Employers warn industrial relations bill will cut casual employment

Companies says employers will avoid exposure to new hefty penalties for misclassifying workers.

Minerals Council of Australia chief executive Tania Constable. Picture: Nigel Hallett

Employers say Labor’s “unworkable” industrial relations changes will result in fewer casual jobs as firms avoid exposure to hefty new penalties for misclassifying workers.

The Business Council of Australia told the Senate inquiry into the Closing Loopholes Bill that the government should abandon the proposed legislation, calling it the most radical, regressive change to workplace law in decades.

In its submission, the BCA says employers would be exposed to significant legal risk when seeking to engage casuals who might perform a regular pattern of work, with companies at risk of significant financial penalties up to $469,500 if they misclassified workers.

The Recruitment Consulting and Staffing Association also raised concerns about the penalties deterring employers from taking on casuals.

ALP senator Linda White told the inquiry that the penalties would apply only if employers knew they were breaking the law, and they would not be penalised if they had a reasonable belief they were applying the law.

Calling the bill the wrong step at the wrong time, the BCA said the changes also bolstered union power at a time of record low union membership while reducing take-home pay and increasing the cost of living.

It said the bill proposed significant changes to casual employment, the gig-economy, independent contracting and labour hire arrangements and union rights.

“It will impact every sector of the Australian economy, including every business that employs a casual or contract worker,” it said.

The BCA said the government should “go back to the drawing board to properly define the problems it is trying to solve, clearly identify the outcomes it is working towards and provide evidence justifying any proposals”.

It backed the proposal by Senate crossbencher David Pocock to split the bill and legislate its less contentious elements this year.

Minerals Council of Australia chief executive Tania Constable told the inquiry that employers had spent tens of millions of dollars on its campaign opposing the changes.

“The bill will capture any business that provides workers, ser­vices or skills to another company, roping in millions of Australian workers right across the economy,” she said.

The Mining and Energy Union told the inquiry the bill’s casual definition allows the practical ­reality of the employment relationship to be considered and calls time on the permanent casual rort.

“It will enhance the job security of especially labour hire workers in the extremely profitable mining industry,” the union’s submission says.

It said the bill would close the labour hire loophole that allowed profitable mining companies to contract out mining jobs to labour hire on lower rates of pay than the mine site enterprise agreements.

“The labour hire loophole is not about short-term surges or short term absences. The labour hire loophole is not about specialist or expert work. It is not about genuine service contractors,” the union says.

“It is all about a labour hire workforce that is embedded in the day-to-day operations of the mine.

“Commonly, these labour hire workers will work in the same crews; do the same work such as operate the same dump trucks in an open cut mine or operate the same continuous miners in an underground mine; work to the same roster; work to the same policies, procedures and rules; and be exposed to the same risk in an inherently dangerous industry as employees engaged on a per­manent basis by the mine site ­operator.

“The only real difference (is) that the labour hire workers will commonly be paid between 30 per cent to 40 per cent less than the employees engaged on a per­manent basis by the mine site ­operator.”