I’ve pursued allegations of fraud, conflicts of interest and risk management about the Coal Long Service Leave Corporation for years. Finally, an independent review has confirmed dozens of governance and fraud risks that have left casual workers without their fair entitlements. It’s a hard-fought win for casual coal miners by One Nation, but there is still much further to go.
Transcript
CHAIR: Senator Sheldon, you are making a statement. We will now go to Senator Roberts.
Senator Cash: Do you feel better, Senator Sheldon, for getting that off your chest because—
Senator SHELDON: I do feel better.
Senator Cash: I’m glad you do because, as I said, I don’t believe, Senator Sheldon, that you as the head of the TWU would indulge in this behaviour. I don’t believe that you, three years later, after a case has been dismissed by the full bench of the Federal Court, would actually stand up and say, and make admissions, the national executive did not approve any of the 20 donations, the subject of the investigation, which contravened the registered organisations act. As I said, that was as recently as December 2021. You’re referring to a statement made on 7 March this year, I would reflect, backed on the admissions made by the AWU in December 2021—a range of admissions concerning contraventions by the AWU. They submitted they made mistakes; they did not comply. So I think, if anyone’s providing an apology, perhaps the AWU should apologise to its members for those contraventions.
Senator SHELDON: And the minor breaches that they were fully aware of throughout the entire five years—
CHAIR: Thank you, Minister. Thank you, Senator Sheldon.
Senator Cash: Senator Sheldon, as you and I know, you need to comply—
Senator SHELDON: The ROC was fully aware that they were minor breaches all the way through, and yet they continued to pursue it.
Senator Cash: You and I are going to have to agree to disagree in relation to the incorrect information you’re providing by way of your questioning.
Senator SHELDON: That’s not incorrect. It was minor breaches, and they were fully aware for the whole five years, and they dragged this out—
Senator SMALL: Who decides whether it’s major or it’s minor? Is that how you plan to act in government?
CHAIR: Order! Order, Senator Small! We would like now to move on to Senator Roberts, who has a series of questions on a different topic.
Senator ROBERTS: Thank you all for appearing today. Most of my questions, I think, will be going to the minister, or certainly to the department. Minister, recently KPMG presented their report into Coal LSL. How are you progressing in relation to implementation of this review and report, and when will it be completed? I understand that some are immediate and some are—
Senator Cash: Understood. I know this is a genuine interest for you, so what I will do is ask Ms Williams to take these questions for you.
Ms T Williams : Senator, you asked how we are progressing with implementation of the recommendations. As you might know, the government has accepted all 20 recommendations of the review. In terms of the 10 recommendations specifically directed at government, the government response to the review identified that the government will take legislative action to clarify eligible employees and ensure that no eligible employee is worse off; ensure fairness for casuals to be treated equitably with permanent employees; address legacy coverage issues to ensure fairness and transparency for employees, employers and employers that may register with the scheme; and strengthen decision-making, review and dispute resolution to enhance accountability and compliance.
The government response to the review really highlights that. It recognises that the reforms are complex and they will require further technical legal advice to ensure that the changes really have the desired impact and benefit for employees and employers under the scheme. The intention is for consultation and action to continue in the spirit of the review, which, as you may be aware, included consultation with producers, employer groups and peak bodies, employers, employees, unions and representatives from modern industry stakeholders. We’ll draw on their expertise and stress test ideas going forward. We’ll need to do that closely and methodically with the stakeholders, including the provision of exposure drafts of legislation. The department is just working through that now, and consultations will begin as soon as practicable.
Senator ROBERTS: I can understand that it’s still being digested. When do you think the plan will be available—or you will have one, even if you’re not sharing it?
Ms T Williams : We’re working through. The review also canvassed that there were a number of existing proposals put to government and suggested that they provided a really good foundation to start to work through some of those ideas. The department is working through that now. In terms of the exact specifics of the consultation, we’ll provide advice to government in due course.
Senator ROBERTS: Reading parts of the report—I haven’t read the whole report—I believe some can be remedied by legislative changes, some can be remedied by the existing proposals and some can be remedied by further consultation. When do you think you will you have the plan together?
Ms T Williams : We’re working on that now. The specifics of that will be a decision for government but, as I said, it will continue in the spirit of the review and be broad-ranging in terms of the consultations. I think the other thing that the review really recognises is the deep industry expertise from employers and employees in this sector and also a real commitment by all the stakeholders that were consulted in the review to get this right. So we’ll provide advice to government on how to take that forward, but the consultations will be very much in that vein.
Mr Hehir : I might just add to that. We’re still some months away. The consultation process will still take a few months to work our way through. Then, following the consultation process, we’ll need to put our advice to government. So we’re still some months away.
Senator ROBERTS: Thank you. I will just go to page 126, and I’ll read the main points, the issues in red that are not—
Senator Cash: Just hold on for one moment. Have you got the whole—
Ms T Williams : Yes, I do.
Senator Cash: It will assist if the official is reading it with you.
Senator ROBERTS: It’s a fairly simple question, even though the question will be long. I’ll read out the issues not addressed—the ones in red. On waiver agreements, it says:
The Existing Proposals do not substantively address this issue.
The report says the same thing about conflicts of interest, which it says are significant; allegations of fraud; culture; communications; risk management; adoption of technology; data security and privacy; and validation of data. So none of them are being addressed. For each of them, the report says:
The Existing Proposals do not substantively address this issue.
When do you think you will have something around those? They’re the core issues. That’s not a complaint about the report; the report is fine. But we need to understand when they will be addressed.
Ms T Williams : I will just clarify for you that this section of the report is actually talking about the existing proposals that were put to government before the government realised, or in the process of the government realising, that we needed to have a holistic response to the issues in the sector. So these proposals were actually put by stakeholders, and then the government commissioned an independent review. So the review itself and the recommendations do cover those issues. I think conflicts of interest are covered by recommendation 11.
Senator ROBERTS: What about changes to the board structure and composition?
Ms T Williams : That’s recommendation 13. So they are all covered by the review. This is really talking about how, before the government commissioned the review, those existing proposals had that gap in them. So we commissioned the review, which has now addressed those areas.
Senator ROBERTS: Thank you very much. Now I’d like to move onto the Fair Entitlements Guarantee, the FEG. These are simple questions. You may have to take them on notice. My first question is: have the Fair Entitlements Guarantee and Coal LSL paid any Coal LSL entitlements to One Key employees who no longer work in the coalmining industry and were not CFMMEU members?
Mr Manning : Is this about the One Key workforce case?
Senator ROBERTS : Yes.
Mr Manning : Ms Saunders, who will be coming up from our waiting room downstairs, should be able to answer that for you. Unfortunately, we couldn’t get a room next door today. But we wouldn’t be told whether or not they were union members. We wouldn’t ask that on the application form. So I’m not sure about that, but, when Ms Saunders arrives, she might be able to answer it. You might need to repeat the question, though, because she’s had to come from downstairs.
Ms Saunders : Would you mind repeating the question?
Senator ROBERTS: Sure. It’s from a constituent. Have the Fair Entitlements Guarantee and Coal LSL paid any Coal LSL entitlements to One Key employees who no longer work in the coalmining industry and were not CFMMEU members?
Ms Saunders : Under the Fair Entitlements Guarantee, we pay the five basic employment entitlements: redundancy pay, long-service leave, wages, annual leave and payment in lieu of notice. So our consideration of that doesn’t actually take into account the extent to which they are funded by another organisation, except that, if there is a redundancy trust fund or whatever that will step in to pay a portion of the cost, that is not covered under the Fair Entitlements Guarantee program. I guess, in the sense that any entitlements that were payable under their governing instruments would have been paid under FEG, to the extent that they were eligible for it. For example, with One Key Workforce we paid 346 claimants a total of a $6.8 million in FEG assistance. That covered a range of entitlements.
Senator ROBERTS: What was the total figure?
Ms Saunders : It was $6.8 million.
Mr Hehir : Recognising that covered off a number of different employee entitlements.
Ms Saunders : I don’t have the detail of what made up that in terms of the different entitlements that were covered. I can take that on notice.
Senator ROBERTS: If you could, please. I’d like to understand this issue because it involves some constituents in the Hunter Valley. My next question is: why did the Fair Entitlements Guarantee not pay One Key employees who were non-CFMEU members all entitlements owed under the black coal award, including shift penalties and overtime rates?
Ms Saunders : Okay.
Senator ROBERTS: It’s a complex issue, but it should be able to be boiled down once you have the data. I’m happy to take it on notice.
Senator Cash: You’re happy for us to take it?
Senator ROBERTS: Yes. I’d like to get to the bottom of it.
Senator Cash: Yes, understood.
Senator ROBERTS: Finally, the issues raised in here show—I won’t say neglect, but times are changing across industry and the cracks that are exposed in Coal LSL itself are significant for employees and some employers. They’re very important, but they’re minor relative to the cracks in the Fair Work Act that have been exposed with changes in industry and in employment practices over time. Minister, is the government open to comprehensive review of industrial relations? The reason I ask is that Dave Noonan and heads of the CFMEU and the ETU have said they welcome a comprehensive, fair approach to reviewing and revising industrial relations. The Business Council of Australia has told me that they’re open to it as well and they support it. Large employers have told me the same. Small business is crying out for it, and medium businesses are as well. The industrial relations club which consists of major union bosses, major employers, major industry groups, consultants and lawyers are feeding off this, but the workers are not protected. Even unionised workers are not protected today, and they’re coming to us. The Fair Work Act is so complex that people are trying to detour around it, and that’s adding even more complexity. We need to restore fairness, entitlements and protections to workers—especially fairness to the small businesses. Are you open to comprehensive review of industrial relations?
Senator Cash: I think the government is always prepared to listen to stakeholders—it’s obviously subject to the ability to get anything through the Australian Senate—to make the system a better one, a more productive one, both for employers and for employees. You do raise a good point, though, in relation to the complexity of the system, and I might just ask the official who was talking about the budget announcements that we have made in relation to small businesses in particular being able to better navigate the system to come back to the table, because this is something that you and I had actually spoken about. We have made a budget announcement, so it’s embedded in the budget. But this is, in particular, to assist small businesses to be able to better understand and better navigate the Fair Work Act as it currently stands. If you would just indulge us for two or three minutes, I will get you this information.
Ms Huender : The government’s providing $5.6 million over four years to the Fair Work Commission to establish a dedicated small business unit within the Fair Work Commission to provide tailored support to small businesses to assist them to navigate the system. We’re aware that small businesses are a big part of the Australian economy, with 3½ million businesses employing over 40 per cent of the workforce. However, they do find the system complex. They don’t have the support of HR managers or legal support, so they also find navigating the system costly. So this unit’s designed to provide strategic leadership and to develop improved information resources and case management support for small businesses when they engage with the system. Small businesses, I understand, make up 50 per cent of the Fair Work Commission’s customers, as it were, but they represent 95 per cent of first-time users.
Senator ROBERTS: Minister, that’s necessary, but it just reemphasises my point. It’s a moribund, complicated, inefficient system. And I’m thinking now that, for not only small business but also workers in the Hunter Valley for some of the world’s largest companies, workers in Central Queensland, workers for other large companies, some of the things that are going on with the COVID injection mandates are just despicable. I could tell you stories that would really shock you. We’re not living in a Third-World country, but we’re behaving as if we are, and some workers have no longer got basic protections and basic entitlements.
Senator Cash: I would disagree.
Senator ROBERTS: It’s like we’re living in a Third-World country.
Senator Cash: And I understand, because you genuinely do prosecute this case that every estimates and in relation to, in particular, the size of the Fair Work Act now and its growth over time.
Unidentified speaker: I’m disappointed you didn’t bring it along today!
Senator Cash: As I’ve said, the government is always prepared to work with stakeholders, employers and employees, to take on board the feedback to improve the system. Ultimately, though, changes are to the Fair Work Act itself, and those changes do need to be got through the Australian Senate. I think the perfect example—and you and I had many discussions on this—was the omnibus bill. There were significant parts of that bill that would have given more certainty to certain sectors et cetera, but we just could not get that through the Australian Senate.
With your support, though, we of course rectified the Rossato decision, and that was later, obviously, confirmed in the High Court of Australia. That was an incredibly important decision, as you know, because of the uncertainty that it had given to small businesses that they might end up with what we’d estimated to be I think it was up to a $38 billion or $39 billion liability. We couldn’t even get the support of the Australian Labor Party to actually take that impost off small businesses. You worked with us, and I was very appreciative of that, and we did make that change.
But, in relation to the other parts of the bill, again I’m prepared to work with people. I think a better system, a simpler system and a more productive system—but it has to reflect the needs of both employers and employees—is a good situation to aspire to, but ultimately, as you know, it does come down to the ability to get legislation through the Senate, and we can’t get the Labor Party or the Greens to support that type of productive change.
Senator ROBERTS: We had to work with small businesses to identify issues that they had, and we were pleased that the government resolved some of those issues and put our suggestions into the revised act. But, again, your recounting of the situation, while accurate, reinforces the need for change, because it is just so difficult and such a complex environment, with so many stakeholders hanging on by their fingernails. It’s just out of date and it’s hurting workers.
Senator Cash: As I said, you and I have had many discussions over many years now, and we’ve always worked constructively together in this regard, with a commitment to improving the system for both employees and employers. Ultimately, though, it is difficult to get through the Australian Senate. But what I think it does show is that it’s not therefore about one policy lever. If that policy lever is difficult to actually pull and properly implement because of the nature of the Australian Senate, you do then need to look at other ways that you can deliver for small business.
You and I have long talked about lowering taxes. When you look at, say, the tax rate for small business, under the Australian Labor Party it was 30 per cent; under us it is currently 25 per cent. So, whilst that’s not the industrial relations system as such, it is another way that you can ensure that you’re giving back to small business. I know, throughout COVID-19, even just the ability to change the way you process documents to allow for that—the e-technology certainly assists them. There is the availability of the instant asset write-off and the ability to say to them, ‘If you have that capacity to invest in your business, the government’s going to back you every step of the way.’ If one lever proves difficult, there are other levers that you can then look to utilise to ensure that you are responding in every possible way to that commitment that they are the backbone of the Australian economy, that they deserve to be backed by government, which is what we do. In relation to those changes, the omnibus bill is the perfect example: it was a very reasonable bill that would have provided both employers and employees with a more productive workplace, but we couldn’t get it through the Senate. I was grateful for the support you gave on the Rosato decision.
Senator ROBERTS: You fiddling with the tax system, and I don’t mean that derogatorily.
Senator Cash: I know what you’re saying.
Senator ROBERTS: The tax system makes the Fair Work Commission and Fair Work Act look simple. It doesn’t fix basic safety protections that have gone AWOL in workplace relations. It doesn’t fix the basic employer-employee relationship, which is the primary relationship of any workplace and must be such. We need something that’s comprehensively reformed and brought back to something simple that looks after the primary workplace relationship between employer and employee.
Senator Cash: On safety: I think that, for each one of us, that has to be paramount in the workplace. There are no two ways about that. I know that, when I first came into portfolio and I worked very closely with Mr Hehir on this, we were presented with the outcome of the Boland review. That was something that I looked at. As you know, there are model work health and safety laws, and the Commonwealth works with the states and territories to ensure that we can effect change that is recommended to us. We had the Boland review, we had the recommendations of the Boland review and I worked constructively with our state and territory colleagues regardless of political persuasion. If you’re, the relevant minister I work with you. I was very pleased that, within a few weeks of me formally come portfolio, all relevant ministers across Australia had agreed to accept all the recommendations coming out of the Boland review.
So certainly, when it comes do work health and safety, I have a very good relationship with state and territory ministers, and we will make improvements to the model work health and safety laws together by accepting all of the Boland review’s recommendations.
Senator ROBERTS: Notwithstanding what you just said, I have enjoyed working with Mr Hehir. I have found him easy to deal with and open to deal with.
Senator Cash: Thank you for that feedback.
Senator ROBERTS: But there are people being severely injured, not even reporting and then being threatened if they dare raise safety issues in this country, and that’s not good enough. I’m happy to leave it there, but it is an issue that’s really important, and we will be pushing it.
Senator Cash: Thank you for those questions.
