Zali Steggall MP speaks on the Fair Work Amendment Bill 2024

27 February 2024

I rise to speak on the Fair Work Amendment Bill 2024. Many small businesses in Warringah are struggling right now. Some are even closing entirely. At the end of 2023, we had local institutions in Mosman shut up shop, including Brunskills Pharmacy, Savior Faire, Shane's Quality Butchery, Don Adan cafe, a vast variety of local businesses. They have been local favourites for over 30 years. Whilst there are a lot of pressures facing small- and medium-sized businesses right now—inflation, utility bills, less consumer spending—one other thing I always hear about when visiting small businesses is the difficulty and complexity of navigating our industrial relations laws, their fear of getting it wrong and the fact that it is constantly changing.

The government has now pushed through several legislative packages of major changes to our industrial relations laws, some of which we are still working through. It makes it difficult for small businesses to operate, especially when only about 43 per cent of them are even breaking even. This bill is a classic example of the government doing a Senate deal and rushing through the legislation. I would argue it's poor policy, it hasn't been thought through and it hasn't been properly consulted on. The government is now having to clean up what happened through the rushed process. It only gives uncertainty and angst for businesses. It is not how we should be making policy in Australia. I respect the right to disconnect for employees, but by legislating it in the rushed way that we did—and we are now having to fix it—we are going to see unintended consequences.

Many have heard about this in the media. What is the right to disconnect? It gives employees a right to disconnect from their employers' unreasonable contact outside of work hours. The difficulty of course is in the definition of 'unreasonable contact' and how that is interpreted. The change is partly a response to smart phones and working from home blurring the lines between work and personal life. We know that over the last few years with COVID many things have changed in our workplaces. While it is incredibly important to get the balance right, by legislating it in this way we are at risk of creating a real minefield for businesses.

The right-to-disconnect amendment to the government's legislation came from Senate deliberations. It was not part of the suite of legislation that was put to the House. It was not part of a consultation process with COSBOA or BCA or business lobby groups. It hadn't had full consideration in the House before the government legislated it in the Senate. Now we're seeing it coming back to the House from the other place. In fact, we're having to pass this additional legislation because of the unintended consequence—or rather the effect of rushing to pass it—of including a criminal sanction in relation to this provision. No-one disagrees that employees need time to switch off, but we need to balance that with the need to get the job done, with productivity and with how businesses operate in a modern era with smart phones. We need to balance flexibility with being connected.

The COVID-19 pandemic saw a huge change in the way many Australians work day to day. These changes have meant newfound flexibility for many, and that does make it harder to disconnect. Nevertheless, we don't want to lose the flexibility that many employers and employees alike value, because it has helped on both sides. For example, many women or families who need to deal with family commitments need to be able to leave the workplace, and they need to request more flexible arrangements. The converse is also true for employers. They will have difficulty in knowing what is going to be considered 'unreasonable contact' and during what times while continuing a willingness to provide more flexibility in relation to working arrangements. If this change in the law is used in a vexatious manner—which, let's get real, does happen—it will absolutely spook employers into winding back the flexible working arrangements that so many have come to enjoy.

This amendment was rushed. We know that unintended consequences arise out of well-intentioned policymaking but rushed processes. The Australian Chamber of Commerce and Industry stated that this sort of amendment is 'a blunt instrument which will do more harm than good'. They highlighted a tension, where technology has afforded employees more freedom to work unusual hours or to not be physically onsite but also assured employers that they are contactable if needed. That shows there is a level of nuance here that is worthy of greater scrutiny in order to get the policy balance right.

How did we get here? Why must the government do this additional legislative clean-up? The second tranche of the government's closing loopholes legislation established the right to disconnect. This was established in the debate in the Senate on this legislation, where an amendment was sought to be made by the government to make clear that parties who breach a right-to-disconnect order issued by the Fair Work Commission are not committing a criminal offence. However, as so often happens here, political shenanigans and posturing were afoot, and the government were not granted leave for this amendment to be moved. Instead, we are taking up time in the House with an additional bill to do what that amendment was trying to do in the first place.

This bill simply fixes that issue. It makes sure that noncompliance is a civil rather than a criminal offence, something which should have been done by amendment in the first place. But it does bring to light the broader problem in relation to this legislation and the processes of government in how these changes have occurred. This bill relates to the bill passed by the Senate a few weeks ago, and there's great concern in relation to some of the changes for casual workers. The government didn't give us enough of an opportunity to speak on the amended legislation at the time. In fact, it used its numbers to gag debate and rush it through, which is rather hypocritical in light of my having been in this place myself during the last term of government when the shoe was on the other foot and the now government complained about being gagged in those days. Good policymaking requires scrutiny and debate time.

The definition of 'casual employee' and the conversion process have been amended in a way that is more palatable and, hopefully, practical for employees and employers. That would have been something I would have enjoyed the opportunity to debate when that bill came back from the Senate. Now there is one conversion process, initiated by an employee. That simplification is good. Businesses—and this was an amendment that was pushed for in the House but, as so often happens, was only agreed to by the government in the other place—only have to act on converting an employee from casual to part or full time if they receive a notification from the employee. Employees can initiate this after six months working for a bigger business or after 12 months working for a small or medium enterprise. This highlights yet another industrial relations issue we have, which is that there are currently 12 definitions of 'small business' in Commonwealth legislation. We will have more to say on this, and I'm urging the government to address that problem. Changes to the casual conversion process echo the amendments that the crossbench in the House had offered, and it's good to see that our efforts had some impact, since they were then agreed to in the other place.

Overall, the changes that affect casual workers are not what is needed right now, I would argue, especially for small businesses, in light of current economic circumstances. They will still create complexity, uncertainty and more pressure for many that are already struggling to break even. Small businesses will continue to feel this pressure well into 2024.

One of the biggest concerns I had with the original legislation was in relation to employee-like status and that threshold. This has also been amended in the other place, but of course we did not get the opportunity to comment on those amendments, because the government elected to gag debate. To be an employee-like worker, a person must satisfy two or more of the listed criteria, rather than one as in the original bill. There have now been some sensible changes introduced, refining what may be included for the Fair Work Commission to look at who is an employee-like worker and the scope of matters that will be included in minimum standard orders. This is a move in the right direction and provides more precision than existed in the original legislation. However, it is still a massive and complex change to the IR framework that will be complex and difficult for many to understand and implement, and with complexity comes uncertainty.

Many of my constituents and businesses in Warringah will be affected by this new piece of legislation in relation to the right to disconnect, and quite possibly not in a positive way. I would argue to the government that we must look to ease the burden of red tape on our business owners, big and small. If we keep passing complex legislation that is rushed and not properly consulted on, we are making it harder for businesses and entrepreneurs to succeed in Australia. We need to get back to basics, with draft exposures of legislation for consultation and genuine engagement with a variety of stakeholders—listening to feedback and incorporating it to make our laws better. If we don't, we will continue to waste the time of this House on legislative clean-ups.

Question agreed to.

Bill read a second time.