Tuesday 15 August
Senator RHIANNON (New South Wales) (12:41): The Fair Work Amendment (Protecting Vulnerable Workers) Bill—it's not a normal name for a bill that comes out of this government. But the circumstances are worth considering. It got to a point where there was such enormous pressure on the government that they had to do something. But when we look at the detail of the bill we see that something isn't adequate; it doesn't actually solve the problem. And the problem is enormous: extreme exploitation of some of the most vulnerable workers that we have in our society. The fact that the bill has been introduced is significant, but we need to look into the detail, and the Greens will be moving amendments similar to those that my colleague the Greens industrial relations spokesperson, Adam Bandt, moved in the other place.
This bill is before us because of the courage of a few people who really looked into what was going on with the franchisees to understand the conditions that the workers were existing under. It became apparent that they are very tough. For many of them, their lives are on hold because of uncertainty with regard to the wages that they will be paid, and even if they will be paid. A lot of these scandals started with 7-Eleven. We quickly learnt that one person's convenience store is often another person's workplace of extreme exploitation and rip-offs. What we learnt is that 7-Eleven is probably just the tip of the iceberg, because there's Caltex, Domino's and probably many others where the loopholes in the law are now well-known by the legal eagles who are employed. They've worked out how they can become rich very quickly off the back of people who are actually keeping these businesses going.
These scams are extreme. It was found that some people were getting paid and were then being forced to give back part of their wages in so-called cashback scams. It was found that, so the proper payment and proper taxes did not have to be paid, the hours the people were being rostered for did not actually represent the hours they were working. It is a real scam of the books that has been going on for a long time and is now out in the open. We have the opportunity to clean it up, and clean it up properly, but that will only occur if this bill is amended.
What we also need to remember here is that the workforce that we're dealing with is often people with limited English or people who are from overseas and very worried that they may be under threat of being deported, even if they have a secure visa and it's totally legitimate that they live here. There have been many reports of intimidation, threats and insinuations made along the lines of, 'If you speak up, if you try to change things and get your proper pay, you could well be deported.' That's deeply shocking, and it needs to be factored in to how we handle this situation.
In my opening remarks I said that we have this bill before us now largely because of the dedication of a few individuals. One of them is Michael Fraser, who really dug into what was going on here. With the 7-Eleven case, he went from store to store collecting stories, winning the understanding, support and confidence of the people working there so he could document what was really going on—the levels of oppression and exploitation that shouldn't be occurring in workplaces anywhere in Australia. There was also a group of Fairfax journalists who took on this story and reported it in detail—another factor leading to the government being forced to act. We also learned from their studies that it was not just the workers who were getting done over; the people who bought into these franchise operations were, in many instances, also being put in a situation where their income was greatly reduced—it was often quite minimal—because of the way head office operated, and they were under pretty clear directions that a lot of the money had to go back to head office. Again, it's worth looking into the operations here: (1) we need to understand it and (2) it informs us of why this bill is inadequate in its present form.
How do these franchises work? Most of us have had the experience of going into a 7-Eleven. Wherever you go, they all look pretty much the same in terms of the stock that they carry, where the stock is, the signage and all that sort of thing. This is how it operates: the head office dictates how these places are managed, micromanaging to the nth degree. But one aspect of how these small businesses—if we can use that term in this case—operate that isn't consistent is the payment of wages. This is where they seem to have a whole different set of standards. The small business franchisees that run the business carry the legal risk if there is underpayment. It's not the head office; it's not the billionaire who's sitting back, doing pretty well off the back of the hardship of so many of the workers in the industry. We see time and time again that the worker who sits at the bottom is the one who is being ripped off.
This is where we are again reminded of the failure of the bill before us, because it does not offer the protection that the title of the bill suggests. If you believed the title of the bill before us—'protection of vulnerable workers'—you'd think it sounds pretty absolute, but that's not the case. What we need here is shared responsibility, and that is why we need to amend what's before us. The bill does not shift any responsibility back home to the owner—and they're really getting filthy rich off the way this system works. When you read the stories of the people who are making money for the people who own these companies, you see that what's going on is very ugly.
As I said, the bill does not make the head office responsible. Instead, it effectively says, 'You're only responsible if you knew or could reasonably have been expected to have known that the franchisee was underpaying the worker.' That's just passing the buck. It's simply unacceptable; it's been exposed and it has to change. That's why we're going to move to amend the bill—to close that loophole and make sure that the head office is responsible. That's the essence of what we're dealing with here. Really, the government should've had a good look at the Greens' bill that Adam Bandt, the MP for Melbourne, worked on. That really brings all these issues together and makes it very clear that we do need that shared responsibility, that you can't let the head office off the hook here.
So we will be moving an amendment that will make it very clear that, if you're a worker in one of these franchises—7-Eleven, Domino's or wherever—and you are underpaid, you can go straight to the head office and claim your underpayment. At the moment, it doesn't work that way. What happens is that the head office can just get out of it. We read that time and time again in those reports and articles about what was happening. They were just passing the buck back to the small business owners that they have further down their chain of command. This really does need to change here, otherwise what the government is doing is a farce. We need it set up so that if the worker wins a court case they can claim it against the head office. This is the key to achieving the protection that the government is stating is in this bill. Then it is up to the head office. They are then the ones who have to have the battle with the franchisees that they have brought in to run their stores. That is where the battle lies. Meanwhile, the workers who have been exploited and underpaid have been able to pick up their correct pay, because they have been able to go direct to the head office. It is a very simple requirement. The government has done a disservice here.
In many ways, it is classic in terms of what you see from Liberal-National parties when they are in government. They will often try to walk both sides of the road, particularly when a problem has been identified where the business world is doing the wrong thing. They will say, 'We'll bring in a correction; we'll fix this up,' but they have left the loopholes in the bill so that big business can still, effectively, get away with so much of the exploitation. Again, let's remind ourselves: it should not be the worker left in limbo trying to work out how they get their money, who owes them money and who can actually pay them. That is what was revealed in so many of the reports that exposed how so many of the companies were working. Whether it is 7-Eleven, Domino's or Caltex, there is a similar pattern. It is ruthless; it must stop. We have the opportunity right now to stop this level of exploitation.
I can't emphasise enough: it should not be up to the individual worker to try and work out who is the person responsible for the underpayment and who will actually pay them the money. We have to get rid of the tricks—and there are tricks in the legislation before us. Our amendment effectively says that the worker can go directly to the head office and get their money back. Then we're leaving it up to the franchisees and the head offices to fight it out and to work out how they are going to undertake their business model. It really does need to change. It really needs to recognise that people have rights and that they can't use some legal scams to get away with what's currently going on.
So, yes, we do need this legislation, but to be effective it does need to be considerably amended. I look forward to the discussion at the committee stage.