David Penberthy: Paying workers properly shouldn’t be this hard
Whether it’s the sniff test, the front bar test or the barbecue test, there isn’t a one that corporate Australia can pass when it comes to the chronic underpayment of workers, writes David Penberthy.
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Whether it’s the sniff test, the front bar test or the backyard barbecue test, there isn’t a test that corporate Australian can pass when it comes to the underpayment of workers.
As irritating as he is, let’s set George Calombaris aside for a moment. Let’s also forget Neil Perry of Rockpool fame. These guys are big restaurateurs, and successful businessmen, sure, but they are veritable minnows when compared to the corporate behemoths who have now been busted in the sustained and substantial underpayment of their staff, in some cases going back almost a decade.
Some of these businesses have self-reported. People such as Woolworths. Whoop-de-do. This is less an act of altruism than self-preservation. To borrow a line from Shakespeare, the truth will out, and the decision to go public over the overpayment question was not so much a noble display of transparency, but the dead-obvious advice of the corporate affairs department.
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And here’s the thing.
The businesses we are talking about here are massive.
They have corporate affairs departments.
They have in-house counsel in well-staffed, extravagantly-remunerated legal departments.
They have human resources department that do a diligent job ticking every requisite box when it comes to dismissing staff in the name of downsizing, right-sizing, or slotting the unruly staff member who drunkenly photocopies his bum at the office Christmas Party.
They manage vast and complicated national procurement and distribution systems, they have mind-boggling information technology requirements, they use customer relationship management software so they can email you when it’s your birthday to tell you that you’ve got a $20 voucher to spend in store.
They can do all that.
They just can’t pay their staff properly.
There’s a word for all of this. The word is: “crap.”
On the first Tuesday of every month the members of the Reserve Bank gather to determine the settings of the nation’s monetary policy – that is, how much the official cash rate is for lenders. These interest rates have historically been used as a lever to stimulate the economy. You encourage people to spend money elsewhere, and encourage business profits and jobs growth, if you reduce the cost of the biggest financial burden on the average family income – namely, the family home.
The lever doesn’t work anymore. Interest rates have never been lower, and inflation is also low, yet Australians are currently almost professionally hostile to the idea of spending money.
It puzzles me that this puzzles corporate Australia. The only reason it can puzzle corporate Australia is that corporate Australia must move in pretty cloistered circles, and spends too much time necking Stella Artois at Martin Place or Collins St wine bars to hear what is being said in suburbia or via the text lines and email inboxes of talkback radio programs.
People aren’t spending money because most of them haven’t been given much extra money through the enterprise bargaining system for the last five to 10 years.
Worse, many people aren’t spending money because they are being paid even less than the amount to which they are legally entitled.
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As with the banking royal commission, where the big four railed for years against the unnecessary, baseless witch-hunt of a full-blown inquiry into their practices, only to have them chronicled in a long overdue expose, corporate Australia risks giving itself a collective black eye over this issue.
You get the sense that the Morrison Government has smelt the tea leaves on this issue and has tried to get in front of the blowback it is undoubtedly causing in the community.
In a commendably fiery attack, Attorney-General Christian Porter said on Thursday that corporate Australia “has been asleep at the wheel”, and flagged that saying the directors of companies that failed to pay workers properly could be banned from sitting on boards.
“I suspect the only way you will get board directors who sit on boards and get 180 grand a year for 12 meetings to take this stuff seriously is if there is something on the line for them,’’ Mr Porter said.
“I accept that some awards are complicated, particularly in the restaurant and retail environments, but these are unbelievably very sophisticated organisations — Bunnings, the ABC, Maurice Blackburn, Woolies — and they have huge HR departments.
“These organisations have a massive amount of time, energy and resources devoted to ensuring they don’t pay a cent more tax than they have to; they get involved in sporting teams and social issues. If they put commensurate resources into making sure they got their payrolls working in accordance with EAs (enterprise agreements), awards and the law, they wouldn’t be having this problem.”
Hear hear to all that. The Government absolutely must act on this issue. For in the event that the Australian Labor Party ever stops talking about itself, it is the number one issue that the ALP could campaign on effectively against the Government. As an acolyte of John Howard, Scott Morrison will recall that the final nail that was hammered into the former PM’s electoral coffin had the word “WorkChoices” written on it, when Mr Howard exceeded his mandate with his ambitious industrial reforms after the 2004 election.
Industrial relations is the Coalition’s greatest vulnerability, especially when there are few companies that have the intestinal fortitude to stand shoulder to shoulder with the conservatives in championing the cause of workplace reform anyway. It is for that reason, too, that the Coalition will feel emboldened to hang corporate Australian out to dry on this issue. They owe business no favours. And in addition, the socially conservative government also suspects that if these companies were less busy gladhanding and posturing on everything from climate change to reconciliation, and stuck to their knitting and just paid people properly, perhaps they wouldn’t be in their current pickle.