Casuals, contractors and gig workers set for ‘potentially massive’ changes under Labor
Work is going to change for millions of Australians.
- Labor will make job security a key aim of laws and processes around work
- Gig workers may get expanded protections and “employee-like” conditions
- There is little detail about the proposals
With the election campaign focused on issues as disparate as the cost of living, China’s growing regional influence and transgender women playing sport, you might have missed it — but the incoming Labor government has promised a radical overhaul of an employment system it says is letting workers down.
“The changes are potentially going to be huge… potentially massive,” says Dr Giuseppe Carabetta, senior lecturer in employment law at the business school of the University of Sydney.
Changes to boost security will be welcomed by Janine Saligari.
“It’s a juggle,” she says, of the pressures of insecure work.
She’s spent most of her career in the community services sectors, helping women from refugee, asylum seeker and migrant backgrounds.
It has been rewarding but the funding model meant a churn of insecure roles: short contracts and “temp” placements that lacked sick leave, holiday pay and superannuation.
Now in a stable position running programs at a neighbourhood house in the Melbourne suburb of Chadstone, Ms Saligari describes her job security as a relief from how she used to live.
“Usually going from pay cheque to pay cheque,” she says.
“Planning was just keeping a roof over your head. It’s really the basics. It’s just, ‘pay for your children, school’. It’s just the basics.”
Ms Saligari wants others to experience better job security, to give them the chance to plan their lives – not just try and line up their next shifts.
IR largely unheard
During the election campaign, industrial relations was not a key issue.
The main element discussed was the cost of living, which has been rising far faster than wages. That has led to a decline in “real wages” (what you can buy with your money) and falling living standards.
The key remedy — and flashpoint — was then-opposition leader Anthony Albanese’s support for the minimum wage increase to outpace the 5.1 per cent rise in inflation.
“We think no-one should go backwards,” he said.
Then-finance minister Simon Birmingham labelled the move a “thought bubble” and questioned Mr Albanese’s economic credentials.
“He’s put a figure out there without a shred of analysis or information to back up his position,” he responded at the time.
But largely undiscussed were Labor’s plans to potentially empower millions of workers by adding a new focus to laws around employment and to boost protections for those in the gig economy.
The new government has promised to enshrine secure work as an objective of the Fair Work Act, the laws around employment.
That impacts the Fair Work Commission, which sets the minimum wage and hears disputes between employees and employers.
If the change occurs, the commission will have to put job security at the heart of its decision making, alongside existing factors like productivity and economic growth.
Dr Leonora Risse, a senior lecturer in economics at RMIT University, says recent decades have seen a “shrinking share of profits and revenue flowing to employees”, with a larger share going to employers, shareholders and owners.
That shift has prompted the incoming government to take a closer look at job security, how wages are set and what’s happening to workers in the booming gig economy.
Labor promised to establish minimum pay and conditions for gig and ”employee-like” workers.
Creating this new class of ”employee-like” worker — such as contractors dependent on a particular business — could see those workers get minimum conditions and bargain collectively for new entitlements.
But there’s more.
“The ALP’s proposal to instil the principle of gender equity into the Fair Work Act would be a game changing step towards addressing the low pay of female-concentrated sectors such as aged care and childcare,” Dr Risse adds.
The poor wages in those sectors are a big contributor towards the gender pay gap.
“The way that the [commission] currently functions makes it very difficult for these sectors to put forward the case that they should be paid more,” Dr Risse argues.
Changing the law to make gender equity part of the Fair Work Act could force the Fair Work Commission to consider why the sectors deserve to be paid more: “including the longstanding societal norms that unfairly associate female work and care work as being of lesser worth.”
No change, please
Employers do not believe the gig economy is expanding employment insecurity — and argue that changes would disrupt an industry that is working for customers and workers.
Current challenges for business include supply chain disruptions, soaring costs of labour and materials, a worker shortage, weak productivity growth and rising interest rates, according to Innes Willow, chief executive of employer association the Australian Industry Group.
The Ai Group represents most of the large “platform” businesses with an on-demand employment model: where an app connects workers and tasks.
In a speech to the Industrial Relations Society of New South Wales just prior to the election, Mr Willox said the entitlements that commonly apply to employees do not suit how platform workers do their jobs.
The key example was the “three or 4-hour minimum” call-out that is common under large agreements called “awards”.
“A platform worker may be logged on to one or more apps waiting for a job while they are sitting on their couch at home,” he said.
Operators of platform employers want to be a part of any conversation about change.
Peter Scutt is co-founder and chief executive of Mable, an online service connecting people with care and support workers.
“Mable’s looking forward to having conversations with the government about their agenda around secure work,” he says.
“We’re certainly keen to share some of the experience of operating a platform that allows small businesses to come into the aged care and disability support sector.”
Mr Scutt points to different models among platform businesses — which range from things like food delivery and transport to tasks, specialist services and in-home care.
Mable, he points out, does not set the rates or terms of engagements.
“That’s small businesses engaging directly with their clients,” he notes.
Without wanting to pre-empt potential changes, Mr Scutt calls any alteration to the objectives of the Fair Work Act a “big undertaking”.
When your ability to feed yourself relies on work from the opaque algorithms of an app, any boost to security is welcome.
Nabin Adhikari works delivering food and groceries by car in Canberra. The soaring cost of living — and skyrocketing price of fuel — have added to his regular work problems of maintaining his vehicle and earning enough to live on.
A lack of transparency in how he is paid makes that a daily struggle.
“We never know how we are getting being paid,” he says.
“All the corporates are deciding what we get paid, there is none of any of the fundamentals on deciding a payment system for us.”
The inability to fight unfair dismissal or algorithmic punishments — where workers are penalised, blocked or stymied on the apps — is another issue for workers like Mr Adhikari.
“If we get minimum (wage) payment, that’s gonna change a lot,” he says.
Michael Kaine, national secretary of the Transport Worker’s Union (TWU), has been fighting on behalf of members as apps have changed the way the hire car and delivery industries operate.
“Increasingly, what we’re seeing in our economy is workers put in competition directly with each other,” he says.
Mr Kaine sees the definition that divides “employees and non-employees” as a legal ploy — “workers are workers and they deserve rights and protections” — that might finally be addressed.
“Pushing to that kind of flexibility — that some workers crave and that the companies talk about — there’s no reason we can’t have that and protect workers at the same time.”
You can see the growth in the gig economy in the number of food delivery riders or hire cars trawling city streets.
But the growth of casual work — like the rolling short-term contracts the new government seeks to cap — is contested.
An RMIT ABC Fact Check in 2018 found it was not strictly true that the rate of casualisation in the workforce has increased in recent decades.
But it was complicated by the fact there is no formal legal definition of casual employment and that the term is used interchangeably with “insecure work”.
ACTU secretary Sally McManus has pointed to so-called “gig economy” workers and a definition of insecure work as “that which provides workers with little social and economic security, and little control over their working lives”.
That would expand the proportion, because it would take in types of employment prone to being insecure, like casual work, fixed-term contracts, seasonal work, contracting, labour hire and home-based outworkers.
A Victorian inquiry into the gig economy looked at how to regulate the booming field.
Former fair work ombudsman Natalie James found many so-called independent contractors were “genuinely autonomous” self-employed workers with the ability to choose how they toiled.
“But an increased number of work arrangements are ‘borderline,'” Ms James wrote as chair of the inquiry.
The inquiry called the legal status of gig workers “a great unresolved question”. One which might finally be resolved.
The industrial relations reforms could be the most substantial since those ushered in during the 2000s under the Howard government’s WorkChoices scheme.
Dr Risse from RMIT University says they were designed to boost competitiveness, flexibility, and efficiency in the labour market.
“But they played a role in weakening employees’ negotiation power through collective agreements and tipping the pendulum towards employers to set the terms and conditions of employment.”
For Andrew McKellar, chief executive officer of business lobby group the Australian Chamber of Commerce and Industry, it comes down to what we want at the core of our industrial relations system.
“Job security has arguably never been better,” he argues.
Mr McKellar is hopeful a foreshadowed summit of employers, unions and others involved in employment — set for September — will change the conversation.
“It has to be all about driving flexibility and getting productivity outcomes,” he says.
“That’s the only way we’re going to be able to get real wages increasing in the Australian economy.”
Dr Carabetta from the University of Sydney is waiting for his invitation — and considering what Prime Minister Albanese has said about his overall approach to governing.
“He wants a more collaborative approach. And so those things will take time. Hopefully to eggheads like myself, academics like myself, as well.”