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SUBMISSION TO "VICTORIAN INQUIRY INTO THE LABOUR HIRE INDUSTRY & INSECURE WORK" FROM BENDIGO UNITING CHURCHES SOCIAL JUSTICE GROUP

Preamble:

The Bendigo Uniting Churches Social Justice Group (BUCSJG) seeks to represent the social justice concerns of some 900 people in Bendigo, Central Victoria who have a stated association with the UnitingChurch in Australia.

The Key Aim of the BUCSJG is to encourage interest in & response to social justice issues at local, State, National & International levels by members/associates of the Bendigo Uniting Churches. To accomplish this the Group is informed by such publications as Just Focus, a bi-monthly publication compiled by the Justice & International Mission Unit of the UnitingChurch in Australia's Synod of VictoriaTasmania.

Why this Submission has been developed:

In March 2015 the ABC's Four Cornersprogram detailed widespread abuse of the 417 Visa conditions. Subsequently, on 5 May of the same year the Victorian Government announced an inquiry into labour exploitation to commence in the second half of 2015.

On 23 July 2015 the BUCSJG wrote to the responsible Minister, for Industrial Relations (Hon Natalie Hutchins) encouraging her to accelerate the proposed Inquiry. The Group based this request on the following:

* Whilst valuing the contribution they make in providing employment in our Region, we understand that large local employers such as Hazeldene's & KR Castlemaine have, over the last decade, moved from a direct towards an indirect employment model using contracted labour hire firms.

* This has created a two-tiered system of employment whereby some workers have secure, well paid jobs and other workers are employed on a casual basis with no sick leave. We understand that some workers employed via Labour Hire Companies are grossly underpaid, work excessive hours and have little control over their accommodation & its associatedconditions.

* In addition to the illegality of this arrangement, we are concerned the established practice of using Labour Hire firms, who bus workers in from outside Bendigo, has impacted on the employment opportunities for local job seekers. In the longer term this will contribute markedly to deterioration in the social fabric of the wider Bendigo community.

* We note, with concern, the Australian Bureau of Statistics record of increasing unemployment in the City of Greater Bendigo (CoGB) from some 2500 (4th Qtr, 2011) to some 4200 (4th Qtr, 2014). We note also local concern as expressed by the CoGB's Mayor (Cr Peter Cox) at a Bendigo Employment Expo on 11 March 2015 when he was reported as describing youth unemployment as "a crisis for the central VictorianCity."

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Prevailing political philosophy - a General Comment

The prevailing political philosophy, which underpins the operation of most business activity, is neo-liberalism. Neo-liberalism espouses the desirability of specific conditions to enable business to operate in an economically efficient manner.

These include competition, privatization, minimization of government oversight by way of regulation - favouring self regulation & labour market reform directed towards cost minimization, profit maximization & enhanced share -holder return.

An emphasis on self rather than external regulation & profit maximization can encourage a propensity for business to introduce practices which can stretch & indeed rupture negotiated employment agreements & legally established Award conditions.

In times of medium to high unemployment the power differential between the employer & the employee moves significantly in favour of the former.

Responses to "Questions for participants to address in submissions":

Introduction:

We have chosen Hazeldene's Chicken Farm P/L as an example upon which to base our Submission. We acknowledge there may be other Bendigo businesses which utilize labour hire companies. We don't have the resources to research this possibility.

To what extent is labour hire used inVictoria? In which industries & regions is it most prevalent?

Labour hire is used by Hazeldene's Chicken Farm P/L in Bendigo, Central Victoria to provide portion of its work force. Hazeldenes is a family owned chicken processing/distribution business.

In what ways do hosts typically use labour hire workers? Are they used to supplement or to replace ongoing workforces or direct employees?

1) Part of Hazelene's operationsinvolvespacking processed chickens into boxes. They claim this is "skilled" work for which contracted labour is used. This is not "skilled" work in the normally accepted understanding of the word. This practice represents a loss of potential employment for local people.

2) Over an 8months period some 150 local job applicants were inducted through a potential employment program conducted by Hazeldenes. Of these only some 20-30 were finally employed.

Does the use of labour hire impact the availability of apprenticeships & traineeships?

Boning constitutes an integral part of Hazeldene's chicken processing operations. Currently this is being provided substantially by contracted workers who are trained on the job by the contractor. The level of acquired skill is suspect, leading to inefficient operation & wastage.

A training course in boning could be provided by the local TAFE with attendant benefits for the Bendigo labour market.

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Does the use of labour hire arrangements lead to positive outcomes for Victorian workers, businesses & the broader community? What problems does it create?

The use of labour hire companies is causing dislocations in part of the Victorian labour market. These are to do principally with payment of below Award wages & sub-standard condition.

Currently labour hire companies largely escape any government oversight. All that is required to set up a labour hire company is $500, a computer with spread sheet capability & an internet connection. There is a clear need for the Government to set up a licensing system for labour hire companies to provide meaningful oversight.

A Comment on Insecure Work:

The increasing incidence of short term contracted employment is contributing substantially to work/employment being regarded as insecure.This has personal & societal implications.

At the personal level, anxiety, stress, dysfunctional behaviour & relationship breakdown are well documented outcomes.

For society, an inability/reluctance to enter into arrangements requiring long term commitment, such as housing mortgages, is becoming increasingly apparent. This, together with increasing pressure on housing affordability, has the potential to impact on that significant driver of the national economy- the housing industry.