Wednesday, 21 March 2012
Fair Work Amendment (Textile, Clothing and Footwear Industry) Bill 2011 ; Second Reading
Home based workers have always been a feature of the clothing industry and I recognise some of these workers in the gallery today. Since import tariffs were reduced, beginning in 1992, Australian manufacturers have been cutting their labour costs to compete with cheap imported clothing from low-wage countries. As a result there has been a substantial increase in subcontracting to sweatshop factories and home based outworkers. While the closure or downsizing of large companies creates the impression that clothing production is moving offshore, a sizeable industry slips under the radar here in Australia, hidden and largely unregulated in small sweatshop factories and private homes.
A major issue for most home based clothing workers is their status with their employer as a contractor not a worker. It is not a technically legal status but one pushed upon them just because they work at home. It is a status used by employers to try and cheat them out of the wages and benefits that a worker in a factory would receive. Under current legislation, TCF outworkers are entitled to most of the key protections and benefits of workers in a factory—namely, payment no less than the minimum wage and hourly rate for the clothing industry, superannuation, WorkCover insurance, annual and long service leave and severance pay if they are made redundant. But even though outworkers have a legal right to these and other entitlements that does not mean they actually receive these entitlements. In fact, outworkers are usually only paid a piece rate payment—a payment equal to as little as $4 or $5 an hour—while the legal minimum wage is almost $16 an hour. This payment does not reflect their skill, their effort or their investment—just their circumstances. These circumstances are exemplified for most by being from a non-English-speaking background, by having poor English language skills, a lack of knowledge about the Australian legal system and low levels of union awareness and therefore membership. The payment of $4 or $5 an hour does not include superannuation, does not make provision for workers compensation insurance or severance pay and certainly does not reflect the casual nature of their industry. This payment might barely cover their electricity bills and their repayments on their industrial-strength sewing machine, let alone repairs to the machine if needed or any pleasures in life for them.
A sad tale is one of outworkers being gathered together and the work being auctioned off to whoever will accept the lowest payment. That is why I stand here and applaud the work of the Textile, Clothing and Footwear Union of Australia—with whom one of my staff worked in Darwin many years ago—to assist TCF workers to receive a fair day's pay for a fair day's work. The TCFUA have been there supporting outworkers in successful claims for unpaid wages and entitlements from their employers for many years. But, like all good unions, the TCFUA have also supported educational and community-building activities for outworkers such as information sessions on work rights, leadership training for outworker activists, free English language and literacy classes and a Vietnamese language radio program. The TCFUA's principal aim is to organise and educate clothing outworkers, and they have been effective in campaigning for legislative changes.
A number of inquiries have been conducted and reports published examining outwork in the TCF industry in Australia over many years. No less than five parliamentary committee inquiries have been held over the past 15 years. These inquiries go back to the Senate Economics References Committee's inquiry into outworkers in the garment industry in 1996 which found problems with payments and hours of work as well as confusion and misinformation in relation to rights and responsibilities. More recently, a report by the Brotherhood of St Laurence in 2007 found that outworkers experience poor working conditions and are frequently underpaid—sometimes as little as $2 or $3 an hour.
These reviews have found, and the government accepts, that outworkers in the TCF industry suffer from unique vulnerabilities as a result of their engagement or employment in non-business premises. As I stated earlier, these vulnerabilities are made worse by the fact that outworkers are often migrants with poor English language skills, a lack of knowledge about the Australian legal system and low levels of union awareness and therefore membership to support them. Currently, the Fair Work Act contains a number of important protections for TCF outworkers, including scope for awards to include targeted outworker terms and enhanced right of entry arrangements. There are additional entitlements and protections for outworkers contained in the Textile, Clothing, Footwear and Associated Industries Award.
Further, most states have legislation that provides protection for TCF workers. However, there are differences in the approaches that they take. For example, in New South Wales, Queensland and my home state of Tasmania legislation deems contract outworkers to be employees, while more limiting deeming applies in Victoria and South Australia. There is provision for the recovery of unpaid amounts up the supply chain in most states but not all states. There is a mandatory code of practice in place in New South Wales, Queensland and South Australia and there is no relevant legislation in Western Australia. In other words, most jurisdictions have recognised that special measures for outworkers are required but there has not been a uniform approach, meaning that outworkers do not have the same level of protection in all jurisdictions. Where outworkers are entitled to fair minimum conditions they can have difficulty accessing them. Even the Fair Work Ombudsman faces difficulties in identifying and assisting outworkers because outwork is, by definition, not performed in traditional workplaces and it can be difficult to identify for whom work is being performed.
The ongoing vulnerability of outworkers in the TCF industry, along with the lack of a consistent approach across the country, has led the Gillard government to conclude that federal legislation is necessary to ensure equitable and consistent protection for all these workers. These changes will promote fairness and ensure a consistent approach to workplace entitlements and protections for a class of workers that is widely recognised as being uniquely vulnerable to exploitation.
Of course, it is today the view of those opposite—as it was when they were in government—that it is too hard, that government is unable to do any more than stand by and hope that the TCF industry will voluntarily improve working conditions for outworkers. This is just not good enough. I know I am here because I believe in a fair go for all Australians. The track record of those opposite is that, together with voting against this important reform today, in 2006 they implemented measures worth hundreds of millions of dollars to support the TCF industry but did not see the need to include any specific measures to address the challenges faced by outworkers.
In comparison, the Gillard Labor government is again getting the balance right. We are assisting both the industry and its most vulnerable workers. Yesterday the Minister Assisting for Industry and Innovation, Minister Lundy, announced that businesses in the textile, clothing and footwear industry can partner dollar for dollar with the Gillard government and apply for a grant of $250,000 or more to support manufacturers who have a vision for their industry based on smart ideas, strategic thinking and technical excellence.
The measures in this bill will go some way to fixing the problems outlined before. It will extend the operations of most provisions of the Fair Work Act to contract outworkers in the TCF industry so that they are recognised as employees and not—unfairly—as contractors. The bill will provide a mechanism to enable outworkers to recover unpaid amounts up the supply chain if they go unpaid by the person responsible for paying them, because everyone deserves a fair day's pay for a fair day's work. The bill will enhance right of entry rules for the TCF industry to allow a permit holder to better target sweatshops. This ends the current limitation that exists in relation to right of entry into conventional business premises in the TCF industry operating under sweatshop conditions—another protection for these vulnerable workers. Further, the bill will extend outworker-specific right of entry rules to all premises in the TCF industry, to enhance protection for employees working under sweatshop conditions. There will be an exception for the principal place of business of a person with appropriate accreditation. In such cases, the standard right of entry rules will continue to apply. This means that permit holders will now be able to enter sweatshops to check relevant documents before businesses can be closed and moved to another location to avoid scrutiny.
A TCF outwork code will be issued to deal with standards of conduct and practice to be complied with by parties in the supply chain—holding all parties to account for their actions. The existing power of Fair Work Australia to include outworker terms in awards will not be limited. Additional protection for outworker terms will be provided by ensuring that these important industry-wide standards cannot be undercut by use of flexibility terms in enterprise agreements. This is a true Labor reform, helping the most vulnerable in our community access a fair day's pay for a fair day's work. I commend the bill to the Senate.