australia's position on the competitiveness index to know that we are not going in the right direction.

Presently, Australia is ranked 20th by the World Economic Forum, two places lower than Saudi Arabia—so too on unit labour productivity, as it is when one removes the crutch of the resources industry. One can see again that we are moving in the wrong direction, and the trend is negative. By implementing a price-floor model into a globally obsolete notion of the working week, Labor is ensuring fewer of the people it purports to help will be at work. Fewer young people, part-time workers and those returning to work will have work. Put simply, the higher the unit cost of labour, the fewer people will be employed.

The Fair Work Commission is best placed to arbitrate on the market-clearing rate of labour, plus sufficient and appropriate compensation to correct asymmetries of information on the part of the worker. Making Australia more uncompetitive does nothing to address the needs of the Australian worker in the knowledge economy, to say nothing of the Asian century. There needs to be less red and green tape. There needs to be a recognition of individual flexibility arrangements, provided a greater or compensating benefit has been won—again, the proper recourse being the Fair Work Commission.

Scrap the carbon tax to ease the pressure on Australian business. Fix the budget to return certainty and confidence to the Australian economy. If we do not work to build real solutions and instead opt for ideas best consigned to the scrap heap of history, then we will never get to having that cafe society. The hospitality industry will continue to feel the strain and our best chance of sustainability growth via a sustainable industry in tourism will be jeopardised.

The Fair Work Commission was set up to be the independent umpire on issues of award and penalty rates, yet here we are discussing a motion that in essence undermines the role of the Fair Work Commission. Where is the trust in the umpire—an umpire the Labor government set up?

11:31 am

Photo of Richard MarlesRichard Marles (Corio, Australian Labor Party) Share this | | Hansard source

Rather than being a motion which undermines the work of Fair Work Australia, as has been said by the member for Tangney, this is a motion which absolutely supports the work of Fair Work Australia and its predecessor, the Australian Industrial Relations Commission, since its inception in 1904—because that is what occurred to give rise to penalty rates. That is why am so pleased to speak today in support of the member for La Trobe's motion before the House.

Penalty rates are an acknowledgement of the fact that, when you work other than nine to five, there is a cost. There is a cost to your ability to pursue your personal life, your family life, whatever you choose to do. Working unsociable hours is a more difficult thing to do and comes at a greater cost to people personally than working between nine and five, and that is because, naturally, our society has organised itself around people largely working from nine to five. Therefore, many of the things we enjoy doing in our lives are scheduled outside of those times, which means people miss out in the event they are asked to work outside that spread of hours between nine and five.

Penalty rates acknowledge that and acknowledge that there should be appropriate compensation for that. Obviously, it varies according to how much you are working outside the nine-to-five spread, what day you are working on and the significance of that day. That is how it should be and that has been built up through the process of collective bargaining and the process of arbitration in the Australian Industrial Relations Commission and in Fair Work Australia since 1904. It is a very significant part of the way in which we conduct our working lives today. It is also now a part of people's remuneration, forming the basis on which people calculate their take-home pay. When you remove penalty rates, you actually eat in to people's ability to earn a living wage. So penalty rates go really go to the heart of the balance between work and family life in terms of both the hours that you work and the amount you are able to bring home to sustain your family.

The most important defence or safety mechanism that we have to ensure that penalty rates have their appropriate place within our society and within our working arrangements is collective bargaining. Collective bargaining ought to be and is right now at the heart of our industrial relations system—enterprise bargaining to workplace, not centralised wage fixing. Indeed, that is the international norm that we as a member of the International Labour Organization promulgate to the world in terms of how bargaining ought to be conducted, and it is the safeguard of penalty rates in this country. The reason I raise this is that when we see laws put up which seek to undermine collective bargaining, as we did through Australian workplace agreements under the previous Howard government's Work Choices legislation, that is when we see a serious attack on penalty rates and that is, in fact, what occurred.

Most Australian workplace agreements which were signed did something to remove the penalty rate for the worker. It is a system which encourages people to bargain away long-fought gains which have been achieved over decades through collective bargaining and through arbitration. That is the great concern about a legislated scheme of individual contracts, which is what we saw with Australian workplace agreements and what, in the policy announced by the Tony Abbott opposition, would come into being were they ever to achieve government in this country. The centrepiece of what they are about, as always, is to remove enterprise bargaining as the centrepiece of our industrial relations system and replace it with a legislated individual contract agreed between a worker and their company. In no other place in our economy do we see such a discrepancy in bargaining power enshrined in our law as we saw with Australian workplace agreements and as we will see again if ever there is a coalition government which puts forward the policy Tony Abbott is talking about. It puts one person totally at the mercy of another. There is no unfairer place in Australia's system of law and it will lead to a reduction of penalty rates.

11:37 am

Photo of Warren EntschWarren Entsch (Leichhardt, Liberal Party) Share this | | Hansard source

In addressing this private members motion today, I have to agree that work-life balance is extremely important. However, I must say that too much emphasis on either and the other one suffers. Like most of the legislation which comes through this place from the government, there is always a sting in the tail. We are focusing on the health and welfare of workers, their families and our communities, but the silent victims are the owners of small businesses who, in my electorate in particular, are being driven to the wall financially and emotionally. Penalty rates are very much a contributor. It is no surprise for me to see that tourism provides 11.3 per cent of all jobs in Cairns, with retail accounting for 11.3 per cent and hospitality 10.9 per cent.

When talking about work-life balance, it is important to realise that that scenario is only an issue if you have a job. We are seeing many small businesses—particularly in hospitality—fold as a direct result of an imbalance created in this area. In my region, of the 23,900 businesses 1,303 were classified as medium- or large-sized companies meaning that, as of June last year, 22,597 businesses in my electorate were classified as small businesses.

In these small, family-owned businesses the smallest change in profitability margins can make a huge difference as a result of the slightest of downturns, new competitors or high staffing costs. I highlight the case of Krokodillos restaurant at Yorkeys Knob where I live, a place I visit on many occasions. It is a lovely spot with relaxed tropical dining, friendly service and great modern Aussie tucker put on by the owners Greg and Sarah Rochford. This small business is open five nights a week from Wednesday to Sunday and operates only between 5 pm and 9 pm. As you can see, those hours mean that they are constantly forced into a penalty rate situation.

Krokodillos has been operating now for seven years. Greg and Sarah now need to spend more time with their seven-year-old daughter, Madison and they have had it on the market for a long time. Greg and Sarah work every day and every night. They work it themselves to make a living. But the work-life balance is clearly not there and they cannot spend time with their daughter. I know that they would love to be able to take on more staff so that they have more quality family time, but they have limited opening hours and have to pay penalty rates to staff for every one of those. When people go out for a meal and a drink late at night, they expect people to be working and businesses to be able to offer their products at a price that they are prepared to pay. We need to create an environment where small businesses are able to provide those jobs—because, at the end of the day, they are the only ones that will.

The Fair Work Amendment Bill came up for debate recently, and penalty rates formed a key discussion point. I note the secretary of the trades and labour council said in a speech on 6 February, 'We are asking the government to enshrine penalty rates and weekend work legislation to protect it forever'. I have seen many businesses in my electorate close down and the heartbreak and financial and emotional stress that follows. Unfortunately, this motion demeans the Fair Work Commission and its role as the so-called independent umpire. The minister has indicated that the government would not countenance any reduction in penalty fees. Therefore, if the Fair Work Commission rules that way, as the minister has signalled, it will be perceived that the Fair Work Commission is being monstered by the minister. I am very sympathetic to the concerns of businesses but, at the end of the day, it is a matter for the Fair Work Commission to determine, and I hope that it will take into account the very real impact that they are having on small businesses.

Debate adjourned.