Wednesday, 6 September 2017
Education and Employment References Committee; Report
I present the report of the Education and Employment References Committee on corporate avoidance of the Fair Work Act 2009 together with the Hansard record of proceedings and documents presented to the committee.
Ordered that the report be printed.
That the Senate take note of the report.
I just want to make a few very brief comments. It was a really eye-opening inquiry for this committee. It was generated because of a number of high-profile disputes which seemed to undermine the objectives of the Fair Work Act. The committee started on a task of looking at the behaviour of corporations and other employers and ascertaining whether or not the Fair Work Act was, in fact, fit for purpose. What we know at the moment—and some figures from the ABS have just come out today again confirming this—is that the profit share of GDP is increasing at the same time as the wages share of GDP is going backwards. As well as that share going backwards, wages themselves are in decline and, in real terms, are going backwards. We've got agreement making in decline and award reliance increasing. At the same time, we've got union membership decreasing and noncompliance with the Fair Work Act increasing.
All the evidence points to a system that is underpinned by an act which is now not delivering for working people in this country. The act is not offering protections for working people. The inquiry uncovered, quite frankly, corporate indifference to the plight and the welfare of employees of major corporations. We saw so many examples of large multinational, wealthy, high-profit-making corporations simply structuring their businesses in such a way to reduce wages, reduce job security and reduce conditions, all in order to save money for the company but with total disregard for the welfare of the people who, in some cases, had provided 30 to 40 years of service to those companies. Workers were put in positions where, through no fault of their own, contracts were re-let to different companies and they were simply replaced and discarded, all in the name of a number of companies thinking, 'If we can pay people the lowest legal minimum wage that we can, that seems to be our obligation.'
That is not what the Fair Work Act was meant to achieve. The Fair Work Act was meant to provide a basis of fair opportunities for employers and employees to encourage them to agree and to take advantage of productivity improvements—which, by the way, are at an all-time high in this country. But, instead, it's enabling employers to actually undertake a race to the bottom. It is clearly the conclusion of the committee that the Fair Work Act is no longer fit for purpose and providing those protections that we set out to try to achieve when the Fair Work Act replaced the failed Work Choices experiment.
The committee has made a number of recommendations, but I have to say that implementing those recommendations probably ultimately won't be enough. I think the committee would have been of the view that this inquiry could have gone on for a lot longer. We would have identified many more problems, and we may have been in a position—and still may be, into the future—of making many more detailed and specific recommendations of changes to the act. But at this point, we have made some recommendations. We would urge all policymakers to look at those and consider their implementation.
It is my view and I think the view of the majority of the committee that the Fair Work Act itself needs to be revamped and rewritten from the ground up, to make it a system that underpins fairness in the system. That fairness is no longer there. It cannot be relied upon. It is not providing that structural framework to benefit working people in this country, to offer them protections. Unfortunately, we all too often see, when those protections aren't there for working people, that corporations—not all of them but many—take advantage of those loopholes, those structural deficiencies, and simply seek to cut wages and conditions and job security of working people in this country.
We would urge everyone to start thinking about what needs to replace the Fair Work Act. It's been in place since 2008. We have come a long way. It has served a purpose in the past but if we are going to move forward as a wealthy, high-wage-earning country with good protections, where working people aren't working poor, we need to revamp the underpinning structures of the industrial relations system. I commend the report to the Senate and, if no-one else wishes to speak to it, I will seek leave to continue my remarks later.
Leave granted; Debate adjourned.