The Kingston Reid Jobs Summit Fringe Festival provided a unique opportunity for clients and friends of Kingston Reid to gain insights into the issues being debated up the hill at the Commonwealth Government’s Jobs + Skills Summit. Our event brought together a range of opinion leaders with diverse views on the debate over workplace relations reform in Australia.
We were fortunate to have speakers and panellists from across the entire political spectrum from business, Government and unions, along with expert opinions on economics and from those who prosecute, defend and determine rights and responsibilities in the workplace relations system.
- It’s the Economy Stupid – Chris Richardson, Rich Insight
Our event was turbo charged from the beginning with a presentation of stark economic reality from renowned economist Chris Richardson. While the title of the presentation called up the famous mantra coined during Bill Clinton’s successful presidential campaign in 1992, perhaps it ought to have been called “It’s Productivity, Stupid”, as the key underlying message was that real wage growth will be doomed unless productivity can be increased.
- observed that the Jobs + Skills Summit had missed an opportunity by focussing on how to decide who gets a share of the pie rather than making the pie bigger;
- foretells that the type of reform to workplace relations legislation being floated prior to the Jobs + Skills Summit created a risk that wages will chase prices, inflation will be too high, and real wages will not improve; and
- busted a myth by showing that international migration to Australia creates jobs; it does not take jobs away.
While the relative lack of focus on productivity at the Jobs + Skills Summit was disappointing, the sensible decision to lift the cap on skilled migration showed that good economic policy can translate to good Government policy through the Jobs + Skills Summit process. He also told us that ideally wages should not rise above 3.5% per annum if we want to avoid increased inflation.
- The Union Perspective – Scott Connolly, Assistant National Secretary, ACTU
As a vocal contributor to the Jobs + Skills Summit and a strong advocate for reform, we were pleased to have the benefit of insights from Sally McManus’ Second Lieutenant, Scott Connolly.
The ACTU position is that productivity gains are being made but that they are not being shared with workers. Mr Connolly said:
- the ACTU believes the labour market should be re-regulated;
- workers are not benefiting from national income and productivity gains;
- industrial action is necessary for multi-employer bargaining but with a “measured approach”; and
- there are significant problems with skills and training infrastructure and that Jobs and Skills Australia should have a bigger role in the development of skills and training.
The Government has been careful not to describe its “immediate actions” from the Jobs + Skills Summit as re-regulation of the labour market, but the reform contemplated involves more, rather than less, regulation. The reaction of business to Government election commitments and statements at the Government Jobs + Skills Summit suggests there is wide support for a greater role for Jobs and Skills Australia.
- The Political Perspective – Adam Bandt MP, Australian Greens
In the first of our Political Perspectives, the Greens used the opportunity of Leader Adam Bandt’s speech to announce the party’s proposed industrial relations reforms.
Mr Bandt said that the Greens hold the balance of power and will be taking a “no compromises” approach to the reform proposals being put forward by the Government, threatening to withhold support for any legislation that comes out of the Jobs + Skills Summit unless the Government agrees to their demands.
This strong position flows from a party view that reforms need to take back the power from corporations because real wages are declining, and the power balance needs to be re-shifted.
Mr Bandt announced the Greens position that:
- the Greens support an overhaul of the bargaining system, and that greater control needs to be given to workers by reviewing hours of work and insecure employment provisions in the Fair Work Act;
- low paid wages need to be lifted to 60% of the full-time median wage;
- the Government needs to reduce the cost of essentials (including free child-care) in order to support workforce participation;
- there needs to be an increase in accessibility to union membership;
- gig and casual workers should receive sick and holiday pay in addition to the current casual loading; and
- legislation should be amended to include a presumption that all jobs are permanent unless there are sound demonstrable reasons otherwise.
Mr Bandt raised concerns that the Jobs + Skills Summit is “Half a Hawke” in that the Government has blocked any discussion on tax.
While the Greens position could be seen as posturing aimed at blunting proposed reforms that are contrary to its policy position, it’s no compromise position on issues such as climate policy suggest that an “all or nothing” approach is a definite possibility. Keen observers will note the Greens are actually one vote short of holding the balance of power in the Senate, so a decision by the Greens not to support legislation plays the crossbenchers (and even the Coalition) into the game.
- The Union Perspective – Daniel Walton, National Secretary, AWU
While reported comments before the Jobs + Skills Summit about union membership for newly arrived migrants might have suggested we would be hearing some controversial proposals from Daniel Walton, the AWU position is arguably much closer to the business position than that of the ACTU, and certainly that of the Greens.
By focussing on a broader agenda than industrial regulation, the AWU appears to be reaching for the centre ground and consensus with business. While careful to caution there is no “silver bullet”, Mr Walton told us he views the three big issues for the Summit to address are:
- energy (in the context of the transition from fossil fuels to renewables);
- industrial relations reform; and
- skilled migration.
Other policy areas that Mr Walton covered included:
- addressing the higher cost of living, inflation and productivity and the challenge of increasing real wage growth;
- a restoration of balance to appointments to the Fair Work Commission;
- making enterprise bargaining simpler;
- fixing a “flaw” in current modern award and enterprise agreement consultation obligations, which only trigger once a definite decision to introduce major change has been made; and
- investment in training.
Many of these matters were found in the statement of “immediate actions” published by the Government after the close of the Jobs + Skills Summit on Friday which suggests that the AWU is close to policy makers.
One area of potential difference is in looking to migration to address skills shortages. The AWU points to the fact of apprenticeship commencement numbers increasing, but apprenticeship completion numbers are diminishing. Flowing from this, Mr Walton said that looking around the world for skills is “short sighted” and that as a nation “we need to restore our own skills”.
Mr Walton observed that employers should see this period as an opportunity for collaboration and consultation with their employees and unions.
- Future of Work Panel
Jordan O’Reilly, Co-founder & CEO, Hireup
Luke Webber, Managing Director, Labourpower
Michael Kaine, National Secretary, TWU
Dr Alex Veen, Senior Lecturer, University of Sydney Business School
This panel produced a fascinating discussion on areas of workplace relations regulation and reform in the area of labour hire, independent contractors and the gig economy which are changing at an extremely rapid pace. Our panellists told us that:
- the definition of “insecure work” is a live question and means different things to different stakeholders;
- the gig economy creates a different working environment where platforms take a step back and much more control is placed in the hands of consumers and workers about how work is performed;
- the gig economy is here to stay, and there needs to be appropriate regulation of non-standard work performed within this space;
- while the majority of gig work is conducted under independent contractor arrangements, there is a space for effective employment frameworks if modern awards are less rigid;
- there are emerging trends where workers want to choose how, and when, they work and do not want to be bound to one employer on a full time basis;
- technology and artificial intelligence will continue to change the shape of work, both in terms of the labour required and how that labour is engaged; and
- since the inclusion of “casual conversion” in legislation, and a wide range of industrial instruments, anecdotal evidence suggests that a tiny proportion of employees (sometimes as low as 2%) are choosing to convert from casual to permanent.
Michael Kaine from the TWU noted that the transport economy attracts some of the most vulnerable workers, but equally has represented independent owner-drivers since the union’s inception, illustrating that the TWU does not have any inherent objection to non-standard work. That does not mean that we necessarily need to shoe-horn workers into employment relationships or redefine the employment relationship. If we can find a system that permits flexibility with appropriate protections, then we should do it. That system must provide appropriate and fair remuneration (mechanisms for workers to recover costs and get a return on their investment / risk) and other support networks (workers compensation, superannuation, safety requirements, etc). One option is an “owner-driver” type system like in NSW.
Jordan O’Reilly from Hireup, a digital platform connecting people living with a disability with support workers, was concerned that the gig economy could be viewed as a race to the bottom in a two-speed system (regulated employment relationships vs non-regulated independent contractor relationships). Flexibility is key, but the flexibility you need differs from sector to sector so there needs to be sector-specific approaches. We have found employment relationships work well in the disability care sector. However, it is important there is an equal playing field, which requires certainty from Government.
Dr Alex Veen from the University of Sydney Business School shared the findings of his research which found that it is not as simple as just passing on costs to consumers. Research indicates that platforms are generally dominated by cost-sensitive consumers. Whilst the consumers generally do not understand the terms and conditions that apply to gig workers and when they’re informed about them, they think that they’re unfair, they’re also only prepared to pay an additional $0.85 – $1.25 for the services. It is a delicate balance to find a solution to, and we might benefit from looking at more holistic approaches in other jurisdictions.
Luke Webber from Labourpower observed that the recruitment industry is not seeing a race to the bottom. Businesses cannot attract workers on modern award rates and are having to pay workers more. Flexibility appears to be just as important as stability. Every year casual employees are offered the opportunity to convert to permanent employment, but the majority do not take up the offer, in fact, a number of workers who have converted to permanent employment have subsequently requested to convert back to casual employment.
- The Political Perspective – Senator Tony Sheldon, ALP
The Jobs + Skills Summit, and the whitepaper that is proposed to flow from it, was a core part of the ALP’s policy platform entering into the Federal election which saw the party take Government. In gaining an understanding of what would be discussed up on the hill immediately following the Festival, we heard from Senator Tony Sheldon.
Senator Sheldon was able to give some insights into the drivers for Government policy and how discussions at the Summit were likely to unfold. Senator Sheldon told us that the big issues for the Government are:
- single enterprise bargaining is outdated, and greater access multi-enterprise bargaining is needed;
- low paid and highly feminised industries should be the focus of multi-enterprise bargaining;
- the issues are low real wage growth and the need to “plug” loopholes in insecure work such gig, casual and labour hire work; and
- there is a need to abolish the ABCC as it negatively impacts on productivity.
Senator Sheldon acknowledged that “We are not going to agree on every single thing but that is ok. We are cementing ideas for the future.” This reference to laying the ground for future reform suggests that the ALP is playing a long game and sees the Jobs + Skills Summit as a starting point for a reform process rather than an event where consensus will immediately be achieved. This was reflected in the “immediate actions” and “further discussions” approach taken by the Government in the Jobs + Skills Summit Outcomes document published after the Summit.
- [email protected] – Plaintiff Perspectives – Josh Bornstein, Maurice Blackburn
True to the old adage, keep your friends close and your enemies closer, Josh Bornstein, Head of Employment and Industrial Relations of applicant and union law firm, Maurice Blackburn, provided Fringe Summit attendees with a rare insight into the thinking of a lawyer whose name would otherwise ordinarily be at the bottom of letters of demand.
Mr Bornstein gave us an overview of his experience in acting for plaintiffs in the rapidly changing area of workplace discrimination, bullying and sexual harassment.
- There are opportunities to understand what the introduction of a positive duty to take all reasonable steps to eliminate sexual harassment in the workplace will be at the Federal level from the Victorian experience. Noting that Victoria’s anti-discrimination legislation has incorporated a positive duty since 2010. This positive duty is likely to incorporate an expectation that employers have prevention plans in place.
- Discussions about the outlawing of non-disclosure agreements (NDAs) need to carefully balance the rights and needs of victims of sexual harassment, taking into account that many of Mr Bornstein’s clients seek the privacy and confidentiality that an NDA offers. NDAs should be subject to time limits or scope for the victim to otherwise not be constrained from discussing their experiences when they are ready to do so.
- Mr Bornstein also highlighted that there will be more arrows in the quiver for the prosecution of sexual harassment and related discrimination claims, with the Australian Human Rights Commission to gain powers to make representatives claims, lifting the need for individuals to prosecute their own claims in all cases.
- [email protected] Panel
Kate Eastman AM SC
Lindall West, Managing Director, Ombpoint
Kristen Hilton, Former Victorian Equal Opportunity & Human Rights Commissioner
This panel focussed on the potential impact of incoming legislative measures and the practical steps that businesses can take to make workplaces better and minimise harm.
- Employers need to recognise the power that comes with the positive duty as an important first step in taking leadership to consider all reasonable steps to eliminate sexual harassment in the workplace
- A “prevention plan” is an important element of satisfying the positive duty. It is not a single policy document. Rather it requires employers to review their businesses and culture.
- The new concept of sex-based harassment and gender stereotyping goes beyond the concept of sexual harassment and is intended to capture micro-wrongs and long-standing gender-based stereotyping.
- NDAs can maintain confidentiality and privacy if that is what the impacted person chooses. Blanket bans are not appropriate and remove bargaining power held by women in seeking a settlement of their claims.
- Speak-up culture is part of protecting victims. Employees raising issues, and employers responding effectively at an early stage, are important elements of this.
- Services like Ombpoint provide a valuable first line of protection by triaging issues when they first arise, potentially resolving them before unnecessary escalation but also allowing space for important issues to be escalated.
- Diversity in the workplace is going to be an economic lever and opportunity.
A core message out of the panel was the need to ensure your businesses are ready for the legislative changes including the introduction of a positive duty. Having the engagement of your Boards, managers and employees will be key.
- The Political Perspective – Jacquie Lambie, The Jacquie Lambie Network
While not an attendee at the Government’s Jobs + Skills Summit, Senator Lambie spoke to our event and made it clear that any reform arising out of the Jobs + Skills Summit will require her support, or the support of another of her crossbench colleagues. Senator Lambie raised concerns that those making political donations would have the loudest voices when considering the legislative reforms to flow from the Summit, reinforcing her general concerns that reform around the regulation of political donations is sorely needed.
Senator Lambie pointed out:
- there was a risk that the Government summit would make a lot of noise but not actually solve the real problem of cost of living that was impacting all of the people she represents;
- the unions do not necessarily speak for all working people, and decisions made out of the Summit are made by people in places like Melbourne for people on their doorstep, not for the people in the communities she represents;
- we need fewer “roundtables” because they “go round and round and nothing gets done”, we need greater consensus and action on consensus. The Government needs to listen more to community and less to lobbyists and those who pay to be heard;
- political donations should be prevented and replaced with a system of solely public funding;
- in north-western Tasmania, the heart has been ripped out of TAFEs which were previously a hub of the community, and the impact on the skills held by members of the community had been devastating.
- The Political Perspective – Senator Michaelia Cash, Coalition
When invitations for the Government’s Jobs + Skills Summit started arriving, Opposition leader Peter Dutton was quick to send back the Coalitions “will not be attending” RSVP card.
This did not mean that we were left without the views of the Coalition on industrial relations reform. Shadow Minister for Employment and Workplace Relations, Michaelia Cash, set out the Coalition’s concerns with the agenda being taken by the Government to the Jobs + Skills Summit.
Senator Cash told the Fringe Summit that genuine reform that makes it easier for businesses to find workers would be embraced, and pointed to the reforms that the Coalition had achieved when in Government, including:
- banning corrupting benefits for unions and establishing the Registered Organisations Commission to restore integrity for members who pay their union dues in good faith;
- protecting vulnerable workers;
- re-establishing the Australian Building and Construction Commission;
- protecting the role of thousands of volunteer fire fighters in Victoria; and
- abolishing the Road Safety Remuneration Tribunal with the support of small business owners; and
- passing legislation to clarify the status of casual workers and prevent “double dipping” on entitlements.
Senator Cash highlighted the Coalition’s policy to increase access to work for pensioners (without affecting their pension payments). This became a recommendation that was adopted by the Government at the end of the Jobs + Skills Summit. She also:
- reaffirmed the coalition’s support of the ABCC and criticism of the Government’s action in defunding the body and stripping the provisions of the Building Code;
- noted the economic impact of current strike action at Sydney Trains and ports as an indicator of the kind of disruption that would be caused by the industrial relations changes being contemplated by the Government Summit, particularly sector bargaining;
- reaffirmed the Coalition’s commitment to 6-year maximum nominal terms for greenfields enterprise agreements on major projects; and
- pointed out that changing the test for casual employment, legislating “same job, same pay” and making labour hire unworkable would have a damaging effect on business, particularly small business.
- Fringe Festival Full Bench
Former Deputy President Greg Smith AM
Former Deputy President Geoff Bull
Former Commissioner Danny Cloghan
The proceedings in the first instance reflected a diversity of views on what were the key priorities for the Summit to achieve. A Full Bench of Former Members of the Fair Work Commission was accordingly convened, and points of appeal put to Former Deputy President Greg Smith AM, Former Deputy President Geoff Bull, and Former Commissioner Danny Cloghan for their consideration and determination.
- In answer to the appeal question of what “productivity” means to the tribunal, Former DP Greg Smith AM observed that the Australian Industrial Relations Commission took an active role in ensuring productivity returns in the settlement of industrial disputes and questioned whether it was appropriate for productivity to be removed as a factor to which the Commission should give active consideration in its decision making outside of the annual minimum wage decision.
- In answer to the appeal question of whether bargaining is broken, there were split views. Some expressed that it can work well but depends on the attitude of the parties. All considered the current tests applied for approval of agreements required reform and that the Commission should have a greater role in assisting parties to resolve deadlocks.
- In answer to whether the Commission should be made more accessible by conducting hearings in shopping centres, the Full Bench unanimously dismissed the appeal. We were also relieved that an appeal to include lawyers in Fair Work Commission proceedings was also unanimously upheld.
- Where to now?
The Government closed the Jobs + Skills Summit on Friday in Canberra with a statement that it will take “immediate” action to update the Fair Work Act. This is in addition to a list of what it has described as “complementary existing commitments” that it promised to deliver at the election and, in many cases, are already in bills that are before parliament.
It is important to remember that this immediate action starts with business, union and Government consultation and must be passed by the parliament, including an upper house where the Government needs the support of the Coalition or a combination Greens and a crossbencher to get legislation through. We heard from representatives of these three groups, and it suggests that support is anything but guaranteed.
For those who attended the Kingston Reid Jobs Summit Fringe Festival we hope that you found it as informative and thought provoking as we did. For those who did not we hope that we have captured some of the highlights here and would of course be pleased to discuss anything that has piqued your interest further with you.