Morrison’s COVID-19 response puts profits ahead of people

Lisbeth Latham

Federal parliament passed the Coronavirus Economic Response Package (Payments and Benefits) Bill 2020 on April 8, which provided the enabling legislation for a range of stimulus measures the government has already announced, including the JobSeeker allowance.

While the creation of the JobSeeker allowance is significant, and has been welcomed by Australian Council of Trade Unions (ACTU) secretary Sally McManus as a “victory”, the package has a number of significant weaknesses.

Essentially, it outlines that the bulk of the economic crisis will be passed on to working people, particularly more marginalised workers.

The JobSeeker payment will provide qualifying employers with $1500 a fortnight per qualifying employee for six months.

There are qualifying thresholds for employers: those with less than $1 billion in turnover must also have lost more than 30% of their revenue; those with more than $1 billion in turnover must have lost more than 50%; and charities must have lost more than 15%.

When it became clear that there was to be a special category for charities, TAFEs and universities had hoped to be included under charitable organisations. But the government has since made it clear that the payment would only go to organisations providing direct charitable support.

For a worker to qualify, they must be either a permanent or fixed-term employee, and employed prior to March 1. A qualifying casual employee must also have been working for their employer for more than 12 months.

The $1500 JobSeeker payment essentially establishes a new income floor for qualifying employees, paid for by the government.

For around 30% of workers the subsidy reflects either an improvement on, or a maintenance of, their current incomes.

But for the majority of workers, it represents a wage cut and, for many, a significant one.

As the new act amends the Fair Work Act to make it easier for affected employers to change workers’ hours, direct them to take leave, relocate them and make changes to the work they do, any reduction in hours will result in a corresponding reduction in pay for workers, down to a minimum of $1500.

The subsidy is not the starting pay. Rather, a worker will need to work towards and surpass the equivalent number of hours if they are to receive close to their normal pay, as employers are only required to pay a qualifying worker whichever is greater of the $1500, or whatever the worker earns in a fortnight.

For companies still employing people in work, the subsidy is more a subsidy to their profits rather than a wages subsidy, with workers in effect providing $1500 unpaid labour each to the employer.

The failure of the government’s stimulus package to sufficiently protect workers’ incomes was highlighted by an ABC report on April 9 which stated that 617, 000 people have told the Australian Tax Office (up from 360,000 on April 3) that they will be seeking to draw on their superannuation accounts this financial year (after April 20).

If each of these draws the full $10,000 eligible, that will amount to $6 billion. This will not only undermine the future retirement of those workers, but it will impact all working people.

However, as inadequate as the package is, a far greater problem are the hundreds of thousands of workers who do not qualify for any subsidy right now.

These include more than 1 million casuals, workers on visas and workers employed in firms which have not met the revenue loss threshold, but are dismissing or standing down workers nonetheless.

The ACTU had been lobbying for a broader qualifying definition for casual workers, based on a reasonable expectation of further work, which is part of the test for casual employees qualifying for unfair dismissal protections.

Attorney General Christian Porter rejected the ACTU on the basis that it was “too broad”. He justified the government’s decision not to include more casuals on the basis that “casuals move between multiple employers”.

Porter would know that many casual workers rely on a single employer. It also ignores the reality that, while some new work being created, that is dwarfed by the numbers losing work.

The government’s refusal to include all visa holders in its wage subsidy protections, combined with Prime Minister Scott Morrison’s April 3 statement that struggling international students should “go home if they can’t support themselves”, is consistent with successive governments’ view that international students and other visa-holding workers are sources of income and cheap labour which can be disposed of at whim.

Leaving Australia is not a viable option; the government's callousness will simply force these workers into extremely insecure and exploitative situations.

The United Workers Union has launched an important campaign for no worker to be left behind, irrespective of visa status, with an amnesty for undocumented workers. It should be supported. We also need to demand that workers be given permanent residency and citizenship, should they request that.

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[Originally published in Green Left Weekly #1260]
This article is posted under copyleft, verbatim copying and distribution of the entire article is permitted in any medium without royalty provided this notice is preserved. If you reprint this article please email me at revitalisinglabour@gmail.com to let me know.

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Can unions Stop the spread of casual work?

Lisbeth Latham

During the past two decades, the number of Australian workers employed as casual workers has grown dramatically. More than 2 million workers — or a quarter of the workforce — are now employed on a casual basis.


“Casual employees offered cheaper labour costs, they offered greater ease of dismissal, they offered the opportunity to match labour time to fluctuations in demand, they offered greater administrative convenience, and they offered a greater opportunity for enhanced control of employees”, Dr Ian Campbell, a lecturer at RMIT, explained in a submission to the Australian Industrial Relations Commission (AIRC).

While casual employment may be good for company profits, it increases work stress and uncertainty for workers, and exacerbates income inequality. According to the Australian Council of Trade Unions' (ACTU) Future Strategies report, during the 1990s almost three out of every four jobs created were casual or part-time. Eighty per cent of the jobs created paid less than $26,000 a year. This lowering of income partly reflects that most casual workers are part-time, but a hefty 39% of casuals are full-time workers.

Casual employment is not, as many believe, used mainly as a temporary stop gap. Tony Abbott, the federal workplace relations minister, told parliament on June 23 that the majority of casual workers have worked for the same employer for the last 12 months and have regular patterns of work.

The federal government, and employer organisations such as the Australian Chamber of Commerce and Industry and the Australian Industry Group, justify the increasing casualisation of work with the claim that a “flexible” work force will ensure business competitiveness.

This just means that denying workers’ holiday and sick leave means bigger profits. In the NSW TAFE system, for example, there are more than 15,000 casual part-time staff. According to July 4 episode of the ABC’s Stateline program, casual “part-time” teachers working full-time hours earn approximately 30% less than their full-time colleagues employed on permanent basis.

The growth in casual employment also undermines conditions for permanent workers, who are driven to become more “flexible” in order to compete. In the stevedoring industry, for example, the current P&O agreement creates a new form of work — “permanent irregular”. While they have a guaranteed annual income, these workers will not have a roster. Instead, like current casuals, their shifts will be irregular and impossible to plan around.

A large number of different employment conditions makes it harder to develop solidarity in a workplace. It’s easier for bosses to play the different groups against each other.

There have been a variety of different responses to casualisation from its opponents. Unions have tried to improve conditions for casual workers, limit the spread of casual conditions and ensure casual workers can move into permanent positions relatively quickly.

To achieve this, unions have pursued clauses in enterprise agreements and rulings in the AIRC that limit the proportion of a work force that is casual, limit the amount of time a worker can be employed casually and make casual workers more costly to employers.

Casual employment conditionsIn 1999, the metal division of the Australian Manufacturing Workers Union applied for a variation in the metal and engineering award, in order to improve the working conditions of casuals. The AMWU wanted to increase the casual loading to 30% and establish a minimum daily hiring period (“engagement”) for workers.

Casual loading compensates casual workers for their exclusion from award benefits such as sick and annual leave. The union estimated that anything less than 30% meant casuals would be worse off than permanent workers.

One of the worst pitfalls of casual work is the lack of certain income. The daily minimum engagement was designed to limit this, and ensure that workers knew they would be paid enough to offset the costs of going to work, such as transport and childcare. The AMWU applied for a minimum engagement of six hours, and a maximum of one engagement per day.

While the AIRC accepted the AMWU’s arguments, it granted an increase in loading to 25%, and a minimum engagement of four hours, with workers able to be engaged more than once a day.
Despite the short-fall, this case provides a basis to argue for such changes for all casuals. The National Tertiary Education Union (NTEU) is attempting to use the decision as a precedent to win a 25% casual loading as part of its national pattern bargaining campaign for new industrial agreements. The Australian Workers Union (AWU) has also won an increase in the casual loading to 25% for horticultural workers and shearers.

An alternative approach is being followed by the New South Wales Teachers Federation. In a claim going before the industrial relations commission in September, the federation is asking for casual part-time TAFE teachers to receive pro-rata conditions such as holiday and personal leave. The claim is for staff who work eight or more hours a week, and will affect 5200 teachers in New South Wales.

Limiting casual employment
In the 1999 metal and engineering case, the AMWU unsuccessfully attempted to ensure casual employees were only employed to meet short-term work needs, in emergency circumstances, or to perform work unable to be practicably rostered to permanent employees. The union wanted to ensure that permanent employment remained the standard form of employment.

The NSW Public Service Association (PSA) won an alternative limit on casual employment in the libraries of the Illawarra TAFE Institute during 2001. The institute's management had attempted to reduce permanent employment by replacing retiring permanent workers with contract casual labour. Through a persistent industrial campaign, the PSA's members were able to win a 5% cap on the proportion of workers that could be employed as casuals.

Converting casual to permanent employmentDuring 1999 and 2000, three landmark award decisions gave casuals the right to transfer to permanent employment after a period of time. These were the graphic design award, the South Australian clerks award and the metal and engineering awards.

On the graphic design award, the AIRC ruled in 1999 that after 12 weeks, casual workers would automatically switch to permanent employment. This could be extended, if the worker, union and employer agreed, by a further 12 weeks — if the work was ceasing during that time.

In a 1999 case before the South Australian industrial relations commission, workers covered by the clerks’ award were given the right to “voluntary conversion” after 12 months, although this could be extended to two years. Under voluntary conversion, workers must apply to be made permanent, and can be refused if “reasonable grounds” are given.

In the 1999 metal and engineering award case, the AMWU applied for automatic conversion to permanent employment after four weeks, extendable to eight weeks. However the AIRC ruled that in order maintain “employer flexibility”, voluntary conversion would apply after six months, extendable to a year.

The AMWU wanted a shorter pre-conversion period in order to discourage bosses from laying off workers instead of making them permanent, then hiring new casuals. The shorter the period, the more often bosses would have to hire and train workers in order to keep rotating casuals.

Since these decisions, conversion rights have been inserted in a number of awards. In May 2003, the Liquor, Hospitality and Miscellaneous Workers Union (LHMU) won voluntary conversion after 12 months for workers in the hospitality industry. Casual horticultural workers in New South Wales, South Australia, Tasmania and Victoria now have voluntary conversion after 12 months. The NTEU is also seeking conversion rights after 12 months in its pattern agreement.

According to Professor Barbara Pocock from the Centre for Labour Research at Adelaide University, voluntary conversion provisions have had limited success. “This is not surprising when you look at the workers who are in casual employment, and the precarious circumstances of their employment”, she told Green Left Weekly. “There are two reasons for this low uptake. Firstly, any casual worker applying to their employer to [be made] permanent is sticking [his or her] head out, so it would take a very brave person to do so. Secondly, most casual workers are on low wages, so the move towards permanent employment means a 20% cut in take home income that they cannot afford”. Pocock's research indicates that many casual workers underestimate the risks of casual work, which has no sick leave.

Pocock argues that casual work should be “strictly limited to truly temporary work, and any work that extends this should automatically convert to permanent employment. This would allow workers to factor into their budgets the move to permanency and would eliminate an abuse of the industrial relations system”.

The AIRC might be unwilling to allow short-term, automatic conversion to permanent employment, but the Victorian AMWU has shown it is not impossible to win it. In the branch’s metal division Campaign 2003, the model agreement includes automatic conversion from casual to permanent employment after 12 weeks. Through militant industrial action, this has already been won at a number of work sites.

Originally published in Green Left Weekly #547

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