The 6th Annual Ron McCallum Debate saw a fascinating discussion on inequality and insecurity. Featuring speakers from different perspectives, the Debate covered:

  • the experiences of workers in insecure work;
  • the reality faced by small and medium businesses in today’s economy;
  • the regulatory deficiencies that provide the conditions for the exploitation of temporary migrant workers;
  • the importance of education and leadership in building a strong society; and
  • some of the causes of and solutions to rising economic inequality.

The take-home message of the night was provided Ron McCallum himself when he reminded us that there is always another way. He encouraged us to think big and to think outside the box when considering how to respond to the challenges of insecure work and economic inequality.

                 “Beware when anyone tells you that there is only one way to do something, or only one way to solve a problem. This is almost always not true.” Ron McCallum

In opening the event, AIER President and Chairman of Harmers Workplace Lawyers, Michael Harmer, acknowledged the traditional owners of the land and reflected on the fact that our society is built off the back of the invasion of the land of the First Nations’ people. He went on to note the AIER has long argued for a principles-based approach to industrial relations as found in the Australian Charter of Employment Rights. Michael argued that the non-principled leadership and short-termism of many business leaders has lead to Australian workplace cultures being consistently ranked internationally as passively defensive or aggressively defensive and bullying in nature. He argued that in the context of technological change and how work is changing, a principled-based approach is important to guaranteeing fundamental human fairness and decent workplace cultures.

“Australian workplace culture is the major cause of the current mental health pandemic in this country. In that context for our Productivity Commission to give a big tick to our workplace relations system that produces those results … is an abject farce.” Michael Harmer

Introducing the topic and the panel, the Debate Moderator, the Hon Geoff Giudice, reminded the audience of a group of people who are locked out of the Australian labour force altogether – the hundreds of people seeking asylum in Australia who are being held in offshore detention on Manus and Christmas Islands and Nauru. Geoff quoted from an Amnesty International and Human Rights Watch Report on how this policy as resulted in the Australian government violating the rights of people seeking asylum to be free from torture and other ill-treatment, and from arbitrary detention, as well as other fundamental protections.

“Many countries are wrestling with immigration and refugee policy. But I venture the view that it is indefensible that fellow human beings who are seeking safety and freedom in Australia should be treated in this way.”                      The Hon Geoff Giudice

Kicking off the substantive discussion, Caterina Cinanni, National President of the National Union of Workers, highlighting the differences between people who have secure employment – having an income you can building a life around; and people in insecure work – paid less, segregated, more likely to be bullied. She noted that there is no pathway to cross from one side to the other. Globally, 50 multi-nationals companies directly employ only 6% of their workforce. Caterina provided stories of three workers in insecure work – Han, Steven and Ross – and how their experiences show that businesses that are utilising insecure work are:

  • Driving resentment, division and an ugly racism in the workplace and the community;
  • Creating a two-tier labour market of the insiders and the outsiders; and
  • Driving underemployment through practices such as casual pools and 4 hour shifts to avoid lunch breaks.

She then discussed various solutions that would restore control and power back in the hands of those that need it – the workers. These solutions include:

  • Obligations to attach to where real power lies, that is, at the host employer;
  • Economic bargaining, not enterprise bargaining, where workers can bargain with the entity that has the real economic or market power;
  • Freedom to bargain including scraping prohibited matters, and the workers to choose scope of agreements which could be across industries;
  • A real right to strike and take collective action with no injunctions and no penalties;
  • Labour-hire licensing to get rid of the bottom feeders;
  • 30 hour week with no loss of pay, providing work to the unemployed and underemployed and life balance for the overworked.

But fundamentally, the solution lies in the right of workers to organize into unions. Insecure work strips workers of power, control and a voice at work. Only unions can restore all three of these elements. Only unions can provide hope for change. Caterina gave the example of the NUW’s Fair Food campaign. Rights and freedoms for unions is critical in this debate. Laws and policies are wonderful things but cannot work without the power of workers to stand up and tell their stories and enforce their rights.

“Insecure work is not about choice, or flexibility or freedom. It is about power, control and profit.” Caterina Cinanni

Kate Carnell, the Australian Small Business and Family Enterprise Ombudsman, followed with a small business view. She asked “What does the Australia look like?” The small business part of economy is the engine room. It is the part of the economy that is growing quickly from an employment perspective. Furthermore, increasingly small businesses are run by women and run efficiently.

Big business, from an employment perspective, is getting smaller. They are in a better position outsource and offshore while technology is reducing the number of people needed. This is what the global economy looks like. Kate suggested it is naïve to have this debate suggesting the future workforce is about big business employing people 9-5, or people who aspire to work 9-5. That is simply not what the workforce looks like. It looks like innovative small business people in a range of different areas.

She then reflected on the parts of the economy that are growing:

  • Finance is a global technology-based business, operating 24 hours a day;
  • Retail where we as consumers except shops to be open on Sundays and after hours, which is when on-line shops are open;
  • Hospitality and tourism is a huge growth area but businesses need to be open and available to service that industry;
  • Housing sector has always operated on sub-contractors, same as the telco industry;
  • Service industry is the biggest growth area providing the services to help us live the life we need, such as aged care.

Kate argued we need to make sure that when we talk about insecure work we are talking about the reality of the market we live in. Obviously we need and should have good solid underpinning employment standards and companies that break the law should be help accountable. But what we don’t need is workplace laws that fundamentally stop the service industry, or our tourism industry to grow to meet consumer demand.

Kate concluded by throwing down challenge, asking why do small businesses employ casuals and contractors? Because the current system is too complex. The difficulty of ramping up the workforce to meet demand and ramping it down when demand isn’t there is incredibly difficult under the current system.

“One size does not fit all. A flexible workforce is essential to ensure more women are in the workforce, more young people are in the workforce and increasingly that more older people have the capacity to get jobs that are flexible and suit their lifestyle.” Kate Carnell

Dr Joanna Howe spoke next focusing on the experience of temporary migrant workers in Australia. Almost one tenth of the Australian workforce are temporary migrant workers, and the number is growing. These are 457 visas holders who are highly skilled workers and also working holiday-makers and international students, visas not typically identified as being for work purpose. But increasingly, Australia has a backdoor, low skilled labour migration program.

After proving some examples of the exploitation of temporary migrant workers, Joanna argued that there are systemic reasons in the design of Australia’s temporary migrant worker program which make visa holders more vulnerable and insecure than their Australian counterparts. While in theory temporary migrant workers have the same rights as other workers under the Fair Work Act, in practice temporary migrant workers fail to access legal remedies. Furthermore, the vast majority of claims on behalf of temporary migrant workers are made by the Fair Work Ombudsman not by the workers themselves. So the uncovering of exploitation relies on the limited resources of the FWO.

Joanna provided three reasons for her argument of the systemic vulnerability of temporary migrant workers:

  • Australia’s migration settings create a strong link between employer sponsorship and permanent residency;
  • Prohibitive visa conditions which create extra pressure on temporary migration workers that when breached can lead to visa cancellation and deportation; and
  • Allowing employers to dictate the composition of Australia’s skilled temporary migrant workforce and that we have a backdoor for low skilled workers through the working holiday and international student visas.

In conclusion, Joanna suggested three solutions:

  • Uncouple permanent residency from one employer’s sponsorship, allow periods of employment to count;
  • Remove deportation as the penalty for breaches and replace it with a system which is far more proportionate and appropriate such as fines and administrative sanctions; and
  • Rethink the regulation of skilled and low skilled migrant worker pathways so the are based on Australia’s actual labour market needs, including establishing an independent expert commission to determine which occupations are in shortage and which are appropriate for temporary labour migration.

“Under the Fair Work Act 2009 (Cth) we expect that temporary migrant workers would have the same access to ‘the fair go’ as their Australian counterparts – after all, the law applies equally to both. However, in practice, we find a different story emerging.” Joanna Howe

[Joanna has a chapter on these issues in the AIER’s latest publication Employment Rights Now]

Alex Malley from CPA Australia spoke about the importance of education and leadership. He suggested that we need to look at the issue holistically and that includes considering access to education and the right to be relevant as individuals. He argued we need a school system that is tech-savvy, that is more focused on Asian languages and that looks to enhance communication skills. These are all skills that will help to build the individual.

Alex went onto say that the whole topic is about leadership. We are just not getting political or public leadership on a whole range of topics including this. So if we are not getting it then what is our next option? To show ourselves through example and building good business cultures.

He suggested three themes for building a good culture in business:

  • Purpose – the purpose of a business needs to be wider than profit and has to contribute to the community locally and contribute to the economy nationally;
  • Mentoring – mentoring young people, talking to the next generation, providing access to experience ad wisdom is essential to how cultures develop.
  • Recognition of the individual – business needs to respect and create opportunities for each individual to develop multiple skills and the ability to fend for themselves.

“If you want to build a strong society, you build a strong individual.” Alex Malley

Jacqueline Phillips from ACOSS began by acknowledging that inequality and insecure work are daily realities for Aboriginal and Torres Strait Islander people in Australia. She then outlined the trends in income inequality in Australia:

  • Over the last 20 years the share of income going to those at the top has risen, while the share flowing to those in the middle and at the bottom has declined.
  • Strong employment growth over the past 17 years helped to reduce income inequality, but wages growth has been very unequal and acted to increase income inequality, as did increasing disparities in working hours.
  • Over the 25 years to 2010, real wages increased by 50% on average, but by 14% for those in the bottom 10% compared with 72% for those in the top 10%.

Jacqueline noted that our tax and transfer system, along with a full employment policies, universal access to public education and a unique system of wage regulation have protected Australia from becoming a more socially and economically divided country. But we now face very real threats to these institutions.

She went on to discuss the role the changing nature of work and the labour market has played in these trends of growing inequality and poverty. In particular she noted the increase in part-time work and growing under-employment and the continuing significant gender pay gap.

Jacqueline concluded with a number of actions the government can take to manage these shifts:

  • Provision of minimum adequate living standards for low paid workers. The combined effect of minimum wages and family payments on the extent of poverty in families should be considered in setting minimum wages.
  • Maintenance of an adequate social safety net so people can cope with periods of unemployment or underemployment. This requires increasing the Newstart payment;
  • Provision of assistance to low and middle-income families to supplement income earned through paid work and meet the costs of children;
  • Ensuring tax and economic policy settings that support investment in activities which will drive economic and jobs growth. This should include taxing different kinds of economic activity more consistently; and
  • Ensuring policy settings that recognize the changing nature of work and do not penalize people with fluctuating hours or income, for example, through rigid eligibility requirements. She noted it was for example a big risk for someone on the disability support pension to take a short-term job, as they would have to re-apply for the pension and may find themselves on a lower payment.

“Increase in part time work is really significant. Most of the growth in employment has been in part time employment…Underemployment is at an historic high…A lot of people not getting as much as paid work as they are willing and able to work and their incomes are suffering as a result and their ability to meet basic living costs.” Jacqueline Phillips

To conclude, Ron McCallum summed up the discussion so far with the clear statement that the system is clearly broken. He noted that we don’t have inequalities in US and UK but on other hand we aren’t the egalitarian society we were 50 years ago.

Ron asked – What can we do? We need better politics. The shrill discordant notes of politics are something he has not seen in his lifetime. The country is becoming ungovernable because of the electoral cycle. Ron argued that we need at the very least 4 or even 5 year fixed term parliaments so that politicians can focus on making long term decisions.

What about companies? They are caught up in short-termism and the 3 month cycles in the stock market. Ron suggested a closer look at the European style of company law with a two-tier board. A management board that meets frequently and an upper board with community members that looks at long term policy and acts as a body of moderation and restraint that might meet three times a year.

Ron asked – How can we alter our institutions so that long term coherent policies can be developed? For example, why do we persist in having long service leave? It was an innovative policy after WW2 when we were wanting to encourage workers to stay in their jobs long term. But what new policies can we think of for today’s circumstances? If one of the problems is that many workers don’t have access to leave, why not set up a leave bank? People could call upon it for annual leave, sick leave etc. and relieve some of those pressures.

What about trade union organisations? They should be able to make agreements solely for members. If freedom of association means anything, it means gathering together to get terms and conditions for your members.

Ron proposed extending the TCFUA regulations relating to supply chains to other industries such as food and agriculture for example, noting these represent are innovative ways we can operate.

Ron warned us about thinking there is only one way to do something. He gave the example of investing in infrastructure because this will trickle down. He then asked – Why don’t we give everybody a basic minimum income? More goods and services would be bought and economy would operate more smoothly. Finland is introducing a universal basic income next year and provinces in Canada are experimenting with the idea.

He urged us to tmake our politicians and company executives and trade union leaders and academics think more broadly and more challengingly.

Ron concluded by echoing Geoff Giudice’s opening comments on Australia’s refugee policies noting the outrageousness of detaining people on Manus and Nauru. Ron pointed out there are tipping points in society and there will be tipping on this issue.

He encouraged us to remember there is more than one way to do everything and that we need to demand clarity of thought and long term policies. Just as our forefathers did in establishing compulsory conciliation and arbitration which for 75 years of the last century made Australia one of the most egalitarian countries on the planet.

After Ron’s comments there were questions from the audience which covered the complexity of the Fair Work Act; whether part-time work is becoming the new form of casualisation without the loading; how unbridled corporate power hurts workers and small businesses; and what unions are not doing right.

There was general agreement across the panel on the complexity of the current laws but different approaches to how to simplify them. Ron argued for the need for broader discretion for tribunal and courts and that we don’t want the parliament legislating for every unlikely eventuality.

In response to how to provide some flexibility to deal with peaks and trough in business, Caterina noted that unions are not opposed to causal work or flexibility. In fact unions negotiate those arrangements everyday with workers. She also noted arrangement like the seasonal pool which when there is a peak everyone gets work, and when in a trough workers are involved in making sure the work available is fairly shared. There was also a challenge from the panel for unions to be more flexible.