Rachel Siewert (WA, Australian Greens) Share this | Hansard source

Although I am going to specifically address the issue of the Independent Contractors Bill 2006 shortly, I would like to draw the Senate’s attention to the last-minute inclusions in the amendments presented today—several hours ago—of changes to the Workplace Relations Act which go well beyond what this bill is purported to be dealing with, well beyond what the Senate inquiry looked at and well beyond what we were led to expect to be dealing with in the amendments.

I feel like it is groundhog day,as it is almost a year to the day when we were debating the regressive Work Choices legislation. We are once again having amendments fobbed off on us at the last minute when we have no time to adequately consider either the extent to which they apply to this bill or the broader ramifications they have for the Workplace Relations Act.

The government have reached a new low in their approach to the Senate and the contempt in which they hold this place. Maybe they thought they could sneak these amendments in under changes to the Independent Contractors Bill. Not only is the government using this bill quite plainly to get at employees to make them independent contractors, which undermines their rights; they are using it to have another go at introducing changes such as the stand-down provisions, encouraging people to trade their sick leave and not ensuring employees record everybody’s work hours—and the list goes on.

The amendment on stand-downs looks at providing employers with an extensive and wide-ranging right to stand down employees without pay at any time during which an employee cannot be usefully employed. It goes through things like a downturn in work, a breakdown in a piece of machinery, a strike or industrial action or any stoppage of work for any cause for which an employer cannot be reasonably held responsible. This is wide open to interpretation. It is not clear exactly how far employers can take this or under what conditions employment might resume. What happens if there is a power blackout and everyone is stood down indefinitely? What happens if you travel out to a remote mine site and the equipment is not working; are you stood down and do you have entitlements to accommodation and transport? What happens if an employer fails to maintain equipment like they are supposed to do? Once again, the employees are held responsible.

This is an absolutely outrageous piece of legislation. It is clearly open to not only interpretation but abuse. We have already seen how employers blatantly abuse the Work Choices legislation. The government might as well scrap all AWAs, scrap all employment requirements and say, ‘Go for it, guys.’ I would suggest that these provisions leave it wide open for unscrupulous employers to dump staff whenever it suits them, with the employees’ only recourse being to pursue expensive legal action. Of course, if you have been stood down without pay, your chances of being able to pursue legal action are very poor. It is likely to impact most on employees who are low paid and in unskilled positions and those who are unable to take any action and fight this piece of legislation.

It is also unclear whether people who are stood down will be able to claim some form of income support. So they are stood down without pay, and we do not know whether they will be able to claim income support. Tell me how that is fair to workers. Tell me how that is family friendly. You go into work expecting to work for the day and there is a piece of equipment down: ‘Sorry, there’s no work. You’re stood down.’ How ridiculous is that?

Section 245A deals with the entitlement to cash out an amount of paid personal or carers leave—it is on page 25 of the government amendments. This provides for the ability to cash out personal leave, which can include sick leave and carers leave. It is unlikely to help very many workers and has the potential to disadvantage many, particularly those who are caring for children or family members. This is not a piece of family-friendly legislation and it does little to redress the current imbalance between work and family life. It threatens to make things substantially worse. Australia is already facing a care crisis. Things are set to get worse with an ageing demographic, and carers already tend to be one of the more disadvantaged groups in our community. Carers need to use more of their personal leave and family leave to meet their care responsibilities. These changes will systematically prejudice workplaces against people with family and care responsibilities and put pressure on Australian people to cash out their leave.

Carers leave and personal leave are things that many employees do not think they will need until they are hit with a serious illness or family crisis; if they have been pressured and encouraged to cash it out, they will have no recourse. While there is a minimum amount kept in reserve, it is unlikely to be enough if you or your loved ones are in crisis and need care or if you have a sudden serious illness. Younger workers in particular—again, those already disadvantaged by Work Choices—are likely to think that they will not need illness or sickness cover. They are the ones that are highly likely to be encouraged to think it is a good thing to cash out their leave.

Sick leave was never supposed to be tradable. It is supposed to be there in case of emergencies if you are sick. It is likely, as I said, to encourage particularly young people and also those on low incomes, who might think they will get a slight advantage, to cash out their sick leave. What happens when they do get sick? It will encourage people not to call in sick when they are sick, which in turn will lead to a drop in productivity, not only their own—which they will probably get in trouble for—but also that of other members of the workplace who catch the sickness or the illness because the person came in sick. Medical experts have repeatedly said it is best for people to stay home as soon as they start feeling sick. It is better for the person—the worker—and it is better for the workplace.

There are other amendments in this legislation. Of course, due to the time constraints—we have had these amendments for only a small amount of time—we have not had time to go through them. I am sure there are other hidden little beauties in the bill that we will be shocked to discover when we get more time to discuss it. We will no doubt be debating those during the committee stage.

I now turn to the issue of the Independent Contractors Bill 2006. In 2004, as part of the federal election campaign, the government stated that, if re-elected, a coalition government would introduce an independent contractor act to prevent the workplace relations system being used to undermine the status of independent contractors. Well, that is certainly not what this bill does. This bill undermines employees. It is clearly designed as another plank in the federal government’s approach of undermining workers’ rights and treating workers as just a commodity. It is likely to impact on a growing number of Australians as more employees are forced into independent contracts. Already, there is estimated to be, I would say, over a million people already under some kind of individual contract, and this is likely to increase significantly with the passing of this legislation. This legislation is not delivering what I think some people thought the government intended to deliver. As I said, it is about undermining workers rights by forcing employees into being independent contractors, taking away their entitlements and basically making inaccessible many of the provisions that they as workers should get.

The bill purports to move the contracting relationship as far away as possible from the realm of employment and to place it as far as possible under commercial regulation. The bill seeks to exclude state and territory laws which deem as employees many independent contractors entering commercial agreements with employers. It is the government’s view that state laws interfere with the rights, entitlements, obligations and liabilities of parties to genuinely engage in independent contracting arrangements. The bill supposedly retains existing protections for outworkers and road transport owners and has, the government maintains, a provision for service contracts to be reviewed on the grounds that they are harsh or unfair. But that is only possible by application to the Federal Court. The Federal Court is hardly easy for workers to access. Having to go to the Federal Court would put anybody off the very idea of seeking a review, let alone having the money to do it.

The bill does not define the term ‘independent contractor’ beyond the current meaning under the common law. The problem with this is that independent contractors will not receive the same entitlements in doing their job as an employee. The independent contractor is seen as a person who contracts for services, and is not afforded the same legal status as an employee. The bill also overrides the deeming provisions contained within state and territory industrial legislation which deem certain categories of independent contractors to be employees and provisions which bestow employee related entitlements on independent contractors. Those deeming provisions provide independent contractors with their basic employment conditions beyond those required federally under the existing legislation. Again, the bill is about undermining employees. Those safeguards will not exist when this legislation is passed, except for owner-drivers in New South Wales and Victoria and, potentially, some outworkers—that is dependent on the extent of the government’s amendments, which, of course, we have not had time to check out.

The House of Representatives Employment, Workplace Relations and Workforce Participation Committee report titled Making it work noted the difficulties with the common-law distinction between employees and independent contractors. Common law has a number of mechanisms available to it in determining whether a person is an employee or is performing work under another type of arrangement. The report recommended that, when drafting independent contractor legislation, the government maintain the common-law approach to determining employment status but distinguish between employees and legitimate independent contractors.

In addition, the report recommended that any new legislation adopt components of Australia’s legislative income tax assessment alienation of personal services income tests to define independent contractors. The Taxation Office has a number of criteria which a person has to satisfy to claim taxation status as an independent contractor. The bill does not implement that recommendation. The minister argued that the test is a self-assessment and therefore able to be easily manipulated by a person to arrive at a desired outcome. But the question that should be asked is this: if it is good enough for the tax office to require criteria to determine if a person is actually independently contracting then why is it not for the independent contractor legislation? It is interesting—more than interesting, I have to say—that yet again the government has been given advice through parliamentary process and has not listened to it.

The relationship between an employee and an employer is not equal. This is even more so when the person is earning a livelihood as an independent contractor and has no fallback or no-one to stand up for their rights. This legislation should protect the vulnerabilities of people who are not always able to negotiate fairly with employers. It does not. Employment and workplace advocates have expressed concern at the growing incidence of independent contractors in Australia. They are concerned that the independent contracts are issued to advantage companies—big surprise!—and are being used as a means of not providing employee entitlements such as superannuation, training, occupational health and safety requirements, sickness leave et cetera. These responsibilities fall to the independent contractor. The reason the government wants to do this is to make it easier and easier for employers and harder and harder for workers.

Ensuring a better definition of ‘independent contractor’ as well as defining it by common law and entrenching it in taxation assessment is essential. It should be harder for companies to offer independent contracts as an alternative to taking on employees. Because of the limited protections afforded to people who work in industries that run on independent contractors, such as truck drivers and workers in the textile and footwear industry, state governments have introduced deeming legislation to ensure that workers have protection under their state based industrial relations systems. A number of states consider that many of these workers are dependent contractors or are actually disguised employees—that is, they do not have an independent say in choosing to independently contract; it is all they are offered. In other words, they are disguised employees.

Deeming in the context of employment law involves the power to declare people who work under a contract for service, such as independent contractors, to be employees. This means that the independent contractor is then able to access the state based safeguards, ensuring that they receive basic pay and conditions which they would not otherwise be entitled to. Despite the many submissions received from the many inquiries into workplace arrangements over the years, and despite the reports available to them, the government have failed to provide the protections that independent contractors—or, more importantly, those disguised employees who are forced to become independent contractors—need. They need these provisions.

The ACTU, in their submission to the House of Representatives Standing Committee on Employment, Workplace Relations and Workforce Participation inquiry into independent contractors and labour hire arrangements, commented that non-standard work arrangements are increasingly being used to undermine the employment relationship and the protections offered. The growth of these forms of work has also contributed to the lack of skills development and has serious implications for the management of occupational health and safety. Occupational health and safety is an area of utmost importance and I believe that all Australians feel passionately about it. Independent contractors are vulnerable in this area and there should be greater mechanisms in place to protect them from workplace hazards and safety concerns.

This bill does not address the issues faced by working Australians who are forced to independently contract their labour. The bill, as I said, not only fails to adequately define ‘independent contractor’ but also does not address concerns that employers may be using contract arrangements to avoid employment obligations. As I said, it does nothing to address occupational health and safety concerns to ensure that people working under independent contracts are adequately protected, nor does it look at trying to avoid taxation liabilities. There is no provision for appropriate amounts of superannuation to be paid to independent contractors or to clarify workers compensation responsibilities.

Whilst it is good that the bill retains specific protections for owner-drivers in New South Wales and Victoria, the government has taken a selective approach to the way that it is dealing with these issues. It is good that it has moved to protect New South Wales and Victorian legislation. However, it leaves other states which may want to bring in this type of legislation—Western Australia has legislation pending, as does the ACT—out in the cold. It is not in the nation’s interests to not adequately protect a vulnerable group of workers such as owner-drivers, who are the lifeblood of transport—they transport many goods within Australia. It does not adequately protect them. It puts increasing pressure on those people. Unless the government protects others beyond New South Wales and Victoria, it takes away their right to collectively bargain. It takes away their safety provisions. It does not adequately protect these so-called independent contractors who are essentially only working for one employer. Whilst I appreciate that the government has chosen to protect owner-drivers in New South Wales and Victoria, it would be offering exactly the same level of protection to the other drivers in the other states if it were genuinely trying to ensure that those provisions are there for all owner-drivers.

In summing up, I would like to make the point, yet again, that the government has reached a new low in the way it is dealing not only with this legislation but also with the amendments to this legislation. I feel like I am in Groundhog Day. We are being forced to consider a raft of amendments dumped on our desks just before dinner—literally as we are about to walk in and debate this legislation. This is exactly what happened with the Work Choices legislation. It was dumped on our desks as we were walking into the chamber to debate that regressive legislation that has far-reaching implications for all workers in Australia. Again, a year later, we have exactly the same thing. We are being forced to consider, at very short notice—or with no notice at all—legislation that has far-reaching ramifications for the workers of Australia.