Fair Work Legislation Amendment (Closing Loopholes) Bill 2023

Kate Chaney

I move amendments (1) to (6), as circulated in my name, together:

(1) Clause 2, page 2 (table items 8 and 9), omit the table items.

(2) Clause 2, page 3 (table item 12), omit the table item.

(3) Schedule 1, Part 7, page 63 (line 1) to page 69 (line 14), omit the Part.

(4) Schedule 1, Part 10, page 74 (line 1) to page 76 (line 17), omit the Part.

(5) Schedule 1, Division 7, page 221 (line 12) to page 222 (line 18), omit the Division.

(6) Schedule 1, Division 9, page 222 (line 25) to page 223 (line 2), omit the Division.

These amendments propose to remove some parts of the government's bill that extend the reach of union delegates in workplaces. In schedule 1 part 7 the government's bill introduces a series of new rights for union delegates employed in workplaces. This includes any employee acting as a shop steward having uncapped time off for union training; making employers engage with delegates on any matter they wish to raise, even where the matters are fanciful or unrepresentative of the priorities of a majority of employees on site; allowing unions to demand their delegates be given subsidised access to company intranet, office facilities, transport and meeting rooms; and inserting union delegate terms into all modern awards and agreements. My amendments remove these additional union powers. The case has not been made for these changes. They have not been backed by any identified problem to be solved or by specific difficulties experienced by delegates which could not be addressed by working with employers or using the enterprise bargaining system.

Schedule 1 part 10 of the government's bill expands the circumstances in which unions can come onto worksites without prior notice. Usually union officials are required to give 24 hours notice of entry to a worksite. There's already an exemption to this if the Fair Work Commission is reasonably satisfied that giving a workplace advance notice of entry might result in the destruction, concealment or alteration of relevant evidence. The government's bill extends this exemption if an official seeks to investigate underpayments—that is, the union could then enter without notice. I don't want workplaces to underpay employees, and I don't want workplaces to destroy, conceal or alter relevant evidence, but this extension of union powers in the government's bill doesn't require the union to establish that there's any risk of the destruction of evidence or records. My proposed amendment removes this additional exemption.

Making it easier for unions to enter workplace without notice is overreach and doesn't contribute to closing any loopholes. The government is seeking to legislate for problems that do not exist. Any union wanting to enter a workplace to represent a member or attract members already has a straightforward and well-understood mechanism to do so through the entry permits held by its officials. This is another example of the government's bill extending union powers beyond what's necessary to address any problem identified.

We see this extension of union powers repeatedly in the bill. Even in the government's amendments we see additional union powers to pull multiple labour hire employers at one host site into an existing same job, same pay order.

I'm told by business groups that increased union powers to enter workplaces without notice and increased employer obligations to union delegates on site were not part of the exposure draft consultations. The Fair Work Commission's data on entry disputes does not reveal any problems with entry rights. This was an unexpected addition to the legislation and seems to be the government paying its dues to the union movement to support the growth of its influence and power, rather than passing legislation that addresses actual problems.

Unions have a part to play, but that doesn't mean that extending their reach into workplaces and growing their rights is always justified. If there isn't a problem that needs fixing, we should not be creating additional union powers.

Tony Burke

I should explain why the government is opposing these amendments before we have the vote, and I'll be extending the same respect to the member for Curtin as to the previous members—with no doubt whatsoever that what is being presented is a valid representation of the views of the electorate. But I'll start by explaining the two issues. I'll deal briefly with delegates but a bit more with respect to the right-of-entry provision, because obviously a delegate is already someone within the workplace.

The impact of delegates, where they are well trained, is that you end up with safer workplaces and workplaces where the rules are followed. While this legislation squarely goes to issues of underpayment—some forms of underpayment that are lawful and some forms of underpayment that are unlawful—the objective here is not to lock up employers with the wage theft provisions. The objective is to have a series of measures that cause people to be paid properly in the first place. The government's very firmly of the view that, if you have someone in the workplace as an employee who is trained and knows people's rights, that makes a categorical difference in making sure that rules are followed, that you have a safer workplace and that underpayments are less likely.

Very much in the context of what we are doing on wage theft, we did not want the criminal offence to effectively be the only lever that we were looking at. Many employers already do all the things, with respect to delegates, that are contained in this legislation. But the objective here is to make sure that we don't simply have the penalty at the end of the process, when we finally find out about it. Having the different measures in place makes sure, as much as we can, that it is much less likely that people are underpaid in the first place.

I'll go into a little bit more detail, if I may, on the right of entry, because the concept of someone coming into your workplace who is not an employee is obviously a bigger deal. I want to explain why the government believes this is a natural extension to the provision which already exists. The provision that's already in the act, which the member referred to, is the provision where you can have right of entry without notice on the basis that the Fair Work Commission has decided that there is a reasonable likelihood of the destruction of evidence. The reason for that is really simple. If you give the notice you'd otherwise have to give and there is a risk of the destruction of evidence, you turn up, the evidence isn't there and the whole purpose of the visit collapses.

With respect to underpayments, there are various methods—and I have spoken previously about some of these in question time—by which people are underpaid. Finding out that this is happening can be entirely manipulated, with right-of-entry notice, by basically making sure that the relevant people, those who have been underpaid, are not there that day. For example, one of the classic ones that I've referred to previously was 7-Eleven, where people were put on the roster for fewer hours than they were working. If you give 24 hours notice, you will turn up and people will leave at their exact rostered time on that day. That's what will happen. These are practices which have been going on, sometimes, for years.

I remember seeing one of these instances. There's been reference previously to my small-business background. I also have a union background. I remember turning up at for a midnight meeting with the night-fill team of a very reputable business, and this exact situation of people working hours for which they had not been rostered had been going on for more than six years. For a team of about 12 or 14 people, it ended up being more than $100,000 they'd been underpaid. There was an agreement with that particular company that I would be able to turn up and talk to people. Had there been the formal notification, I wouldn't have found out that that was happening. I might add that for that late-night shift, until I turned up that time, there was no delegate on site. I don't see how we catch underpayment early unless there can be occasions where there's a reasonable belief in the view of the commission, so you have the umpire over the top—can I seek the call a second time, please?

Mike Freelander

Sure.

Tony Burke

Unless the commission is able to say, 'Yes, in these circumstances it is all right for you to turn up unannounced,' there will be cases of wage theft that we will never get to the bottom of.

I also add this reality: while we provided more resources for the Fair Work Ombudsman, there will never be any government in this country that can provide enough resources for the Fair Work Ombudsman to be able to effectively police every underpayment in the country. Some of it will be done by parents and lawyers, and some of it will be done by unions. But whenever it involves something like an entry without notice—while the oversight of the commission is important—effectively what we have here, the government believes, is an exact parallel to the rationale for the provision that already exists with respect to the likelihood of destruction of documents.

Kylea Tink

Minister, I rise to support the amendments moved by the member for Curtin. I think they are infinitely reasonable. I've listened very closely to your answer as you've responded to those amendments. There are two points I would like to offer back to you.

The first is that my understanding of the legislation that the government has provided and the changes that the member for Curtin has introduced is that it is unreasonable in any work environment for any employer to have one of their employees have unlimited access to training that the employer has not bought into and does not believe is in the best interests of their business. With respect, I would offer back to you that the argument you just used—about workplaces being safer if delegates are trained well—could be made on any one of a number of business principles. Your books are going to be run better if your accountant has unlimited access to training. Your workplace is going to be safer if your employees have unlimited access to first aid training. It's simply not practical to say to an employer that they will have no right to say to their employee, 'Your training hours are done.' It's why it's very standard to have limited training hours in any work environment. Responsible employers dedicate part of their budget to ensuring their employees are trained. In my experience, anywhere up to three per cent of their operating budget will be dedicated towards employee training. I think this creates a really unnecessary point of conflict between unions and workplaces, because it is basically saying that employers don't need to recognise union training under their training budget. I think that's to the detriment of unions. By the same token it's saying that employers have no right to buy into how their employees are trained in that situation.

The second point I would make is on the second amendment: who is the cop here that is actually making sure that a union delegate isn't just invoking the argument, 'I believe there's a case for underpayment, so I'm going to turn up'? Who's going to stop that? The reality is that there are by your own admission, Minister, many, many responsible businesses in this country doing exactly the same thing. There is also a very long and fractious history, in a number of industries, between the unions and those that would employ the people who are represented by them. Extending this power into some of those industries—and I would include the construction industry here—is incredibly problematic and has the potential to inflame situations in a work environment.

So, again, with respect, I think there are two pieces to this argument. Firstly, if the union delegate believes there is a case of underpayment, why would it not be the case that the union delegate doesn't at least have to go and get the Fair Work Commission's approval before they go in? That would be my first question. Secondly, even if they did go in and found, as you described, that there had been a manipulation of circumstance, doesn't that in effect equate to the destruction of evidence, and, therefore, isn't that right already there for them—in terms of believing that a manipulation of a work environment would be the equivalent of the destruction of evidence?

Tony Burke

Just quickly—because there are questions there I should, in fairness, respond to with the government's view. First of all, on the concept of unlimited training, it's not unlimited training. The concept there would be very similar to the obligations that are already there for work health and safety training, where that would be defined within awards. In terms of who the cop is who is making decisions on right of entry, that is the Fair Work Commission. The Fair Work Commission would make that decision in advance of the right of entry. So hopefully that at least clarifies the issues, while I respect that it doesn't change the view of the amendment.

Milton Dick

The question is that the amendments moved by the honourable member for Curtin be agreed to.