The Albanese Labor Government has introduced a new amendment bill intended to close loopholes that undercut pay and conditions.
The Fair Work Legislation Amendment (Closing Loopholes) Bill 2023 will criminalise wage theft, introduce minimum standards for workers in the gig economy, close the forced permanent casual worker loophole, and close the labour-hire loophole.
However, Australian Retailers Association (ARA) CEO Paul Zahra said the proposed changes will move workplace relations reform in the wrong direction.
“We support an equitable and balanced workplace relations system, but this Bill seeks to implement complex regulations without any real productivity benefit, which is amongst the top priorities for businesses,” Zahra said.
“The Government should be simplifying the workplace relations system, not complicating it further. The Bill fails to meet that test, and our key concerns relate to the changes for casual workers and underpayment of wages.”
Speaking on the closing of the casual worker loophole, Zahra said there are currently very low levels of casual conversion.
“This Bill means there is going to be a lot more administrative work for employers without any material change in casual conversion rates,” he said.
“While we support the Government’s decision to limit the wage theft laws to deliberate and intentional conduct, the Government needs to reduce complexity in our workplace relations system to minimise unintentional mistakes.”
When announcing the changes last week, Minister for Employment and Workplace Relations Tony Burke conceded that the Bill will lead to higher complexity and higher costs.
“If we're going to be a nation where you don't have to rely on tips to make ends meet, then there needs to be some extra regulation and words on the page – and that has to be done,” Burke said. “Businesses put to us there’d be some aspects and ways we could regulate that would create a real problem in complexity for them. So, we have evaded that.”
“Underpaying people is cheaper – yeah it is. Slavery is probably cheaper too. There is some modest pass-through here. We are talking about some of the lowest-paid people in Australia, and if that means there's a tiny bit extra you pay when your pizza arrives to your door and they're more likely to be safe on the roads getting there, then I reckon it's a pretty small price to pay.”
Burke said that when Secure Jobs, Better Pay legislation was introduced to Parliament last year, those against it said it would lead to unemployment, strikes and a failure to get wages moving.
“On all of that, the results are now in,” he said. “At the exact same time that inflation has been moderating, what's been happening in our workplaces? Wages have gone up.
“The Wage Price Index at the moment at 3.6 per cent has a ‘3’ in front of it - something that didn't happen under the previous government, where low wage growth was a deliberate design feature of their management.”
“In fact, not only did it not have a "3" in front of it – the Wage Price Index in the entire history of the index has only had nine quarters where it's been below 2 per cent – and all of those have happened under Coalition governments.
“In terms of the threats as to what all this would mean for jobs - we had, as a new incoming government, the best new jobs growth of any incoming government. We now have more than half a million jobs that have been created.
In response, Zahra said Federal Government must be careful with any policy changes that drive price increases, considering the cost-of-living pressures already being felt by Australians.
He added that this Bill marks the third round of reforms in less than 12 months.
“The pace and intensity of industrial relations change is a real concern for business, particularly in a uniquely challenging economic landscape,” Zahra said.
“The Government’s decision to carve out small businesses with an exemption on part of the Bill is understandable given the complexity, but also serves as an admission that these reforms are overly complex and challenging to implement.”
Zahra acknowledged the Federal Government’s “modest concessions” that have been made in conversations with employer groups, however, he said they are by no means sufficient.
“We look forward to working with the Senate Crossbench to advocate for a version of this Bill that drives productivity, create jobs and increase workforce participation because we cannot support the Bill in its current form,” Zahra.
Other elements of the Closing Loopholes Bill include:
- Allowing the Fair Work Commission to set minimum standards for the road transport industry.
- Continuing to implement the Boland Review to introducing an offence for industrial manslaughter and increasing penalties.
- Better support for first responders diagnosed with post-traumatic stress disorder.
- Expanding the functions of the Asbestos Safety and Eradication Agency to include silica safety and silica-related diseases.
- Stronger workplace protections for survivors of family or domestic violence.
- Provide specific protections for delegates, greater legal powers to challenge unfair contract terms, and cracking down on sham contracting.
- Better representation for safety and compliance issues in the workplace, including expanding the powers of the Fair Work Commission to permit right of entry to investigate suspected underpayments.