Labor strike on companies sending jobs offshore

A Labor government would face immediate union pressure to support a crackdown on companies sending jobs offshore.

Leader of the Opposition Bill Shorten. Picture: AAP

A newly elected Labor government would face immediate ­pressure from unions to support a crackdown on companies sending jobs offshore, prompting business figures to warn of a retreat to ­protectionism under a Shorten prime ministership.

In what is shaping as the next industrial relations test for the Opposition Leader, several Labor MPs and unions have backed measures that would prevent Australian businesses using cheap labour in India, The Philippines and China, including in overseas call centres.

The Labor MPs have called for a new regulatory response to offshoring that would prevent companies from outsourcing jobs overseas, unless they had first conducted labour-market testing aimed at filling positions with Australian workers.

The proposed crackdown on offshoring — a move supported by the Australian Services Union and the communications union — threatens to open up a new front between Bill Shorten and business. The Opposition Leader is already vowing to limit temporary work visas and the use of ­labour-hire firms.

Small Business Ombudsman Kate Carnell said the proposed crackdown on offshoring was protectionis­t and would give multi­nationals an advantage over Australian businesses.

“The Labor Party would need to be really careful they didn’t make Australian-based companies less competitive with multinational competitors in Australia,” said Ms Carnell, a former Liberal ACT chief minister.

“Those sorts of approaches move away from the internationalisation of business more broadly and ensuring that you improve your competitiveness in the global market. And we want Australian companies to be more competitive globally.”

There is support in Labor ranks for laws to force firms to disclose the proportion of overseas workers they employ when invoicing clients or tendering for contracts. This could have an impact on major employers including Telstra­, Optus, National Australia Bank, Westpac, ANZ, Insurance Australia Group and PwC.

Experts say offshoring is growing among law, accounting, IT, ­finance, engineering and customer services firms. Australia imported $5.7 billion of professional services work in 2017, up from $4.4bn in 2014, according to the latest figures available from market research firm IBIS.

Deputy Labor leader Tanya Plibersek said this morning that her party “won’t apologise” for putting Australian jobs first, but the Opposition’s stance was “not about keeping the unions happy.”

“We are unashamedly a pro-trade party. Because when we trade with other nations, we find export markets for our own goods and services,” she told ABC News.

“But what we won’t apologise for is putting Australian jobs first. If there is an Australian in Australia available to do a job, then we think that Australian should get the job before we open it up to an overseas worker to come in and do that job.

“It’s not about keeping the unions happy, it’s about putting the national interest first and making sure that we put the interests of ordinary working Australians ahead of any pressure from the unions, or from big business, or from Scott Morrison.”

Labor employment spokesman Brendan O’Connor said the workforce needed an industrial relations system that encouraged jobs to stay in Australia.

“Too often we are seeing ­employers outsourcing and ­subcontracting labour, often sending jobs offshore,” Mr O’Connor said. “This leaves employer­s who do negotiate better pay and conditions undercut by those who don’t.”

Two members of the Labor Left, senator Murray Watt and lower-house MP Andrew Giles, said regulatory measures such as labour-market testing should be considered to crack down on jobs being sent offshore.

Frontbencher and right-wing powerbroker Don Farrell said businesses should be encouraged to keep jobs in Australia. “We ought to be employing people in Australia on Australian wages and creating jobs here rather than overseas,” he said.

Queensland Left MP Graham Perrett and NSW Right MP Chris Hayes also said they were ­uncomfortable with the level of offshoring among businesses.

Senator Watt, a Queensland Left powerbroker, said big companies­ should be stopped from sending jobs offshore “just to save a buck”.

“There are still a lot of companies that are motivated only by the bottom line rather than thinking about what they can put back into the Australian community that supports them,” he said.

“This growing trend towards offshoring means that we have got to think about new approaches to deal with it and that might include some form of labour-market ­testing or some other form of regulation.”

He said many customers were frustrated that their complaints or queries for their bank, telephone or internet provider were connect­ed to overseas call centres.

Mr Giles said broad regulatory changes should be considered to reduce the number of jobs being sent overseas. “It’s about the sort of society we want to live in, whether people’s jobs — and their lives — are to be considered disposable,” he said. “Insecure work means an insecure life, and ending this requires changing more than just the provisions of the Fair Work Act.”

Council of Small Business of Australia chief executive Peter Strong said the regulations would have “unintended consequences” and not help increase employment. “It is a global world and it is also about competition,” he said. “That is the nature of globalisation and we have all had to come to grips with it.”

The national president of communications union the CEPU, Shane Murphy, said the union would support any measure making it harder for businesses to send local jobs offshore. “Executives of companies need to start recognising that they have a responsibility to not only deliver a quality product for customers but also a responsibility to reinvest back into the local community,” he said.

ASU assistant secretary Linda White said law firms were increasingly having preliminary legal work done offshore at the expense of graduates. “There are more law graduates than ever in Australia and those sort of jobs are going offshore. So it is quite hard to get a start. It cuts out entry-level jobs for graduates,” Ms White said.