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  • Australia Needs Universal Paid Sick Leave To Get Through the Pandemic

    Australia Needs Universal Paid Sick Leave To Get Through the Pandemic

    by Alison Pennington

    Alison Pennington

    Senior Economist

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    Chief Medical Officer Brendan Murphy recently issued a directive that going to work with the ‘sniffles’ is ‘off the agenda for every Australian in the foreseeable future.’ But with millions of workers without access to paid sick leave, government plans to lift restrictions on economic activity could risk dangerous and costly outbreaks. 

    In this commentary, which originally appeared in 10 Daily, Centre for Future Work Senior Economist Alison Pennington discusses the consequences of low paid sick leave coverage for worker safety and public health efforts during the pandemic, and reviews the merits of a universal paid sick leave scheme to address both COVID-19 and precarious work.

    ‘No More Heroics Going To Work Sick’ Sounds Fine Unless You Have No Paid Leave

    Remember the Codral ‘soldier on’ television commercial? “With Codral you can soldier on”.

    In 2008 a concerned citizen on a WA hospital pandemic influenza committee complained to the Advertising Standards Bureau (ASB), worried the ‘soldier on’ message would ingrain community habits that could undermine emergency efforts during a national/international pandemic.

    The ASB dismissed the complaint, agreeing that Codral was designed to self-medicate for “sniffles”, not for more serious influenza symptoms.

    Now fast-forward to the present day. The world is facing a global pandemic. It’s clear the decision has not aged well.

    Outlining plans to get people back to work, Chief Medical Officer Brendan Murphy announced last week “no more heroics”. Going to work with a sniffle is now “off the agenda for every Australian for the foreseeable future”.

    I welcome Murphy’s sentiment. Changing social attitudes and behaviours is key to infection control.

    But sentiment isn’t policy.

    Murphy’s public health directive is out of touch with the reality for working Australians who, Codral or not, continue to soldier on in a labour market marred by precarity, low wages, and jobs without basic sick leave protections.

    In fact, more than 3.3 million workers have no access to sick leave – almost one in three workers. This includes almost one-quarter of the workforce employed on a casual basis. One million more are independent contractors, including many so-called ‘gig workers’ — better described as misclassified employees like food delivery drivers.

    Casuals without sick leave are often the most vulnerable workers in the economy. As unemployment surges they will feel increasingly pressured to work every shift they can. There are real financial consequences of taking unpaid leave from the workplace. The bills don’t stop rolling in. Rent needs to be paid.

    Even before the pandemic, going to work sick is not some benign workplace habit. Taking sick leave is perceived by many bosses as a lack of commitment to the job. Workers are often punished for absences with diminished opportunities and disciplinary performance management akin to bullying. This fuels high levels of presenteeism — even for those with sick leave entitlements.

    The new COVID-19 work regime is exposing society-wide risks of unequal sick leave coverage. About 30 percent of the workforce have the potential to work from home — predominantly professionals, managers and administrative workers. Insulated from contagion, remote workers are paid almost 25 percent more than those working outside the home. They’re more likely to be permanent, full-time workers with sick leave.

    Meanwhile millions of essential workers across supermarkets, transport, cleaning and community and social services go to work each day exposed to both income precarity and higher viral loads, all without the ‘safety’ of sick leave and secure work.

    The common factor in the two major workplace COVID-19 outbreaks at Cedar Meats and Newmarch House aged-care facility is labour hire: on-call work with no guarantee of future shifts. And no sick leave.

    To put it bluntly: in a pandemic, insecure jobs with no sick leave will literally kill people.

    The Fair Work Commission introduced two weeks unpaid sick leave for half the private sector workforce in April. Unpaid sick leave is, however, useless in preventing workers coming to work unwell if the outcome of sickness is still financial punishment.

    This is why Australia needs universal paid sick leave: a system that allows for up to four weeks of leave to account for the full incubation, treatment and recovery lifecycle of COVID-19.

    It’s easy to do this. The New Zealand Ardern Government introduced a sick leave scheme for all NZ businesses, organisations and self-employed people under hardship due to COVID-19 from day dot. Australian policymakers have been slow to act on sick leave reform, but it can act now.

    A universal sick leave scheme can be publicly funded and transferred to employers at a future date when they’re in better shape. To signal the transfer of obligations, the entitlement should be entered into the National Employment Standards (NES) — the set of minimum employment conditions covering all employees — with an additional scheme for independent contractors not covered by the NES.

    The elephant in the room is that government intends to plough on with a ‘bosses knows best’ industrial relations agenda that would expand casual jobs (without sick leave), cut wages, and undermine workplace coordination needed to contain the disease.

    But it will be impossible to resume economic activity without universal paid sick leave — lest we risk dangerous and costly outbreaks.

    Trust, discipline and sacrifice has been demonstrated by Australians to flatten the curve and ensure community safety. It’s time government reflected this good will in people’s working lives.

    The virus doesn’t care about the employment status of its host. We must combine principles of public health with safe, secure jobs.

    Taking a codral won’t help us soldier on through this pandemic. Legislating universal paid sick leave will.


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  • Log of Extraordinary IR Measures During COVID-19 Shutdowns

    COVID-19, Wages & Entitlements

    Log of Extraordinary IR Measures During COVID-19 Shutdowns

    by Alison Pennington

    Author

    Alison Pennington

    Senior Economist

    COVID-19 containment measures have suspended large sections of the economy. Governments have committed over $220 billion in income supports to workers and firms. The $130 billion JobKeeper wage subsidy scheme is the most extensive “shock absorber” (with worrying exclusions of many casual and migrant workers). With the scheme now in place, assessment of the government’s COVID-19 measures is now shifting to implementation. This includes effects on the laws and regulations governing wages and how businesses and employees (and their unions) interact to determine the terms and conditions of employment.

    Despite enduring a heightened anti-union agenda, unions (headed up by ACTU) liaised early with government to secure the JobKeeper wage subsidy to prevent mass layoffs. Unions have negotiated with industry to adapt Awards and enterprise agreements (EAs) to new business conditions. The Coalition government has proceeded with significant changes to the Fair Work Act that could hamper efforts to drive an inclusive economic and labour market recovery. What’s more, the Morrison government has indicated it will continue its pre-COVID agenda to further weaken representation rights and minimum labour laws.

    To inform assessment of the impacts of COVID-19 on jobs, wages, and workplace protections, we have summarised major developments within the industrial relations system since March 2020. The log traces revisions to Awards, enterprise agreement-making rules, new instruments formed between unions and industry, major decisions by the Fair Work Commission, and ongoing lobbying efforts by business to weaken minimum labour laws. Links to relevant research from Centre for Future Work released during the crisis, or prior to, are provided. All log entries are reported in the industrial relations publication Workplace Express. Links to other media outlets are provided where relevant.

    If there are any major IR developments that we have not reported here please get in touch at futurework@tai.org.au.

    Thursday 17 September

    • The Fair Work Commission rejects a union application for a $5 per hour “COVID-19 care allowance” for disability workers attending to clients quarantining with COVID-19. While the FWC acknowledged that disability workers were more at risk of having to take paid or unpaid leave to self-isolate, they considered the circumstances in which the allowance would be paid “rare and temporary”, while also presenting an undue cost burden on employers dealing with real or potential COVID outbreaks. The Commission also noted concern that the decision would trigger further litigation, leading to “pressure for a flow-on to other employees and awards” to other sectors with the same circumstances including in hospital care, aged care, home care and crisis accommodation.

    Thursday 3 September

    • New legislation introduced by Morrison government granting more flexibility for parents of young children to vary how they use their 12 months’ unpaid parental leave under the National Employment Standards (NES). The NES entitlement presently requires 12 months unpaid leave to be used in one continuous period (with the employee forfeiting any unused leave if returning to work before 12 months is up). Under the proposed changes, all parents (primary and secondary carers) will be able to access 30 days of flexible unpaid leave of their 12 months’ quota, subject to agreement by their employer about how the leave can be used (e.g. reduced hours, single days, groups of days, or one single block). Primary carers currently eligible under the government’s parental leave scheme will be able to claim the minimum-wage parental leave payment from Services Australia for their 30 days of flexible unpaid parental leave ($753.80 per week). The proposed laws also provide for 12 months of unpaid parental leave for families who have experienced stillbirths, infant deaths and premature births.

    Wednesday 26 July

    • Morrison government introduces JobKeeper V2.0 legislation. The Bill establishes a new two-tiered JobKeeper payment scheme and an additional revenue test that expands access to JobKeeper-enabled exemptions to the Fair Work Act (FW Act) for employers no longer eligible for the wage subsidy. The emergency FW Act measures were introduced in April for businesses receiving JobKeeper, allowing employers to change workers’ hours, duties, days, and location of work, and direct employees to take annual leave. The new Bill allows businesses that fail the existing 30% revenue decline test to apply for FW Act exemptions under a new 10% revenue decline test to determine whether they’re still “distressed”. Employees in businesses that qualify for the revised revenue test for JobKeeper-branded FW Act exemptions can have their hours reduced by up to 40%, with worrying implications for large reductions in employee incomes. The legislation states that employers cannot require staff to work less than two hours a day, and must provide seven days’ written notice before a JobKeeper-enabling direction is given. The Bill adds that employers cannot unreasonably target certain categories of workers for hours reductions, compared with other employees also subject to the directions.
    • The new two-tiered JobKeeper payment replaces the flat $1,500/fortnight rate with $1,200/fortnight for employees who worked full-time prior to the pandemic (in February), and $750/fortnight for employees working less than 20 hours. From January 2021, payments will reduce again to $1,000 and $650, respectively. The scheme will be extended to March 2021.

    Monday 27 July

    • As COVID cases surge in Victoria’s aged care sector, the Fair Work Commission approves an application for two weeks paid pandemic leave for healthcare and social services workers required to self-isolate for coronavirus. The Commission originally adjourned the application on 8 July due to concerns the leave entitlement would cause private aged care providers financial difficulty. The new COVID-era paid leave entitlement expires in three months and applies to full-time and part-time workers, but only casual workers with “regular and systematic shifts”.

    Tuesday 21 July

    • Morrison government reveals JobKeeper wage subsidy payments will be reduced from late-September under a new two-tiered system paying $1,200 for employees who worked full-time prior to the pandemic, and $750 for those working less than 20 hours in February. In January 2021, payments will reduce again to $1,000 and $650, respectively. Employers must continue to meet turnover tests to be eligible for the scheme which will be extended to March 2021.
    • The federal government announces the JobSeeker coronavirus supplement will be reduced from $550 a fortnight to $250 per fortnight, extended only until December 2021. The $300 cut to the supplement coincides with an increase in the income-free threshold for JobSeeker payments from $106 per fortnight to $300 per fortnight. Means-testing and mutual obligations will be reintroduced on 4 August.
    • Cuts to the JobKeeper and JobSeeker programs will reduce government spending by $10 billion per month and reduce the number of employees covered by the wage subsidy by over 2 million by December. Research released by The Australia Institute shows cuts to JobSeeker will plunge 370,000 people into poverty, including 80,000 children.

    Friday 17 July

    • Prime Minister Scott Morrison announces intention to extend JobKeeper exemptions to the Fair Work Act for employers no longer receiving JobKeeper. The COVID-era exemptions were introduced in April for a period of 6 months and allow employers to change workers’ hours, duties, days, and location of work, and direct employees to take annual leave. Extension of JobKeeper FW Act provisions would allow businesses no longer receiving JobKeeper to continue operations with all relevant Awards, enterprise agreements, individual contracts or transitional instruments suspended (though hourly rates of pay under the prevailing pay instruments remain in place).

    Wednesday 8 July

    • In a major decision with concerning public health consequences, the Fair Work Commission adjourns a union application to introduce a paid pandemic leave entitlement for Award-covered healthcare and community services workers required to self-isolate during coronavirus crisis. The Commission contended the COVID-era paid leave provision would undermine financial security of private aged care and NDIS providers.

    Wednesday 1 July

    • Fair Work Commission extends temporary COVID-19 variations made to the fast food, retail, health industry, clerks, hospitality and vehicle maintenance awards in late-March. The flexibility schedules broadly allow employers to deploy workers across classifications, direct employees to take annual leave, and reduce minimum hours requirements. The Clerks Award variation enabling employers to spread out employee working hours without paying penalty rates were opposed by the ASU but the FWC granted the extension until September 27.
    • FWC extends unpaid pandemic leave provisions until further order for health professionals, nurses, aged care, pharmacy and ambulance awards. Other awards granted extensions until defined cut-off dates include fast food, retail, and hair and beauty (July 31), and airline pilots (December).

    Thursday 11 June

    • The Morrison government announces intention to withdraw the regulation introduced in April enabling employers to reduce the period of notice they give employees of proposed changes to EAs from seven days to one. IR Minister Christian Porter stated that the regulation introduced to support employers to rapidly respond to COVID19 disruptions to business was no longer needed.
    • Senate approves Labor proposal to discharge the Ensuring Integrity Bill.

    Tuesday 26 May

    • Morrison announces five working groups of business representatives and unions will be assembled to create a new workplace relations deal by September. The working groups will cover five key areas: award simplification, enterprise agreement making, casual and fixed-term employment, greenfields projects, and compliance and enforcement in areas including wage theft. Morrison also announces withdrawal of the Ensuring Integrity Bill from its second vote in the Senate.

    Wednesday 20 May

    • A full Federal Court rules that a coal miner employed as a casual under six consecutive contracts over almost four years is an employee entitled to leave benefits. The decision exposes employers to annual leave backpay claims for approximately 1.6 million casuals working on a regular, predictable basis.
    • FWC approves AiG application to vary the Fast Food Industry Award covering over 200,000 fast food workers to mitigate impacts of COVID-19 on employees and businesses. The variation approved by the SDA and ACTU (and contested by RAFWUU) allows employers to cut part-time workers’ hours with reduced overtime penalties, amend rosters, and request employees take annual leave which they cannot “unreasonably” refuse.

    Tuesday 19 May

    • Australian Industry Group release post-COVID-19 IR proposals for enterprise agreement-making, limiting Award content, and expanding casual employment. AiG propose to abolish the Better Off Overall Test (that requires employees covered by an EA to not fall below terms and conditions outlined in Awards), replaced by the weaker No Disadvantage Test, and weakening scrutiny of non-union EAs by the FWC, unions and employees. Award content would be drastically reduced under AiG’s proposals to remove annual leave, personal/carer’s leave, redundancy pay and public holiday loadings from Awards. Other Award derogation proposals include the expansion of Individual Flexibility Agreements (a revitalised form of the Australian Workplace Agreement implemented under WorkChoices by John Howard), and annualised salary clauses. Contrary to “fresh” branding, these proposals were developed long-before the pandemic struck. We documented the enterprise bargaining proposals from AiG and other business lobbyists in October 2019.

    Monday 18 May

    • Federal Court rules in favour of Qantas claim that it is not required to pay sick leave, carers’ leave and compassionate leave to the thousands of Qantas workers stood down due to coronavirus. Court considers entitlements forms of income protection that are extinguished when workers are not in receipt of income.

    Thursday 14 May

    • Federal government announces intention to limit the life of enterprise agreements varied using the shortened access period to 12 months. IR Minister Christian Porter said government intends to introduce the regulation through agreement with the Governor-General. On April 16, the government reduced the access period employers are required to consult with employees on changes to EAs from seven days to one.

    Friday 15 May

    • FWC flag that wages paid by distressed companies signed up to Job-Keeper could be frozen as part of the Commission’s Minimum Wage Review decision. The Commission will hand down its decision by June 30.

    Wednesday 13 May

    • The FWC hands down the first published ruling in the JobKeeper dispute jurisdiction, ruling a part-time employee unreasonably refused an employer’s request to use up one day annual leave each week for 16 weeks. The employee argued the wage subsidy was not intended to be used to offset employers’ annual leave obligations, but the case was unsuccessful.

    Friday 1 May

    • Federal government modifies JobKeeper eligibility rules to exclude workers employed by corporations owned by foreign governments. This exclusion applies to all workers including Australian residents.

    Monday 27 April

    • FWC approves joint employer-union application to vary Educational Services (Schools) General Staff Award covering non-teaching staff in non-government schools (bus drivers, maintenance workers, and others). For workers otherwise stood down due to school operations ceasing, the variation allows employers to cut hours by 25%, and redeploy workers across classifications (similar to hospitality and clerks Award variations).

    Friday 24 April

    • Business lobby groups propose changes to the enterprise bargaining system as key economic recovery measure. The proposals to increase employer unilateral power setting terms and conditions of work in EAs were prefaced pre-crisis (documented by Alison Pennington here) and include: removal of Better Off Overall Test, introduction of “whole of life” greenfields agreements, and less scrutiny of non-union EAs.

    Wednesday April 22

    • Government announces intention to reintroduce the Ensuring Integrity (EI) Bill (defeated in the Senate in December 2019). The anti-union Bill would allow the federal court to disqualify union officials, place unions under court administration, and deregister unions altogether. The Bill would also empower the FWC to prohibit union mergers on “public interest” grounds (See Jim Stanford’s submission on EI).

    Monday 20 April

    • Major law firms seek variation to the Legal Services Award mirroring previously agreed changes to the Clerks Award. Changes allow employers to provide workers of 24 hours’ notice of a vote to reduce working hours by 25%, give directives to use annual leave (beyond two weeks), reduce the minimum hours per shift for part-time and casual workers from three hours minimum to two hours, and widen ordinary weekly hours.
    • Australian Tax Office issues updates JobKeeper advice to employers clarifying the “one in, all in” rule. “You cannot choose to nominate only some employees.”

    Sunday 19 April

    • Australian Mines and Metals Association (AMMA) launch second call to abolish all Awards and all enterprise agreements (EAs) for a period of 6 months due to impacts of coronavirus on business activity.

    Thursday 16 April

    • Federal government drastically weaken representation rights under the Fair Work Act, reducing the access period employers are required to consult with employees on changes to EAs from seven days to one. Employer instruments to change hours and pay hitherto were only available to those qualifying for JobKeeper. These FW Act changes are accessible to all employers covered by EAs (including those in no danger of business failure).

    Wednesday 15 April

    • NSW Industrial Relations Commission approves a “splinter Award” covering NSW local government workers (who are ineligible for JobKeeper as state public sector workers) in the first instance of new union-employer Award-making during the pandemic. Covering over 100 councils, the Award requires councils find alternate work for worker redeployment. Those who cannot be redeployed receive a retention allowance of $858.20 per week for a period of 13 weeks. The Award provides a new Special Leave entitlement of four weeks at normal pay to cover any period where no suitable work can be provided (including self-isolation due to contracting COVID-19).

    Tuesday 14 April

    • FWC approves an employer application from Melbourne-based Mason Architectural Joinery to cut redundancy pay – the first redundancy pay entitlement cut by the Commission during the pandemic.
    • The Commission rules against an employer application to reduce the redundancy pay for three manufacturing workers on the same day. Cash flow problems were deemed an insufficient excuse since the company “has both the means to pay the full amount of the redundancy entitlement[s]. . . and the money in the bank to do so”.

    Thursday 9 April

    • Government announces pay freeze for hundreds of thousands of Commonwealth public sector workers. The pay increase deferral is stipulated by determination from April 14 for a period of 12-months. CFW release a report one week later assessing the negative impacts of public sector wage freezes on workers’ incomes and economic recovery post-pandemic.
    • JobKeeper wage subsidy legislation passes Parliament.

    Wednesday 8 April

    • FWC introduce two weeks’ unpaid pandemic leave to Award-covered workers required to self-isolate. The entitlement is available to workers who cannot access other leave entitlements and is inserted into 103 modern Awards, covering around half of all private sector workers (or 4.4 million workers). Awards were selected by the FWC based on a combination of factors including industries most affected by COVID-19, and industries with high proportions of Award-reliant workers and small and medium businesses.
    • In a worrying sign the FWC will permit enterprise bargaining to unravel due to COVID-19, UWU lose their bargaining order application with large food manufacturer Baida after the company refused to continue EA negotiations, proceeding to present the same EA deal to employees previously voted down. The FWC agreed with employer claims that it was too difficult to host negotiations due to virus social distancing requirements.

    Tuesday 7 April

    • Government introduces $130 billion JobKeeper wage subsidy scheme delivering payment of $1,500 per fortnight for a period of 6 months to employees within businesses who have experienced a 30% revenue decline compared to this time last year (less than $1 billion turnover). Registered charities with 15% revenue decline qualify for the scheme. Only Australian citizens (NZ included), employees in full-time or part-time roles, casual roles where an employee has been with the same employer for at least 12 months, and self-employed workers with ABNs are eligible for the subsidy.
    • Morrison government seek substantial changes to standard operation of the Fair Work Act 2009 (FW Act). Government and ACTU reach agreement allowing eligible employers to lawfully change workers’ hours, duties, days and location, and force employees to use annual leave (with two weeks’ “buffer” leave remaining) for period of 6 months. Limited safeguards are introduced with the FWC empowered to adjudicate disputes. No additional funding for the FWC to deal with disputes has been announced. These changes were implemented through entirely new provisions in the FW Act (Parts 6-4C in The Coronavirus Economic Response Package Omnibus (Measures No. 2) Act 2020) that suspend operation of all relevant Awards, enterprise agreements, individual contracts or transitional instruments applicable to employers covered by JobKeeper for a period of six months. The new JobKeeper provisions in the FW Act state:
      • Employers must pay all eligible employees an amount of at least $1,500 per fortnight. Employers are required to pay all wages earned above the JobKeeper threshold to employees who performed work in the period.
      • New employer powers to decrease employee hours, and change duties and location of work. These “JobKeeper enabling directions” allow employers to amend hours of work to “match” the subsidy rate (though hourly rates of pay under the prevailing pay instruments do not change). All directions must be provided in writing, reasonable in the circumstances, delivered with three days’ notice to the employee, and be necessary to the continued employment of the worker.
      • Employers may request that employees agree to alter the days and times that they work, provided the employees’ duties are safe (including with protection from COVID-19), and within the scope of the business’ operations. Employers can also request workers take annual leave, provided they maintain a two-week annual leave balance. Changes to work days and times, and request to use annual leave must be by agreement with employees, but an employee may not “unreasonably refuse”.
    • The Centre for Future Work release early analysis of the pros and cons of JobKeeper, including polling from the Australia Institute showing 81% of respondents support extending the wage subsidy to all casual workers.

    Thursday 2 April

    • The FWC full bench approves the first application by an employer to suspend wage rises payable under the EA due to impacts of COVID-19 on future business revenue. The FWC approve the application from Queensland-based electrical services to withhold a 3% pay rise due to predicted (but not yet realised) revenue decline. The FWC hold powers to change EAs so long as employees remain better off overall than the Award. An additional untested provision allows the FWC to approve EA changes that provide for below-Award conditions in “exceptional circumstances”.
    • Council of Small Business call for suspension of unfair dismissal claims during COVID-19. Joining the Australian Mines and Metals Association, the Council also call on government to suspend all Awards and enterprise agreements for up to six months.

    Tuesday 1 April

    • Restaurant employers apply to vary the restaurants Award with consent of ACTU and UWU. Employers apply for the same hours, leave and location variations made to the Award for clerical and hotels workers on 26 and 24 March.

    Monday 30 March

    • FWC approves UWU ballot for industrial action at RSEA – a manufacturer of personal protective equipment – after the company applied to freeze bargaining for a new agreement till July. The company claimed the industrial action ballot should not be approved due to their “essential business” status and inability to bargain within an unpredictable economic climate.

    Thursday 26 March

    • FWC approves application from Australian Chamber of Commerce and Industry and AiG for a three-month variation to the Clerks Award covering approximately 1.3 million administrative workers. Changes allow employers to reduce minimum hours, allow work across classifications, direct employees to take leave, and provide leave at half pay. The application mirrors amendments made to the hospitality Award on 24 March.
    • NSW parliament passes legislation allowing early access to long service leave entitlements for period of 6 months. Amendments to the Long Services Leave Act 1955 will allows employees to use accrued long-service leave in shorter time periods (such as one day per week), with less notice by agreement with their employer.

    Tuesday 24 March

    • FWC approves joint union–employer application to vary the hospitality Award. The joint Australian Hotels Association and United Workers Union amendment inserts a flexibility schedule expiring in three months. Changes allow employers to deploy workers across classifications, direct employees to take annual leave with 24 hrs notice, and reduce minimum hours requirements – full-time employees entitled to 22.8 to 38 hours per week, part-time employees to 60% of guarantees minimum hours.

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  • Working From Home: Opportunities and Risks

    COVID-19, Future of Work

    Working From Home: Opportunities and Risks

    by Alison Pennington and Jim Stanford

    Authors

    Alison Pennington

    Senior Economist

    Jim Stanford

    With many regular workplaces shut down to ‘flatten the curve’ of COVID-19, millions of Australians are now shifting their work to home. Home work has great potential to cushion the economic blow of the pandemic: allowing many to keep working and earning an income, and many firms and industries to continue at least partial production. But there are also many challenges and risks associated with this major shift in work patterns. Much of the increase in home work will likely become permanent, even after the immediate health emergency passes. That makes it crucial to ‘get home work right’: providing home workers with appropriate support and protections, and preventing abuse and exploitation as home work becomes more common.

    This new Briefing Paper from the Centre for Future Work, written by Alison Pennington and Jim Stanford, surveys the scope of home work, considers its impacts on economic and gender inequality, and proposes several policy recommendations to make home work safer and fairer.

    Main findings of the Briefing Paper include:

    • About 30% of Australian jobs could conceivably be performed from home – but it will take time for workplaces to make necessary organisational and technological adjustments to reach that potential.
    • Occupations which can work from home were already paid about 25% more than occupations which cannot be shifted to remote locations. The shift to home work could therefore exacerbate income inequality; this reinforces the need for comprehensive income protections for those who cannot work from home.
    • The expansion of work-from-home arrangements raises several concerns regarding the conditions of home work, and protecting those who perform it. These include fair compensation for extra expenses associated with home work; applying normal rules regarding working hours and pay; ensuring a safe home work environment (including its social and familial context, with challenges like domestic violence); and protecting the privacy of home workers from undue monitoring and surveillance by employers.

    The paper concludes by urging researchers, unions, regulators and policy-makers to pay top-priority attention to ensuring the safety and fairness of home work – because this shift is clearly here to stay.



    Full report

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  • Gender Inequality in Australia’s Labour Market: A Factbook

    Gender at Work

    Gender Inequality in Australia’s Labour Market: A Factbook

    by Alison Pennington and Jim Stanford

    Authors

    Alison Pennington

    Senior Economist

    Jim Stanford

    While women have made some progress in closing the wage gap and other dimensions of gender inequality in Australia, they still face daunting and persistent barriers to their full participation and compensation in Australia’s economy.

    That’s the conclusion from a new factbook on gender economic inequality in Australia, released by the Centre for Future Work to coincide with International Women’s Day on 8 March.

    The factbook compiles evidence on over 60 different statistical indicators of gender inequality in Australia, organised into 18 different subject groupings. It paints a composite picture of how women are blocked from full participation in work and economic activity, experience greater precarity in employment, are paid less for their efforts, and experience other forms of exploitation (including violence and sexual assault in workplaces).

    Some of its more startling findings include:

    • The true wage gap between women and men is much larger than often reported. The commonly-cited gender wage gap of 14% only applies to women working in full-time positions, and excludes bonuses and overtime payments. However, women have less access to full-time jobs, and receive far less bonus and supplementary income than men. The gender gap in total wage income is 32% – more than twice as wide.
    • Women are much more subject to precarious and insecure work arrangements than men. They are far more likely to be employed in part-time, casual, and temporary positions than men. Only 43% of employed Australian women work in a traditional full-time permanent job with normal entitlements (such as paid sick leave, holidays, and superannuation). The rest all experience one or more dimensions of precarity in their jobs. That compares to 57% of men in permanent full-time jobs with entitlements.
    • Women who undertake self-employment are especially vulnerable. The report shows that 47% of self-employed women are in vulnerable business positions: working part-time, and working either without incorporation or without any other employees (or both). That compares to 19.% of self-employed men.
    • Women are now more likely to be members of a union than men, and make up more than half of union members. Women who are in a union earn 29% more per week than women who are not in a union. For part-time workers, the union advantage is even bigger: women union members earn 44% more than non-members

    “The statistical evidence is overwhelming that women are a long way from achieving equality in Australia’s workplaces,” said Alison Pennington, Senior Economist at the Centre for Future Work and co-author of the factbook.

    “These systemic and structural barriers to full participation and fair compensation are holding Australian women back and our economy is weaker for it.

    “Australian women need to be able to work and earn to their full potential. This requires powerful measures to support women workers in all aspects of their lives; from quality affordable childcare to much stronger protections against violence and sexual harassment.”



    Full report

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  • Collective Bargaining “Reform”

    Unions & Collective Bargaining

    Collective Bargaining “Reform”

    What Does Business Want? And What Would Actually Fix the System?
    by Alison Pennington

    Author

    Alison Pennington

    Senior Economist

    Media release



    Business Council of Australia Research Confirms Centre for Future Work Research

    Coalition leaders hardly mentioned industrial relations topics during the recent federal election campaign, but now that the party is back in power, an aggressive and wide-ranging agenda for changing Australia’s labour laws has been quickly assembled—with the enthusiastic backing of business lobbyists.

    In a new report, Centre for Future Work Senior Economist Alison Pennington has compiled the various proposals advanced by employers, and shows that together they would constitute a thorough reorientation of Australia’s collective bargaining system. The end result would be a situation (very similar to the Work Choices regime of the late 2000s) whereby employers have unilateral power to determine terms and conditions, wages can be locked in for very long periods of time (contrary to employer’s calls for greater “flexibility”), and the scope for true workplace negotiations is compressed.

    Main findings of the report include:

    • The share of private sector workers covered by enterprise agreements (EAs) has now been halved since 2013, to only 11%.
    • This decline reflects three simultaneous negative trends: declining agreement renewals, sharp decline in new agreements being negotiated, and high rates of agreement termination.
    • Only 917 new private sector EAs were negotiated in 2018 (down on 7,623 in 2009).
    • The changes to industrial relations rules now being proposed by business broadly signal a return to the Work Choices pattern of unilateral employer wage-setting power in enterprise agreements.
    • The changes to enterprise bargaining proposed by business lobbyists include: weakening or removing the Better Off Overall Test; weakening scrutiny of non-union EAs; diminishing the scope of matters employees may negotiate with their employers; and blocking bargaining altogether through introduction of “whole of life” greenfields agreements.
    • Based on the experience of the Work Choices era, when similar measures were in place, we can expect a resurgence of non-union EAs if those proposals are accepted.
    • It is possible that EA coverage might increase, but on the basis of non-union EAs that are motivated primarily by the desire of employers to evade minimum conditions in Awards (a perverse strategy that would be facilitated by the elimination of the BOOT test and watering down of EA scrutiny & approval processes).
    • In short, employers are aiming for a collective “bargaining” system that has little room for actual bargaining – it would instead be characterised by employers with increasing power to unilaterally set the terms and conditions of work.
    • The growth in non-union EAs would come at the expense of both genuine collective bargaining and Award coverage, and would produce a decline in average wage increases for EA-covered workers (since wage increases in non-union EAs are consistently lower than for EAs negotiated with union involvement).
    • Simulations project a slowdown in average wage growth across all private sector EAs of at least 0.4 percentage points. That is just the direct effect of the changing make-up of EAs (with more lower-wage non-union deals); the indirect effect (weakening unions’ ability to negotiate better wages in their EAs) would be even worse.

    The loss of wages resulting from that slowdown slowdown in (already-weak) wage growth could cost an average private sector EA-covered worker over $2000 in lost income over just the first three years.

    PLEASE NOTE: This posted version of the paper corrects a previous error arising from a data coding problem which resulted in an inaccurate allocation of newly approved enterprise agreements between new and renewal agreements.



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  • The Future of Work for Australian Graduates

    Education & Training, Young Workers

    The Future of Work for Australian Graduates

    The Changing Landscape of University Employment Transitions in Australia
    by Alison Pennington and Jim Stanford

    Authors

    Alison Pennington

    Senior Economist

    Jim Stanford

    Media release



    University-to-Job Pathways Key to Boosting Graduate Employment Outcomes

    The Centre for Future Work has released a major new report documenting the new challenges faced by Australian university graduates in finding jobs that are stable, rewarding, and utilise their newly-developed skills. The report was prepared in conjunction with Graduate Careers Australia.

    The world of work is being transformed by a complex and interdependent set of forces – including technology, changes in workplace organisation and employment relationships, environmental and demographic challenges, and more. No group of workers will confront the reality of constant change more directly than young workers. As new entrants to the labour market, they cannot count on the protection of previous structures or practices to insulate them from coming changes. They immediately face the challenges of an increasingly precarious job market – one in which less than half of all employed Australians now fill a traditional “standard” job (full-time, permanent, paid work offering normal entitlements like paid leave and superannuation).

    Holding a university degree is still a vital and valuable asset for young workers entering this challenging and unstable milieu for the first time. Individuals with university degrees are more likely to be employed, to have more stable jobs, and to be paid more. But despite this relative advantage enjoyed by university graduates, employment conditions have become much more challenging even for graduates. Rates of graduate employment in full-time work are down significantly over the past decade, and there is evidence of a growing mismatch and underutilisation of university graduates in positions that do not fully or even partly utilise their hard-won knowledge and skills. At the same time, employer complaints about supposed skills shortages and the dearth of “job-ready” graduates are as loud as ever; the report documents that those complaints need to be interpreted with considerable scepticism.

    Australia’s higher education system could do a much better job at anticipating the needs for highly-skilled workers in the future, evolving their program offerings in light of those needs, and then assisting students as they traverse their university educations and find meaningful, relevant work.

    This comprehensive new report from the Centre for Future Work, developed in conjunction with Graduate Careers Australia (an association that has worked to gather data and make recommendations regarding university graduate employment issues) provides an overview of the prospects and challenges faced by future university graduates. The report confirms that university education makes a vital, essential, and valuable contribution to Australians’ prosperity: both at an individual level for those who have attained higher education, and at the macroeconomic and social level. But it catalogues gaps and failures in crucial education-to-jobs transitions, considers the most likely factors contributing to those gaps and failures (while dispensing with some commonly-cited but unconvincing myths and stereotypes), and makes several concrete recommendations for policy change and innovation.

    Key findings of the report include:

    • Employment outcomes for university graduates have deteriorated notably since the GFC. Full-time work placements have deteriorated (from 85% in 2008 to 73% in 2018, measured by full-time employment 4 months after graduation). Many graduates report being underemployed: both quantitatively (working fewer hours than they want) and qualitatively (in jobs that do not fully or even partially use their hard-won expensive skills), and insecure work has become a big problem for graduates (like for others in the labour market).
    • Employers continue to complain about pressing “skills shortages” hampering their growth opportunities. But careful empirical data suggests this claim is questionable. Reported skills shortages in most occupations have in fact eased considerably since the GFC.
    • Another stereotype not backed up by hard data is the common assumption that STEM and technical skills are in the most short supply, and that STEM graduates will have the best employment outcomes. For example, math grads have one of the worst full-time employment placement rates of any discipline. Employers report they especially seek applicants with verbal, social, problem-solving, and communication skills.
    • Vocational degrees (tied to specific occupations, often regulated – like health care, engineering or teaching) have the best employment placement rates.
    • Therefore, the solution to graduate employment challenges must include better strategies for directly linking degrees to jobs: for example, through paid placements, occupational licensing, and accreditation.
    • Australia’s system for planning skills / higher education / job placement functions is fragmented, and often contradictory. We could learn a lot from other countries (especially in Europe) which have taken a more hands-on and direct approach to forecasting future skill requirements, planning higher education offerings accordingly, and channeling graduates directly into relevant career opportunities.
    • The report makes 9 specific recommendations to improve university-to-work transitions for future graduates, including establishing a national higher education planning capacity, and creating a timely and high-quality labour force information system.
    • An overarching recommendation in the report is a call for a new social compact for universities as major actors in Australia’s skills system. This includes increased public funding for universities attached to requirements for national policy coordination among universities, expanded employment-to-jobs programming, and stronger mechanisms connecting public research to the development of an innovation-intensive, high-value export-oriented industry policy.

    Download the full report, The Future of Work for Australian Graduates: The Changing Landscape of University-Employment Transitions in Australia, by Alison Pennington and Dr. Jim Stanford. There is also a 12-page summary report available for download. The report was commissioned by Graduate Careers Australia.



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  • Paid Parental Leave for Fathers Advances Parental Equality

    Paid Parental Leave for Fathers Advances Parental Equality

    by Alison Pennington in Medium

    Alison Pennington

    Senior Economist

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    Originally published in Medium on August 26, 2019

    Rising pressure on individuals and families to meet their caring needs is the “human face” of decline in workplace protections and bargaining power that has gathered pace since 2013. Meanwhile, the need for fathers and male spouses to take on more caring and household labour is routinely discussed in the public domain. But how have Australia’s work/care policies worked to support a redistribution of caring and household labour to males and fathers?

    In this commentary, Centre for Future Work Economist Alison Pennington reports on a timely roundtable discussion held with work/care policy experts on Iceland’s “father’s quota” parental leave system, and the future for paid parental leave in Australia – co-hosted with the Nordic Policy Centre.

    Research presented by leading Icelandic academic Dr. Ásdís Aðalbjörg Arnalds on the day shows that paid parental leave for both parents at wage replacement levels is key to building more equal workplaces, families and communities, and a modern dual work/care model.


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  • Where To Now for Union Campaign? Workplace Express

    Where To Now for Union Campaign? Workplace Express

    by David Peetz, Alison Pennington and Jim Stanford

    David Peetz

    Laurie Carmichael Distinguished Research Fellow

    Alison Pennington

    Senior Economist

    Jim Stanford

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    The unexpected results of the 2019 Commonwealth election have sparked many commentaries regarding what happened, and why. This article, reprinted with permission from Workplace Express, considers the role of the major #ChangeTheRules campaign mobilised by Australian unions in the lead-up to the election – and ponders the movement’s next steps in the continuing debate over labour market policies and industrial relations. It cites both our Economist Alison Pennington, and our Director Jim Stanford, as well as our previous research on the erosion of collective bargaining in Australia.

    Workplace Express is Australia’s leading labour policy and industrial relations newsletter. Please visit its website to subscribe.

    Where to Now For Unions?: Experts

    Reprinted from Workplace Express, May 27, 2019.

    Future union membership numbers will depend on how effectively unions organise without being able to rely on the political system delivering changes to workplace laws, according to an expert on employment relations.

    In the immediate aftermath of the Morrison Government’s election win, Griffith University’s Professor David Peetz said it was likely that it would be harder to grow union membership under the Coalition than under Labor.

    “In the end, it’s up to unions to organise effectively, they can’t rely on the political system to deliver what they would like, even though it can’t be denied that politics makes a big difference,” he told Workplace Express.

    Whether union membership would fall under three more years with the Coalition in power depended on a range factors, said Peetz, including the government’s ability to pass inhibiting legislation; the movement’s own organising performance; and the effects of underemployment, which both put a brake on union bargaining power and reduced wages growth.

    “Has the focus on political campaigning taken the edge away from workplace organisation, or has it reinforced it?” said Peetz.

    “Will union activists feel so disillusioned by the election result that they give up?

    “Or will they put more effort into workplace action in recognition of the failure of political action?

    “I think these are all things that will become clearer over the next couple of years.”

    Deal ‘protections’ weaker at the margins: Peetz

    Union membership is currently running at less than 15% of the workforce, with unions having a stronghold in the public or government sector thanks to nurses, teachers, public servants and police (see Related Article).

    However, private sector membership remains a weak point, amid a shift away from enterprise bargaining to award coverage.

    Peetz, who is currently a visiting fellow at City University of New York, said the fall in enterprise bargaining coverage was mostly a delayed result of the decline in union density.

    “EB coverage held up for a while because it suited some employers to stick with union bargaining arrangements when unions were weaker,” he said.

    “But eventually a point had to come where those employers would decide to circumvent unions altogether and/or the award simply caught up with what the EB rates were.

    “Of course it means that fewer people are now getting the ‘protection’ of EBAs, but that protection was getting weaker at the margins anyway, and the bigger picture is the decline in the proportion of people getting the ‘protection’ of unions.”

    Peetz said the biggest impact would be felt in non-union workplaces.

    “In unionised workplaces, it’s workers’ own experiences of unions that will determine how well or badly unions go.

    “Unionism is, to use econo-speak, an ‘experience good’.

    “There, unions’ future is very much in their hands.

    “In non-union workplaces, where quite a few employees have no direct experience of unions – or it was so long ago it’s not really relevant – the ideology that comes through the media is more important, and the question of who’s in government and what they say and do, and what employers with government support do, and what the media themselves do, becomes more important.”

    Private sector bargaining ‘out of reach’: Pennington

    Last year, the Centre for Future Work released a report, On the Brink, contending that enterprise bargaining was on the edge of collapse, largely due to its abandonment by the private sector (see Related Article).

    The report, by Centre economist Alison Pennington, said that more than half of the reduction in private sector coverage is due to the termination or expiry of large agreements in the retail sector and the accommodation and food service sector.

    She found that private sector agreements dropped by 46% between December 2013 and June 2018 (from 22,638 to 10,333), while the number of employees under agreements fell by 34% (from 1,950,561 to 1,288,100).

    Last week, Pennington told Workplace Express that new data from the Department of Jobs showed the number of employees covered by enterprise bargaining has shrunk by another 170,000 in the six months to December 2018.

    She did not expect to see any reversal of the trend without reforms to the bargaining systems and freeing unions from restrictive “anti-organising laws”.

    “What it says, for me, is that bargaining rights are out of reach for the vast majority of private sector workers.”

    Nonetheless, Pennington says that private sector union membership is unlikely to fall further than what she believes to be levels already below 10%.

    And on a positive note for unions, she argued the Changes the Rules campaign was successful in terms of recruiting members, with some unions doing “a lot better than others”.

    Union campaign heard: Stanford

    Centre for Future Work director, Professor Jim Stanford, also said the ACTU campaign succeeded in its first aim to “influence the debate” in the lead-up to the election on wage stagnation, work exploitation and job security.

    “Now the question is how do convert that public opinion that workers need fairer treatment into policy reform given the government that’s in power,” said Stanford.

    “That will be challenging, but it’s not impossible because the Coalition has to keep an eye on where people are at.”

    Stanford said the Coalition could not be “deaf” to public opinion on wage stagnation and job security, and the same was true for the FWC, which last year awarded a 3.5% in minimum wages.

    “I think they [the Commission] heard the concerns about wage stagnation and they recognised they had a role to play.

    “I think the public education and organising that the union movement did will still pay dividends, even with a generally hostile government in power.

    “The wage crisis is not going to go away and I think Australians are well aware are that their pay packers are going nowhere relative to consumer prices.

    “That combination of continued wage suppression with an awakened, angry population … is a pretty potent mix.”

    ‘Remain bold,’ Forsyth tells ACTU

    RMIT University’s Professor Anthony Forsyth has argued on his blog that unions can still tap into “deep problems” in the workplace that Labor sought to address.

    These problems included underpayments, “dodgy” labour hire contractors, workers trapped in long-term casual engagement and the widespread use of rolling, fixed-term contracts.

    “We still have the collapse of collective bargaining in the private sector, and employer ‘work-arounds’ to avoid negotiating an enterprise agreement or get out of an existing one,” says Forsyth.

    “We still don’t have the basis for a real living wage.

    “Rather than shrinking back to a ‘small target’ strategy, as is now being contemplated in other policy areas, I reckon the ACTU should remain bold in its reform ambitions.

    “It should make a more substantive case for ‘changing the rules’ with strong underlying research that precisely measures the nature of the current problems (such as the nature and incidence of ‘insecure work’, a concept that business groups constantly debunk in the media).”

    But Forsyth argued that “organising and connecting with workers on the ground in new and innovative ways” are also essential, as shown by United Voice’s ‘Hospo Voice’ initiative and both the Young Workers Centre and Migrant Workers Centre at Victorian Trades Hall Council.

    “As the National Union of Workers and United Voice put it in the context of their current amalgamation proposal: ‘We need to change the rules, but we also need to change the game’.”


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    Centre For Future Work to evolve into standalone entity

    The Centre for Future Work was established by the Australia Institute in 2016 to conduct and publish progressive economic research on work, employment, and labour markets. Supported by the Australian Union movement, the centre produced cutting edge research and led the national conversation on economic issues facing working people: including the future of jobs, wages

    IR Bill Will Cut Wages & Accelerate Precarity

    by Alison Pennington in Jacobin

    The Morrison government has proposed sweeping changes to labour laws that will expand unilateral employer power to cut wages and freely deploy casual labour. Together, the Coalition’s proposed changes will accelerate the incidence of insecure work, undermine genuine collective bargaining, and suppress wages growth. Impacts will be felt across the entire workforce – casual and permanent workers alike.

  • Scourge Pricing’: Understanding and Challenging Uber’s Business Model

    Scourge Pricing’: Understanding and Challenging Uber’s Business Model

    by Alison Pennington

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    Centre for Future Work Economist Alison Pennington recently gave a keynote address to hundreds of delegates at the ATIA International Taxi Conference, held this year in Gold Coast, QLD.

    Her presentation discussed the historical, economic, and moral context for the rise of “gig-economy” businesses, such as Uber. She reviewed Uber’s business model, and the company’s recent IPO, in detail, arguing that it depends on underpayment of its drivers – who for all practical purposes are “employees,” even if current labour laws do not always explicitly recognise them as such.

    Growing competition, regulatory and legal problems, and growing resistance to the ultra-precarious and low-wage incomes offered in this type of work suggest that the future success of digital platform businesses like Uber is very much in doubt.

    Pennington also referenced findings of our previous paper estimating the net incomes of Uber-X drivers in 6 Australian cities.

    Please view Alison Pennington’s full presentation below.


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    Presentation slides

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    The REAL Diary of an Uber Driver

    by Jim Stanford

    ABC recently announced plans for a new 6-part television drama called “Diary of an Uber Driver.”  The Centre for Future Work’s Director Jim Stanford wonders if this drama will truly constitute insightful drama – or whether it will serve to whitewash the labour practices of a controversial, exploitive industry.

    Centre For Future Work to evolve into standalone entity

    The Centre for Future Work was established by the Australia Institute in 2016 to conduct and publish progressive economic research on work, employment, and labour markets. Supported by the Australian Union movement, the centre produced cutting edge research and led the national conversation on economic issues facing working people: including the future of jobs, wages

  • Workplace Policy Reform in New Zealand

    Labour Standards & Workers’ Rights, Unions & Collective Bargaining

    Workplace Policy Reform in New Zealand

    What are the Lessons for Australia?
    by Alison Pennington

    Author

    Alison Pennington

    Senior Economist

    Australia can learn much from the policy leadership of the Ardern Government in New Zealand and its reforms to address stagnant wages and rebuild a more inclusive workplace relations framework, according to new research from the Centre for Future Work at the Australia Institute.

    As Australia’s debate over wages and workplace rights heats up ahead of this year’s federal election, important changes in labour policy are also being implemented right across the Tasman Sea. Under the Labour-Green-NZ First coalition government which came to office in New Zealand in 2017, several progressive changes in labour law have already been enacted. Others are in development.

    Economist Alison Pennington reviews the policy reforms underway in New Zealand, and considers their relevance for Australia, in a new paper published by the Centre for Future Work.

    Pennington provides a timetable and analysis of seven specific reforms in New Zealand, including:

    1. a landmark pay equity judgement and development of a bargaining principles approach to facilitate pay equity claims and settlements economy-wide;
    2. the introduction of industry bargaining agreements;
    3. restoration of employee and union rights to collectively bargain;
    4. legislation tabled to extend greater protections against unfair dismissal to labour hire and agency workers, and new collective bargaining rights;
    5. government commitments to significant annual increases to the minimum wage;
    6. the establishment of broad civil society alliances in a campaign for a “living wage”; and
    7. the passage of legislation for a universal employee entitlement to 10 days paid domestic violence leave.

    Together they represent an ambitious and multi-dimensional effort by the new government in New Zealand to address low wages, inequality, and poor job quality. In every case, Pennington notes, the reforms emphasise the importance of collective representation and unions: not just to lift standards directly through collective bargaining, but also to play a central role in implementing other reforms (such as pay equity and domestic violence leave).

    New Zealand’s experience with these reforms holds several lessons for the Australian debate over workplace policies. The ambition and scope of the New Zealand reforms certainly confirms that there is great potential for national governments to act forcefully to respond to growing public concern over work, wages, and job security.

    “Australians have been touched by the tragedy in Christchurch, and impressed by the compassionate and effective response from the Ardern Government. And it seems there are other areas where we could learn from our New Zealand neighbours, including their new workplace policies,” said Pennington.



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