SUBJECTS: Unfair dismissal laws, the better off overall test, unions, John Setka.

DAVID SPEERS: Tony Burke thanks very much for your time this afternoon. So last week Kate Carnell - she's the Small Business and Family Enterprise Ombudsman - released a review of unfair dismissal laws. She says the laws aren't working at the moment and that there needs to be a significant widening of the definition of when it's actually okay to dismiss someone. At the moment theft, fraud, violence you can be dismissed but she says that does need to be widened to include wilful or deliberate behaviour by employees inconsistent with the continuation of their employment. Would you have any problem with widening that definition?

TONY BURKE, SHADOW MINISTER FOR INDUSTRIAL RELATIONS: Well if you have a look at the code already it makes clear that while the ones who you've referred to in terms of theft, fraud or violence are already covered specifically as automatic dismissal, it says that it's in no way limited to that. And so for anything that clearly and permanently breaks the employment relationship that's already covered under the part of the code for instant dismissal. You then have another part of the code and it's not a long document. The rest of the code just creates a situation where if an employee is not performing up to scratch then they have to be given a warning if they're from small business and a chance to be able to respond and to be able to get things back up to scratch. It's not that often that small business gets to the point of firing someone. I’m from a small business family myself. I know the way the people who work for the business can very much become members of your extended family, I know how that works. But what we can't have is a situation where something happens that is clearly unfair and the employee then has nowhere to go. And if you have a look at what the Liberal Party backbench is now pushing for - they're creating exactly that circumstance where something can be clearly unfair. But according to what people like Senator Stoker are calling for if it happens in a small business everyone or turn a blind eye to it.

SPEERS: But there are those in this small business who argue it is too cumbersome at the moment. A lot of claims are lodged that are vexatious. I think the official figures are less than one percent of claims lodged are actually ultimately backed by the Fair Work Commission. And so the business has to deal with that whole process. That's time consuming, can be costly. They ultimately may have to pay go-away money. Do you appreciate the concerns that are there for some employers?

BURKE: We need to remember the way it works now is quite different to how it looked when John Howard was arguing that small business should be exempt from unfair dismissal laws. Most of these consultations if the small business requests it happen over the phone. And when you referred to only one percent being backed by the Commission, you'd have a similar percentage of being rejected by the Commission. Almost everything gets sorted out in terms of conciliation. And sometimes that conciliation, it will normally for a small business it will be over the telephone and on the phone if a worker has made a claim and the Commissioner says no it's got no chance of getting up, they get told. And they get told straight. And it's not like it used to be where the only option for the small business operator is they got to shut the shop for the day, head into the Commission, maybe things get put off for another day. Most of this for them is done over the phone. So there's a fair bit of licence being taken by some of the people who are wanting to really push how difficult it is. And I think Amanda Stoker really gave the game away, where she started talking about complete exemption. And think about what the circumstances can be –

SPEERS: You’re not going to support complete exemption there but if it if there is some tweaking, some changes, some greater flexibility for small business - is that something you'd be willing to look at?

BURKE: If the government has a proposal, it’s for the government to put forward a proposal. The proposals we've seen and we look at what they put forward. So far in industrial relations most of what they have put forward have been pretty bad proposals. And the only concrete proposal that's come forward at the moment is coming forward from their backbench which has been about a complete exclusion from these laws. And you need to think through what those sorts of examples are. You know the person who loses their job when they are asked by the boss to go on a date. Now if you've got a complete exemption for small business, is the community really expected to believe that that's fair? That that's where we are in 2019? Where somebody is - you know I remember seeing an example for someone who I represented at one point where the boss is throwing a bucket of water at him. He swore in response and then got fired for swearing. These are real examples. These things do happen.

SPEERS: Kate Carnell points to examples of where employees who might be drunk at work and it's impossible to get rid of them. Do you think there are other real world examples too on the other side?

BURKE: And that's why you have the conciliation process over the phone where for examples like the ones you've described, if there's a clear breakdown of the employment relationship it's dealt with relatively quickly by the industrial commission. Let's not forget these are views that Kate Carnell has always held back from when she was a Liberal Party first minister. I know that they've now given her a job where she's supposedly independent but I haven't yet seen many views emerge that have been different from the Liberal Party view from Kate Carnell.

SPEERS: All right. All right. Look one of the other areas the Government is looking at you know is enterprise bargaining agreements, and what's called the BOOT - the better off overall test. So as you know the Fair Work Commission can only approve an enterprise agreement between an employer and a union if this BOOT test is met, so that no individual worker is worse off. We have seen some problems with this. I mean Coles struck a deal with the union, an enterprise agreement and I think it was a trolley operator launched a successful complaint. They would be worse off, trading away some of their penalty rates in return for a higher base rate. Are you saying this is an area that should be off limits as well?

BURKE: Well I think the government would need to make a case here. First of all in terms of the example that you gave. I'm not critical of Coles nor of the union on that, because at the time there was presumed to be a different interpretation of the law. And once that interpretation was brought down it's been complied with. But think about the employee and think about the economy if the Government wants to make this case. If the government wants to make the case that they need to amend the law so that there are some employees who are no longer better off, that's an extraordinary claim for the Government to be wanting to make. And similarly to do that at a time in the economy when people are saying their jobs aren't secure enough and their wages have been flatlining. The Government is proposing responding by making your jobs less secure and putting further downward pressure on wages. Now if the Government wants to make that case –

SPEERS: If the bulk of the workforce is better off and the unions are happy with that deal. But you've got one or two workers who are worse off, why should they be able to hold up the whole thing?

BURKE: Well if it's one or two workers then I suspect it's not an expensive enterprise to make sure that they're not worse off. We need to both look at the case of the individuals and we also need to look at the needs of the overall economy at the moment. The economy needs wage growth. This isn't just the Labor Party saying it, it’s not just the labor movement saying it. You're getting it from the Governor of the Reserve Bank. We need wage growth. We need upward pressure on wages. If we have a situation where you know you put it in those terms what if it's only one or two workers holding up the whole thing. If it's only one or two workers then the concept of making sure nobody’s worse off shouldn’t be a difficult thing to be able to salvage.

SPEERS: But it is isn't it? If you have to change the rates for everyone for that penalty rate to address the concerns of one or two workers, you’re having to renegotiate the entire deal. This is the complaint that employers have made.

BURKE: Look in terms of renegotiating entire deals, you're talking about any agreement that was struck prior to the interpretation that was later given to the better off overall test. Now that that interpretation is given, yes there are some areas that need to be updated but you know that that's a one off. That's not a permanent problem because you've then got the new understanding of the better off overall test being understood widely and future negotiations being based on it. All I'm saying is if the Government wants to argue that workers shouldn’t be better off overall they need to make that case. And I don't see how it's good for them or good for the economy at the moment.

SPEERS: So these areas are all still being looked at by the Minister, Christian Porter, and he's some months away from completing that process. But there are a couple of measures the Government's trying to move on right now. One of course is the Ensuring Integrity Bill. This would make it easier to do register unions that break the law or ban officials for misconduct. What specifically is your objection to this legislation?

BURKE: The simplest example I can give is if a group of nurses - I'm just beside a hospital here I'm during the interview - if a group of nurses took unprotected industrial action because they thought not enough people were being rostered on compared to the number of patients they had to look after, the entire Nurses Federation could be deregistered under this act. And who can take the action? Any person of sufficient interest is the only way they have defined it in the legislation. They want to argue this legislation as though it's really quite extreme examples. That's not what they've introduced into the Parliament. What they've introduced into Parliament is a direct attack on the right of workers to be able to get representation from unions, on the right of workers to be able to collectively organise. They have even got a clause in there about union amalgamations which says if two unions are deciding whether to amalgamate and all the members of each union have a vote, the vote is conducted by the Australian Electoral Commission, and it comes out with a yes vote - then they've got a clause there to be able to completely overturn the democratic process. You can't make this stuff up. They want to talk about this bill as only dealing with the most extreme examples. The extreme example is the bill.

SPEERS: But there is a good example there at the moment with John Setka. And I know this is a prospective piece of legislation - it can't apply retrospectively to John Setka - but you know he's a guy that even some of your colleagues reckon should not be a union leader and there's no law that enables him to be removed.

BURKE: Well there are laws that if he was convicted of further offences under the Fair Work Act there are laws already where union officials can be disqualified. That threshold needs to be high. It shouldn't be something that can be effectively a decision that Ministers get involved. Why does it need to be high? Because it's a big thing to depart from the principle that workers should get to choose who their representative is. Christian Porter and Scott Morrison shouldn't be choosing who your representative is. If Christian Porter or Scott Morrison - if they're in private enterprise and wanted to get a representative they'd be able to choose whoever they wanted to be their representative. It's a big step to say that workers don’t enjoy that same right.

SPEERS: But are you saying that John Setka – I mean you've suggested he would need to break more law to actually be disqualified, to be able to be removed. Are you saying –

BURKE: What I’m saying is there are provisions. It’s a matter for his members. The union movement have made comments in terms of what’s the interest of the union movement.The Labor Party's made its own decision, which is you know we're waiting for a court decision before we go to the next stage. But the Labor Party leader Anthony Albanese has made absolutely clear his view on this bloke's role in the Labor Party. He's already suspended, so for all purposes he's already gone. And he's there because his members are chosen for him to be there. You need to remember with all of this as well, these sorts of examples that you want to point to are a tiny corner of what this legislation does. Your average union member these days is not in the construction industry. Your average union member these days is a woman in her 40s, probably working in aged care or the health services industry in some way. That's the bulk of the modern union membership. And any law that is designed to make it harder for those workers to be able to choose who their representatives are needs to be suspect. And it interweaves with what we were talking about before David with respect to what the Coalition backbench is coming up with. Every step. There is a pattern here. There's nothing here to give workers more bargaining power. There's nothing the Government has before the Parliament or is proposing that increases the bargaining power of the organisations that have a chance of pushing for wage growth to start to kick off again. The pattern is always the same. Less secure work and flattening wage growth.

SPEERS: Let me just finally, the other measure the Government is trying to legislate is the Proper Use of Worker Benefits Bill. It says some $30m a year is being siphoned off worker entitlement funds, mostly in the construction sector by unions who've set them up. What the legislation aims to do is create more transparency around this and ensure that the workers’ funds can only be used for the workers’ benefit. What's wrong with that?

BURKE: Have a think about the double standard here. If the fund didn't exist all of the workers’ entitlements money would be sitting in the employer's bank account and whatever earnings come off it are 100 per cent pocketed by the employer. Now the reason that these funds have been set up is because when an employer goes under - as from time to time they do - workers lose their benefits and the taxpayer ends up forking out. So here we have a system where the workers’ benefits are completely protected. None of that money you referred to undermined the workers’ entitlements, that the taxpayer is protected and then cooperatively, the workers’ representatives and the employer's representatives use the earnings to run additional services. Things like funeral insurance, things like occupational health and safety training both for employers and for employees.

SPEERS: What's wrong with more transparency around this and is there any harm from saying it must be used for the workers’ benefit?

BURKE: They've governed already under the Corporations Law. They're already governed as trusts. If the Government has no confidence in trusts law being overseen by the Australian Taxation Office then they can amend trusts law, but they won't do that. You can guarantee they won't do that because of the taxation involvement, and use of these trusts by a whole series of their mates. So what they're wanting to do is say, well these are the only trusts they're concerned about. And if there are earnings on workers’ benefits where the taxpayer and the employees are not protected then the employer can pocket all the money. I mean the double standard here is extraordinary. They call it worker’s money, the earnings on workers’ money, and they'll say they need to regulate it only if it's being jointly and cooperatively managed. But if it's 100 percent going to the pockets of the employer then it's no longer workers’ money and they're fine with that. It's hypocrisy in the extreme.

SPEERS: Shadow IR Minister Tony Burke thanks so much for joining us this afternoon, appreciate it.

BURKE: Great to talk to you David.


Tony Burke