During investigations into the the abuse of casual coal miners I found that the government has spent over $2.4 billion on casual labour hire from one firm, Chandler Macleod Group, alone. The government couldn’t even tell me what the total casual labour hire bill was across all agencies because they don’t even collect that data. The fact that the Australian Public Service Commission don’t even know how much money they’re spending is inexcusable.
Transcript
Senator ROBERTS: Thank you, Chair, and thank you all for appearing today. When we were investigating, over the last 2½ years, the abuses of casual black-coal miners in the Hunter Valley, we noted that there were thousands of casuals working for the Australian Public Service, with hundreds of millions of dollars being paid to labour hire firms. Why does the Public Service do this?
Mr Woolcott : Could you just put that question to me again, Senator? I didn’t quite understand. You’re talking about why we employ casual hire?
Senator ROBERTS: Casuals. We know that some people prefer to work casually; so I’ve got nothing against casuals. We know that casuals fulfil a basic secondary role within any workplace, with fluctuating workloads, someone going on leave, projects et cetera. Why does the Public Service use so many labour hire firms to employ these casuals?
Mr Woolcott : It’s for agency heads to determine how they construct their workforce. The Public Service Act sets out that the normal method of engagement is full-time, ongoing employment as a public servant, but there are provisions in the Public Service Act for non-ongoing and other aspects. It’s very much for each individual agency head to work out what is the appropriate mix of their workforce. Obviously, if it’s work that fluctuates then it’s quite appropriate for them to use labour hire and casuals to manage those fluctuations. But again, as I say, it’s a matter for each individual agency head. They’re the accountable authority. They have responsibility for delivering for the government and the Australian community and it’s for them to work out their proper mix.
Senator ROBERTS: As the Australian Public Service Commission, I imagine you’d be interested in efficiency, cost-effectiveness and employees’ conditions?
Mr Woolcott : Obviously we’re intimately involved in many of those aspects but, in terms of running that agency and running the duties and obligations that they are committed to undertake, it’s for them to do that.
Senator ROBERTS: I get that point. How many casuals are currently employed across the Australian Public Service—hundreds, thousands, tens of thousands?
Mr Woolcott : I think it’s 87 per cent that is ongoing. Ms Steele will have the data.
Ms Steele : That’s correct. In terms of casuals in the last year, we have at the moment 8,696 casuals. That’s an increase of 51 since December 2020.
Senator ROBERTS: Thank you. How many of those would you know are casuals in their own right employed directly by the Australian Public Service and how many are labour hire subcontractors or labour hire firms?
Ms Steele : I do not know that. I do know that those who are employed for a specific term or task are a further 10,816.
Senator ROBERTS: In addition?
Ms Steele : In addition to the casuals. There are two types of non-ongoing. One is casual, and one is you can be engaged for a specific term or task.
Senator GALLAGHER: And that can be contract, labour hire, fixed term?
Ms Steele : Correct.
Senator ROBERTS: Thank you. How many casuals have been employed in the Australian Public Service for more than six months?
Ms Steele : I would have to take that on notice.
Senator ROBERTS: Could you, and could you also provide a de-identified report—anonymous employees—by department, by labour hire company or direct employment, by cost and duration of service?
Ms Steele : We don’t collect that information about labour hire firms or companies; we only collect the number of casuals by agency.
Senator ROBERTS: This one you’ll probably have to take on notice too, Ms Steele: how many casuals, internal or labour hire, have converted from casual to permanent employment in the Australian Public Service in the past 12 months?
Ms Steele : I will take that on notice.
Senator ROBERTS: Thank you. Are casuals that the Australian Public Service has engaged through labour hire companies able to convert to the Public Service roles that they’ve been working in for more than six months?
Ms Steele : No.
Senator ROBERTS: If someone has been engaged for more than six months it would seem that they’re needed, so why wouldn’t they be eligible? Because the employer is not the Public Service?
Mr Spaccavento : I think it’s important to draw a distinction between a casual employee and a labour hire employee. A casual employee is an employee of the Australian Public Service and is eligible to convert to permanent employment if they meet the criteria laid out in the Fair Work Act and the Public Service Act. A labour hire employee is an employee of an entirely different company and not of the Public Service. A labour hire employee would not be eligible to convert to permanent employment.
Senator ROBERTS: Do you see some inconsistency there?
Mr Spaccavento : No, because in one instance the employee is a direct employee of the Australian Public Service, directly engaged by an agency. So it’s a contract of service versus a contract for service.
Senator ROBERTS: I understand that. We’ve seen the abuse of coal miners, for example, and we’ve seen hints of abuse of casual workers in other sectors as well—lost entitlements, basic safety provisions, significant pay cuts—and it seems to me that it’s just a naked attempt to go around the provisions of the Fair Work Act.
Mr Spaccavento : Casual employees in the Australian Public Service are engaged under the terms and conditions of agency enterprise agreements, so they receive essentially the same terms and conditions as permanent employees. I say ‘essentially’ because there’s some leave entitlements they don’t get and there is a casual loading. Labour hire employees are obviously different because they are employees of a different organisation. There’s a range of reasons why agencies would engage labour hire firms, and that would be a decision for that agency head to make.
Senator ROBERTS: In the course of our investigations in the Hunter Valley, Central Queensland and elsewhere we found, for example, that the Chandler Macleod Group was paid an estimated $2.4 billion over four years for providing labour hire contractors or labour hire employees to the Australian government. That seems pretty substantial to me.
Mr Spaccavento : I can’t comment on decisions that agencies have made.
Senator ROBERTS: Are you aware if these casuals under labour hire firms are paid the same and have the same terms and conditions as similar roles that they work beside?
Mr Spaccavento : Because it’s outside of our remit, we don’t have visibility of what labour hire employees are paid or the conditions they are on. It would be a matter of the employment arrangements they have made with the labour hire company and those employees. I couldn’t say yes or no to that question because we don’t have responsibility or visibility of it.
Senator ROBERTS: Minister, this is a request for an opinion: do you think that’s reasonable?
Senator Duniam: In terms of the decisions that heads of agencies make around it?
Senator ROBERTS: The employment of people for more than six months by a labour hire firm could be a way of getting around the requirement now to offer casual conversion.
Senator Duniam: As the commissioner outlined earlier, heads of agencies make decisions with regard to how they engage their workforce based on the needs at the time. There are a range of circumstances that they obviously take into consideration. I would have every faith in those heads of agencies that they are doing the right thing to ensure that the people they work for, the taxpayers of Australia, are getting the service that’s required and that their employees are being treated properly as well.
Senator ROBERTS: With respect, that’s a nice motherhood statement, but I’ve seen people who work for firms with reputable international and Australian reputations completely abusing workers in this country. That has come as a big shock. To compound that, neither the Labor Party nor the Liberal Party nor the National Party nor state and federal governments nor the various bureaucrats have been interested in this. They’ve ignored requests to investigate.
Senator Duniam: If there are specific cases of abuse of employees then there are appropriate channels to deal with those things. I would encourage you, or those you ask these questions on behalf of, to take action, because that’s the appropriate thing to do. I don’t think there’s anyone around this table, on that side or this side, that would seek to endorse any abuse of employees or withdrawal or withholding of entitlements.
Senator ROBERTS: It’s remarkable—and I’m not accusing people of doing that in the Public Service—and I’m trying to find out whether or not the government and the Public Service understand there is a potential for that. We’ve seen that widely in other industries from so-called reputable firms. I’ve heard some stories about the Public Service hiring $2.4 billion worth of labour hire people over four years. That’s a staggering figure.
Senator Duniam: I appreciate you’re not making an accusation. Certainly, your point is that there could be potential, or you’re trying to seek an understanding of whether there is. If there is a single case of this abuse then I would expect that it would be raised and referred to the appropriate authorities and dealt with accordingly.
Senator ROBERTS: What doesn’t give me confidence—I accept what you’re saying—is that some people in the Hunter Valley, for example, raised this repeatedly over the course of about five years and got nowhere, neither from the state nor the federal government, with blatant breaches of the law. I’m just trying to understand, if the Public Service know that this could be going on, what they’re doing to protect not only workers who work for them permanently, casually, directly, but also those who work indirectly through labour hire firms, because not all labour hire firms are ethical.
Mr Woolcott : I’m not aware of the particular issues that you are raising. Obviously, if you have concerns, please take them up with the relevant minister or with his department in relation to the way they manage their affairs.
Senator ROBERTS: I’m trying to find out whether or not you’re aware of the particular—
Mr Woolcott : I’m not aware of any of the particular concerns that you’re raising, Senator.
Senator ROBERTS: Or the potential for that. Are you aware that casual workers who are employed either directly or through labour hire firms have less job security and find it harder, for example, to get home loans, because one of the requirements for a home loan is a secure, permanent job?
Mr Woolcott : Am I aware of that?
Senator ROBERTS: Yes.
Mr Woolcott : Again, it’s not an issue that’s been brought to my attention.
Senator ROBERTS: So you’re not aware; okay. These workers who are working for the Public Service for more than six months miss out on the terms and conditions of government employment. Is that reasonable?
Mr Woolcott : You’re asking me for an opinion there.
Senator ROBERTS: I’ll ask the minister.
Senator Duniam: With respect to the decisions made by heads of agency around how they engage their workforce, either in the way you’ve characterised or otherwise, as the commissioner has outlined, it’s a matter for them based on the needs of the community they serve and the work that they do. Personally, I would love to ensure that everyone gets everything they’re entitled to, and I have every expectation that, for those who are engaged, under whatever contractual arrangement occurs, those contracts are in alignment with the law and are done in accordance with what is legally required of the employing agency. My hope is that everyone gets what they deserve and nothing less.
Senator ROBERTS: That’s my hope, too. But in the Hunter Valley, for a period of seven years now—five years until we started working on it—there were many people who were abused and exploited, and they were told to go and talk with the state department, WorkCover. They were told to take it up with the federal government, and nothing happened. We were then actively misrepresented when we tried to do something about it. Eventually, we prevailed in some areas and we’re still working on others. So it could happen in the Public Service, and I’m checking to make sure that the Public Service is aware of some of these things; that’s all.
Senator Duniam: You have brought this concern to the commissioner’s attention. Certainly, the minister that I’m representing will be aware of your concerns. Again, if there’s a specific instance or a series of them, we should deal with them in the appropriate forum.
Senator ROBERTS: One final question, Chair: what margin is paid to labour hire firms when you engage a casual through them? I’m now putting on my other hat; instead of protecting constituents, I’m protecting taxpayers, who are also constituents. What’s the margin?
Mr Woolcott : We don’t keep data on that, so I can’t answer that question. It would be a matter for each particular agency head, in terms of the arrangements they have. We don’t collect data on that issue.
Senator AYRES: Ms Steele, I didn’t hear your answer to Senator Roberts’ initial question. I think you gave an answer—tell me if I’m wrong—which was about the number of direct casuals and the number of non-ongoing; and, consistent with the APSC’s previous answers to the committee, you don’t have an answer for the number of labour hire employees engaged by the APSC?
Ms Steele : That is correct.
Senator AYRES: The justification for what I think is an impossible proposition is still the same, Mr Woolcott, is it?
Mr Woolcott : We collect data on Australian public servants, and arrangements under the APS act fall outside our terms of reference. Having said that, Senator, it’s always appropriate to look at ways to improve data collection and our understanding of the public sector workforce. We will continue to do so, and use the COO committee to that end.
Senator AYRES: Does that mean that you’re heading towards being able to collect that data, to be able to identify what proportion of the workforce is privatised, or are you just making a general comment?
Mr Woolcott : I’m just making a general comment at this point, Senator.
Senator AYRES: So it’s still studied ignorance on labour hire. With the survey work that the commission does on a regular basis, there’s been no consideration given to extending that survey work to the experience that labour hire employees have with the Public Service?
Mr Woolcott : Not at this point.
Senato r ROBERTS: There’s no guarantee—you can’t provide a guarantee—that there’s no wage theft going on in the industry, in the public sector?
Mr Woolcott : No, I can’t provide that guarantee.
Senator Duniam: Again, it’s important to say that, if there are examples of that, I’ll walk with you to the appropriate authority; we’ll make sure that they’re made aware, that investigations occur and justice is done.
Mr Woolcott : The workforce ombudsman, Sandra Parker, obviously looks at this aspect very closely in terms of both the private sector and the public sector.
