Budget Estimates 2017: Industrial Relations Hearing

6 September 2017

Adam Searle’s questions to the Industrial Relations Panel:

  • The Hon. DOMINIC PERROTTET, Treasurer.
  • VICKI TELFER , Executive Director, Industrial Relations, Treasury.
  • VIVEK BHATIA , Chief Executive Officer, icare.
  • MICHAEL PRATT , Secretary, Treasury.

The Hon. ADAM SEARLE: Minister, does your Government have plans to provide new and better protections for young workers in the wake of the wage theft scandal in and around Wollongong?

Mr DOMINIC PERROTTET: I would have thought one of the more significant issues in terms of wage theft was the union movement contracting out the entitlements of Sunday workers at the expense of those who work during the week. I have read a very concerning report—

The Hon. ADAM SEARLE: Treasurer, my question was about protecting young workers in the Illawarra and the wage theft scandal there. Does your Government have plans to provide new and better protections for young workers: yes or no?

Mr DOMINIC PERROTTET: The best protection and the best support we can provide to young people across this State is a job—

The Hon. ADAM SEARLE: Only if they are paid properly.

Mr DOMINIC PERROTTET: What was that?

The Hon. ADAM SEARLE: Only if they are paid properly.

Mr DOMINIC PERROTTET: I would also look at the support that we provide the public service here in New South Wales. When I look around other States that are not in as strong a financial position and that have stagnant wage growth, particularly in the private sector, I see that we are providing greater support to public servants across New South Wales, allowing wage increases of up to 2.5 per cent and more than 2.5 per cent in circumstances where savings are found. From my perspective as Treasurer, I have a strong focus on the budget and a strong focus on the economy. The decisions that we make today have a significant impact on employment opportunities. We have the lowest unemployment rate in the country, at 5 per cent, which is almost a whole percentage point below the rest of the country. We have created close to 400,000 jobs since 2011—

The Hon. ADAM SEARLE: Treasurer, you are not answering the question.

Mr DOMINIC PERROTTET: —and we certainly want to provide protections for young workers. The best we can do for young people across the State is to find opportunities. Opportunities for jobs come from economic growth. I make the point that we are not only leading the way on economic growth right now in New South Wales but also half a percentage point of that economic growth comes directly from the pipeline of the public infrastructure that we are building. I look at the jobs growth coming out of projects like WestConnex: There are 10,000 jobs from the WestConnex project. I am very proud of our Government’s job record. The concern that I have when it comes to wage theft—and I have spoken about this in question time particularly— there are many young workers out there on a Sunday and the Shop Distributive and Allied Employees Association [SDA] is trading away their wages, and they are worse off. You have Bill Shorten, the alternate Prime Minister—

The Hon. ADAM SEARLE: The Fair Work Act specifically leaves child labour protection laws to the States. Given the extensively documented exploitation of young workers in the Illawarra, why will you not act on this issue? It is totally within the New South Wales Government’s capacity to do so. What do you have against protecting young workers?

Mr DOMINIC PERROTTET: Nothing.

The Hon. ADAM SEARLE: Will you do something about it?

Mr DOMINIC PERROTTET: I want to help young workers. That is why I am bemused when I see some of the goings on in respect of the SDA and what they are doing to vulnerable young workers in places like McDonald’s and KFC. The alternate prime minister is making claims about penalty rates when unionised staff are worse off. That concerns me. I want to answer the question.

The Hon. ADAM SEARLE: What are you doing to protect young workers?

Mr DOMINIC PERROTTET: I do want to answer the question. I might pass to Ms Telfer if there is anything further to say in respect of—

Mr DAVID SHOEBRIDGE: Wage theft for young workers in the Illawarra.

Ms TELFER: Nothing specific from New South Wales. I think it is important to remind the Committee that at the end of 2009—it took effect in 2010—New South Wales referred its industrial relations powers to the Federal Government, and that includes all private sector workplaces. I note—

The Hon. ADAM SEARLE: Except that child labour laws are left to the States, Ms Telfer, you know that.

Ms TELFER: I understand that. But the primary responsibility is with the Fair Work Act. I do note that in the Federal Parliament this week there were discussions about vulnerable workers’ legislation.

Mr DOMINIC PERROTTET: Which Labor supported.

Ms TELFER: Which has been a matter of—

The Hon. ADAM SEARLE: Franchise workers, yes.

Mr DOMINIC PERROTTET: Franchise workers.

Ms TELFER: —great debate. That is about franchises. I think that is very important and I understand most jurisdictions are supporting the work around the vulnerable workers bill, because that will give additional powers to the Fair Work Ombudsman to investigate and bring matters to the appropriate conclusion.

The Hon. ADAM SEARLE: My question was, What is New South Wales doing to protect young workers? I do not mean providing a cheer squad for whatever the Commonwealth might be doing.

Ms TELFER: I obviously cannot talk from a policy perspective. But I can talk about the matters that we—

The Hon. ADAM SEARLE: You can be to the point about whether or not the New South Wales Government is doing anything.

The Hon. TREVOR KHAN: Point of order—

The Hon. ADAM SEARLE: To the point of order: Ms Telfer is being non-responsive.

The Hon. TREVOR KHAN: I have taken a point of order.

The Hon. SCOTT FARLOW: The point of order had not been made.

The Hon. ADAM SEARLE: The witness is not being responsive to the question.

Mr DOMINIC PERROTTET: Is there a point of order?

The Hon. TREVOR KHAN: I had taken the point of order. Ms Telfer is entitled to answer the question. She is being generally relevant and you should allow her to answer rather than being rude and interrupting her all the time. It is quite unnecessary.

The Hon. ADAM SEARLE: Mr Chair, if only the witness would answer the question.

Mr DOMINIC PERROTTET: Ms Telfer is answering the question. I provided a very detailed response that was clearly on point. Ms Telfer is going into further information.

Mr DAVID SHOEBRIDGE: That is debatable.

Mr DOMINIC PERROTTET: We only have a short period of time to talk about the industrial relations component, which is a key component of my portfolio of responsibilities.

The CHAIR: We will move on to Ms Telfer’s answer being relevant to New South Wales.

Ms TELFER: I will keep my answer brief and to the point.

Mr DOMINIC PERROTTET: No, you should make it.

Ms TELFER: As the Committee would be aware, we have a team of inspectors in the NSW Industrial Relations. We are particularly focused in that unit about providing information and advice to employers and to employees but making sure that employers can in fact undertake their rights and responsibilities. We also have an Aboriginal education unit and they are out with that community making sure that people in that community know their rights and responsibilities. But our focus has been about making sure that we can get employers to undertake their rights and responsibilities so that they do succeed and do not fail. We provide a range of advice to Government on a range of different matters. It is not my place to provide commentary on policy decisions. I can provide advice about what we do in the NSW Industrial Relations.

The Hon. ADAM SEARLE: Given that leave, of course, is a work entitlement, will you commit to expanding domestic violence leave for public sector workers from five days to 10 days paid leave, and if not, why will you not do so?

Mr DOMINIC PERROTTET: That is unfortunately becoming more of a relevant issue in both New South Wales and around Australia today. From my understanding, the current arrangements provide in the public service for domestic violence leave in circumstances once personal or sick leave has been exhausted. I understand that the Minister for Family and Community Services is looking into this. There have been discussions at the Council of Australian Governments [COAG]. From the State’s perspective, we would strongly support initiatives that enable and support victims of domestic violence to continue to participate in the workforce. The directive from Treasury specifically on this point is important. The provisions that agencies should apply are that sick leave, family and community service leave, sick leave to care for a family member— also referred to as personal and carers leave—may be used by staff members experiencing domestic violence. Employees can get access to that. They are not entitled to take leave prior to that point.

The Hon. ADAM SEARLE: Will you increase it? It is five days now, will you increase it to 10 days?

Mr DAVID SHOEBRIDGE: We have all read the circular.

Mr DOMINIC PERROTTET: You have all read the circular?

The Hon. ADAM SEARLE: We have. I have a copy here.

Mr DOMINIC PERROTTET: Domestic violence is something that the New South Wales Government takes very seriously. We are always looking at new opportunities where we can provide greater support. It is not for me at budget estimates to make new policy decisions on behalf of the Government. That is an area that the Government has taken a key interest in. We provided expanded support for victims of domestic violence in this year’s budget. We understand that governments around the country should have a can-do attitude and should look at doing more to provide support for people experiencing domestic violence. We will continue to look at ways in which we can do that. That does not exclude areas in industrial relations. There is no position to change the current policy to date. We will always look at avenues where we can find greater support.

The Hon. ADAM SEARLE: What about the private and non-government sectors? The Fair Work Act expressly provides that leave for victims of crime—which of course includes domestic violence—is left to the States to deal with. Are you going to provide domestic violence leave for those in the private sector?

Mr DOMINIC PERROTTET: Once again, I would refer to the approach in my previous answer.

The Hon. ADAM SEARLE: Which is no.

Mr DOMINIC PERROTTET: No, which is to inform the Committee that the Government takes the issue of domestic violence very seriously. We provided more funding in this year’s budget for support of those who experienced domestic violence. We have a specific Minister for domestic violence who is a strong advocate for greater support. We want to make sure that we are providing programs that assist and not impede people who find themselves in these grave circumstances and are not able to continue to work. They should not be discriminated against in continuing their work during what could be a period of transition out of home or needing some time from work. We are open to looking at a range of opportunities.

The Hon. ADAM SEARLE: Including extending those rights to the private sector?

Mr DOMINIC PERROTTET: If there is a provision within the State we would always look at ways in which we can provide greater assistance. We are providing a range of programs and there is obviously a whole suite of measures in this area. There is not a panacea to stopping the scourge of domestic violence and there never will be. We will always look at ways in which we can assist. I believe within this circular, at the very least at a public sector level, we are providing that support because there is access to leave in those circumstances. That Treasury provides this directive and instruction across Government is an indication of the seriousness with which we take the matter.

The Hon. ADAM SEARLE: The Queensland Parliament is on track to legislate to regulate labour hire companies as a result of a parliamentary inquiry. There has also been an extensive inquiry in Victoria about regulating labour hire firms to provide better protection for workers. Will you legislate to regulate labour hire firms in New South Wales, or will you at least examine the issue?

Mr DOMINIC PERROTTET: I examine all aspects of my portfolio.

The Hon. ADAM SEARLE: I have not had much luck with you so far.

Mr DOMINIC PERROTTET: Really? As I said, I thoroughly examine all aspects of my portfolio. If there are opportunities to provide greater support to workers across New South Wales, we will do so. This Government has a track record of not only protecting workers but also delivering more jobs across the State. We have a range of programs and initiatives that do that regardless of the stage of the work cycle.

The Hon. ADAM SEARLE: There has been a great deal of commentary about the need to protect people working under so-called “non-standard” work arrangements—that is, so-called “gig” workers. What plans do you have to ensure that people engaging in work of that type who are not employees and who fall outside other regulatory support models have access to things like minimum standards of engagement and minimum rates of pay?

Mr DOMINIC PERROTTET: The best thing we can do from a New South Wales Government perspective is to provide positive conditions for employment across the State and to grow business and opportunities. That is exactly what we have done. More than 400,000 jobs have been created since 2011 and close to 200,000 jobs have been created since 2015. There are more people in work in New South Wales than ever before and our unemployment rate is the lowest in the nation. That is achieved by providing support for people in those roles regardless of where they are.

Ms TELFER: As some members of the Committee know, this issue has been at the forefront for industrial relations practitioners over the past couple of years. In fact, it has been discussed at Industrial Relations Society of New South Wales conferences. It would be fair to say that this is an issue for those of us interested in the policy and regulation of employment or employment-like arrangements. We want to find the right set of arrangements that will suit the changing types of work. It would also be fair to say that none of us has found the right levers or the right set of arrangements.

The New South Wales Government and State bureaucrats are talking to our counterparts across Australia, and particularly to the Commonwealth Government. I had a meeting with Commonwealth officials about six to eight weeks ago to discuss this very matter. We discussed how we might be able to predict what models might emerge which should be discussed further and on which we should provide advice to government. There is no answer at this point. However, it is true to say that regulators around the country are examining the issue. We must ensure that we have the right balance of regulation versus ensuring that people are not prevented from entering into new forms of employment. Rather than imposing unnecessary red tape, we should ensure that we introduce the right regulatory models so that people who might otherwise be vulnerable have the protection they need. I am sorry that I do not have the answer yet, but we are working on it with our counterparts in other States.

The Hon. ADAM SEARLE: Last year the former Minister in answer to supplementary questions said:

NSW Government agencies are developing initiatives to implement the NSW Government’s policy that 100 per cent of public service jobs will be flexible by 2019 on the basis of ‘if not, why not’.

Will you provide the Committee with a report on how the Government is progressing with the implementation of this policy?

Mr DAVID SHOEBRIDGE: And if not, why not?

The Hon. ADAM SEARLE: I would like tangible examples of changes that have occurred in the past 12 months, in particular.

Mr DOMINIC PERROTTET: To ensure that we provide the Committee with the most detailed progress report possible, I will take that question on notice. However, I assume that significant progress would have occurred because the innovation in our public sector is probably world leading. I expect to provide evidence of a strong result.

Mr DAVID SHOEBRIDGE: And if not, tell us why not.

Mr DOMINIC PERROTTET: With pleasure.

The Hon. ADAM SEARLE: Are all the members of the Industrial Relations Commission of New South Wales performing all of their statutory duties, including dealing with industrial disputes? I am happy for you to take that question on notice.

Mr DOMINIC PERROTTET: I will.

The Hon. ADAM SEARLE: Will the commission remain at 47 Bridge Street, or does the Government still have plans to move it the Administrative Decisions Tribunal building or even to the Fair Work Commission building?

Mr DOMINIC PERROTTET: That is an interesting question because the commission is in the building into which the Leader of the Opposition has said he would like to move his ministry in the incredibly unlikely event that at some time in the future we have a Labor government.

The Hon. ADAM SEARLE: There is a lot of space in that building.

Mr DAVID SHOEBRIDGE: He simply wants to be near the Governor.

Mr DOMINIC PERROTTET: Henry Parkes’ office in that building is exceptional and it should be preserved.

The Hon. Dr PETER PHELPS: Hear! Hear!

Mr DOMINIC PERROTTET: The office is as it was in Henry Parkes’ time. There is a picture on the mantel of Henry Parkes sitting at his desk in that office, and it is as it was when the picture was taken.

Mr DAVID SHOEBRIDGE: The divorce courts are also beautiful.

Mr DOMINIC PERROTTET: The entire building is beautiful. The Government has made a commitment to ensure that the Industrial Relations Commission operates as well as it can. No decision has been made about the commission’s relocation. I have met with the newly appointed chief commissioner and he raised this issue specifically. A decision has not been made, but if the commission were to move it would be to a suitable location at which it would be able to carry out its functions and duties.

The Hon. ADAM SEARLE: So it will not move to the Administrative Decisions Tribunal building?

Mr DOMINIC PERROTTET: Mr Foley’s decision will not play any part in my consideration of that issue.

The Hon. ADAM SEARLE: I did not ask that.