Australia’s Insecure Work Framework Is Designed and Maintained by the Labor Party

The Australian Labor Party is introducing legislation it claims will help end endemic insecure work. But if the party’s track record is anything to go by, casual workers shouldn’t hold their breath.

Labor Party leader and prime minister Anthony Albanese speaking on March 30, 2023 in Canberra, Australia. (Martin Ollman / Getty Images)

Two proposed reforms in Australia have incensed the business lobby. The first will see the Labor government legislating its “same job, same pay” campaign promise, intended to prevent labor hire companies from undermining union-negotiated agreements by paying contract workers to do the same job, at the same worksite, for less money.

Labor’s second proposal claims to redefine casual work in order to stop employers mis-categorizing ongoing workers as casual, in order to avoid paying entitlements. In part, this move responds to a 2021 court decision that asserts that work contractually defined as casual work is casual work. This tautological definition — also favored by the opposition Liberal party — gives employers the unilateral right to determine whether work is casual, regardless of the real situation.

The Australian Labor Party (ALP) supports an earlier court decision that defines work based on the totality of the circumstances involved in a given case. By this measure, if an employee works regular hours over an ongoing period, they are owed the entitlements of a permanent worker even if their contract defines them as casual.

The full details of Labor’s proposed changes have not been released, but they will most likely involve a shift back to the earlier “totality” definition, giving workers the right to request conversion to permanent status after twelve months of work and every six months after that. Workplace relations minister, Tony Burke, has made it clear that workers will not be obliged to request conversion. Indeed, even when they do request it, it’s doubtful that employers will be compelled to agree.

And even before the details of the proposed changes are released, a look at the history of casualization in Australia makes it clear that the union movement would do well to be skeptical of Labor’s intentions.

“First Class Honors at Greed University”

There is no strict definition of a casual worker in Australia. But roughly a quarter of the workforce — 2.7 million people — do not receive paid leave of any form. As these employees theoretically trade entitlements — like leave, penalty rates, or redundancy pay — for a higher hourly rate, this figure serves as a broad indicator.

Included in this figure are roughly 320,000 labor hire workers. They work mainly as laborers, tradespeople, and machinery operators. A near-majority of labor hire workers were born overseas, and 84 percent do not receive paid leave.

On top of these numbers, around 1.1 million work in the gig economy. Thanks to a recent court ruling, these workers are not classified as employees, but as independent contractors.

Employers paint insecure work as a choice employees make. In reality, for many workers it is the only type of work on offer, and one they have no clear way out of. More generally, the prevalence of insecure work has given bosses a tool to undercut wages and conditions across the economy and to undermine union organization and membership.

Just how we got here is the Labor Party’s dirty secret. Despite claims to the contrary by the party’s representatives in the Australian Council of Trade Unions (ACTU), the increase in casualization happened on Labor’s watch.

In the early 1980s, approximately 13 percent of the workforce were casual. The rate increased to 24 percent by the mid-1990s and has remained fairly constant since. At the same time, average working hours increased, as did the amount of unpaid overtime work regularly being performed.

The rise of labor hire began slightly later. From around 1990 — Bob Hawke’s last year as prime minister before his treasurer, Paul Keating, took over — the number of labor hire workers began to grow from a low thirty-three thousand by about 15.7 percent a year.

As this timeline suggests, reforms by the Hawke and Keating Labor governments are directly to blame. As ACTU president, Hawke worked on behalf of the United States to undermine “industrial idiots,” namely, the more militant wing of the union movement. After becoming prime minister in 1983, he continued this agenda, cajoling unions into accepting his Prices and Incomes Accord. The accord demanded unions abandon industrial disputes in favor of mandatory negotiations with bosses, mediated by the state. In return, Hawke promised caps on cost of living. These mostly never eventuated. With their unions hobbled, workers’ share of national income tumbled over the next few decades.

After becoming prime minister in 1991, Keating turbocharged his predecessor’s trade liberalization agenda, pressuring firms to decrease their overheads or lose to international competitors. Because the accord had brought an end to the era of the “closed union shop,” in which unions represented upwards of 50 percent of the workforce, employers now had a free hand to attack wages and conditions. Labor hire was one of the most convenient ways to do this.

Indeed, not only has labor hire undermined wages and conditions across the board for three decades, it is now inextricably linked with organized crime and forms of human trafficking. The prevalence of labor hire also substantially contributed to COVID-19 outbreaks in quarantine hotels and aged care facilities.

Escape Clause Expert

Now, workplace relations minister Burke is promising to address some of the harm done by his own party. Unsurprisingly, according to his announcements, his proposals will fall flat and remain entirely in line with a party and factional track record that prove he has little intention of holding any bosses to account.

First of all, despite business crying wolf, Labor has gone out of its way to stress the ludicrous modesty of its proposals. Labor already reinstated the right to request a transition to permanent status after twelve months of ongoing, regular employment. It seems that the new changes will simply allow casual workers who work ongoing regular hours to make a repeat request every six months.

So far there has been no suggestion that the request must be granted. As the Australian Chamber of Commerce and Industry has alluded, it might simply be easier to fire casuals who repeatedly request to transition.

And on the off chance an employer does agree to a casual worker’s request for conversion to permanent status, Burke has created another loophole allowing businesses to escape responsibility. In principle, if an employee has worked regular hours and, as a result, they are converted to permanent status, this suggests they were mis-categorized to begin with. And if this is the case, it means that for the duration of their “casual” employment, their employer was underpaying them by not paying their entitlements.

To avoid the outside possibility that employers might be required to compensate their workers, Burke has already ruled out back pay. This preemptive move to placate business suggests that many workers are currently in this situation and are being underpaid.

Indeed, Burke is something of an escape-clause expert. Last year, his “Secure Jobs, Better Pay” legislation passed through parliament and sneakily undermined the better off overall test (BOOT). The BOOT test is applied to ensure that workers are not worse off under enterprise agreements than under the minimum conditions stipulated by the relevant industrial award. Burke’s new stipulation that the BOOT be “applied flexibly as a global assessment, not a line-by-line comparison” provided employers with welcome wriggle room to undermine award conditions.

Burke’s “Secure Jobs, Better Pay” act also allowed enough exemptions for employers from multiemployer bargaining — its centerpiece feature — so as to make it more or less redundant.

Now, Burke has already indicated that he is ready to accept caveats to his new “Same Job, Same Pay” legislation that would essentially exempt large mining operations. This is ominous. Mining is the most unionized industry of those affected by labor hire, with the unique exception of the construction industry, where the practice is union-dominated. If the mining unions can’t secure watertight promises from Burke, there is little chance weaker unions in aged care and other industries awash with labor hire will fare much better.

All of this is in keeping with Burke’s record of working closely to advance bosses’ interests. He was formed politically in the Shop, Distributive and Allied Employees’ Association (SDA). On paper, the SDA is the biggest union in Australia, and it thrived during the Hawke-Keating years. It now governs the nation’s biggest industry superannuation funds jointly with big business representatives.

The SDA has also been one of the only unions to establish “closed shop” arrangements after the accord of the 1980s. But SDA closed shops are nothing like the union strongholds of the 1970s. Instead of building union strength by fighting the bosses to win better pay and conditions, the SDA relies on some of the largest retail businesses in the country to encourage new employees to join the SDA. This inflates its membership base and power in the ALP, and in return, the SDA crafts agreements that lower wages and conditions below the minimum industry standards. These agreements have transferred billions of dollars from workers to bosses and have paved the way for the now legally mandated ongoing reduction of the minimum award standards.

Indeed, a number of the SDA’s agreements were so bad that they were thrown out under the old BOOT conditions. That’s why Burke — true to his SDA roots — undermined the BOOT last year.

We Need Unionists, Not Lobbyists

Business has decried the proposed changes to laws governing casual and labor hire work, describing them as a union power grab. If only this were the case. Far from seizing power, the organized labor movement is conspicuous by its absence from the debate.

The decline in union membership and density in Australia corresponds directly to the Hawke-Keating era. Union membership in Australia was 51 percent in 1982. Thanks to Hawke’s accord, 1983 marked the beginning of a steady decline steady decline to today’s depressing 12.5 percent.

Far from learning the obvious lesson — if unions abandon militancy, they will lose — the leaders of most unions, as well as the ACTU, operate almost exclusively as lobbyists rather than organizers. And as members of the ALP, most union bosses subordinate their members’ industrial interests to the political interests of Labor.

On a more general level, the Labor Party’s continued support for policies like youth wages demonstrate that it has no real commitment to the principle of “same job, same pay.” In Australia, workers under twenty-one years old are only paid a fraction of the adult wage, which can be as low as 37 percent. Not only did Labor support the huge expansion of youth wages in the mid-1990s, the SDA still works hard to ensure that some of the biggest employers in the country save $3.5 billion each year by legally underpaying young workers.

The movement can no longer wait for gifts from federal Labor governments that have proven they are not interested in change. If we really are to turn the tide against insecure work, the hard, dirty work of organizing fightback in workplaces must begin now.