The Weekend Australian, May 6, 2017, Grace Collier
Wonderful news: in late March, Nick Xenophon put to the Senate a motion he wants voted on. Next Tuesday, the vote will occur. A positive result is anticipated but, just in case, cross your fingers please. If the vote does get up, it will signal another victory in my jihad against dodgy deal-making between companies and unions.
The motion requests a Senate inquiry into “claims that many employees working for large employers such as Coles, Woolworths, McDonalds and KFC receive lower penalty rates under their enterprise agreements than those set by the relevant modern award, giving those employers a competitive advantage over smaller businesses that pay award rates”.
A report on the findings is requested by August 14.
To get up, the motion needs support from one of the major parties. Labor cannot be relied on; it is compromised on this issue. So much money from these arrangements flows to Labor via the union involved.
Therefore it falls to the government to support the motion and assist the inquiry. This is the time to up the ante and ram home Labor’s revolting duplicity on penalty rates.
Malcolm Turnbull loves to make snide remarks in parliament about Bill Shorten’s dodgy deals from years ago, but the Prime Minister is strangely silent on the dodgy deals that exist right now.
This makes no sense at all, particularly in the light of recent submissions made by a new trade union to a Senate inquiry into a related topic, corporate avoidance of the Fair Work Act. As the submission shows, the numbers are staggering. This data could be used to smash Labor’s penalty rates campaign into oblivion.
The Retail and Fast Food Workers Union represents workers in the retail and fast food industry, and it offers workers an alternative to the now toxic “Shoppies” union, the Shop Distributive & Allied Employees Association.
The RAFFWU submission says: “Approximately 500,000 workers are employed under SDA-negotiated agreements at any one time. The estimated loss (compared to the minimum remuneration provided by the award) to workers employed under these agreements is in excess of $300,000,000 each year.”
The submission concludes: “Coles, Woolworths and McDonalds are the three largest private sector employers in Australia … there is ample evidence to raise concern that these and other major Australian employers have engaged in conduct specifically aimed at subverting the objects of the Fair Work Act, and leading members of the Fair Work Commission into error … assisted by the SDA … the result of this conduct is wage theft, on a colossal scale, from the lowest paid workers in Australia. It ought not be permitted to continue. It ought to be retrospectively fixed, through compensation. Those responsible should be held accountable, including those at the SDA.”
I couldn’t agree more.
For decades, industrial relations professionals, when applying for jobs, would commonly list “a good relationship with key unions” as a selling point of their skill set. What this really meant was the person was willing and able to strike dodgy deals to advantage the employer and the union but disadvantage the employees.
Things are changing, though, and the incidence of enterprise bargaining is plummeting, particularly in the retail sector. According to Department of Employment data, since 2014 there has been a 30.8 per cent decline in current agreements, and in retail the drop has been by 49.1 per cent.
Further, recent data from the Australian Bureau of Statistics shows that in the past two years union membership in the private sector has dropped to 941,500 (a loss of 55,200), with density going from 11.1 per cent to 10.4 per cent.
As workers turn away from unions, and companies turn away from bargaining, professionals need to fill the void. Companies need to be shown how to terminate agreements, return to the award and pay their staff by individual arrangement, at market rates where appropriate. To do this, they must develop new ways of engaging with staff to build trust. Relationships should be made with employees rather than union organisers.
Lawyers, and accountants, too, need to pay extra attention to the advice they offer.
The RAFFWU submission says “it is simply not believable” that Coles, Woolworths and McDonalds, which have “a sophisticated corporate structure and access to specialist legal advice, did not know what they were doing or, at the very least, were reckless as to the consequences of their conduct”.
Again, I couldn’t agree more.
Before any enterprise agreement is sent out to the workforce, managers cost the wage outcomes before requesting final sign-off from the boss. Any company that makes an agreement that pays staff below the award will know it is doing so, and its advisers may too. Anyone who drafts an agreement will know if it pays people less than the award.
As the corruption and graft are washed out of our system, companies that face prosecution and back-pay bills may look to recover their costs from the lawyers advising them.
Just this week, the Federal Court found an accounting firm liable as an accessory in underpayments of wages breaches in a prosecution against a restaurant. Emails between the accountant and the restaurant showed the accountant must have known, and was therefore complicit.