construction industry economy

The febrile reaction to Labor’s rather modest industrial relations policy announced yesterday by Anthony Albanese suggests not merely that corporate Australia remains wedded to its old slash-and-burn workplace ideology, but that the chances of decent wages growth any time soon are slim indeed.

Labor was proposing to “kill off casual employment”, according to the Australian Chamber of Commerce and Industry, with a plan for “closing businesses” while “new and innovative 21st century forms of work would be smothered”. It would “destroy jobs and investment”, said the Australian Industry Group’s IR hardliner Innes Willox and “threaten the jobs of hundreds of thousands of labour hire workers”.

Industrial Relations Minister Christian Porter claimed Labor’s policy would cost $20 billion, a figure presumably drawn up on the back of a Public Bar coaster.

What had elicited such apocalyptic warnings? Labor proposes to address job security by elevating it in the Fair Work Commission’s powers and objectives and reducing the capacity of employers to keep workers as casuals or on fixed-term contracts when they are effectively permanent.

Albanese also committed to lift wages by enabling portable leave entitlements for casuals (it’s unclear how) and requiring that workers in labour hire companies are paid the same as permanent employees doing the same job.

Employer groups are particularly concerned about giving the Fair Work Commission more power to protect gig economy workers as employees. Willox argues simultaneously that casualisation hasn’t increased in the workforce but that “the gig economy is delivering huge benefits to the Australian community.

The digital economy has created completely new jobs and new markets.” This seems a tad inconsistent — especially since Willox is right about jobs being created in the gig economy. Most of the jobs created in recent months have been “non-employee” jobs or casuals.

While ending the practice of digital platforms treating employees like they’re not employees will help reduce exploitation and precarious work, Labor’s proposals to “deliver better pay” won’t do much to address the sub-2% wages growth workers — and especially lower-income workers — will be stuck with for the next few years.

That Labor has been unable to effectively exploit the Coalition’s deliberate wage stagnation policy is one of many blots on its political record in recent years, but it ought to have greater luck in emphasising the unfairness of the treatment of gig economy workers (sorry, “new and innovative 21st century forms of work”) and workers being paid less for the same job.

Random claims of cost impacts on business — Porter’s $20 billion doesn’t even sound that big in a post-pandemic world — and business lamenting being prevented from exploiting and imposing greater uncertainty on workers are unlikely to make much headway against a fairness argument among voters.

But yesterday’s announcement was essentially defensive — aiming to prevent employers from further abusing the existing industrial relations system to exploit workers.

A more proactive policy on wages growth, one aimed at more than simply preventing a further deterioration, would involve calling for a significant minimum wage rise from the commission — which would induce howls of outrage from business — and using the government’s direct wages tool, public sector salaries, to speed up wages growth rather than using it to curb growth as the government is doing.

It would also involve expanding workers’ power to take industrial action in support of wage claims — something vanishingly rare that has been demonised out of any IR debate.

Employers meanwhile continue to push the debate further and further away from the interests of workers. Just this week, AIG called for “excessively generous” workers’ entitlements under the fair entitlements guarantee — the last-resort taxpayer-funded guarantee for employees’ entitlements when companies collapse without being able to pay them — to be slashed in order to reduce costs.

There is literally no area where employer groups will not attempt to undermine pay and conditions — and confect outrage that anyone might suggest protecting workers more effectively.