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July 17, 2018

HAMISH MACDONALD: Brendan O’Connor is the Shadow Minister for Employment and Workplace Relations. Welcome back to Breakfast.


MACDONALD: This policy is based on the premise that if you do the same job you would get the same pay. Don’t some people go through labour hire firms because they want the flexibility that goes with that?

O’CONNOR: There might be those who choose flexibility, but what happens too often is people are stuck in insecure work, and too often they are employed and they are not getting the same as the people standing next to them, or the people in the same office. So what we are seeking to do is ensure people are paid the same for the same work. If they’ve got the same skills and responsibilities, then they should be paid the same. That doesn’t happen now, and that should happen.

MACDONALD: Isn’t that going to mean that the trade-off these people get - greater flexibility in return for less pay or fewer conditions - that gap will be diminished and so they won’t find that they’re given the same flexibility?

O’CONNOR: I think what has happened is the floor has collapsed in workplaces. The floor - that is the rates of pay and conditions for workers has collapsed. So we see too often the undermining of basic conditions of employment.

Why do we see the highest levels of casualisation in Australia today? One of the reasons is the misuse of labour hire. Why do we see two workers in the same workplace paid hundreds of dollars a week differently? Often it’s because people are under different arrangements.

Now, in Australia we should have a fair day’s work for a fair day’s pay. That should mean you get paid the same as people in the same workplace doing the same work. That needs to happen, and it doesn’t happen now. It’s one of the reasons we have wage stagnation in this country. The lowest wage growth in a generation.

MACDONALD: How widely used are these labour hire firms? How many people are employed in these sorts of scenarios?

O’CONNOR: The peak employer body says it’s about 1 in 25. I think it’s between 2-4 per cent and growing in the labour market, and if you look at the forms of employment - labour hire used properly can be legitimate of course, as can casual work, as can other forms of employment. But it can also be misused and abused, and it’s not fair if a worker is working at workplace, undertaking same role with the same responsibilities and the same qualifications, and yet they find themselves not only paid less - but insecure at work, when in fact that can go on for years.

It's one thing to start a casual or temporary job for a period of time and find there is a pathway to permanent work - but when you are working for years and not being treated the same, when you're waiting by the phone the night before to see if you're working the next day, it's not fair, and it needs to be stamped out, and it will be stamped out by a Shorten Labor Government.

MACDONALD: I mean, I understand that that’s one picture that you can paint of those arrangements, but as an example, in the Fairfax papers today there is an electrician that they use as a case study. He was rehired by the same employer after being made redundant. He is on fewer entitlements, but he is receiving $55 an hour, which is in excess of double time payable under the modern award for a casual employee. He would be worse off under this new arrangement?

O’CONNOR: Of course not. If you are better off than the arrangements in the workplace, then of course we’re not we're not going to affect people’s employment contract. It's where they are paid less money, where they’re being treated as casuals indefinitely for months and sometimes years on end - and if you ask workers in this country what the main problems are, they say we want a pay rise because wages are falling in real terms and we want secure work.

What is happening too often is we are seeing workers not able to makes ends meet because they do not have security of employment and they do not have decent wages and conditions.

MACDONALD: So are you comfortable to give a guarantee that nobody would be worse off under your proposal?

O’CONNOR: Well the proposal ensures that you have to be paid the same conditions of employment and the same wage rates as those workers and by the way -

MACDONALD: But that could be less couldn’t it?

O’CONNOR: What I’m saying to you is it has to be that you are paid the same. Let’s just think about the people that are being exploited here. Firstly it’s the workers themselves that are paid less.

Secondly it means those workers who are paid more find themselves less secure – because it’s going to happen over time, that the lower paid workers will start getting the work. You have those companies doing the right thing – that is, paying their labour hire employees the same - and are now at a competitive disadvantage to companies that are paying them less.

This has brought down the industrial floor in too many sectors of our economy. It’s unfair. It exploits workers. It should be stamped out. By the way, in Britain - in fact in all of Europe, and Canada – this applies now. It should apply in Australia. It’s one of the reasons why we have the lowest wage growth in 25 years.

MACDONALD: Let’s just get a straight answer today from you though, I mean, I understand that there’s multiple scenarios that you are talking about there. But you do acknowledge that some people will be paid less than they currently are.

O’CONNOR: I am not sure – that’s your question. I am saying to you that there has to be pay equity. People have to be paid the same conditions, or no less than the same conditions and rates as direct employees. It’s a reasonable principle.. If there are any concerns about that, or if there are any issues as to whether that is the case, that can be dealt with either internally or by the Fair Work Commission, who can deal with whether in fact that principle applies properly.

MACDONALD: Ok. Labour hire firms are regulated by the Fair Work Act, as you have just referred to. Workers employed this way already have the same rights as other staff to bargain for enterprise agreements. Don’t the laws already exist to better protect these workers?

O’CONNOR: It’s very hard to collectively bargain when you are not in the same workplace. You think about it. You are sending your worker off into another workplace, that worker does not get to collectively bargain with the workers that he or she works with, and of course they are not in some notional workplace bargaining for their labour hire rights.

They should be allowed to be paid the same as the workers in their workplace doing the same work, working with them each and every day.

Of course, for those specialist labour hire employees who may not be doing similar work to those businesses – as we have made clear, it wouldn’t affect them, it wouldn’t affect those labour hire workers who are on better conditions – but we have to stamp out unfairness. One of the ways to do that is to ensure workers are treated the same in the same workplace.

MACDONALD: There are a whole range of industries that use labour hire as I understand it – construction, manufacturing, horticulture, hospitality, IT as well. We are already hearing from employer groups that this will make Australian firms less competitive, that they need to be able to outsource work to labour hire firms to compete with overseas rivals. Do you acknowledge that there is a challenge for these industries if you tighten up the rules here?

O’CONNOR: We think that labour hire can be used legitimately. For example, for smaller businesses, they will not be affected. One, because the workers they tend to bring in have different skills and different jobs to the ones they are employing. Of course we understand labour hire needs to be able to be used for fluctuations in demand, or seasonal work – but it shouldn’t be an excuse to have very significantly lower conditions and rates of pay undertaking exactly the same work as those who are working in that workplace.

For example, if you have different qualifications, or are less experienced and have less responsibility in a workplace – that would understandably mean, Hamish, that you would have different arrangements.

But, if you are of comparable skill and have the same responsibilities doing the same work, I think most Australians would agree – you should be paid the same.

MACDONALD: You would be aware that the Liberal Senator Dean Smith on another matter wants an enquiry into a population policy, and a slow-down in the migration rate. You are a former Immigration Minister – do you think it is time for a reset on population growth?

O’CONNOR: On permanent migration, Hamish, we have tended to have a bipartisan position. It has gone up and down based on demand in our economy, particularly the skilled immigration stream, which has not really been controversial to that extent.

What has become an absolute problem has been the explosion, the misuse, and abuse, of issuing of temporary work visas. There are 1.6 million visas in Australia at this point. In fact, the current Government has increased that by 200,000. So what you have now Hamish, for example you have temporary visas being issued as student visas, where the applicant is not primarily studying. You have work holiday visas being issued for those who are not on holiday – they are undertaking work here, primarily.

The visas themselves have been abused, and one of the reasons why we have one of the highest levels of youth unemployment, high underemployment, is because there has been an abuse of temporary work visas. That should be stopped.

MACDONALD: Brendan O’Connor, thank you very much.

O’CONNOR: Thanks Hamish.