Wednesday, 21 March 2012
Fair Work Amendment (Textile, Clothing and Footwear Industry) Bill 2011 ; Second Reading
Australia's fashion and clothing manufacturing sector is doing it tough. Be it the enterprises or the workers and contractors engaged in that sector, they are doing it tough. But this bill, the so-called Fair Work Amendment (Textile, Clothing and Footwear Industry) Bill 2011 , which we are debating, will make this tough situation even worse for the 8,600 enterprises and 22,000 workers engaged in the sector.
Regrettably, the Senate committee inquiry into this bill was cut short—as is this debate today—courtesy of the Greens-ALP alliance majority in the Senate, ruthlessly and recklessly using their numbers to avoid scrutiny. The chief industry body in relation to this sector was denied a hearing by the committee because the hearing was so truncated courtesy of the Greens-ALP majority. But you got it right: the union got a hearing, as it should have done, so I have no criticism of that. I will turn to the union later. But the industry body that deals specifically with textiles, clothing and footwear was denied a hearing. This is now just another example in a very long list of the Greens-ALP majority in this place deliberately truncating Senate inquiries and debates on bills to ensure that they are not put under the sort of scrutiny that the Australian people expect of us. The reason the Greens-ALP majority do not want this scrutiny is that they know their legislation is only designed to enhance trade union bosses' powers rather than enhancing the economic wellbeing of our nation or enhancing the benefits to individual workers and enterprises.
Let us be clear: there has been exploitation in this sector. That is why the coalition always had special protections in our legislation for outworkers. I pay tribute to former senator Judith Troeth, from my side, who as a distinguished former chair of the Senate Standing Committee on Education, Employment and Workplace Relations ensured that we got the balance right. I regrettably was unable to sit in on the Senate hearing, and no wonder because, if you blinked, you would have missed it—it was that short. As a result of my inability to attend, I did avail myself of a briefing by the TCF Union and I congratulate Ms O'Neill and her colleagues from the union on giving me a well-presented and professional briefing. They did their membership proud. However, we do disagree on the best way forward.
One of the things that have always struck me about the TCF sector and those that are exploited in it is that those who are vulnerable are those who do not have English language skills. That is why I repeat, as I do on a regular basis, the importance of government in ensuring that new entrants to this country are properly supported with language skills. Having proper English language skills is the fundamental ticket to ride to social justice, to social integration and to personal empowerment. If you cannot read a bus timetable, you cannot get around. If you do not know what the product labels tell you, you do not know what you are buying. If you cannot read the language, you do not know what the award entitles you to. As a result, English is a very fundamental prerequisite for our fellow Australians, albeit new arrivals, to be able to actively and equitably engage within our community.
The sad fact is that these people with poor language skills are often exploited by their former fellow countrymen, and that is also a matter of great regret. They seem to do a disservice to people from countries that they themselves came from. I say that as an aside in this debate, because it is vital to recognise that those who are exploited are often those who have very poor language skills. To those who say that we should be celebrating multiculturalism and those things, I say simply: don't forget the vital need to encourage people to learn the English language, because without it they cannot engage in Australian society.
Having accepted and acknowledged that there is exploitation in the sector does not mean that you therefore have to treat every single person in that sector on the same basis and force everybody into an employer-employee relationship. Indeed, in doing so we will do a huge disservice to the young, the vibrant and the innovative. I will talk about that later.
In the meantime, let us have a look at the government's justification for this bill. The government's justification, as presented by the then minister, Senator Chris Evans, was based on a reference to a 2007 report by the Brotherhood of St Laurence and a 1996 Senate Economics References Committee inquiry. It is interesting to note that it is both those reports, from which the Labor Party must have finally wiped the dust, which have motivated them, but both those reports were there before the Fair Work Bill was presented to this parliament and passed. The government knew about these reports. The government knew about the assertions made in those reports and the government deliberately dismissed the matters in those reports as they drafted and enacted the Fair Work Bill.
So one has to ask: why is it that these two reports have bubbled to the surface? Indeed, a number of people who I understand assisted in negotiating the Fair Work Act—indeed, Ms Gillard told us that she negotiated the Fair Work Act—got the balance right. In getting the balance right, from time to time you have to dismiss the assertion of certain trade union bosses—that comes with the territory. That is what Labor did to get the sign-on of certain businesspeople.
Having got the legislation through with the sign-on of certain businesspeople, what do Labor do? They have that locked away; they then move the amendments which they were not prepared to put into the original bill. Talk about a sell-out; talk about deception; talk about the Labor government, because that is the hallmark of the Labor government. They say one thing and do another straight after the event, be it the carbon tax, be it private health insurance, be it the definition of 'marriage' or be it the treatment of textile, clothing and footwear workers in the workplace relations regime of this country. They do a deal, they sign it off with somebody, they say, 'This is a great balance; well done,' they get that locked away and then, with a Greens-ALP majority in this place, they force through this legislation in breach of that which has previously been agreed, relying on reports that were in existence at the time and were deliberately dismissed. No wonder the government want a truncated debate. No wonder the government wanted a very truncated Senate committee inquiry into this bill, because they would have been embarrassed in trying to justify why these two reports, which allegedly underpin this legislation, all of a sudden have become so important.
They also need to justify the 12 amendments which were put into the Senate late yesterday. They were not part of the Senate inquiry or any of the analysis but they are now part of this truncated debate. Clearly we will not have time for any proper committee stage, if we are lucky enough to have a committee stage. We will not get explanations as to why we have these last-minute amendments. Exactly the same approach was taken by Mr Shorten, the Minister for Employment and Workplace Relations, in relation to the Office of the Australian Building and Construction Commissioner legislation. Make sure the Senate inquiry is finished, make sure you have a truncated debate in the Senate and then whack in the amendments, which are far-reaching and devastating, to ensure there is no proper public analysis of the government's changes.
This government is abusing the parliamentary process because it can gain a majority in this place courtesy of the Australian Greens, who, under the Howard government, were the champions of every single clause of every single bill, which had to be analysed for every comma and full stop. It is not so now under the Greens-ALP alliance. They want everything swept through without any consideration and it happens not only in this place.
Remember the so-called 'new paradigm' we were going to experience when Ms Gillard signed up the country Independents, Mr Windsor and Mr Oakeshott? What a disgraceful turnout that has been. They are complicit in this as well. Never once have we heard them complain that the government is guillotining legislation through the Senate, that the government and the Greens are disallowing proper analysis of bills. We were promised all this under the new paradigm. There was going to be new transparency, greater accountability. All of that has been thrown out the window by this government with the complicity of those so-called country Independents.
I said earlier in my contribution that this bill will stifle the young, the innovative and the entrepreneur. Allow me to read a letter I received recently:
I am an emerging Australian Fashion Designer starting a label from home. I would like to draw your attention to the Fair Work Act and the Textile, Clothing, Footwear and Associated Industries 2010 (the TCFAI Award) Modern Award regime which defines me as an outworker, despite my 4 year degree in fashion from Ultimo TAFE. The current TCFAI Modern Award definition has a "catch all" definition where anyone working from home in the fashion industry is an OUTWORKER … yes, I can be considered an OUTWORKER if I sell to a boutique or department store, because of the deeming provisions of the award. Most graduating & emerging Australian Fashion Designers starting out, establish a trading relationship with a fashion boutiques on “indent”. In the eyes of the law, MA000017- Schedule F that would mean boutique owners are required to pay me as an employee, including all benefits and entitlements under the National Employment Standards and unfair dismissal laws. This is unfair and an unworkable regime that disadvantages me and other graduating & emerging Australian Fashion Designers, and is making it very difficult starting up a new business, as no boutique owner will agree to employ me, and I don’t want to be employed by them either.
Beyond that as a fashion student/designer, if I hand out work to a “maker/outworker” to sample a design I am obligated by law to employ them with full benefits and entitlements, and that is against the law for me to employ them casually. Further I am aware that in the final form of the Fair Work Amendment (Textile, Clothing and Footwear Industry) Bill 2011 (the Bill) currently before parliament, deems all outworkers to be employees for most purposes of the Fair Work Act 2009 (Clth) (the FW Act) including the National Employment Standards, Superannuation and unfair dismissal laws. As a start-up business, in the beginning it will be challenging to pay myself, never mind employ a ‘maker/outworker’ on a regular basis, and pay all these entitlements. Again this is unworkable and in trading in such an environment, I face prosecution in breach of the TCFAI Modern Award 2010. The risks are too great.
I would like you and your government to consider this letter and make the necessary changes to allow me and other graduating & emerging Australian Fashion Designers making samples and small orders (with business turning over less than $100,000 per year) to apply for exemption to this onerous and impractical regime, as part of the Modern Awards Review 2012.
There you have it: a young, innovative individual who will be stifled. Is this really what we want for our modern economy in the 21st century, that the young and the innovative are so stifled that they cannot do that which they want to do? We have heard it firsthand and it makes sense. That is what happens when you try the one size fits all. But we know this government has a severe dislike for independent contractors. They see independent contractors as potential union members and employees. As we have seen from the Health Services Union, we know how some of the union bosses behave with union members' moneys.
Back to the issue at hand. We also have from designers and makers in Australia their very real concern. One such letter I got says:
I am writing to you today in great distress … We have developed this brand over the last two years with the soul of the brand being an Australian made product.
… … …
Over our journey so far we have met many wonderful people in the fashion industry. From designers to stylists, to garment makers we have a wonderful and colourful collection of talent here in the fashion industry in Australia. By introducing changes to the Fair Work Act that doesn’t allow the fashion industry to employ the use of outworkers in the production of garments you will be forcibly restricting the amount of garments that can be produced in Australia. Not only by the way manufacturing companies will be forced to employ but also by the increase in production costs that will result from this. Making an already expensive process even further out of reach for the average Australian.
We … are proud australians and who have seen over our generation many great brands including iconic Victorian names such as Rip Curl and Quiksilver send all there production off shore and even more recently Pacific Brands was forced to do the same in a whole other manner.
The plea in this letter is:
… I implore you to severely look at any changes you make that would effect a great industry that is trying to put the "Aussie" back in "Aussie made!!!
This bill will stop putting Aussie back into Aussie made. This bill will unfortunately adversely impact the 8,600 enterprises and the 22,000 workers in the textile sector. It is a matter of regret that this legislation is in breach of the deal that was struck when the Fair Work Act was originally implemented. Whilst it disappoints it does not surprise, because we know that this is a government whose word cannot be trusted in any area of endeavour that it engages in. Having said that, the coalition does believe there is a better way forward in looking after the needs of exploited workers, and we have put that on the record in the past.
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.
I rise to speak on the Fair Work Amendment (Textile, Clothing and Footwear Industry Bill) 2011 . It would be a furphy for those on the other side to say that the coalition does not support provisions and protections for those in the clothing, textile and footwear industry. When in government, the coalition was faced with some very compelling evidence of endemic and inappropriate conduct in workplaces in this industry. We acknowledged that protections were needed for people in this industry. And, faced with this evidence of the need for additional protections in the textile, clothing and footwear industry, we took the appropriate legislative action. The coalition, throughout its time in government, maintained protections for outworkers in the textile, clothing and footwear industry in the various iterations of workplace relations legislation between 1996 and 2007. It was on this same basis that the coalition implemented workplace legislation specific to the building and construction industry. Again, we recognised that specific protections were needed for people within a certain industry. And, in considering the need for the bill before us today, the coalition notes, as has been put forward by those speaking on the government side, that there continue to be specific provisions in the Fair Work Act to protect outworkers, as there should be, as well as varying equivalent provisions in state and territory legislation.
The question that the chamber needs to ask itself is this: why are we faced this week with yet another bill that seeks to change the industrial relations landscape in this country, given in particular that no commitment was taken to the previous federal election by the government in relation to introducing amendments dealing with industrial relations? I do qualify that comment by saying that commitments in the Labor government do not mean a lot; they promise one thing before the election and as soon as they are elected they do an entirely different thing. In relation to industrial relations commitments, one would think that, given the fact that we are this week debating a number of bills that are all of an industrial relations nature, the government may have flagged with the people of Australia that when they were elected they did intend to make changes to the industrial relations landscape. They did not do that.
But the answer, when it comes to commitments from the Labor Party, is quite simple. It would appear, based on everything that we have heard to date, that yet again, as with the abolition of the ABCC, the government's motivation for this amendment is more about giving something to its friends in the union movement in the lead-up to the next federal election. The government's modus operandi has been, since its election, to ensure that it appeases the unions, and for a very good reason—because it needs to do something to offset the acute pain employees will feel and are feeling as a result of the passing of the carbon tax legislation. The unions have for some time now made it very clear that they are not happy with this government and the impact the carbon tax legislation will have on their employees—pain that has been deliberately inflicted on them by their own Labor government.
These very real concerns in relation to the impact of the carbon tax have been exacerbated in light of a new study, produced by the Energy Users Association of Australia, which has found that that Australia's electricity prices are very near to the highest in the developed world and seemingly set to actually become the highest. The study found that electricity prices in Australia have risen by 40 per cent in real terms since 2007. And the reality for Australians and for all the unions and for the employees within the union movement is that from the 1 July, in 101 days, Australian households and businesses will pay the world's biggest carbon tax, which will increase electricity prices by more than 10 per cent in the first year alone. In subsequent years prices will go up and up.
Hence the bill we have before us today. The unions know that this is the worst time in history to introduce a carbon tax. It is also the worst place in the world to introduce a carbon tax that will see electricity prices that are already at global record highs go even further. This bill represents a very small gesture by the Gillard Labor government to appease the very real fears the unions have for employees because of actions taken by the Labor government.
One of the interesting facets of this debate is that the government's justification for the protections that are required for this industry is at odds with its justification for the abolition of the Australian building and construction commission. One of the government's core arguments in support of the abolition of the ABCC was that the ABCC discriminated against certain workers and that the industrial relations regime in this country should take a one-size-fits-all approach. That was the government's justification—which was actually elucidated yesterday in this place—for the abolition of the ABCC. The government said that the industrial relations landscape in this country should take a one-size-fits-all approach. But, a mere 24 hours later, the government comes into this place with another bill, a bill that is intended to change the industrial relations regime in this country, and the reasons that it puts forward for supporting this bill are in complete contradiction to the reasons it gave for the abolition of the ABCC. The government is saying that we have to pass the bill before the Senate because a one-size-fits-all approach to the industrial relations regime does not work.
One of the other issues of concern to the coalition in examining the justification for this bill is that the government continues to suggest that the measures proposed by this legislation are required because, as set out in the committee report on the bill, government members were struck by comments made by a deputy president of the Australian Conciliation and Arbitration Commission that related to the remuneration and treatment of outworkers. I too was struck by those comments. But the comments were made in 1987, some 25 years ago. Over the last 25 years appropriate changes have been made in legislation to ensure that workers in this industry are afforded the protections that they need. If they had not been made, those on that side of the chamber, quite frankly, are to blame. I would suggest that the government's comments, therefore, are a little disingenuous, to say the least.
An additional justification for this bill, as proposed in 2011 by the then Minister Chris Evans, was based on a reference to a 2007 report by the Brotherhood of St Laurence and a 1996 report of a Senate Economics References Committee inquiry. The government knows that both of these reports were completed prior to the passage of the Fair Work Bill. Therein lies a problem for the government, because if these reports constitute such a strong case for the bill that we have before us today, why has it taken the government so long to act? Why is it that on 21 March 2012, we are suddenly debating this legislation? If the government's concerns are so real, why didn't it address those concerns as soon as it had the first legislative opportunity to do so? That was, namely, the introduction and the subsequent passage of the Fair Work Bill.
In relation to the bill before us, the Australian Chamber of Commerce and Industry, in its submission to the Senate Standing Committee on Education, Employment and Workplace Relations, has also expressed concerns about the evidence supporting this legislation. It said:
Apart from references in the Minister’s second reading speech to a November 2011 Channel 9 story in a Melbourne TCF “sweatshop” and a July 2011 Sunday Herald Sun report on “sweatshops and outworkers producing school uniforms for Victorian families for as little as $7 an hour”, there are no examples provided in the extraneous materials as to the precise deficiencies of the existing legal framework, what recommendations these proposals are based on (such as from the Productivity Commission or a dedicated independent inquiry by the Federal Government) and how the proposed measures will reduce possible exploitation of workers in the TCF industry.
There is no evidence that actually supports that these measures will reduce exploitation.
Then we have the evidence of the Council of Textile and Fashion Industries of Australia, who expressed similar concerns:
The arguments for introducing the legislation are based on research conducted nearly 5 years ago not current evidence and fail to acknowledge the gains made in the 10 years of existing legislation and the 4 years of investment by the Federal Government in Ethical Clothing Australia.
Indeed, in support of those concerns are statements made by the current Prime Minister when she was the Minister for Education and the Minister for Employment and Workplace Relations. Ms Gillard said at the time: 'I believe the fair work system is right. We worked hard to get the balance right and I believe that the Fair Work Act is right.' During the passage of the Fair Work legislation, when confronted with all of this evidence, Ms Gillard said, 'I believe that the Fair Work Act is right.'
There appears to be a problem with that statement because if there is, as we are now told by the government, such a strong case for change in the industrial relations landscape in this country, then clearly the balance was not right when now Prime Minister Julia Gillard made that statement. In fact, the very nature of this bill and the comments that Ms Gillard made to workers in this country, in particular to workers in this industry, actually shows that the government had not got the balance right.
Despite everything the government said at the time, that they were going in to bat for the workers and that they were making these fundamental changes to the industrial relations landscape in the country, and despite the Labor Party going on record as saying to the people of Australia, 'We got the balance right,' the mere fact that we are in here today debating this legislation shows that that was yet another Labor Party lie. They deliberately misled some of the most vulnerable people in Australia; hence the bill we have before us today. But, as with so much of the legislation that is currently being debated or, should I say, not being debated because, as we all know, we are not getting the opportunity to properly investigate this legislation by way of a proper committee process, we are also subject to the unholy alliance of the Labor Party and the Greens, which will, at 12 o'clock today, guillotine debate on what is acknowledged to be a very important piece of legislation.
We suspect that the government's motivation for this amending legislation is more about cleaning up a very big mess that it has made in passing the carbon tax and the economic pain that the government knows is currently being felt by those who are most vulnerable in this country. What is worse is that that pain will be further exacerbated on 1 July, when the carbon tax legislation commences.
If the government were dinkum about giving further protections to people within this industry, they would wait for the outcome of the Fair Work Act, the debate of which is currently underway. This is an industrial relations bill. The provisions of this bill should be considered as part of a total review of the Fair Work Act, along with any other changes proposed in any final and publicly available report resulting from that review.
The Bills Digestfor this bill sets out concerns of the major interest groups about this legislation. As set out in the Bills Digest:
The National Retailers Association … states that there has been no consultation with industry about the changes included in the proposed legislation and has criticised the timing of the Bill's release which coincided with the peak trading season for retailers, inhibiting the ability for the organisation to consult with its members.
And remember that this government was all about consultation—but consultation on its own terms, not consultation where you have a major industry group, faced with a major change of legislation, not being given the opportunity to actually consult with the industry.
Then there are the comments of Heather Ridout, Chief Executive of the Australian Industry Group, who voiced employer concerns about the bill. In November 2011, Ms Ridout commented in a National Press Club address that the bill:
… will add another 30 pages to the Fair Work Act to increase union entry rights and protections for workers in the Textile Clothing and Footwear industry.
Ms Ridout listed a raft of government measures, such as the Road Safety Regulation Tribunal Bill 2011, funding award wage increases for social and community workers et cetera, including the bill to abolish the Australian building and construction commission, as evidence that this bill is indicative of the government not acting in the national interest, not acting in the interests of workers but agreeing to an extraordinary series of union claims. This is what Ms Ridout said.
The (TCF) Bill implements longstanding TCFUA claims which were opposed by Ai Group and other employer groups when the Fair Work Act was being developed and rejected by the Government at that time.
In relation to the legislation before us today we are presented with a government that told the people of Australia that it had got the balance right when it passed the Fair Work Act. The mere fact that we are debating the legislation today clearly shows that that was a lie.
We have a government that has failed to identify and present sufficient evidence that the measures contained in this legislation are justified. We have a government that has failed to justify the need for this legislation, based on the consistency of its approach to other legislation, namely, the abolition of the Australian building and construction commission. We are faced with a government that is yet again delivering a suite of measures that are designed to appease the union movement in the light of the devastating impact of Labor's toxic carbon tax on the most vulnerable people in Australia.
I am pleased to support the Fair Work Amendment (Textile, Clothing and Footwear Industry) Bill 2011 , which amends the Fair Work Act to deliver greater fairness, justice and safety for one of the most vulnerable groups, if not the most vulnerable group, of workers in our country—outworkers in the textile, clothing and footwear industry. This industry has undergone significant structural change in Australia over recent decades. As with many other industries in the manufacturing sector, changes to our systems of tariffs and industry support have seen the makeup, scale and nature of the TCF industry change substantially.
One of the most striking elements of the textile, clothing and footwear industry today is the huge proportion of outworkers—that is, people who perform work from their homes on a contract basis for suppliers in a supply chain. Outworkers within this industry are effectively employees who are engaged to work from home. Often they are migrants from non-English-speaking backgrounds, and some of them unfortunately have very poor communication skills. Sadly, as a result of that, they often have very little concept of their rights or a knowledge of the Australian industrial relations and legal systems. A large proportion of these workers are women from South-East Asia and are essentially exploited for the gain of fashion houses and retail outlets that require cheap and easy labour for their production lines. These workers are often paid much less than the relevant award rate—sometimes $3 to $5 an hour.
Outworkers typically receive no superannuation, annual leave or workers compensation, and usually have to pay for their own machinery, tools and sewing supplies. Some of these workers have openly told their stories as part of the Fair Wear campaign. They have bravely put their case for reform in this industry through a campaign which seeks to end Australian sweatshops and assist workers in the clothing industry secure a living wage. Take Dung, for example, who says:
I migrated to Australia in 1999, and I live in Sydney. In Vietnam, I was a garment factory worker.
I started sewing from home a few months after I arrived in Australia. At first, I was making only parts of a garment. I was paid per piece. I was earning – roughly, an average of $6 an hour. I had to work very long hours and had very little sleep.
Then there is the story of Ms Nguyen, who says:
I came to Australia in the early 1980s as a refugee from the Vietnam War. At the time I had two young children and had another one on the way. We were very poor. We would often eat rice mixed with tea and dried fish. We slept on old mattresses that were found on the side of the road. Life was tough.
My partner and I soon invested in an industrial sewing machine so I could start sewing from home.
Back then if you worked in the factory you could earn about $5 an hour cash-in-hand. Working from home, payment was calculated per garment and you could earn about $3-5 per garment.
Unfortunately, in this day and age in Australia, some of these situations persist, with circumstances such as these still occurring in the textile, clothing and footwear industry. Surely these stories have no place in a modern Australia.
The Fair Work Act currently allows for special provisions relating to outworkers, allowing specific terms to be included in the Textile, Clothing, Footwear and Associated Industries Award. Most states have legislation that provides for TCF outworkers. However, unfortunately there is an inconsistent approach across the states. For example, in my home state of New South Wales we have specific legislation which means that outworkers are regarded as employees, while Victoria takes a more limited approach. Queensland also deems outworkers to be employees, while Western Australia has no legislation relating to outworkers. This bill provides for a uniform approach at a national level. It ensures that outworker provisions contained in the TCF award are enshrined in law to guarantee fairness and ensure consistency across jurisdictions.
This bill means that the provisions of the Fair Work Act will apply to all outworkers as if they were employees in a regular workplace anywhere in Australia. This will mean that outworkers will have the same rights and entitlements as workers who are engaged directly. Outworkers will be treated as an employee of the person or firm who directly engages them. Simply put, being an outworker does not mean you should be at a disadvantage in this industry; you should have the same rights and entitlements as ordinary employees throughout Australia.
This bill will provide a mechanism to ensure that those rights are protected and to ensure that outworkers can recover unpaid amounts up the supply chain when breaches occur. This means that outworkers who are owed money can recover payment from the firm or person who directly engaged them. Where an indirect entity pays an unpaid amount, they will be able to recover the payment from the person who was responsible up the supply chain. For an outworker in the TCF industry this means that wages, commissions and superannuation are protected and are unquestionable rights, no matter where they work.
The amendments in the bill allow for the creation of an outwork code of practice to be issued that deals with standards and conduct in the TCF industry. The code may impose reporting or other requirements on employers to ensure transparency in supply chains and make arrangements for the monitoring of the supply chain. The bill also seeks to extend the Fair Work Act's right of entry provisions into outworker arrangements and into exploitative segments of the industry, such as sweatshops. The amendments within the bill will mean that the 24-hour notice period that normally applies to right of entry into workplaces will not apply to sweatshops. There is good reason for that. The evidence that was presented to the Senate inquiry and many other inquires into this bill is that, once an official of the Textile, Clothing and Footwear Union of Australia identifies a sweatshop and gives the required notice under the Fair Work Act, it is not uncommon for that sweatshop to disappear overnight, particularly when we are talking about circumstances where these facilities are set up in someone's garage. Under amendments contained in the bill, the problem should not persist, creating a new level of fairness and equity in this industry. This provision will mean that sweatshops can be located and that rights can be enforced but, importantly, also explained to workers in these exploitative situations. Unfortunately, those opposite are opposing these provisions—and I do take issue with the claim made by Senator Cash that there is no connection between these provisions and improving the rights of outworkers in this country. I take heart in the fact that those opposite do recognise that there is a significant issue in Australia at this point in time in terms of the working conditions of outworkers. They recognise that there is a level of exploitation in this industry. However, they are wrong when they say that there is no connection between the implementation of these provisions and improving the conditions, working rights and safety of workers in these industries.
The Textile, Clothing and Footwear Union of Australia have, over decades, conducted studies and investigations into the effect of these laws, and the evidence is irrefutable that, when workers have protections and can make claims up the supply chain, the rights, entitlements and safety of workers in these industries are improved. One need look no further than New South Wales to see the evidence of that claim. I think it is instructive that Senator Cash was the one making these allegations, because the one state in Australia where provisions that protect outworkers such as these do not exist is Western Australia—which, of course, is the state from which Senator Cash hails.
I can say to the Senate that in New South Wales these provisions have made a big difference to the lives and working interests of workers in the textile, clothing and footwear industry. And these provisions have been in place since the 1990s. These are not revolutionary reforms. These are not new provisions. These are not unwarranted amendments to the Fair Work Act—as those opposite claim. They are basic protections that all workers in Australia should have the right to enjoy.
I want to close with some remarks from Anna. Anna was a child of parents working as outworkers while she was growing up. She says:
In order to make enough money to keep up with rent, my family started taking sewing work home. We had two home machines, so often my father and mother would sew until after midnight each weekday, and all day on the weekend, while I would cut the threads between the fabricated pieces. We would break for meals, sleep, school and work. This was our daily home life. I was twelve years old.
No child should have to be brought up in those circumstances in modern Australia. I am a big believer in free markets, but I am not a believer in free markets where they produce unjust, unfair and unsafe outcomes. What we have currently in the textile, clothing and footwear industry is exactly that: unjust, unfair and unsafe outcomes.
On that basis, we as legislators and leaders of this country have an obligation to regulate this industry to ensure that those unsafe, unjust and unfair work practices are eliminated from this industry and from this country. We go about our daily lives and sometimes we are often wearing the clothes produced by people who have been exploited in Australia. The time has come for that exploitation to end.
I congratulate the Textile, Clothing and Footwear Union and all concerned with the Fair Wear campaign and for their decades of hard work and advocacy on behalf of one of the most vulnerable groups within society. Their hard work and their efforts are commendable—and hopefully in a few hours time that work will be justified and the bill will pass the Senate. I commend the bill to the Senate.
Members opposite say that they were struck by the comments of a then deputy president of the Conciliation and Arbitration Commission, which was essentially Fair Work Australia in one of its former guises. They say that they were struck by the comments made some 25 years ago by the deputy president of that body. They were struck by those comments about the state of conditions and pay for workers in the textile and clothing industry. And they are so struck, that somehow that is now a basis for this bill, the Fair Work Amendment (Textile, Clothing and Footwear Industry) Bill 2011, which is presented to the parliament after a very much-truncated Senate committee inquiry, allowed less than one day, where particular witnesses who wanted to appear before that committee were denied the opportunity to do so by the Labor dominated committee. In particular I am talking, for example, about the Council of Textile and Fashion Industries of Australia. So members opposite are struck by the comments of a learned person made some 25 years ago and for that reason we are presented with a bill which is subject to inadequate inquiry, which is not going to be able to go to committee in the inadequate time that we have before the chamber today and for which there is zero mandate.
It has all happened so quickly that I forget which bill Senator Thistlethwaite was speaking about, but I think it was the building and construction industry bill. In that speech he placed much importance on the mandate that he claimed the government had for the building and construction industry bill. Funny that he was conspicuous by his silence as to the mandate that the government has for this bill—because, of course, it does not have one. If it was so compelling, why did the government not say that it would be changing the protections that already existed, which were put in place by the Howard government in the late 1990s to protect textile and clothing industry workers? If they wanted to say they had a mandate, why didn't they promise something then?
The Howard government and the coalition have long recognised that there is exploitation in this industry and have tried to do something about it. There has been some criticism of the adequacy of those provisions, but the trouble with the government's bill is that we are struck by the lack of evidence that it will work. I note the presence in the gallery today of Ms O'Neil and her colleagues. I do want to pay tribute to the tireless work that she and others have done to help workers in this industry. I do not for one minute want to take away from the good intentions of the union and Ms O'Neil, and I am not trying to be condescending in saying that. This bill will pass. I hope that it will do what the government says it will do. I fervently hope that it will, because some of the evidence with which the committee was presented at its recent hearing is heartbreaking. And it is heartbreaking to think that those sorts of experiences continue to occur despite the length of time for which there have been provisions in the federal laws and also in state laws. It is absolutely heartbreaking.
Senator Thistlethwaite said that workers in this industry are more often than not immigrants, that they have poor English skills and that they have little concept of their rights. I would suggest that unfortunately they also have little concept of what this bill is about in its detail and whether or not it will actually help them. I do not want to be condescending and I do not want it to be taken that I am trying to take away from the very good efforts and the very good campaign that was being run long before I came to this place. My problem is that I am not convinced that this bill will do the job that the government is telling everybody—including the very vulnerable workers in this industry—that it will do. I think this is a snatch-and-grab job by the government, a kitchen-sink job. Throw anything at it to see if it will fix the problem, because nothing else has worked. If the government really has the confidence that this bill would work, why is the government not allowing the bill the proper scrutiny that this chamber would normally give—particularly when the government did not say, prior to any of the recent elections, that it intended to do this?
In the lead-up to the last two elections, this government talked about abolishing the Australian Building and Construction Commission on the basis that it discriminates against one set of workers and because there should be one set of workplace relations laws for all. The coalition has always acknowledged that where there is compelling evidence of ongoing and systemic issues in any industry then we are prepared to consider industry-specific legislation for those industries. Take, for example, exhibit A: the special provisions attached to the then Workplace Relations Act about the textile and clothing industries; and exhibit B, the Australian Building and Construction Commission. But not this government. This government, up until now, has said, 'The ABCC discriminates. There ought to be one set of laws for all.' To find evidence of that you do not need to look much further than the comments of government members when talking about the need to abolish the ABCC. Mr Neumann said in the House of Representatives on 13 August 2009:
The truth is that the Cole Royal Commission into the Building and Construction Industry was … to ensure that the salary and conditions of those hardworking men and women in the building and construction industry would find themselves subject to a different rule of law than any other worker in any other industry.
There are no qualifications on that from Mr Neumann and no qualifications on that from any other member of the government, and the comments were of course echoed by the cheer squad for the government, the ACTU, on 28 September 2010 when talking about the Building and Construction Commission: 'There should be one set of laws for all workers, regardless of the industry they work in.' No qualifications at all. Yet, when we got to the recent sitting of parliament, the government realised, 'Oopsie! We'd better change the hymn sheet, because we're going to want to wind back the Australian Building and Construction Commission at the same time as we build upon specific provisions for textile and clothing industry workers, at the same time as introducing completely new workplace relations laws'—because that is what they really are—for the trucking and road transport industries in the form of the so-called safe rates legislation.
So-called safe rates, because, just like this bill, there has been no opportunity for the coalition to obtain answers to questions like safe rates: if the establishment of the remuneration tribunal in the road transport industry is about safer roads, then at what precise pay point will all truck drivers across Australia decide to get more sleep rather than work more hours? There is no answer to that question, no evidence forthcoming from the government that the law which establishes the Road Safety Remuneration Tribunal will in fact make our roads safer. It is the same deal here, yet the government wants the vulnerable workers in this industry to believe that the something—anything—bill which we now have before us will do the job.
As for the bill itself, Ms O'Neil was at pains to say to the Senate committee that she considered that the provisions in the bill were not radical. She quite rightly pointed to, for example, the deeming provisions that already deem outworkers to be employees in various state jurisdictions like New South Wales, Queensland, South Australia, Victoria and Tasmania. That is five out of the potential seven. Four out of the six states allow recovery of underpaid entitlements. Three of them—New South Wales, Queensland and South Australia—also have a code. So in Ms O'Neil's view this bill is not radical; it will just achieve national consistency.
That, of course, begs a couple of questions. First, if this bill is not radical and it just ensures some consistency, then I think we are entitled to see the evidence that surely must exist that the provisions that have been operating in various states for some time actually work. If the national legislation, which is this bill, is going to do the job the government says it will do, then where is the evidence that the state and territory based provisions from which it is drawn have done the job? We are not able to see that evidence.
But the flipside of that argument applies. Critics of our position are able to say, 'Why are you opposing something that already exists when it is simply about making it national?' That is a fair question, but I think it is more than adequately answered by the fact that we have not been presented with any evidence that shows that the state provisions upon which this bill is based have actually done the job that the government says this bill will now do.
This bill goes beyond what you could call traditional workplace relations principles. In fact, in some respects it turns them on their heads. I guess that is why the government is proposing with this bill to have provisions very specific to this industry. The trouble is that that turning on its head arguably creates precedent for other industries. It creates precedent for other circumstances in which this government might consider, in the words of former Minister for Tertiary Education, Skills, Jobs and Workplace Relations, Chris Evans:
The government has only ever intervened to protect vulnerable workers at the risk of exploitation. TCF outworkers and owner-drivers are the two groups that meet this test.
He was reported saying this in the Financial Review on 23 November 2011. What other workers in what other industries is this government going to say suddenly meet this test so we can have a series of separate industries subject to separate and special workplace relations laws? We will not necessarily be told about it by this government before an election, because they do not bother to seek a mandate for laws like the ones we are considering right now. So there is every prospect that turning the workplace relations laws on their heads, as this bill does in some respects, will be used by this government as precedent for workers in other industries which this government subsequently decides are vulnerable and deserving of protection.
Some examples of the way in which this bill turns traditional workplace relations on its head is that it deems any outworker in the textile industry to be an employee. As the Senate committee heard in the evidence before it, this has caused great concern, for example, to those who do not consider themselves vulnerable, who do not consider themselves exploited or in need of any sort of protection offered by this government in its workplace relations regime. This legislation will essentially deem someone with a university degree setting up a garment designing business to be an outworker. So it is offering the same sort of so-called protections to those workers as it is to vulnerable and arguably exploited workers who cannot speak English. University qualified designers are given the same treatment as, in many cases, immigrants who cannot speak English. It is a sledgehammer to crack a walnut.
This bill also arguably makes independent contractors and those genuinely so, despite the hot gospelling paraded by many members opposite about the so-called proliferation of this dreadful sham contracting. There is the circumstance where it is proper in commercial circumstances for there to be independent contractors who are not employees, but this bill will say it is simply no longer possible for there to be an independent contractor. It is simply no longer possible to be treated as an independent contractor in the textile industry if this bill becomes law, and that is wrong. This bill also singles out outworkers in the textile industry as not being able to enter into individual flexibility arrangements. These things which the Gillard government think are so cool—they were their creatures—for all other workers are barred as an option for workers in the textile, clothing and footwear sector.
This bill has not been properly thought through by the government. The government itself is not convinced that this bill will do the job that it promises it will do. That is why members opposite have not offered any evidence that it will do so. They properly talk about the very distressing situations and experiences we have seen in this industry and then they simply say, 'This bill will fix it.' They do not join the dots—pretty much, as the Greens have discovered to their horror, as the government has not joined the dots with all the cycleways across country, that little dirty side deal to get the support of the Greens for the stimulus package. Oops, the government has not managed to join the dots on all the cycleways either. This bill does not join the dots.
This bill is a sledgehammer to crack a walnut, and probably one of the most concerning aspects of this bill is that it is supposedly designed to protect and intended to protect workers. The design falls down. It is intended to protect workers who are usually immigrants and cannot understand English. Yet the industry is concerned because this bill overreaches and Labor, in its desperation, has not bothered to do its homework. It has had plenty of time with Ms O'Neill and her colleagues' long and sustained—and proper—campaign for a solution in this industry. It has had plenty of time to make sure it got its detail right.
Businesses in this industry fear that, because this bill overreaches, it will lead to job losses. So the very people who this bill is supposedly designed to protect and intended to protect may well lose their jobs. You may say, 'What good is an exploited job?' In some cases, workers who are being exploited will continue to be exploited if this bill goes through, because there are rogues in every gallery. These workers today have the option to not have the jobs, exploited as they are, yet they are unfortunately continuing to work in those circumstances. The coalition is not convinced that this bill will fix the problems the government says it is designed to fix, and we look forward to seeing the proof over time since, unfortunately, this bill is going to go through this chamber.
I rise today to speak about the Fair Work Amendment (Textile, Clothing and Footwear Industry) Bill 2011. When I came to this place just over six years ago, one of the first issues I confronted as a senator was to visit some sweatshops in South Australia, talking to very vulnerable women—mostly women—who have been exploited for too many years in this country.
We have sat here and listened to Senator Fisher's contribution. We in this chamber remember, and I am sure many others listening to this broadcast remember, that Senator Fisher was a former adviser to Peter Reith. We know what happened on the waterfront. We know the history of those people on the other side of the chamber when it comes to Work Choices. We know what you are all about, and that is bringing back Work Choices mark 2. That is your agenda. Today in this chamber, we are talking to a bill that illustrates again the complete lack of regard for Australian workers by those opposite.
Opposition senators interjecting—
At least you are consistent, Senator Fisher. Of Senator Cash's contribution, I am not sure that she has actually ever met a worker, let alone someone who has worked in a sweatshop in this country.
This bill aims to address the abuse of the most vulnerable workers and disadvantaged Australians. All the coalition are interested in is the big end of town. They are interested in protecting their mates. They have a record of not speaking up for Australian 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 one of the most vulnerable and exploited in this country.
Let us have a quick look at the history. Despite decades of long restructuring and staff reductions, the textile, clothing and footwear industry remains a significant sector within the Australian economy. My hometown of Launceston, where I live, was the centre of the universe of the textile industry in this country. I had family members working in the textile industry. We had mills. What do we have now? We have one small mill left. What do we have in Tasmania? We have very limited opportunities. So, when I come in and speak about an issue like this, I do so because I can relate to those people that have been exploited, and I think that is part of our responsibility when we come into this chamber.
The most recent large-scale review of the TCF industry found that at May 2008 there were approximately 48,500 direct manufacturing jobs. That figure is not indicative of the significant numbers of additional workers engaged as outworkers within the clothing industry. Given the acknowledged difficulty of finding outworkers within the TCF supply chains, and then quantifying the volume of work they produce, it is impossible to state with precision an accurate total number of persons employed or engaged in the TCF industry. However, based on its knowledge of the industry and its compliance and education work, the Textile, Clothing and Footwear Union of Australia estimates that the ratio of factory based workers to outworkers within the clothing industry currently varies between 1:4 and 1:10, depending on a particular supply chain.
Exploitation has been a persistent feature of the TCF industry for many decades. Workers in the TCF industry, both in the formal and home based sectors, are some of the most vulnerable workers in Australia. A significant percentage of TCF workers are from a non-English-speaking background and have poor English language and literacy skills. If people in this chamber had bothered to go to the media conference that the union organised yesterday and had met those women who actually work in that industry, I am sure even you, Senator Fisher, would have had a heart and recognised that these people have been taken advantage of. Many of these people have worked in the industry for a significant amount of time. In the formal, factory based sector the great majority of workers are dependent on the minimum safety net—the modern award and the NES—and have limited economic power to negotiate enhanced conditions through enterprise bargaining. Even within the formal TCF sector, noncompliance with award and other legal obligations is widespread. Many factories operate under substantially substandard health and safety conditions.
The phenomenon of sweatshops within the TCF industry is not new, but they are increasingly adaptive to the needs of the TCF supply chains. These sweatshops may be considered to be part of the formal TCF sector in one sense but they exist in a type of parallel economy with extremely low levels of scrutiny and transparency of operation. Some sweatshops operate entirely on a cash-in-hand basis, others operate with a mix of workers on the books and those who do not officially exist in time and wage records. Even where a sweatshop operates formally, many employees on the books will be engaged on a casual or periodic basis, which will mirror the surge or drop in orders. So there is no consistency in the amount of money that these people earn.
We know that many of these workers are being ripped off by the contractors. That should not be happening in Australia. Workers in the sweatshops rarely have any say in how they are engaged and how they seek to make a living, and we know that the employment is inconsistent.
As I indicated earlier, sweatshop workers are almost uniformly from a non-English-speaking background and are often unaware of, or feel unable to enforce, their legal rights and entitlements. Many are migrants or refugees who have had no experience of independent unions or the role of government in enforcing minimum conditions of employment. Some have been subjected to imprisonment and oppression in their home countries. Fear of government and authorities is commonplace.
Now, let us have a closer look at a series of studies that have provided a history—evidence that the Howard government ignored. Remember, the Howard government was in power for 11½ years and did nothing. Sorry, it was not nothing; they brought in Work Choices. In July to November 1994, the Textile, Clothing and Footwear Union of Australia conducted a national outwork information campaign targeted at outworkers, their employers and ethnic communities to gather information about the largely hidden outwork sector of the Australian workforce. Over the eight weeks of the campaign, bilingual workers employed by the TCFUA received a total of 3,000 calls from outworkers—an average of 375 calls per week. The campaign found, amongst other things, that (a) the numbers of outworkers in the clothing industry was much larger than the union had realised; (b) outworkers' working conditions had deteriorated; (c) when outworkers did get work, a typical working week involved 12 to 18 hours per day, seven days per week at about one-third of the award rate of pay; (d) outworkers had virtually no access to the minimum conditions enjoyed by factory workers; and (e) abuse and harassment from employers was widespread and had become daily occurrences in some outworkers' lives.
One of the findings of a University of Melbourne study of outworkers in 2001 was that outworkers reported earning an average hourly rate of pay of $3.60. So how those opposite can come into this place and vote down this bill is beyond belief. In that study 75 per cent of outworkers said that they had experienced not receiving wages on time whilst 46 per cent had experienced not receiving wages at all for work performed and 89 per cent said that their family could not manage without their wages.
The study found that the average number of hours worked per day was more than 12 hours; 74 per cent reported working in the range of 12 to 19 hours per day; and 62 per cent reported working seven days per week, with a further 26 per cent working six days per week. Only a small minority worked less than this.
Of those in the study, 65 per cent said that they did not like their work. Most were resigned to working because 'I just have to do it'. The main reasons that were given for doing this type of work were that they could not get a job outside the home—70 per cent of them—and that their English was not good enough to get other work—63 per cent. Of those surveyed, 68 per cent reported relying on family members to help complete work orders. The vast majority—93 per cent—reported that they worked routinely during the school holidays, 91 per cent worked on Saturdays and 87 per cent worked on Sundays and public holidays.
Senator Fisher interjecting—
Before you interject, Senator Fisher, I know you support Work Choices and I know that you accept that those sorts of conditions should be what all Australians have. But the people on this side of the chamber—the government—will never, ever relinquish support for Australian workers.
In 2004, the TCFUA Victorian branch completed a compliance report for the Ethical Clothing Trades Council Victoria as to the level of compliance within the clothing industry in relation to outworkers receiving their lawful entitlements. The union undertook inspections in 151 workplaces and interviewed a group of outworkers. The report's key findings concluded, based on the inspections and interviews, that in the vast majority of cases outworkers were not receiving award rates of pay; outworkers were not receiving award entitlements such as annual leave, long service leave, overtime and public holidays; outworkers were being forced into sham contractor and company arrangements as a systemic method of employers avoiding legal obligations to employees; outworkers were not receiving superannuation—
We know where you stand, Senator Fisher, on superannuation. That is on the public record: you vote against it each and every time.
The survey found that employees were not being identified as employees for the purposes of WorkCover, companies were not keeping transparent and correct work records, and companies who give out work are not registered with the Board of Reference.
A subsequent report by the Brotherhood of St Laurence in 2007 found that outworkers interviewed for the research indicated that conditions for outworkers had actually worsened in the previous five years. That was in 2007, for the previous five years. Guess who was in power? John Howard and the coalition. I want to quote from this report:
A shortage of work had left them with very little bargaining power with contractors. One group said that they were paid $2.50 for a detailed shirt which took one hour to sew. Another group said they were paid between $2 and $3 an hour. When asked about hours worked, most indicated that they often went weeks without a job but when the work was available they worked long hours.
These outworkers also said that compared with ten years ago, companies increasingly demanded quicker turnaround times. The scarcity of work and precarious nature of employment leave outworkers with little choice but to accept the job.
Look at the pattern: 1994, 2001, 2004 and 2007. Look at the Fair Work Amendment (Textile, Clothing and Footwear Industry) Bill 2011. The bill will amend the Fair Work Act 2009 to enhance existing protections for vulnerable workers in the textile, clothing and footwear industry. Despite the existing provisions in the Fair Work Act, the relevant modern award and state legislation, outworkers continue to experience poor working conditions. This bill is intended to ensure equitable and consistent protection for these workers—and I make no apology for that, like the rest of my colleagues, who unfortunately will not get an opportunity to speak in this debate today.
The bill will also address a limitation that currently exists in relation to right of entry into premises in the TCF industry operating under 'sweatshop' conditions. The bill will extend the operation of most provisions of the FW Act to contract outworkers in the TCF industry; provide a mechanism to ensure that TCF outworkers recover unpaid amounts up the supply chain; and extend specific right of entry rules that apply to suspected breaches affecting outworkers—which allow entry without 24 hours notice—to the industry more broadly, with an exception for the principal place of business of a person with appropriate accreditation to which the standard right of entry rules would apply.
I would like to turn to another element of this industry, one which should not be left without having a comment made on it. It is the fashion industry, not only here in Australia but worldwide, because they also have a responsibility to ensure that their workers, the ones that make the garments that we all wear, are not exploited. Not only do they have a responsibility to those workers; as I have talked about in this place on many occasions, they also have a responsibility to ensure our young men and women have a healthy outlook on their body image. They take profits out of this industry, but they particularly do so at the expense of these workers that have been exploited for far too long and whose rights should be taken into account on this issue.
I would also like to place on record my appreciation and thanks for the people that have opened my eyes to how these vulnerable people have been exploited in this country for far too long, going back to Steve Brennan, a former official of the South Australian branch of the Textile, Clothing and Footwear Union of Australia, to Barry Tubner, to Tony Woolgar. I note those three people in particular because when I came to this place they educated me on this important issue. You should be aware of at least some of these people, Senator Fisher.
I mention Michele O'Neil and the other officials and, more particularly, their organisers, being those people who have gone out into the sweatshops and out into people's homes to bring this to our attention. They should be commended for their effort and I apologise that it has taken us so long to address this very, very important issue.
As I said earlier, these changes will promote fairness and ensure a consistent approach to workplaces to ensure that entitlements are protected for the class of workers that we on this side of the chamber all know have been exploited. I return to the people that I met yesterday. There has been only a handful of such people that I have met over the years that I have been in this place. There is not one of those people in my mind at least—and I know those people opposite have a different view—that should not enjoy the same rights and protections held by every other worker in this country. I know those opposite will get up after I finish and babble on about how they are protecting their mates. I think this of those people opposite: we know whom they protect; it is the big end of town. When it comes to workers' rights, we know what their agenda is. What they ought to be doing is coming out and saying now what their Work Choices mark 2 version, which they will take to the next election, is going to be about. We know what their view was when it came to the mining resource tax. We know what it was when we were talking last night about the transport industry and protecting that industry. We know their history when it comes to protecting workers. Well, we on this side of the chamber make no apology and while we are in government we will continue—as I will certainly do while I am in this chamber and beyond—to ensure that Australian workers are not exploited by the likes of those opposite. So I take great delight in standing up in here today on this and once again I commend the union, their membership and, in particular, those workers who have been exploited for having the guts to stand up and make sure that they are heard. I commend the bill.
I rise to talk about the Fair Work Amendment (Textile, Clothing and Footwear Industry) Bill 2011. I cannot let the moment pass without reminding Senator Polley that we actually took our policies to all of our elections, unlike this current government, which seems to backflip.
Honourable senators interjecting—
This bill extends the operation of most provisions of the Fair Work Act 2009 to all of those contract outworkers in the textile, clothing and footwear industry—which I will refer to as the TCF industry—by deeming contract outworkers to be employees. It will provide a mechanism to enable TCF outworkers to recover unpaid amounts including those from contractors along the supply chain. It will facilitate a TCF outwork code. Not surprisingly, this bill will give additional powers to unions by extending specific rights of entry rules. Once again the Labor-Greens government have forced their way into another section of the community's homes. This creeping Orwellian government culture is consuming Australians.
Like other manufacturing industries the TCF industry has undergone transformation and structural adjustment. This is a consequence of tariff and industry assistance reforms beginning in the 1970s. With the Australian dollar currently so high in the TCF industry, whose export is now worth $1.7 billion a year, they need flexibility now more than ever. These businesses include new start-ups. As has often been the case in this industry, there are a lot of cottage start-ups coming through all the time—lots of imagination, lots of endeavour and lots of entrepreneurship. This kind of legislation that we see here in this bill will discourage the very entrepreneurship that I talk about and the risk-taking that is necessary for the industry to survive in this country.
Like many of Labor's policy forays, there has been limited consultation on this bill with those who are actually directly involved. This bill is another piece of legislation Labor are rushing through the parliament in order to satisfy their union cronies in their haste to gain more power in the Australian workplace in case this government collapses. There is a growing dominance by Labor of rushing legislation through this parliament, as we will see in just 14 minutes when they again guillotine another piece of legislation which has not been properly scrutinised.
The National Retailers Association is also particularly concerned, Senator Collins, with this bill. Echoing their concern, the Australian Chamber of Commerce and Industry, representing some 350,000 businesses nationwide, noted how this bill will make changes and the results of those changes:
The Bill makes complex and technical amendments to the Fair Work Act there 2009, some of which appears to result in changes which are not practical, will add costs throughout the supply chain and create uncertainty in existing commercial arrangements. We also find it extraordinary that the Government is proposing such changes without consulting key industry stakeholders and seemingly without regard for their impact on an industry already struggling to maintain a presence in Australia.
Similarly, The Ark Clothing Co. claims, and I quote, Senator Bilyk:—
We have serious concerns that the amendments will inadvertently harm the very workers they seek to protect by restricting their ability to operate as independent and autonomous businesses. We believe that these amendments are responding to an outdated view of the industry, and that most of the workers this Bill seeks to protect do not see themselves as outworkers or employees, but as independent contractors working from home businesses.
Likewise, the Australian Industry Group states that the bill would:
… create a complicated web of laws for those in the textile, clothing and footwear (TCF) sector but furthermore the Bill is unbalanced and unfair on business.
I am drawn to repeat the phrase which Senator Fisher used earlier and say: what is it with Labor, that you take to industry with the vigour of a 'sledgehammer to a walnut'?
The Productivity Commission, in its final report on the review of the TCF assistance in June 2003, estimated that in 2003 not more than 25,000 people were working as outworkers in the TCF industry. For the same period, ABS data cited in the final report showed that around 58,000 people were directly employed in the industry. Using this data, the Productivity Commission came to the conclusion that outworker employment was about 40 per cent of total factory-based employment in the sector and exceeded factory-based clothing employment by about 25 per cent.
From this we can see that outworkers make up a significant proportion of those undertaking manufacturing work in the TCF sector. Ai Group goes on to state:
In circumstances where any business that operates in a supply chain which contains outworkers will find themselves legally liable for unpaid monies owed to those outworkers, it is conceivable that businesses will find this risk too great and either contractually prohibit the use of outworkers or cease manufacturing within Australia. Either scenario would be harmful to the Australian economy and the TCF sector.
This will export this country's jobs in conjunction with those jobs set to be lost due to the reckless and mindless carbon and mining taxes. The Labor Party has never seen an Australian success story that it does not want to tax, regulate or levy.
Under Labor's bill, union bully bosses will be able to come once again and extend their antiproductivity agenda into the Australian industry scene. The union movement is flexing its muscle here in parliament and forcing their backward vision upon the Australian economy. This bill comes at the same time that Labor has fundamentally undermined the construction industry by approving yesterday the abolition of the Australian Building and Construction Commission. This legislation appeases the left of the Labor Party in their ideological crusade that only damages Australia's productivity.
One of our most serious worries with Labor's bill is that the fair work agency will struggle to control the bullying union bosses when addressing complex issues in industries such as this. The Cole royal commission stands testament to what can happen when they take their eye off these union bullies. We must maintain our vigilance in the textile, clothing and footwear industry. This bill has the potential to enable the resurrection of misplaced union power and it will stifle Australian innovation and productivity gains in this highly competitive sector. True labour reform? Yes it is, with no view to the longer term sustainability of the clothing, textile and footwear industry.
When the coalition was in government we recognised the need for additional protections in the TCF industry and provided additional protections and safeguards. At the same time, the coalition also recognised the need for protections in the building and construction sector, leading to the establishment of the Australian Building and Construction Commission. Ah—but it is now all back to the future with this dysfunctional Gillard-Brown Labor government!
At present, one of the core arguments of the government in abolishing the ABCC is that it discriminates against certain workers and that the industrial relations regime should take a one-size-fits-all approach. This bill clearly defies Labor's view in relation to the ABCC. Convincing evidence of endemic and inappropriate conduct within workplaces in this industry has been presented in submissions to this inquiry. The coalition has had a strong track record of maintaining protections for outworkers in the textile, clothing and footwear industry in the various forms of workplace relations legislation between 1996 and 2007. With this reality central in our minds the coalition suspects that the government's central motivation for this amendment is to appease the trade union movement in the lead-up to the next federal election. The review of the Fair Work Act currently underway provides the best forum in which the provisions of this bill should be considered.
The coalition has received representations from many young and upcoming designers concerned about this bill. We support individual enterprise and innovation by those willing to take a risk to realise their potential. That is why we are concerned that genuine independent contractors or others could be unjustifiably covered and disadvantaged by this bill. The Council of Textile and Fashion Industries of Australia has outlined such examples, and we worry that independent innovators in this industry will be held back.
The Fair Work Act allows for individual flexibility arrangements—IFAs, as they are known to us—to be made, which they say meet the genuine needs of the employee and the employer subject to complying with certain requirements. These include that the employee must be better off overall under the IFA. This bill appears to deny access to IFAs for outworkers whether they be in the TCF industry or not—the term 'flexibility' must not allow the effect of those outworker terms to be varied. This is also despite the better-off-overall test which ensures that IFAs cannot undercut outworker terms.
There are serious concerns from textile suppliers that business and jobs in garment construction may continue to disappear offshore as the textiles and accessories are outsourced in the locations where the work is undertaken. This bill claims to be for the benefit of the TCF industry and all that work in it but it may, in fact, end up shipping their jobs offshore. This bill represents another piece of policy failure from the Labor government. It is another burden on enterprise, just as the carbon tax, mining tax and the Fair Work Act have made it harder to do business in Australia and to provide jobs for the broader Australian public. Labor is hell-bent on driving Australia's competitiveness into the ground. The party that is meant to represent working Australians is implementing policy that will destroy the jobs it is meant to be championing. It is for these reasons I cannot support the bill.
In the few minutes I have left to speak today on the Fair Work Amendment (Textile, Clothing and Footwear Industry) Bill 2011 I note that all we have heard this week with regard to any legislation we have put up is the antiworker and anti-union comments from those on the other side. We have heard about the union thugs and the union bullies but I have not ever heard from that side of the employers who hold the power as being employer thugs or employer bullies, and as most of us know there are certainly a lot of them out there. Their comments on the union movement throughout the week have been very disrespectful and a gross injustice to all those many fine men and women who are out there every day—union delegates, union officials and the ACTU—working to improve the rights of everyday Australians in the workforce.
I offer my congratulations and commendations to the TCFUA and the ACTU for succeeding in helping us get this bill to this place today. It has been a long struggle. They have been working on it for over 15 years; there have been a number of Senate inquiries and the Brotherhood of St Laurence has done reports. All those reports show that outworkers in the textile, clothing and footwear industry are vulnerable and do not get paid the right amount of wages. Some of them work for as low as $2 or $3 an hour and they work really long hours just to try to make ends meet. They are often non-English-speaking migrants and so are a vulnerable group in our community that is taken advantage of.
It does not matter how many people on the other side stand up, as a number of senators opposite have done, and say that this is not going to improve anything—this will improve the working rights for people. To be quite honest, if it improves the working rights for one person then I think that lot should be supporting it! But oh, no! They come in and say: 'No, no, no, no. We're not going to support this because the unions are behind it. We hate the unions. The only people we like are those rich mining people.' They have no logical arguments. I listened to those arguments and I did not think the previous speaker was talking about the same bill for half of his contribution.
And I was confused, Senator Furner, not because I do not understand the bill but because I could not relate what was being said to the bill that we are discussing. But those union people have worked hard not just over the past year but for decades—15 years or so. The first Senate inquiry went back to 1996, I think, and there may well have been some earlier. Senator Collins participated in that. Those opposite were in government for 11½ years and they did nothing. They just want to move back to Work Choices. We know that is what it is all about. Your problem is that you know that the people of Australia know that is what you want to do, so you come in here and run fatuous arguments and disingenuous comments about unions, union officials and those everyday working people who are members of those unions. You all ought to be ashamed of yourselves. You need to get your policies together. You need to get them funded, and tell the people— (Time expired)
I table a supplementary explanatory memorandum relating to the government amendments to be moved in this bill. The memorandum was circulated in the chamber on 20 March 2012.
The question now is that the amendments on sheets 7214 and 7218, circulated by the opposition, be agreed to:
(1) Clause 2, page 2 (table item 2), omit the table item, substitute:
(1) Schedule 1, item 61, page 25 (after line 12), at the end of Division 5 of Part 6 4A, add:
789EB TCF outworkers not to be worse off
(1) This Part applies in relation to a TCF outworker only to the extent to which, in a particular respect, the outworker would not be worse off.
(2) A reference in subsection (1) to this Part includes a reference to any regulations made for the purposes of this Part.
(3) The regulations may prescribe:
(a) what a particular respect is for the purposes of subsection (1); or
(b) the circumstances in which a TCF outworker would or would not be worse off for the purposes of subsection (1).
Mr President, I rise on a brief point of order. It is usual that you put all the coalition amendments together, so I do not quibble with that, but one of those amendments is to ensure that nobody would be worse off as a result of the passage of this legislation. It may be possible, and I do not know if this is the case, that certain senators might wish to vote for that amendment but not the other one. That is all that I put to you, Mr President: they should be dealt with separately on that basis.
The question now is that the amendments on sheet CA223, circulated by the government, be agreed to:
(1) Schedule 1, page 3 (after line 25), after item 4, insert:
4A Section 12
apparent indirectly responsible entity: see subsection 789CC(2).
(2) Schedule 1, item 61, page 14 (line 15), omit "engaged", substitute "engages".
(3) Schedule 1, item 61, page 14 (lines 25 and 26), omit "for the purpose of a contract for the provision of services (rather than as an employee)", substitute "other than as an employee".
(4) Schedule 1, item 61, page 16 (line 19), omit "instrument; and", substitute "instrument.".
(5) Schedule 1, item 61, page 16 (lines 20 and 21), omit paragraph 789CA(1)(d).
(6) Schedule 1, item 61, page 17 (line 27), omit "Subject to subsection (2), each", substitute "Each".
(7) Schedule 1, item 61, page 17 (lines 30 to 33), omit subsection 789CB(2).
(8) Schedule 1, item 61, page 18 (line 4), omit "subsection (5)", substitute "subsection 789CE(1A)".
(9) Schedule 1, item 61, page 18 (lines 6 to 14), omit subsection 789CB(5).
(10) Schedule 1, item 61, page 18 (line 15) to page 20 (line 3), omit sections 789CC and 789CD, substitute:
789CC Demand for payment from an apparent indirectly responsible entity
(1) The TCF outworker, or a person acting on behalf of the outworker, may give an apparent indirectly responsible entity a written demand for payment of the amount that the outworker reasonably believes the entity is liable for under section 789CB.
(2) An entity is an apparent indirectly responsible entity in relation to the TCF work if the TCF outworker reasonably believes that the entity is an indirectly responsible entity in relation to the TCF work.
(3) The demand must:
(a) specify the amount, and identify the responsible person; and
(b) include particulars of the TCF work to which the amount relates, and why the amount is payable by the entity to which the demand is given; and
(c) state that if the specified amount is not paid by a specified time, proceedings may be commenced against the entity under section 789CD.
(4) The time specified for the purpose of paragraph (3)(c) must not be less than 14 days after the demand is given to the indirectly responsible entity.
789CD Court order for entity to pay amount demanded
(a) in accordance with section 789CC, an apparent indirectly responsible entity has been given a demand for payment of a specified amount; and
(b) the amount has not been paid in full by the time specified in the demand;
a person or organisation specified in subsection (2) (the applicant) may commence proceedings for an order requiring the entity to pay the specified amount.
(2) The proceedings may be commenced:
(a) by the TCF outworker; or
(b) on the TCF outworker's behalf, by:
(i) an organisation that is entitled to represent the industrial interests of the outworker; or
(ii) an inspector.
(3) The proceedings may be commenced in:
(a) the Federal Court; or
(b) the Federal Magistrates Court; or
(c) an eligible State or Territory court.
(4) Subject only to subsections (5) and (6), the court may make an order requiring the entity to pay, to the outworker or to another person on the outworker's behalf, the specified amount (or so much of that amount as the applicant alleges is still owing).
(5) The court must not make an order under subsection (4) if the entity satisfies the court that the entity is not liable under section 789CB to pay any of the specified amount.
(6) If the entity satisfies the court that the amount of the entity's liability under section 789CB is less than the specified amount (or is less than so much of that amount as the applicant alleges is still owing), the court must not make an order under subsection (4) requiring the entity to pay more than that lesser amount.
(7) In making the order, the court must, on application, include an amount of interest in the sum ordered, unless good cause is shown to the contrary.
(8) Without limiting subsection (7), in determining the amount of interest, the court must take into account the period between the day when the unpaid amount was due for payment by the responsible person and the day when the order is made.
(9) Proceedings cannot be commenced under this section more than 6 years after the time when the unpaid amount became due for payment by the responsible person.
(11) Schedule 1, item 61, page 20 (lines 4 and 5), omit the heading to section 789CE, substitute:
789CE Effect of payment by entity (including entity's right to recover from responsible person)
(12) Schedule 1, item 61, page 20 (lines 6 to 9), omit subsection 789CE(1), substitute:
(1) This section applies if an entity pays an amount in discharge of a liability of the entity under section 789CB, or pursuant to an order under section 789CD.
(1A) The payment discharges the liability of the responsible person for the unpaid amount, to the extent of the payment. This does not affect any right that the entity has to recover an equivalent amount from the responsible person (under this section or otherwise) or from another person, or to be otherwise indemnified in relation to the making of the payment.
Question agreed to.
by leave—I very briefly make a similar statement: to save the time of the Senate and given that the next bill will now only have four minutes for debate, we will not divide.