This chapter summarises some of the key issues that were discussed
during the committee's consideration of additional estimates for the 2019–20
financial year for the Education, Skills and Employment portfolio, Industrial
Relations matters under the Attorney-General's portfolio, and Small Business
matters under the Industry, Science, Energy and Resources portfolio.
Scope of matters raised
Over the course of two days of hearings, the committee discussed a broad
scope of matters. Some of these, such as the impact of the recent bushfires
were raised in relation to each portfolio. Other issues that the committee
examined were confined to specific departmental divisions or agencies. These
the nature of appointments of Fair Work Commissioners, and their
universities' adoption and implementation of recommendations
arising from the Independent Review of Freedom of Speech in Australian
Higher Education Providers conducted by former Chief Justice Robert French;
the Department of Education, Skills and Employment's (DESE)
Seasonal Workers Program;
internships and apprenticeships; and
the location of Industry Training Hubs, in particular the process
by which these were selected by DESE's Skills and Training Division.
Key theme—COVID-19 (coronavirus)
A prominent topic raised across the estimates was the anticipated impact
of coronavirus and the preparedness of departments and agencies to assist
industries and individuals affected by it.
The following sections outline the committee's examination of specific
aspects of the issue as discussed with various departments and agencies, and
measures being taken to manage the issue.
Employment and Industrial Relations
Communication and advice
Questions were raised about the role of the Attorney-General's
Department and associated agencies in communicating information on workplace
issues that are likely to come to the fore during the coronavirus pandemic. The
obligations upon employers with respect to affected workers were of
considerable interest in this regard.
The committee was informed that both the Fair Work Ombudsman and Safe
Work Australia have published information and guidance of a general nature
regarding employers' obligations on their websites.
The Fair Work Ombudsman also provides an information line, which may be called
by individuals and businesses for advice in relation to specific circumstances.
Comcare was asked whether there were information dissemination measures
to target 'vulnerable' workers, such as contractors, in certain 'high-risk'
industries, such as transport and the gig economy.
Ms Sue Weston, Chief Executive Officer, explained that, because Comcare's
jurisdiction is limited to employees of the Commonwealth and Commonwealth
authorities and licensed corporations,
information provided is general in nature and communicated through social
media, Comcare's website and by letter.
The committee raised questions about disseminating information in
multiple languages. Ms Weston informed the committee that she and Mr Justin
Napier, General Manager, Regulatory Operations Group, are in contact with the
heads of worker compensation authorities and safe work authorities, which would
provide an additional avenue through which information about coronavirus may be
conveyed to 'small, medium and culturally and linguistically diverse groups' who
fall outside Comcare's jurisdiction.
Protections for casual workers and
contractors affected by coronavirus
A prominent line of inquiry concerned the protections available for workers
affected by coronavirus who may not ordinarily be entitled to sick leave or
other workplace protections, such as casuals and contractors. Particular
concern was raised about gig economy workers, who are identified as 'high-risk'
in relation to coronavirus.
Questions were raised about whether gig economy workers would be able to access
workers' compensation, whether under state-based legislation or through
Comcare, in the event of contracting the virus as a result of their work.
Mr Martin Hehir, Deputy Secretary, Industrial Relations Group, explained
that this would depend on a range of factors, including the coverage of workers'
compensation legislation in individual state jurisdictions, and the
characterisation of contractors, which was a matter for the courts and not the
Mr Hehir observed that contractors should make their own insurance arrangements
to cover the potential financial impact of illness.
The potential impact of coronavirus was compared to that of the recent
bushfires. The representing minister was asked whether the government was
considering either extending Comcare or engaging with the states and
territories to provide assistance similar to that for bushfire victims to gig
economy workers financially impacted by the need to undergo a 14-day period of
Subsequently to the hearing, major gig economy companies Uber and Deliveroo
announced measures to provide financial support for drivers and riders who are
diagnosed with coronavirus and directed to self-isolate or placed in quarantine
by a public health authority.
Impact on early childhood and
DESE's Corporate and Enabling Services Division was questioned about
measures to coordinate with education institutions nationally in planning for
the potential suspension of services and closure of schools and universities.
Dr Michele Bruniges AM, Secretary, informed the committee that the department's
role in relation to the early childhood and schools sector was focused on
serving as a central portal of information from the Department of Health and
Commonwealth Chief Medical Officer and disseminating it to state and territory education
departments, peak bodies and other stakeholders.
In relation to the early childhood sector, activities undertaken to date
included a stakeholder meeting convened by the Minister for Education with
early child care peak bodies.
Similar activities were being undertaken in respect to schools.
A series of fact sheets and material about preventative strategies, accessed by
a dedicated website, have been prepared. The advice in the material is generic
in nature, and is not specifically tailored to schools and child care
In response to the committee's inquiries as to what preventative
measures against the transmission of coronavirus that education institutions
may be directed to take, Dr Bruniges stressed that such decisions were a matter
for the states and territories. She indicated that department's role was to
ensure linkages between state education departments, and that state-based plans
were informed by data flowing from the Commonwealth Department of Health and
Chief Medical Officer.
Dr Bruniges continued:
...the important thing will be for us to bring those
representatives from the schooling sector and the early childhood sector
together to look at their existing plans, to talk about what's universal and
then really take the advice from the health experts in the field.
To that end, a linkup between state education departments and early
childhood sectors, as well as a meeting of senior education officials in
Melbourne, were planned for the following week.
Impact on higher education and international students
The committee was informed that DESE was performing an identical role in
respect to the higher education sector as in respect to the schools and early
childhood sectors: serving as a central portal for information on the
coronavirus, as well as coordinating communication between the sector and
relevant Commonwealth authorities from other sectors.
To this end, the department convened a teleconference of 39 university vice
chancellors and their representatives, the Commonwealth Deputy Chief Medical
Officer, and Australian Border Force, so that universities could directly pose
questions related to both medical and visa matters.
The committee also considered the impact of coronavirus on international
students. Focusing on students from those countries to which travel
restrictions had been applied, it was ascertained that there were, as of 1
February 2020, 106,680 Chinese student visa holders unable to return from
outside Australia, as well as 1,842 from South Korea and 132 from Iran as of 1
Mr Rob Heferen, Deputy Secretary, Higher Education, Research and
International, outlined that the department had supported universities to deal
with the impact of coronavirus primarily through the provision of data.
Other ways in which the department and the Australian Government could assist
universities had been discussed at a meeting of deputy vice chancellors of
Universities Australia member universities, during which it was conveyed to Mr
Heferen that a reduction of those regulatory activities that were within the
department's control would be of assistance.
The committee pursued questions about the department's 'scenario
planning', particularly the possibility that students other than international
students would be impacted.
The committee was informed that this work had yet to move beyond the discussion
stage, given the highly fluid circumstances, rather than any particular
scenario that might arise and its implications for the sector.
The department was in discussions with universities regarding the delivery of
online services to international students unable to enter Australia.
In response to recent events, whereby concern had shifted towards the spread of
coronavirus within Australia, the department was also assisting universities to
prepare and update their pandemic plans.
Employment, Industrial Relations and Small Business matters
Review of the Industrial Relations
system by the Minister for Industrial Relations
In June 2019, the Minister for Industrial Relations, the Hon Christian
Porter MP launched a major review of the nation's workplace laws. The committee
sought an update on the review's scope and ongoing implementation.
The Attorney-General's Department Corporate and Enabling Services
Division provided information about the scope of the review, what matters had
already been examined, and what was to be examined in the future.
Ms Alison Durban, First Assistant Secretary, Employee Conditions
Division, informed the committee that the following discussion papers had been
issued to date:
Improving protections of employees' wages and entitlements:
future strengthening the civil compliance and enforcement framework;
Review of the Code for the tendering and performance of Building
Work 2016; and
Cooperative Workplaces – How can Australia capture productivity
improvements from more harmonious workplace relations.
The remaining two discussion papers are titled: Attracting major
infrastructure, resources and energy projects to increase employment – Project
life greenfields agreements as well as Improving protections of employees'
wages and entitlements: Strengthening penalties for non-compliance.
Ms Durbin informed the committee that the Industrial Relations Minister had
'flagged' an interest in three further topics—enterprise bargaining, the small
business dismissal code and casual employment—and the department was at that
time providing policy advice on those areas, but that 'whether they turn out to
be policy papers will be a matter for the minister'.
The consultation process undertaken to inform the Porter review was also
examined. The committee was advised that the main mechanism for consultation is
through public submissions which inform the discussion papers. Both the submissions
(other than confidential submissions) and resulting discussion papers are then
In response to questions about the transparency of the precise process by which
submissions inform discussion papers, Mr Hehir explained that the purpose of
publishing the discussion papers was to 'engage more broadly with the
community', and that inviting and receiving submissions from unions, employers
and peak bodies to inform these contributed to a 'very transparent process'.
Mr Hehir continued:
The fact that it is out there, that it is being discussed in
public and not behind closed doors is a very good outcome, from our perspective,
and it is a very open and transparent process.
Minister Payne explained that submissions were considered on the basis
of their contribution to the three criteria for potential reforms arising from
the review. These were whether they: 1) drive jobs and wages growth; 2) boost
productivity and strengthen the economy; and 3) ensure the protection of
Regarding the two discussion papers that are now finalised, one had received 50
submissions, comprising nine from trade unions, 15 from employer organisations,
five from government agencies, 13 from external organisations such as community
legal centres and law firms, and eight from individuals.
Six of these submissions were confidential.
The other discussion paper received 18 submissions, comprising five from trade
unions, nine from employer organisations, one from an individual employer, one
from a law firm, and two from individuals.
In addition to invited submissions, consultation takes place with the states
and territories and the Committee on Industrial Legislation (COIL), in
accordance with an intergovernmental agreement in relation to industrial
The committee sought further detail on any consultations that may have
taken place, in particular with employer groups, employee groups, and academics.
Departmental officials could not specifically recall any bilateral meetings
with any individual employer or employee group. However, the department had
engaged external consultant Boston Consulting Group (BCG), for the purpose of
examining end-to-end processing requirements related to single enterprise
agreements. BCG had met with 11 employers, two unions, as well as departmental
officials and representatives from the Fair Work Commission (FWC) and the Fair
Work Ombudsman (FWO).
It was explained that BCG did not consult any academics because the focus of
their inquiry was the practical steps involved in forming a single enterprise
The total cost of the BCG consultation process was $137,500.
Questions were raised regarding the consultation process relating to the
government's planned labour hire registration legislation. Mr Hehir explained
that the process included consultation with states and territories as well as
discussion with stakeholders, which included both employer and employee
Whether any wider consultation would take place or a discussion paper released
in relation to labour hire registration had not at that point been decided.
Wage theft – recovery by
A topic to which the committee returned throughout its examination of employment
and industrial relations matters was wage theft, with a particular focus on
efforts to recover underpaid wages. Questions were raised about the policies
guiding decisions on whether and how to pursue suspected wage theft of those
agencies—the Australian Building and Construction Commission (ABCC), and the FWO—with
responsibility for detecting or penalising breaches of wage entitlements.
The committee was particularly interested in a perceived variance in approaches
taken by the respective agencies to litigation.
As each agency is an independent statutory authority, each has responsibility
for determining and applying its own policy (developed according to model
litigant guidelines) in this respect, and does not report to the
Attorney-General's Department on such matters.
Australian Building and
Questions were raised about the ABCC's rate of recovery of underpaid
wages in the building and construction industry.
The approaches taken by the ABCC led to a consideration of its internal costs,
with 14 per cent of investigation costs allocated to investigating breaches
relating to wages and entitlements ($42,247 out of a total $301,408).
ABCC Commissioner, Mr Stephen McBurney clarified that this figure related only
to investigation costs—that is, investigations prompted by complaints—which
were calculated separately from the cost of the ABCC's proactive audit
activities. The majority—85 per cent—of underpaid wages recovered by the ABCC
are generated by self-instigated audits of employers.
In the period 2 December 2016 to 31 December 2019, $1,443,085 in wages was
recovered, belonging to 2,582 employees, through proactive audits. In the same
period, $256,874 belonging to 64 employees was recovered as a result of
investigations instigated by complaints, of which 189 were received.
Fair Work Ombudsman
The committee was informed that the FWO recovered just over $40 million
in unpaid wages in the financial year ending 30 June 2019.
This was contrasted with the $1.35 billion estimated to be underpaid in
Australia each year by the PwC report.
However, Ms Sandra Parker, Fair Work Ombudsman, raised questions about the PwC
figure, citing uncertainty about the modelling that it was based on. Ms Parker
We were unable to ascertain whether it accurately reflects
the total amount of underpayments, and that is because attempting to model
economy-wide underpayments is potentially misleading. PwC have said that it's
approximately, in their view, $1.35 billion a year and that wage underpayments
affect about 13 per cent of the total workforce. What we would say is: we are
unable to determine how they have come to that figure.
Examination of the FWO's efforts to recover unpaid wages revealed that
the agency currently employs 177 inspectors investigating worksite compliance
on approximately 1.2 million worksites, and had received additional funding for
Ms Parker informed the committee that the FWO's budget is,
appropriately, dictated by the agency's annual appropriation as determined by
the government, and prioritises the allocation of expenditure and resources to
cover its range of functions, 'from education through to litigation', within
In respect to the FWO's allocation of resources to detect and penalise wage
theft, Ms Parker explained that the agency prioritises its activities according
to its assessment of the risk of underpayment. This means that resources are
directed towards industries and areas where there are more vulnerable, low-paid,
migrant, or young workers, or industry sectors which are simply 'more
notorious' for underpaying workers.
The committee heard that the FWO prioritises its prosecutorial activities
according to a goal of achieving 'maximum deterrence'. Ms Parker informed the
committee that: 'We take them to court or institute other compliance and
enforcement so that the message will get out there that this is not acceptable.'
Ms Parker further noted that garnering 'community pressure' was an
important tool in achieving deterrence of wage theft, citing the significant
public attention drawn by recent high-profile litigations of non-compliant
employers as a 'strong deterrence factor'.
National Dust Disease Taskforce—re-emergence
The committee's examination of Safe Work Australia (SWA) included
discussion of the activities of the National Dust Disease Taskforce (the
taskforce), of which SWA's Chief Executive Officer, Ms Michelle Baxter, is a
The committee was informed of the taskforce's interim advice to the Minister
for Health in relation to silicosis.
SWA indicated concerns about the presence of the disease among workers in the
engineered (composite) stone industry.
The committee heard that, while data relating to the number of cases of
silicosis diagnosed in recent years does not exist, SWA does collect data on
the amount of compensation claims made for silicosis.
Between the 2010–11 and 2017–18 financial years, there were a total of 60
accepted claims for silicosis. Claims made during the 2017–18 financial year
(the most recent period for which data exists) are not included in this total,
as that data includes unfinalised claims.
Ms Anthea Raven, Acting Branch Manager, Evidence and Strategic Policy, informed
the committee that, due to the lag in currently available data, caution should
be taken in interpreting any national trends in the occurrence of silicosis.
While the finalised data could not be used to indicate any acceleration
of the disease, Ms Raven confirmed that anecdotal evidence indicated that more
cases are being reported.
This indication was derived from jurisdictions undertaking whole-population
health screenings, including Victoria, which has screened or offered health
screening for advanced or accelerated silicosis to the entire population of
stonemasons working in the engineered stone benchtop sector.
Given that screening for silicosis is currently undertaken by state
governments, and there is no formal mechanism by which states must report their
findings to SWA, questions were raised about whether SWA was taking steps to
develop a national approach to the screening and treatment of the disease.
The committee heard that SWA was undertaking a number of activities to that
republishing its workplace exposure standard in December 2019;
publishing national guidance on working with silica and
silica-containing products in December 2019;
agreeing to work towards a national code of practice for working
with silica, as recommended by the taskforce; and
agreeing on a national work plan into occupational lung disease,
including silicosis in 2019.
The committee heard that, as part of the national work plan, SWA was
undertaking work to develop a comprehensive understanding of the extent of
occupational lung diseases nationally. This involves reconciling a range of
external data sources, for example, hospitalisations data held by the
Australian Institute of Health and Welfare, with the claims data gained from
Ms Baxter informed the committee that SWA's work in relation to
silicosis was 'priority work', which was on its work plan for 2020.
However, it was noted that the work had to be carried out in line with
governance processes, which required securing approvals for work from SWA
members. Ms Baxter also clarified that there is an existing regulatory
framework that applies to the engineered stone industry, including model work
health and safety laws imposing obligations on persons conducting business or
undertakings to manage risks that their workers may encounter.
The Australian Small Business and
Family Enterprise Ombudsman – Supply Chain Finance Review
The committee examined the Australian Small Business and Family
Enterprise Ombudsman's (ASBFEO) review into the impact of supply chain
financing (SCF) on the small business and family enterprise sector. The ASBFEO
released a position paper outlining the review's key preliminary findings on 7
February 2020, and will release a final report by the end of March 2020.
The Ombudsman, Ms Kate Carnell AO, informed the committee of the trigger for
The reason we did the inquiry is that we were very concerned
that the feedback we were getting from lots of small businesses was that some
large businesses were using supply chain finance as a method of having long
payment times—pushing out payment times and saying: 'Here it is. We're going to
go to 60 days, but do we have a deal for you! All you've got to do is sign here
and you can get paid when you should have been paid anyway'—which was 30 days
or less—'and, by the way, it's going to cost you.'
Ms Carnell distinguished between this misuse of SCF and its legitimate
value as a cost-effective source of capital to small-to-medium businesses in
A misuse of SCF may be detected based on the length of the contractual and
actual payment times:
Supply chain finance or reverse factoring...when it's used to
get five-day payments when you have a 30-day contract, is absolutely fine. You
might need that. But what isn't okay is it being almost forced on small
businesses who need to be paid in 30 days or less and they should be paid in
The committee heard that the review had so far received 17 submissions,
with a further two expected in the days following estimates. These had been
received from a range of large businesses, including Vodaphone, Telstra and ANZ
Bank, as well as some supply chain financing companies. In addition,
professional bodies, including the Business Council of Australia and Chartered
Accountants ANZ, had submitted to the review which had also received
submissions from a few small businesses and individuals.
The committee heard that the review had so far made some 'distressing'
findings about the practices of large businesses in relation to SCF, and its
impact on small businesses. These include:
the fact that it is in general used by 'really big businesses' in
relation to their small business suppliers;
the use of artificial intelligence and data to determine how
'desperate' a small business might be to gain cash flow, in order to calculate
the size of the discount that a small business might be willing to take;
the use of 'bidding platforms', whereby those small businesses
who are willing to accept the greatest discount are granted SCF.
The committee was informed of the ASBFEO's input on the planned Payment
Times Reporting Framework (PTRF) to address misuse of SCF. It has made submissions
to the PTRF consultation process and participated in a round table with DESE to
provide feedback on this process.
ASBFEO's submission included a recommendation that any penalty for
non-compliance with payment times under the legislation should be calculated
according to the days in excess, rather than per instance of non-compliance.
Ms Carnell expressed ASBFEO's support for 'a transparent reporting
framework for large businesses in terms of payment times' which would clarify
the proper use of SCF.
However, she stipulated that transparency alone was not a complete solution to
the adverse impacts of SCF on small businesses, and that legal limits on the
length of payment times in supply contracts, such as have been legislated for
in the European Union, are needed to change corporate behaviour. Ms Carnell
[T]he reporting framework legislation—which is
different—doesn't require quicker payment times; it just means that you have to
disclose your payment times. The dilemma is that big multinationals have said
to us that they will continue to have the sorts of payment times they have
because they're set in head office and, if there's no legislation in the
country that they're operating in, they'll set their payment times in their
Prime Minister's Spelling Bee
The committee's examination of DESE's Schools Division included
discussion of a grant made by the department under delegated legislation—the Financial
Framework (Supplementary Powers) Act 1997—to News Corp to build the 'PM's
Spelling Bee' website. The committee heard that the grant of $345,000 was not
made as a result of a competitive tender process, but was instigated by a
proposal put to DESE by News Corp to build the website.
Questions were raised as to why delegated legislation was used in this
Ms Alex Gordon, Deputy Secretary, Schools, explained that the department
requires 'relevant legislative authority' in order to make a grant, and that a
spelling bee concords with the kinds of activities that the department
The committee's discussion of the website also raised concern about a
media report that its source code had included a symbol known to be used by
right-wing extremists to symbolise white pride. Ms Gordon confirmed that the
department had become aware of the matter the same day, and that the symbol had
been removed from the source code within 30 minutes of the website developer
becoming aware of its association with right-wing extremism. Ms Gordon
explained that the symbol had been in place as a standard practice in IT website
developer coding since before its apparent adoption by right-wing extremist
The committee also heard that the website belongs to News Ltd, which has
responsibility for its operation and maintenance, and that neither the
department nor the Prime Minister had approved it before its publication.
Senator the Hon James McGrath
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