Upload
phamtuong
View
218
Download
1
Embed Size (px)
Citation preview
Construction, Forestry, Mining and Energy Union
Mining & Energy Division’s
Victorian District Branch
Submission to the
Victorian Inquiry into the Labour Hire Industry and Insecure Work
January 2016
This response has been prepared and submitted on the basis that it is a public document.
Submitted to: Professor Anthony Forsyth
RMIT University Graduate School of Business & Law
By email: [email protected]
Submitted by: Geoff Dyke Tel: 03- 5134 3311Fax: 03-5134 7058Email: [email protected]
EXECUTIVE SUMMARY
Labour Hire and casual work are currently being used within the Victorian Mining and Energy
Industries in three main areas:
1. For major maintenance outages of generating units and mining equipment.
2. For casual and seasonal employees in the mobile earthwork plant equipment industry
within the mines.
3. For casual employees in the Security and Emergency Services Industries in filling
relief positions in permanent shift rosters.
Each of these areas presents negative impacts on workers, their families, community and the
Industry. Additionally, there are some particularly concerning practices used by power
companies, Labour Hire companies and contractors; specifically:
A preference for casual labour over permanent labour where there is permanent full-
time work available.
Under-utilization of pools of casual employees that are held captive.
Over-utilization of temporary maintenance labour in preference to permanent in-house
labour.
We assert that Labour Hire and casual employment within our industry results in poorer OH&S
outcomes and increased risk, restraint in trade of labour, lower wages and conditions,
unreasonable stress on families, loss of community participation and citizenship, scarcity of
apprenticeships and traineeships, locally depressed business conditions and stagnation of
population growth.
The CFMEU Mining and Energy Division Victorian District Branch recommends that
government considers each of the issues raised, with a view to constructively improving
outcomes for insecure workers, their families and the community.
OVERVIEW
The Construction, Forestry, Mining and Energy Union - Mining & Energy Division - Victorian
District Branch (CFMEU) welcomes this opportunity to provide a submission to the ‘Victorian
Inquiry into the Labour Hire Industry and Insecure Work’. Our submission is in addition to, and
supports both the national CFMEU and Victorian Trades Hall Council submissions.
THE CFMEU
The CFMEU is a registered union at both federal and state levels in Australia and has over
120,000 members organised into three divisions:
Construction and General Division;
Forestry and Forest Products Division; and
Mining and Energy Division.
MINING & ENERGY DIVISION - VICTORIAN DISTRICT BRANCH
The CFMEU, through its Victorian Mining and Energy District Branch, is the dominant union
within the power generating and coal mining industries in Victoria. We represent about 85% of
all workers within the power stations and brown coal mines in Victoria, including those at:
Hazelwood power station, Yallourn power station, Loy Yang ‘A’ power station, Loy Yang ‘B’
power station, Newport power station, AGL Hydro power stations and open cut, brown coal
mines at Yallourn, Morwell and Loy Yang. Additionally we represent the Stawell Gold mine and
contractors within the Security, Emergency Services and Mobile Earthmoving Plant industries.
Our union feels well qualified to make this submission because we are based in Morwell at the
centre of the Latrobe Valley and our officials, members, families and community have all dealt
with the impacts of industry restructuring, privatisation and the constant push to eliminate
permanent jobs and replace them with casual, part-time and insecure jobs.
LATROBE VALLEY’S RECENT HISTORY
The restructuring and privatisation of the Victorian Electricity Industry in 1990s resulted in a
drastic drop in employment within the power industry, associated construction and maintenance
work within the Latrobe Valley. Employment in the Latrobe Valley power industry during this
time of restructuring and then privatisation dropped from 10,800 directly and permanently
employed persons to less than 2,000 persons, directly and permanently employed.
Since this period, there has also been a virtual cessation of the previous continuous construction of
major coal fired power stations in the Latrobe Valley. As a result another thousand or more jobs in
the construction industry and the companies servicing them has also gone. A single dominant
employer in the form of the State Electricity Commission of Victoria has not only been replaced
by many new private power companies but these private power companies have in turn
outsourced and contracted out many significant parts of their businesses.
These large private power companies, who are generally multinationals, play off power industry
contractors against one another on price, which in turn puts additional pressure on the wages and
conditions offered by independent contractors. A recent example is one private power company
asking all of its contractors and suppliers to cut their price by 22% or face the future loss of their
contracts. Most refused of course but this shows the immense pressure that private power
companies can bring to bear on smaller independent contractors.
In most cases, power industry contractors have shown a distinct preference for casual, part-time
and insecure jobs. This is most evident in the Security and Mobile Earthmoving Plant industries
but is also significant during power station major maintenance outages; with nearly the entire
workforce numbering between one and three hundred are engaged on a casual or labour hire basis
for the 1-2 month maintenance outage. It is not only temporary work where this preference is
shown because a contractor performing permanent maintenance work recently elected to make
twenty permanent maintenance workers redundant while still keeping casuals workers under its
employ.
We submit that the following can be attributed as consequences of labour hire, insecure, casual,
part-time jobs and underemployment and that this inquiry should examine all of these
issues/effects:
A net region population loss or depressed population growth.
Higher unemployment levels & withdrawals from the labour force.
Lower family incomes &/or negative impacts on family life.
Limited or non-existent apprenticeship and traineeship outcomes.
Depressed local business conditions.
Weakened community participation and citizenship.
Less than optimal Occupational Health & Safety outcomes.
Less than optimal health outcomes.
Less than optimal productivity/labour market outcomes.
Reduced employee pay and conditions.
Restraints in the trade of labour
This submission will briefly outline our view on all the above points; however, we would like to
point out a lack of resources, time and most importantly access to accurate information prevent
this submission from being far more authoritative in nature.
A NET REGION POPULATION LOSS OR DEPRESSED POPULATION GROWTH.
Since 1996, the Latrobe Valley region has experienced a major decline in population due to poor
job opportunities, with the region continuing to experience depressed population outcomes in
comparison with other areas. An obvious reason for population loss was the dramatic decline in
job opportunities associated with privatisation, but casualization and labour hire have also had
significant impacts.
After privatisation the Latrobe Valley region was left with a large pool of skilled workers without
permanent employment. Many of these workers either left our region to seek other permanent
employment or took up casual/labour hire positions performing shutdown work during major
maintenance outages. This shutdown work is intensive while it is going but generally infrequent
and this has led to these workers chasing shutdown work across Australia, in between their major
outage work in Victoria.
In addition, as a consequence of the drop in local workers, many of the casual/labour hire
employees who perform work on major maintenance outages in the Latrobe Valley now come
from interstate. This influx of temporary workers has led to a further loss of job opportunities
within our region due to the significant transient workforce operating within the Latrobe Valley
region, further affecting our local economy and its population outcomes.
HIGHER UNEMPLOYMENT & WITHDRAWAL FROM THE LABOUR FORCE
Insecure, casual and part-time and underemployment are often all terms synonymous with the
labour hire and contract industries. Our experience is that most casual/labour hire workers are
engaged by contractors to work considerable less than their full capacity, often having long
periods between engagements. This leads to casual/labour hire workers experiencing regular
periods of unemployment and sometimes withdrawing from labour force participation for
extended periods out of frustration.
LOWER FAMILY INCOMES &/OR NEGATIVE IMPACTS ON FAMILY LIFE
Because casual/labour hire workers are often utilized well below their full capacity they generally
have lower incomes than comparable permanent employees. In industries with very low hourly
rates, such as Security, this can lead to workers earning less than if they were on unemployment
benefits. These workers are the working poor, with our union often having to reduce their union
fees because they can’t afford them.
The exception to this would be casual/labour hire workers performing work on major maintenance
outages who work excessive hours over a short period of time. These workers often work six
twelve hour days per week (72 hours per week) followed by a rest day. This pattern of work has
an obvious detrimental impact on family life, with the parent deprived of time to properly interact
with their family, especially when major outages generally run for up to eight to ten weeks. If
these workers chase major outage work interstate then this family and social impact continues on
almost indefinitely.
In the Mobile Earthwork Plant Industry Labour Hire/casual employees are often engaged on a
seasonal basis. This means that during good weather the Labour Hire company/contractor will try
to get as many productive day light hours as possible. These workers will often work 9-10 hour
days, 6 days per week on a continuous basis. We also know of instances on major projects and
coal loading operations where casual workers have been worked continuously in excess of 54
hours per week for several years without any leave break. The only way these casual workers
can get a break with their family is to quit their employment and then go to the bottom of a
waiting list when they return seeking work.
Those casual workers who are underutilized also experience financial stress when they are not
working and are held captive waiting on a phone call. This means they can not plan any family
activities because if the phone rings and they are not available, the Labour Hire
company/contractor puts a black mark against them and they are less likely to be called in future.
These workers also have a great deal of difficulty in getting approval for loans due to the
fluctuating nature of their income.
LIMITED OR NON-EXISTENT APPRENTICESHIP & TRAINEESHIP OUTCOMES
Labour hire and contracting companies are skills takers not skills makers. They rely almost
exclusively from sourcing trained/skilled/qualified workers from what was previously a pool of
workers trained at public expense. As this pool of skilled workers diminishes, because of our
aging workforce, contractors seek further casual/labour hire workers from outside our region
rather than engaging apprentices or trainees. Some of the reasons for this are because private
power companies want work completed in very tight time frames and some of it is because the
lack of continuity of work.
In stark contrast to the past, very few apprenticeships or traineeships are available in the industries
that we cover, with only about two dozen apprentices/trainees employed for about 2000 workers.
Where apprenticeships or traineeships do occur they are generally employed by the core or host
companies and not by the labour hire or contracting companies themselves.
DEPRESSED LOCAL BUSINESS CONDITIONS
The Latrobe Valley region’s business communities were devastated as a result of the restructuring
and privatisation of our and other regional industries in the mid 90’s. The economic impacts of
this is still most evident in the towns of Morwell and Moe, which are ranked in the top ten
percent of Australia’s most disadvantaged towns. There were some signs of economic recovery
in the late 90’s, however this recovery has stagnated in Morwell and Moe as the labour
hire and the contracting industries grew and permanent employment was replaced with
insecure, casual and part-time jobs or underemployment.
WEAKENED COMMUNITY PARTICIPATION AND CITIZENSHIP
Active and worthwhile community participation or citizenship is difficult, if not impossible, for
casual or labour hire workers because they work irregular days, excessive hours or have to live
away from home to travel interstate for work. There is little quality time for them to spend in the
community and the irregular work patterns precludes participation in sporting teams. Our clubs,
organisations and sporting bodies have all experienced significant drops in participants caused by
changed work patterns brought on by the labour hire and contracting industries.
LESS THAN OPTIMAL OCCUPATIONAL HEALTH & SAFETY OUTCOMES
We submit that there is persuasive evidence to suggest that OHS outcomes in the labour hire and
contracting industry are, on average, considerably poorer than in other industries, particularly in
the higher risk area of blue-collar labour hire. The excessive hours worked in some cases in the
Mobile Earthwork Plant Industry and Major Outage Maintenance mentioned earlier obviously
introduce a significant fatigue element that can’t be ignored but there are also other factors.
Whilst the OH&S Act 2004 mandates a duty on the labour hire or contract agency, and the host
company, to provide a safe and without risk to health workplace for workers, it is our submission
that this labour hire or contracting arrangement often fails to achieve this by taking short cuts.
In our experience host companies often enter into these arrangements partly to attempt to remove
themselves from their OH&S responsibility. For example, a private generator is currently seeking
to outsource an arduous task of bunker lancing to labour hire contractors on the premise that this
activity presents an OH&S risk to its own aging workforce. The private generator appears to have
little OH&S concern for any older workers engaged through Labour Hire. That is of course, if it
doesn’t discriminate by secretly telling the contractor to only use younger workers.
We believe job security is a fundamental ingredient to maintaining a safe workplace and to
prevent long-term injuries to workers health. Workers engaged in insecure, casual and part-time
work often find it difficult to fulfil their duties as employees under the Act and stay in
employment. If casual workers raise genuine OH&S issues to their employer they are often
‘black banned’ and not offered further work because they are seen as trouble makers.
We submit that labour hire and contract workers often do not report injuries, or delay the reporting
of an injury or hazards as a result of job insecurity, and that this often leads to working with an
injury or in a hazardous situation. We further submit that workers engaged in casual, insecure and
seasonal work who report injuries, particularly injuries that are significant injuries or cause long-
term health damage (spine, nerve, vibration and lung injuries) fail to be re-employed and are left
to deal with their injury or health damage financially unaided. This practice also avoids the injury
or health damage being properly recorded and denies the worker his rights under a proper Return-
To- Work process.
We believe that labour hire and contracting workers also experience higher injury rates than
permanent workers because they are subjected to changing workplaces and hazards, without
adequate training and instruction. It is our experience that in the Mobile Earthwork Plant industry
a lot of casual and temporary hires who come directly from the farming sector. The farming
sector has notoriously poor OH&S outcomes in Victoria because its workers are generally self-
employed, poorly regulated, lack education in OH&S and have a strong mindset on production
in their own financial self-interest.
Unfortunately, although these ex-farm workers possess good mobile plant skills they also bring
the farm OH&S culture with them. For example, they regard clean and hygienic crib room
facilities in which to eat their lunch as an unnecessary luxury rather than a necessary requirement.
Likewise there is a tendency to improvise to avoid delaying production rather than to take a
slower more safe method.
We recommend that the Victorian Workcover Authority should conduct specific research to
examine the OH&S outcomes in the labour hire and contracting industries, as compared to those
within the permanent workforce. This should be done in conjunction with the establishment of an
industry wide data base that is aimed at identifying casual/labour hire workers and improving the
OH&S performance within this sector
LESS THAN OPTIMAL HEALTH OUTCOMES
We submit that there is evidence to suggest that the health outcomes of workers in the labour hire
and contracting industries are, on average, considerably poorer than in other industries.
Casual/Labour Hire workers tend to change employers more often and there appears to be a lack
of ongoing workplace health monitoring, such as regular hearing testing. We recommend that the
upon establishing a registrar of workers in this sector, the Victorian Workcover Authority should
conduct a health study of casual/Labour Hire workers as compared with the permanent workforce.
LESS THAN OPTIMAL PRODUCTIVITY/LABOUR MARKET OUTCOMES
The myth that labour hire, casual and part time work provides much needed flexibility to workers
is quickly exposed when it is understood that the most sought after type of employment is
permanent. We believe that most workers will do almost anything to get and keep permanent
work.
Contractors and Labour Hire companies always attempt to keep a few ‘permanents’ on their books
and use these workers as ‘carrots’ to the casual and part-time workers. These ‘permanents’ are
picked by the employer as workforce and OH&S ‘representatives’ and generally ‘behave’ to the
bosses liking in order to keep their permanent job status. This undoubtedly leads to a compliant
workforce; however, it does not engender independent or innovative thinking.
Casual/Labour Hire workers experience a great deal of underutilization or are often moved around
from site to site, negatively impacting on the consistency in the job, knowledge of the work site,
work practices and safety systems and knowledge of organisation structure/supervision. These
labour hire or contract relationships are often described as a triangular relationship between the
worker, the labour hire or contract agency and the host but in our experience they are barely a two
way relationship because the host company distances itself from any responsibility of relationship.
REDUCED EMPLOYEE PAY AND CONDITIONS
Casual/Labour Hire workers generally have inferior rights and entitlements under their Enterprise
Agreements because they have little say in their negotiation and private power companies tend to
squeeze their contractor employer financially. To cut cost, Labour Hire companies and
contractors tend to shed any entitlements that are not essential or would put them above the
National Employment Standard minimum.
This reduction in conditions and entitlements is then further impacted by the influx of
casual/temporary farm workers, who have grown up on low wages and poor conditions, who
believe even basic industry wages and conditions are overly generous.
When an Enterprise Agreement is put up by the Labour Hire company/contractor a great pool of
underutilized casuals are given the same voting rights as permanent works. While intuitively it
may sound fair all workers get a vote, how is it fair that a casual worker in the Security Industry,
who has only worked 6 shifts in the past 12 months and can work elsewhere, gets the same vote as
a permanent worker who must work under those pay and conditions day in day out? In the
Security Industry there could be up to 3-4 casuals to make up a full time equivalent position
and their underutilization makes them willing to accept even the smallest of salary increases.
In addition, casual/Labour Hire workers often work under a different Enterprise Agreement with
inferior conditions to that of the permanent employees from host power companies. For example,
in one case, a host power station company has had a Labour Hire employee backfilling permanent
positions on a temporary basis for a continuous ten year period, yet this Labour Hire employee
only gets paid half the hourly rate and gets much lower rates of pay when overtime is worked.
RESTRAINTS IN THE TRADE OF LABOUR
Labour Hire and Contracting companies tend to deliberately maintain excessively large pools of
casual/seasonal workers on their books. This is very easy for them to do in an area like the
Latrobe Valley that has experienced such a dramatic reduction in employment within its
region. The motivation for this is to underutilize casual labour to keep them poorer and hungry
for work. This
is the major mechanism of abuse that Labour Hire/contracting companies use against their
workers in the Latrobe Valley.
By way of example if they discover that one of their workers has dared take up employment with
another company that worker is taken off their books, either temporarily or permanently, as
punishment. This ‘black listing’ of casual employees is a restraint of trade but they are too scared
to speak up in case they never work again. This practice also prevents workers from seeking
temporary work with other contractors, who may pay higher wages, acting to keep wages and
conditions within the industry artificially low. This effect is directly verifiable by comparing an
excavator driver wages in the Latrobe Valley to one in the Hunter Valley.
The same tactic is employed by Labour Hire and Contracting companies to keep OH&S
representatives and union delegates under their direct control. If either make any issues for the
company, they are also ‘black listed’ indefinitely or until they comply.
This tactic also explains the strong preference for casual/labour Hire employees by contractors,
even in situations where it does not make any sense. By way of example; using casuals to fill
relief positions in rotating shift rosters in the Security Industry, where the hours required
exceed a worker’s full time equivalent hours. In theory the cost of a either a permanent or casual
employee in this situation should be roughly the same, yet most employers display a definite
preference for engaging a number of casual employees instead of one permanent, despite
reasons explained previously not always being as productive. In this case control of management
over its employees appears to take preference over labour productivity.