tag:theconversation.com,2011:/nz/topics/sally-mcmanus-37484/articlesSally McManus – The Conversation2023-07-23T12:30:39Ztag:theconversation.com,2011:article/2102592023-07-23T12:30:39Z2023-07-23T12:30:39ZAlbanese government to make it easier for casuals to become permanent employees<p>Casual workers will be given a new path to becoming permanent, with the security that brings, in industrial relations reforms Workplace Relations Minister Tony Burke will introduce later this year. </p>
<p>Under the change, promised in Labor’s election campaign, there will be a new definition of when an employee can be classified as “casual”. </p>
<p>Eligible workers could then apply to change their status, which would mean they received benefits such as paid leave but lost the extra loading casuals have in lieu of entitlements. </p>
<p>Burke says the measure will potentially help more than 850,000 casuals who have regular work arrangements. </p>
<p>But he is anxious to reassure employers, as well as to stress that not all casuals will want to go down this path. </p>
<p>Business has been resisting a change to the arrangements affecting casuals, and in general criticising the government for a pro-union industrial relations agenda. </p>
<p>Burke, who will give more detail of his IR plan in a Monday speech to The Sydney Institute, said the government was keeping “much of the existing framework that unions and business groups agree should not change”. </p>
<p>This included current processes to offer eligible employees permanent work after a year.</p>
<p>The new measure will be prospective – people won’t be entitled to make claims for pay relating to past work. </p>
<p>Burke said many casuals, for example students, who worked irregularly and wanted the current extra loading, would not want to make the transition.</p>
<p>“No casual will be forced to lose their loading. No casual will be forced to become a permanent employee,” he said.</p>
<p>“But for those who desperately want security - and are being rostered as though they were permanent - for the first time job security will be in sight,” Burke said.</p>
<p>“There are casual workers who are trying to support households. They’re being used as though they’re permanent workers and the employer is double dipping - taking all the advantages of a reliable workforce and not providing any of the job security in return,” Burke said. “That loophole needs to be closed.”</p>
<p>Burke’s reassurances follow preemptive criticism from business. </p>
<p>Writing in the Weekend Australian Innes Willox, chief executive of the Australian Industry Group, said: “The kinds of changes potentially under contemplation would inevitably increase business costs and risks, reduce investment and reduce employment”.</p>
<p>“Since it was elected, the government has implemented a series of unbalanced industrial relations changes that will do nothing to boost productivity or assist businesses to grow and increase employment. The changes so far have only looked to deliver on a wide range of longstanding union claims. Enough is enough. </p>
<p>"Current casual employment arrangements need to be preserved to prevent Australian businesses and their workforces losing the choices and agility they need to prosper.”</p>
<p>But ACTU secretary Sally McManus said in a statement in May: “Too many casuals are casual in name only. Too many jobs that are actually permanent jobs have been made casual, denying workers both pay and rights. </p>
<p>"The majority of casuals work regular hours, week in, week out and have been in their job for more than a year. Changes made by the Morrison Coalition Government in early 2021 made this erosion of job security completely lawful.</p>
<p>"Big business has used loopholes in our work laws to make what should be secure jobs into casualised, insecure work. It is a way of driving down wages and putting all the stress onto workers.”</p><img src="https://counter.theconversation.com/content/210259/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Michelle Grattan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Under the change, promised in Labor’s election campaign, there will be a new definition of when an employee can be classified as “casual”.Michelle Grattan, Professorial Fellow, University of CanberraLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2073022023-06-08T10:31:50Z2023-06-08T10:31:50ZGrattan on Friday: Labor caught in pincer movement of fighting inflation and delivering to its constituency<p>During the election campaign Anthony Albanese repeated, endlessly, that everything was going up except people’s wages. </p>
<p>More than a year later, things are still going up, now including some people’s wages. </p>
<p>The latter increase is all good, surely? Yes, up to a point. There’s dispute about whether the (still modest and limited) wage rises recently delivered by the Fair Work Commission will lead to other things going up further. </p>
<p>Jim Chalmers was blooded as a staffer to the then treasurer, Wayne Swan, during the global financial crisis. Now Treasurer Chalmers is in the driver’s seat as another Labor government copes with an economic crisis – very different from the GFC, but similar in that it has arisen from circumstances not of the government’s making. </p>
<p>Chalmers insists the Fair Work Commission’s 8.6% rise in the minimum wage and 5.75% increase in award wages won’t add to Australia’s inflation problem. The minimum wage rise (which is above current inflation) affects only a few people; the increase in awards is below the inflation level. In total, the increases affect up to a quarter of wage earners.</p>
<p>Regardless of the government’s confidence, the medium-term effect of the wages decision remains one of those “time will tell” issues. </p>
<p>Reserve Bank Governor Philip Lowe this week made the obvious point. “How much it adds to the inflation outcomes really depends upon whether it spreads across other parts of the labour market.” </p>
<p>It’s clear current inflation hasn’t been driven by wages. Their future course will rest on what expectations are generated and whether unions muscle up to extract substantial pay deals. </p>
<p>The trajectory of wages is just one of the unknowns in the complex situation facing the economy, and thus the government, over the next year. </p>
<p>For many Australians, however, the picture is starkly simple. Their mortgage payments have been hit again, with the Reserve Bank this week increasing the cash rate by a quarter of a percentage point. The bank has indicated there could be another hit to come. Meanwhile the necessities of life are at sky-high prices.</p>
<p>Many critics are yet again railing against Lowe. One-time Labor minister Stephen Conroy, who probably should know better, declared: “This bloke has lost the plot. He’s given the middle finger on the way out the door to the Australian public as he gets shuffled out the door.”</p>
<p>Lowe’s home truths regularly provoke fury. “If people can cut back on spending or, in some cases, find additional hours of work, that would put them back into a positive cash-flow position,” he said this week. </p>
<p>True, but it’s not what cash-strapped people want to hear (or necessarily can do), especially when the governor makes it clear the bank will, if necessary, inflict more pain. Anyway, higher interest rates will mean some people losing jobs.</p>
<p>While the recent review of the Reserve Bank suggested it should explain itself more, arguably Lowe would have done better to say less over recent years (certainly that’s true of his prediction rates would not move until 2024). Chalmers may list communication skills as one criterion when he chooses Lowe’s successor. </p>
<p>Chalmers himself is strong on messaging, this week carefully keeping his distance from the latest rate rise. </p>
<p>As Wednesday’s national accounts showed the economy slowing and productivity going backwards, the government is caught in a pincer movement. </p>
<p>It must meet the challenge of managing the economy, which means at this point, as Chalmers says, putting the fight against inflation to the fore. Chalmers is always quick to quote those (including Lowe) who say the budget wasn’t inflationary. </p>
<p>Being good economic managers is objectively necessary, but politically too. It’s a mantle Labor needs to wear for the government’s long-term survival. </p>
<p>On the other hand, Labor’s base and its election pitch push in another direction. </p>
<p>This is a LABOR government. Its core constituents, including and especially those on low wages, are hurting badly, while its core union base is feeling its oats. </p>
<p>Labor’s mantra, before the election and since, has been to get wages moving. The unions demanded, and were given, changes to the industrial relations system to improve their bargaining power in the pursuit of wage rises. </p>
<p>Last year’s jobs summit brought together business and unions (as well as the community sector). But, by the end of it, there was no doubt the unions had the upper hand, which was always going to be the case.</p>
<p>This week a coalition of business groups launched a campaign against the government’s planned “Same Job, Same Pay” legislation, designed especially to stop labour hire companies undercutting wages. </p>
<p>It hasn’t taken long for the traditional scratchy relationship between Labor and business to emerge, although in a relatively mild form – nothing like, for example, the fight between the Rudd government and the miners over the resource super profits tax, which is still fresh in Chalmers’ memory. </p>
<p>What happens to the economy in the period ahead is partially out of the government’s hands, dependent on international factors. </p>
<p>Having said that, a lot will rest with Chalmers and his colleagues. </p>
<p>For instance, if wage pressures do become a worry, will the government require a more creative approach to the problem, including perhaps more innovative submissions to the Fair Work Commission or a tax trade-off with the union movement? </p>
<p>The government urgently needs to find ways to get productivity moving, because that’s the route to sustainable real wage rises. No one, however, underestimates how difficult it is to restart this motor. </p>
<p>To an extent, Chalmers finds himself in a relatively isolated position within the government. </p>
<p>Like all treasurers, he has to be the one who (often) says no to spending ministers. He also should be, to some degree, a counter weight to the colleague who in effect speaks for the unions, Employment Minister Tony Burke. </p>
<p>Inevitably, a treasurer must carry the economic debate for the government, although that burden is always shared between treasurer and prime minister. </p>
<p>In this government, for various reasons, including his many international engagements and his preoccupation with the Voice referendum, Albanese has not been doing as much of the economic heavy lifting as some of his predecessors. As people become increasingly agitated about their circumstances, that might have to change.</p><img src="https://counter.theconversation.com/content/207302/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Michelle Grattan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Chalmers is in the driver’s seat as another Labor government copes with an economic crisis – very different from the GFC, but similar in being driven by circumstances not of the government’s making.Michelle Grattan, Professorial Fellow, University of CanberraLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1395622020-05-28T10:28:02Z2020-05-28T10:28:02ZGrattan on Friday: When Christian met Sally – the match made by a pandemic<p>It was Greg Combet, one-time ACTU secretary and former Labor minister, who got Christian Porter and Sally McManus together in the early days of the pandemic.</p>
<p>Recalling what happened, Porter told the Australian Financial Review he said to Combet he needed to “talk directly with people in the union movement”.</p>
<p>Porter knew union co-operation would be vital for the emergency measures the government would bring in. “I don’t necessarily speak their language,” the industrial relations minister told Combet.</p>
<p>“Greg suggested that [ACTU secretary] Sally was probably the one that I should talk to first. I … just picked up the phone two seconds after talking to Greg and spoke with her.”</p>
<p>From there, the Christian-Sally relationship blossomed. It can be seen now as a significant contributor to Scott Morrison’s bid, outlined this week, to seek a consensus approach to reforming the industrial relations landscape.</p>
<p>The personal link with McManus established, Porter convened a meeting with employer and union representatives on March 10, which opened with a briefing by chief medical officer Brendan Murphy to give the players an understanding of the (then) looming scale of the coronavirus crisis.</p>
<p>This was two weeks before major sectors of the economy started shutting down.</p>
<p>Porter and McManus agreed to speak every working day, as special arrangements were put in place to deal with the extraordinary circumstances. Their scheduled (virtual) meetings were recently wound back to two or three times a week (with other contact as required).</p>
<p>While McManus opposed making changes to the Fair Work Act as part of the JobKeeper program, when the government was determined she was pragmatic. She’d earlier assisted by enlisting unions to support employer moves to vary industrial awards to help key sectors cope with the immediate challenges of the crisis. </p>
<p>When she had gripes Porter listened and made the odd concession. She wasn’t happy, for instance, with Porter shortening the consultation period (from seven days to 24 hours) for an enterprise agreement being changed. McManus persuaded him to build in a review after two months of the measure (which lasts six months).</p>
<p>One government observer says, “I think they are both a bit surprised by each other, and how willing they are to have an open and frank discussion about issues”.</p>
<p>After all, this is the woman the government demonised when, new in her job, McManus condoned breaking what she considered bad laws. Senior minister Peter Dutton called her a “lunatic”.</p>
<p>But, as the observer added, “It was a relationship born of necessity, and it’s continued because of the trust established”.</p>
<p>On the face of it, they’re chalk and cheese. McManus has spent her whole career in the union movement, from when she was a trainee at the ACTU (Combet was a senior officer there at the time).</p>
<p>Porter was bred into a Liberal family (his grandfather served as a Queensland politician, his father as a party official); he became West Australian treasurer before moving to federal parliament. He’s now attorney-general as well IR minister.</p>
<p>Although she’s smart and sharp, McManus’s language draws on old-style union-speak (“working people” is her mantra). Porter, a former senior state prosecutor in WA, not infrequently reverts to legalese barely intelligible to the ordinary person.</p>
<p>But what helped them connect is that he’s a policy wonk, and she knows what she’s talking about. And they’ve found they can talk in confidence without their conversations leaking, or (so far) being weaponised by either of them.</p>
<p>McManus has greased wheels during the crisis - the government hopes it can now parlay the relationship with the ACTU into assisting Morrison’s attempt to land permanent industrial relations reforms.</p>
<p>When you want to build on a relationship, a show of respect never goes astray. Morrison invited McManus to Kirribilli House on Thursday afternoon of last week, as he developed his idea of a compact. It was a tough face-to-face encounter over tea in fancy cups. </p>
<p>This week Morrison announced Porter would chair five working groups (with employers, unions and other stakeholders) to consider award simplification; enterprise agreements; casuals and fixed term employment; compliance and enforcement, and greenfield agreements for new enterprises. Their deadline is September.</p>
<p>Morrison says he’s bringing parties to “the table”. But he’s putting nothing on the table. He took off the table the Ensuring Integrity legislation - which was stuck in the Senate and had been “paused” during the pandemic - but only after McManus forced the issue. </p>
<p>Comparisons with the Hawke government’s accords with the union movement have been false. Those were formal agreements between allies, in which both sides traded specifics (wage restraint in exchange for “social wage” policies.)</p>
<p>Neither the government nor the ACTU would see the present process of negotiations as a partnership.</p>
<p>McManus is buying into the process but she must be aware of its risks. Many in her constituency would be sceptical, if not appalled. Bring a long spoon to that table, they’d say.</p>
<p>On the other hand, the much-shrunken union movement has changed and become more feminised in recent years, and one would expect many among its members would welcome the bid for agreement.</p>
<p>Anyway, McManus has to join the play to defend the unions’ interests. Given the extra authority the pandemic has given Morrison, the government would potentially be able to ride roughshod over union opposition. The Senate’s (non-Green) crossbenchers are always fickle, but the unions wouldn’t want to be banking on support there. The government’s position would be even stronger if the unions were just negative.</p>
<p>To see McManus driven only by that however is, on the evidence, selling her short. She accepts there are areas that should be addressed, such as flaws in the enterprise bargaining system.</p>
<p>The government and the ACTU have been careful to narrow the agenda to the items before the groups. Morrison doesn’t want other issues to become matters for trading. The government is focusing deliberately on “known problems” - areas it says have been bugbears for employers and employees alike. Some commentators have seen its list as heavily directed to employers’ concerns, but the issues of casuals and enforcement are core to the unions. </p>
<p>McManus comes to the table with a stash of chips, albeit fewer than the employers or government. These include the goodwill established, and the advantage Morrison would get (not least over Labor) if he could go to the election as the “consensus” prime minister.</p>
<p>If the consultation process fails to produce anything of real value, many in the government and the union movement won’t be surprised. If something positive is achieved, thank the pandemic.</p><img src="https://counter.theconversation.com/content/139562/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Michelle Grattan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Perhaps a silver-lining of the pandemic, the economic downturn has created a more constructive discourse between the minister for industrial relations and the unions.Michelle Grattan, Professorial Fellow, University of CanberraLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1187562019-06-14T06:54:39Z2019-06-14T06:54:39ZSetka furore opens division within the labour movement – and there is no easy solution<figure><img src="https://images.theconversation.com/files/279463/original/file-20190614-32373-19j4ybp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Setka has form in attracting negative media attention as Victorian state secretary of the Construction, Forestry, Mining, Maritime and Energy Union.</span> <span class="attribution"><span class="source">AAP/Daniel Pockett</span></span></figcaption></figure><p>John Setka’s reported <a href="https://theconversation.com/cfmmeus-john-setka-set-to-be-expelled-from-alp-after-attack-on-rosie-batty-118592">comments about Rosie Batty</a> have the potential to seriously damage the Labor Party and unions generally in the public eye.</p>
<p>The Labor Party’s new federal leader, Anthony Albanese, moved quickly to seek Setka’s expulsion from the party following reports of his claim that Batty’s work campaigning against domestic violence had led to a reduction in men’s rights. Albanese had little choice but to act forthrightly, but in doing so he was also careful to emphasise his support for unions more broadly. The shockwaves from the affair have highlighted some divisions in the labour movement and given a political gift to the government. </p>
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Read more:
<a href="https://theconversation.com/grattan-on-friday-the-battle-to-stare-down-the-defiant-john-setka-118803">Grattan on Friday: The battle to stare down the defiant John Setka</a>
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<p>What Setka actually said is contested. He claims he was recounting general statements from lawyers regarding the shift in balance of family law, and that he was “<a href="https://theconversation.com/actus-sally-mcmanus-to-confront-cfmmeus-john-setka-118699">a huge supporter</a>” of Batty. However, the difference appears to be mainly in nuance.</p>
<p>More significantly, he has also indicated <a href="https://www.theage.com.au/national/victoria/labor-and-unions-silent-on-setka-after-he-agrees-to-plea-to-harassment-20190527-p51rp6.html">he will plead guilty</a> to charges of harassment of a woman over a carriage service later this month in court. </p>
<p>Setka has form in attracting negative media attention as Victorian state secretary of the Construction, Forestry, Mining, Maritime and Energy Union (CFMMEU). He <a href="https://www.abc.net.au/news/2019-06-11/john-setka-expulsion-rosie-batty-shows-where-labor-draws-line/11199838?section=analysis">had threatened</a> to expose all Australian Building and Construction Commission (ABCC) inspectors and make their children “ashamed of who their parents are”.</p>
<p>On social media, he <a href="https://www.smh.com.au/politics/federal/cfmmeu-s-john-setka-deletes-tweet-after-scott-morrison-s-threat-to-abolish-union-20180903-p501h1.html">posted a picture of his children</a> holding a placard stating “go get fu#ked” in reference to the ABCC. His actions in industrial disputes have contributed significantly to <a href="https://thenewdaily.com.au/news/national/2019/06/12/unacceptable-words-and-actions-sally-mcmanus-to-confront-cfmmeus-john-setka/?utm_source=Adestra&utm_medium=email&utm_campaign=Morning%20News%20-%2020190613">almost A$16 million</a> in fines from the ABCC and the Fair Work Commission for the CFMMEU.</p>
<p>Although a case over blackmail of an employer was <a href="https://www.abc.net.au/news/2018-05-16/blackmail-charges-against-construction-union-bosses-dropped-by/9766648">eventually dropped</a>, Setka has <a href="https://www.theaustralian.com.au/national-affairs/rap-sheet-reveals-60-charges-for-would-be-union-boss-john-setka/news-story/a7be856aaf25e3120b660a8a995c15e2">numerous convictions and fines</a> for theft, assault, criminal damage and assaulting police.</p>
<p><a href="https://theconversation.com/cfmmeus-john-setka-set-to-be-expelled-from-alp-after-attack-on-rosie-batty-118592">Albanese said Setka</a> “undermines the credibility of the trade union movement through the position he holds and the public views he’s expressed” in relation to Batty.</p>
<p>They also provide ammunition for government efforts to increase union regulation. A number of government members <a href="https://www.smh.com.au/politics/federal/morrison-government-renews-push-for-union-busting-bill-to-fight-cfmmeu-20190612-p51wzh.html">have indicated</a> the time is ripe to reintroduce their <a href="https://www.aph.gov.au/Parliamentary_Business/Bills_LEGislation/Bills_Search_Results/Result?bId=r5953">Ensuring Integrity Bill</a> to ensure unions and registered organisations are run by “fit and proper” persons and can be degistered or placed under administration for industrial lawlessness. </p>
<p>The ACTU secretary, Sally McManus, rushed home from a meeting of the International Labour Organisation in Geneva <a href="https://www.abc.net.au/news/2019-06-13/actu-sally-mcmanus-cfmeu-john-sekta-meet-amid-resignation-calls/11205636">to meet with Setka</a> on Thursday. She urged him to resign and consider the harm he was causing the wider union movement. She said she and other union leaders believe his words “are not compatible with our values”.</p>
<p><a href="https://theconversation.com/actus-sally-mcmanus-to-confront-cfmmeus-john-setka-118699">McManus also reiterated</a> the ACTU’s strong stance against domestic violence, noting that Setka must resign if the allegations of harassment over a carriage service are true: </p>
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<p>However, Setka is refusing to resign, with support from some other union leaders. He claims he has been stitched up by enemies within the union movement. The reported comments were made at a private CFMMEU national executive meeting, which seems to indicate that somebody present informed the media. <a href="https://www.abc.net.au/news/2019-06-12/union-boss-says-labor-leader-anthony-albanese-should-resign/11203312">Others present have supported Setka’s account</a>, notably the president of the maritime division of the union, Christy Cain.</p>
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<p>Setka’s removal from his position would not be easily achieved. He retains strong support within the union, especially from the large construction division. If he does plead guilty to the harassment allegations, or is convicted, union rules would allow his removal for bringing the union into disrepute. However, this would likely be a lengthy legal process, with no guarantee of success. The Federal Court has often been reluctant to sanction removal of elected officials.</p>
<p>ACTU disaffiliation of the CFMMEU would probably be counterproductive. Setka is based in the Victorian construction division of the CFMMEU, but affiliation is a matter for the federal office of the union.</p>
<p>Disaffiliation would also affect other divisions and branches that do not necessarily share Setka’s outlook. The CFMMEU is a conglomerate union, with other divisions representing workers in mining, manufacturing, forestry, energy and maritime sectors.</p>
<p>Labor risks being “wedged” on this issue. Government members <a href="https://thenewdaily.com.au/news/national/2019/06/12/unacceptable-words-and-actions-sally-mcmanus-to-confront-cfmmeus-john-setka/?utm_source=Adestra&utm_medium=email&utm_campaign=Morning%20News%20-%2020190613">have suggested</a> the party should sever ties with the CFMMEU, and frequently highlight that the union is the Labor Party’s biggest electoral donor. Bob Hawke is reported to have counselled Bill Shorten, when he was leader, to cut ties with the union.</p>
<p>But apart from the financial issue, a union’s party affiliation is a matter for the state Labor branches. This and the conglomerate nature of the union complicate the issue.</p>
<p>Prime Minister Scott Morrison <a href="https://mobile.abc.net.au/news/2019-06-11/john-setka-cfmeu-leadership-anthony-albanese-labor-expulsion/11197958?pfm=sm&sf214121319=1">has stated</a> there are “plenty more where John Setka came from”. In one sense he may be right. The construction sector has many robust characters and practices among both unions and employers, although the ABCC regulator tends to focus on unions. </p>
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<a href="https://theconversation.com/restoring-the-construction-watchdog-abcc-experts-respond-69643">Restoring the construction watchdog ABCC: experts respond</a>
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<p>The situation is reminiscent of Norm Gallagher and the Builders’ Labourers’ Federation (BLF), which was <a href="http://www.atua.org.au/biogs/ALE0132b.htm">deregistered for industrial lawlessness</a> in 1986, with the support of the Hawke Labor government and the ACTU. Government members have referred to the <a href="https://thenewdaily.com.au/news/national/2019/06/12/john-setka-refuses-quit/">possibility of deregistration</a> proceedings for the CFMMEU. </p>
<p>However, one important historical lesson is that despite numerous deregistrations of building unions from the 1950s onwards, behaviour in the sector was not greatly affected. It is also now a good deal more complex with the CFMMEU, since deregistration would affect other divisions representing workers outside construction. </p>
<p>The Setka episode has broader cultural dimensions for the union movement. Setka and his supporters represent a declining group of traditional blue-collar macho unionists. But the majority of the union movement is based in the service sector and more feminised.</p>
<p>The biggest unions are those representing nurses, shop assistants and teachers. The ACTU president and secretary are women, and their strongest supporters on this issue to date have been the Australian Service Union and United Voice, both with large female memberships.</p>
<p>The July 5 national Labor executive meeting will decide on Setka’s expulsion. Whatever is decided, the broader political issues will not easily subside.</p><img src="https://counter.theconversation.com/content/118756/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ray Markey is a life member of the National Tertiary Education Union, which is affiliated to the ACTU but not to the ALP.</span></em></p>The latest scandal involving the CFMMEU leader has the potential to cause serious damage to the Labor Party and the union movement.Ray Markey, Emeritus Professor, Macquarie UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1188032019-06-13T13:19:12Z2019-06-13T13:19:12ZGrattan on Friday: The battle to stare down the defiant John Setka<p>In his first days as leader Anthony Albanese has taken two decisive actions to reset Labor’s relationship with the militant Construction, Forestry, Maritime, Mining and Energy Union.</p>
<p>Reshuffling Labor’s frontbench, he removed responsibility for industrial relations from Brendan O'Connor, whose brother Michael is the CFMMEU’s national secretary. This was always a huge conflict of interest, but one that Bill Shorten as opposition leader declined to address.</p>
<p>Then this week Albanese moved to turf out of the ALP the construction union’s Victorian secretary John Setka, whose behaviour over a long period has been notorious. Albanese had Setka’s party membership suspended, and he flagged he’ll ask for his expulsion at next month’s ALP national executive meeting.</p>
<p>Under Shorten, the CFMMEU had what many regarded as a special position. The union formed part of his base, and protected and helped him when he needed numbers.</p>
<p>Albanese has had no such relationship, and he repeatedly emphasises that he’s come to his position without any deals or obligations.</p>
<p>That has made it all the easier for him to take on Setka, who should have been called out a very long time ago.</p>
<p>The trigger point Albanese used was a report that Setka had denigrated anti-domestic violence campaigner Rosie Batty, in remarks he made at a meeting of the union executive. Setka was talking about charges he’s facing of using a carriage service to harass a woman – he has already said he’ll enter a guilty plea. He was reported to have told the union meeting that Batty’s work had led to men having fewer rights.</p>
<p>Albanese was well aware the Setka affair was about to become a lot uglier in coming days, and the ALP needed to shake him off.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/view-from-the-hill-a-soft-reprimand-from-one-hard-man-to-another-118619">View from The Hill: A soft reprimand from one hard man to another</a>
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</em>
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<p>Setka’s initial fightback took the form of appearing hand-in-hand with his wife at a news conference, in which they said they’d been to hell and back and people should lay off them.</p>
<p>Setka denied he’d denigrated Batty, a denial quickly backed by a couple of officials at the meeting. This potentially complicated the situation for Albanese (who insisted he’d checked out the report) in the event of Setka fighting the expulsion move.</p>
<p>But precisely what he’d said or not said about Batty became fairly irrelevant once ACTU Secretary Sally McManus weighed in, meeting Setka on Thursday to tell him he should quit his union position.</p>
<p>McManus, incidentally, believed Setka’s denial; she too had checked out the report, and was satisfied “he never said anything to denigrate Rosie Batty”. Rather, she argues he should quit as an official because of his behaviour (which she stresses she can’t comment on in detail for legal reasons) and the damage being caused.</p>
<p>For the union movement, the Setka affair goes to the heart of its strong pitch against domestic violence, and its credentials in championing women’s rights. The ACTU currently is led by two women – its president is Michele O'Neil – making it even more imperative to match words with actions.</p>
<p>“There is no place for perpetrators of domestic violence in leadership positions in our movement,” McManus said in her Thursday statement.</p>
<p>“We have already put on record the union movement’s values and our principles regarding family and domestic violence.</p>
<p>"We also believe in equality for women and know that instances of violence against women are not just unacceptable, they stand in the way of achieving equality.”</p>
<p>She told the ABC the Setka issue was “about the broader reputation of the union movement, and I think it means that we are in a position where we can’t continue to advocate in the way we want to on issues while John Setka is the main story”.</p>
<p>McManus, who consulted widely with union leaders in taking her stand, is reflecting the position of a number of important unions, such as the Australian Services Union, which represents those who work in domestic violence services and the SDA (the “Shoppies”), which has many female members.</p>
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<em>
<strong>
Read more:
<a href="https://theconversation.com/why-the-israel-folau-case-could-set-an-important-precedent-for-employment-law-and-religious-freedom-118455">Why the Israel Folau case could set an important precedent for employment law and religious freedom</a>
</strong>
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<p>Unsurprisingly, Setka says he won’t resign, and he has the backing of Victorian branch delegates, making it uncertain how things will play out.</p>
<p>It’s a safe bet the ALP executive will back Albanese’s expulsion move – not to do so would be an inconceivable repudiation of his leadership.</p>
<p>With her authority on the line, McManus’s gamble is that as the story unfolds, Setka will be more isolated and will eventually step down or be forced to do so.</p>
<p>Asked whether the ACTU could disaffiliate the union if it would not get rid of its rogue official, McManus said this wasn’t something that had been thought about. She pointed out it would be a very serious course to take over one official.</p>
<p>But one thing the ACTU has been thinking about is the ammunition Setka is giving the government for its fresh push to bring in tough legislation – the Ensuring Integrity bill – to crack down on unions and officials that break the law.</p>
<p>Among its provisions, the legislation would “allow the Federal Court to prohibit officials from holding office who contravene a range of industrial and other relevant laws, are found in contempt of court, repeatedly fail to stop their organisation from breaking the law or are otherwise not a fit and proper person to hold office in a registered organisation”.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/to-protect-press-freedom-we-need-more-public-outrage-and-an-overhaul-of-our-laws-118457">To protect press freedom, we need more public outrage – and an overhaul of our laws</a>
</strong>
</em>
</p>
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<p>The bill was before the last parliament; it was opposed by Labor, and there wasn’t sufficient crossbench support to pass it.</p>
<p>But now the government is hot to trot. Assuming Labor continues to oppose, the question will be whether the government can get it through a Senate likely in general to be easier for the Coalition than the last one was.</p>
<p>It would come down to the votes of One Nation and Centre Alliance. One Nation would be on board. Centre Alliance would want changes that applied equivalent provisions to misconduct in the corporate sector.</p>
<p>If the union movement can’t deal with its Setka problem, the government’s argument, and its hand, certainly will be strengthened in its battle for the bill.</p>
<p>As one union man put it succinctly, “John Setka has bought the naming rights to the Ensuring Integrity legislation”.</p><img src="https://counter.theconversation.com/content/118803/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Michelle Grattan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>John Setka says he won’t resign, and he has the backing of Victorian branch delegates, making it uncertain how things will play out.Michelle Grattan, Professorial Fellow, University of CanberraLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1186992019-06-12T08:42:53Z2019-06-12T08:42:53ZACTU’s Sally McManus to confront CFMMEU’s John Setka<p>ACTU secretary Sally McManus will meet union leader John Setka on Thursday to discuss his “words and actions”, as Setka’s union allies push back against Anthony Albanese’s move to have him expelled from the ALP.</p>
<p>The controversial Victorian secretary of the Construction, Forestry, Maritime, Mining and Energy union appeared with his wife Emma Walters at a news conference and on radio on Wednesday to deny he had denigrated anti-domestic violence campaigner Rosie Batty.</p>
<p>Last week Nine newspapers reported Setka told a meeting of the CFMMEU national executive Batty’s work had led to men having fewer rights.</p>
<p>At Albanese’s instigation, Setka’s ALP membership has been suspended. Albanese will move for his expulsion when the party’s national executive meets on July 5. Before that, Setka will be in court late this month on charges of harassing a woman, to which he has said he will plead guilty.</p>
<p>The Labor party is currently working out a procedure by which he gets natural justice when his expulsion come up.</p>
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<em>
<strong>
Read more:
<a href="https://theconversation.com/australias-asylum-seeker-policy-history-a-story-of-blunders-and-shame-118396">Australia's asylum seeker policy history: a story of blunders and shame</a>
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<p>The Setka affair is now dominating discussion at the highest level of the union movement. McManus returned from Geneva early to deal with it.</p>
<p>She said in a statement on Wednesday she had “consulted with union leaders who are concerned by Mr Setka’s words and actions, which are not compatible with our values, and have impacted on our movement.</p>
<p>"The ACTU condemns all acts of family and domestic violence. Australian unions have made ending family and domestic violence a priority.</p>
<p>"I have heard what Mr Setka had to say today. I have sought a meeting with him tomorrow to discuss these matters. I will have more to say following this meeting.”</p>
<p>Earlier she had said that if any allegations relating to harassment were correct, “John Setka must resign. There is no place for perpetrators of domestic violence in leadership positions in our movement.” </p>
<p>Albanese has said he is not reflecting on the court case.</p>
<p>Setka said the report of what he said at the CFMMEU national executive meeting about Batty was “completely false. I have always been a huge supporter of Rosie Batty and admired her tireless work”.</p>
<p>“The member who leaked these false allegations, for nothing more than political gain, should be the one who hangs their head in shame. I completely agree with Mr Albanese [that] any comments denigrating Rosie Batty are completely unacceptable.”</p>
<p>Pressed on what he had said, Setka replied, “It was just going into what lawyers had told me in regards to some of the laws and had nothing to do with Rosie Batty changing the laws or anything. … There was nothing denigrating and nothing terrible said about Rosie Batty at all”.</p>
<p>He said would not be stepping down from his union position, which is an elected one.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/view-from-the-hill-a-soft-reprimand-from-one-hard-man-to-another-118619">View from The Hill: A soft reprimand from one hard man to another</a>
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<p>Labor frontbencher Kristina Keneally told Sky she did not believe Setka’s union position was tenable.</p>
<p>Albanese took steps to verify the story about what Setka had been reported as saying at the meeting before announcing his move against him.</p>
<p>But Chris Cain, national president of the Maritime Union (a division of the CFMMEU), who was at the executive meeting said the allegations about what Setka had said were false and “misinformation”. He said Albanese should apologise.</p>
<p>Setka also got backing from the state secretary of the Electrical Trades Union Victoria, Troy Gray, who said Albanese’s remarks about Setka were based on a “complete fabrication”. “Albanese needs to withdraw,” Gray said.</p>
<p>However other unions, including the Australian Services Union, which has members working in domestic violence services, are particularly concerned with the Setka situation. The ASU said in a statement: “John Setka should resign if any of the allegations against him are true. The comments attributed to him do not reflect the values of our union movement or the ASU. The alleged comments are abhorrent to victim survivors of family violence and thousands of ASU members who work on the frontline in the family violence sector.”</p>
<p>United Voice has said it supports the ACTU’s position that if any of the reported allegations against Setka were correct “he must resign”. It has also expressed concern about the alleged statements about Batty.</p>
<p>Setka told his news conference that over recent years he and his wife had “been to hell and back, with relentless attacks on us personally for what is nothing more than some people seeking their own political gain. The result of this was
our relationship hit rock bottom.</p>
<p>"We’ve both said and done things that we aren’t proud of. But this is
not an opportunity to get John Setka. My family should not be used as political bait. We’re working very hard together to rebuild our marriage and are confronting the issues that led to the breakdown of our marriage”.</p><img src="https://counter.theconversation.com/content/118699/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Michelle Grattan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The Setka affair is now dominating discussion at the highest level of the union movement.Michelle Grattan, Professorial Fellow, University of CanberraLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/913152018-02-08T00:50:18Z2018-02-08T00:50:18ZUnions can’t just rely on promises of favourable laws to regain lost ground<figure><img src="https://images.theconversation.com/files/205248/original/file-20180207-74512-1dtdlq.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">As ACTU secretary, Sally McManus has proven effective at elevating the debate over workplace reform. </span> <span class="attribution"><span class="source">AAP/Alex Murray</span></span></figcaption></figure><p>This year has begun with an intensification of <a href="https://theconversation.com/vital-signs-jobs-may-be-increasing-but-the-real-test-is-whether-we-get-a-pay-rise-this-year-90110">the debate</a> about wage stagnation and wage inequality in Australia.</p>
<p>Research papers published this year have <a href="http://www.futurework.org.au/decline_in_strike_frequency">linked</a> the stalling of wage increases to drastically reduced levels of industrial action (and therefore unions’ collective bargaining power), and <a href="https://percapita.org.au/research/work-australia-working/">highlighted</a> the current system of workplace regulation’s focus on outdated notions of work and the workplace.</p>
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Read more:
<a href="https://theconversation.com/vital-signs-jobs-may-be-increasing-but-the-real-test-is-whether-we-get-a-pay-rise-this-year-90110">Vital Signs: jobs may be increasing but the real test is whether we get a pay rise this year</a>
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<p>The Labor Party’s national president, Mark Butler, <a href="https://markbutler.net.au/news/speeches/the-future-of-unions-in-australia-and-the-implications-for-labor/">recently urged</a> the labour movement “to have a no-holds-barred debate about the place of unions in Australia”. He pointed to the problems unions faced in terms of employer hostility and unhelpful laws, but also argued:</p>
<blockquote>
<p>Most people still imagine union organising against a backdrop of relatively large workplaces with a stable workforce – traditional factory organising … [However a] modern workplace is far more likely to be small and difficult to access, with a workforce that has high levels of turnover.</p>
</blockquote>
<p>Unions have to persuade people of the wisdom of having a collective voice in the workplace, and find a new version of solidarity for the digital age.</p>
<h2>State of play</h2>
<p>Sally McManus has been secretary of the Australian Council of Trade Unions (ACTU) for just under a year. In that time, she has <a href="http://www.afr.com/brand/afr-magazine/actu-chief-sally-mcmanus-parlays-online-support-into-power-20170814-gxvuo2">proven effective</a> at elevating the debate over workplace reform. The <a href="https://www.australianunions.org.au/change_the_rules">union movement’s mantra</a> – “the rules are broken”, “we need to #changetherules” – is biting in the community.</p>
<p>McManus recently effectively called time on the 25-year process of enterprise bargaining. <a href="https://www.workplaceexpress.com.au/nl06_news_selected.php?act=2&selkey=56458">She argued</a> unions are confronted with “a labyrinth of regulations”, and workers now have “little to trade off”.</p>
<p>The <a href="https://www.legislation.gov.au/Details/C2017C00323">Fair Work Act</a> is a legacy of the last Labor government; it’s been the subject of minimal change by the Coalition to date. </p>
<p>Unions had significant input into drafting the act when Julia Gillard was workplace relations minister in 2007-08. They ensured it included various mechanisms to support collective bargaining, in a shift from the individualised focus of the WorkChoices era.</p>
<p>However, in the decade since then, employers have found various ways to side-step many of the Fair Work Act’s requirements. And other union or employee rights have been read down by the courts and the Fair Work Commission.</p>
<h2>Finding new ways to connect</h2>
<p>Clearly, there are changes to the law that would, <a href="https://www.actu.org.au/actu-media/speeches-and-opinion/sally-mcmanus-address-to-nexgen-2017">as McManus argues</a>, help unions in their efforts to organise and represent workers. These include:</p>
<ul>
<li><p>tackling the “free-rider” issue (where non-unionists gain the benefit of union-negotiated enterprise agreements)</p></li>
<li><p>enabling unions to bargain not just with the direct employer of their members, but across franchise networks and supply chains</p></li>
<li><p>closing down the use of outsourcing, labour hire and other business entities to avoid the application of enterprise agreements, and employers making inferior agreements with small employees that are later applied to a much larger workforce (known as “no-stake” bargaining)</p></li>
<li><p>limiting employers’ ability to seek termination of expired agreements (taking workers back to the award safety net).</p></li>
</ul>
<p>Labor has <a href="http://brendanoconnor.ml.net.au/en-au/News/Brendan-OConnor-Latest-News/Post/16230/WORK-WAGES-AND-DIVISION-CREATING-A-FAIR-AND-PRODUCTIVE-LABOUR-MARKET-NATIONAL-PRESS-CLUB-CANBERRA">already committed</a> to implement many elements of the union agenda if it wins the next election. </p>
<p>But even with the most favourable laws, unions will still need to confront the reality of a dramatic transformation in the world of work: automation, the expanding “gig economy”, and what US academic David Weil calls the <a href="http://www.hup.harvard.edu/catalog.php?isbn=9780674975446&content=reviews">“fissuring” of work</a> – where business functions are split off to new entities that are forced to engage in intense competition, thus driving down labour costs. </p>
<p>Former ACTU assistant secretary Tim Lyons <a href="https://meanjin.com.au/essays/the-labour-movement-my-part-in-its-downfall/">puts it this way</a>: </p>
<blockquote>
<p>The workplaces and communities in which we organised politically and industrially have disappeared underneath us … Unions have to transform to catch up to the world as it is.</p>
</blockquote>
<p>These developments, combined with the disinclination of young workers to join unions, mean new forms of engagement have to be found outside the conventional notion of the workplace. Unions must connect with people in their communities and speak to them using technology they are familiar with.</p>
<p>Some Australian unions are taking on this challenge. They are attempting to organise workers in their homes, places of religious observance, and other focal points for community activity. For example:</p>
<ul>
<li><p>Victorian Trades Hall Council’s <a href="http://www.youngworkers.org.au/">Young Workers Centre</a> harnesses the power of social media in an effort to reach a new generation of workers in disparate, disconnected work environments. </p></li>
<li><p>The National Union of Workers has run a very effective campaign targeting exploitation of farm workers in the fresh food supply chain. It has also offered a <a href="https://www.nuw.org.au/your-fair-go-0">“FairGo” category</a> of membership, enabling non-members to participate in a class action to recover underpayments.</p></li>
</ul>
<p>However, not all union leaders are embracing these kinds of innovation. They may be at risk of placing too much faith in the capacity of legal changes to deliver a revival in membership numbers. </p>
<p>Given record-low wage increases and widespread exploitation of vulnerable workers, the value proposition of a collective voice in the workplace has rarely been stronger.</p><img src="https://counter.theconversation.com/content/91315/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Anthony Forsyth has received research funding from organisations including the BCA, CFMEU, Fair Work Commission and Victorian Government. He is a Consultant with Corrs Chambers Westgarth. The views expressed in this article are his own.</span></em></p>Even with the most favourable laws, unions will still need to confront the reality of a dramatic transformation in the world of work.Anthony Forsyth, Professor of Workplace Law, RMIT UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/756222017-04-24T04:43:08Z2017-04-24T04:43:08ZAustralian politics explainer: the Prices and Incomes Accord<figure><img src="https://images.theconversation.com/files/164642/original/image-20170410-22688-1ma2w9c.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The Hawke Labor government had a strong incentive to seek a new approach to industrial relations when it came to office.</span> <span class="attribution"><a class="source" href="https://recordsearch.naa.gov.au/scripts/PhotoSearchItemDetail.asp?M=0&B=11607706&SE=1">National Archives of Australia</a></span></figcaption></figure><p><em>The Conversation is running a <a href="https://theconversation.com/au/topics/australian-politics-explainer-37192">series of explainers</a> on key moments in Australian political history, looking at what happened, its impact then, and its relevance to politics today.</em></p>
<hr>
<p>During the Hawke-Keating years, the union movement – under the leadership of Australian Council of Trade Unions (ACTU) secretary Bill Kelty – became a partner in Labor’s economic rationalist agenda.</p>
<p>Through Accord agreements, unions accepted a degree of responsibility for Australia’s broader economic health. This was often at the expense of their own members’ interests.</p>
<h2>What happened?</h2>
<p>The Hawke Labor government had a strong incentive to seek a new approach to industrial relations when it came to office. </p>
<p>The last time Labor held government was under Gough Whitlam, between 1972 and 1975. At that time, Hawke was ACTU president, and the front man for the industrial militancy and wages explosion that saw inflation peak at 18% and unemployment reach 5% for the first time since the early 1940s.</p>
<p>Hawke was a confrontational union leader. But Hawke 2.0, the self-possessed teetotaller who became prime minister in 1983, preferred consensus. </p>
<p>In opposition, Labor’s industrial relations spokesperson, Ralph Willis, developed the idea of a formalised agreement between the unions and Labor in government, which was adopted as policy at the Labor Party conference in 1979.</p>
<p>The Prices and Incomes Accord was a series of agreements between Labor and the ACTU where unions would moderate their wage demands in exchange for improvements in the “social wage”. </p>
<p>The first Accord was struck in February 1983, just before the election of the Hawke government. There were six subsequent accords, culminating in Accord Mark VII in October 1991, which ushered in the system of enterprise bargaining. </p>
<p>The Industrial Relations Commission developed a policy of “two-tier” wage fixation, in a shift from the “wage indexation” system of the past. Basic increases would be provided but additional wage rises were dependent on “efficiency offsets”.</p>
<p>By the early 1990s, this had developed into the dual system of basic annual wage increases for award-covered workers, and the opportunity to implement enterprise-based agreements to drive productivity at the workplace level.</p>
<p>The Accord’s social wage elements included better public health provision through Medicare, improvements to pensions and unemployment benefits, tax cuts, and – eventually – superannuation.</p>
<h2>What was its impact?</h2>
<p>The Accord was a key component of the Hawke-Keating governments’ economic reform program. Along with the <a href="https://theconversation.com/the-float-australia-had-to-have-21361">floating of the Australian dollar</a>, opening the door to international banks and the reduction of tariffs, the Accord signalled a turn toward a more globally engaged Australian economy.</p>
<p>Hawke’s consensus-oriented style brought the union movement inside the economic policy management tent. This was also a corporatist project: although business groups were not formally part of the Accord, Hawke brought big business into other institutions such as the Economic Planning Advisory Council.</p>
<p>Generally, business groups became critical of the influence the ACTU exerted over Labor through the Accord years. From the mid-1980s, arguments for radical reform of the industrial relations system grew stronger. </p>
<p>Elements in the Coalition and the New Right pushed for individual workplace bargaining and a reduction of union power. They saw the Accord as symbolic of the much-reviled <a href="https://theconversation.com/the-enduring-myth-of-the-industrial-relations-club-34647">“industrial relations club”</a>.</p>
<p>Within the union movement itself, the Accord was always controversial. Critics argued it transferred power from the grassroots network of delegates and shop stewards to an elite group of senior officials sitting around the table with business and government.</p>
<p>The Accord evolved over the 1980s to focus mainly on managing wages outcomes while ignoring accompanying increases in the social wage. In response, left-wing officials like Laurie Carmichael of the Metalworkers Union became increasingly critical of the Accord. For many, the union movement had simply given up too much for too little.</p>
<h2>What are its contemporary implications?</h2>
<p>On the 30th anniversary of the Accord in 2013, ACTU president Ged Kearney said the Accord’s spirit should be revived to meet the challenges of job insecurity and wage inequality.</p>
<p>Rising inequality is behind the backlash now underway against neoliberalism and the mantra of prosperity through free trade and globalisation. </p>
<p>The ACTU’s new secretary, Sally McManus, has been in the headlines since assuming her position in March this year. McManus <a href="http://www.abc.net.au/news/2017-03-15/actu-boss-happy-for-workers-to-break-unjust-laws/8357698">said</a> she believed workers were justified in breaking laws that they judged to be unfair. </p>
<p>She <a href="https://www.theguardian.com/australia-news/2017/mar/29/neoliberalism-has-run-its-course-says-actu-boss-sally-mcmanus">later declared</a> neoliberalism had “run its course”, and:</p>
<blockquote>
<p>The Keating years created vast wealth for Australia, but it has not been shared, and too much has ended up in offshore bank accounts or in CEO’s back pockets.</p>
</blockquote>
<p>McManus’ combative style recalls an era before market economics gained bipartisan support, when the lines between labour and capital were more sharply drawn. Her approach also raises important questions about the future of the relationship between the industrial and political wings of the Australian labour movement.</p>
<p>McManus appears to be positioning the union movement as the bulwark against unfairness, and the vigorous defender of long-held conditions. There is none of the Kelty “pinstriped proletarian” in her approach. It is unknown whether the McManus-led ACTU will entertain a similar kind of compact with a Shorten Labor government, or take a more conflict-oriented approach.</p>
<p>Bill Shorten is by nature a consensus Labor leader, who is inclined to seek common ground between business and labour. At present, though, he is riding the turn against neoliberalism, adopting a pro-union position and populist rhetoric on issues such as corporate tax cuts and penalty rates.</p>
<p>There is some prospect therefore of a new Labor-ACTU compact for the 2020s. This would not focus so much on the Accord’s economic objectives, but on the protection of workers’ rights in the fast-changing world of automation and new platforms of service delivery.</p><img src="https://counter.theconversation.com/content/75622/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Anthony Forsyth has received research funding from organisations including the BCA, CFMEU, Fair Work Commission and Victorian Government. He is a Consultant with Corrs Chambers Westgarth. The views expressed in this article are his own.</span></em></p><p class="fine-print"><em><span>Carolyn Holbrook does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The Prices and Incomes Accord was a series of agreements between Labor and the ACTU where unions would moderate their wage demands in exchange for improvements in the ‘social wage’.Anthony Forsyth, Professor of Workplace Law, RMIT UniversityCarolyn Holbrook, Alfred Deakin Research Fellow, Deakin UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/754552017-04-10T04:47:36Z2017-04-10T04:47:36ZFactCheck: do 679 of Australia’s biggest corporations pay ‘not one cent’ of tax?<blockquote>
<p>… 679 of our biggest corporations pay not one cent of tax. <strong>– Australian Council of Trade Unions (ACTU) Secretary Sally McManus, <a href="http://www.actu.org.au/actu-media/speeches-and-opinion/speech-by-actu-secretary-sally-mcmanus-at-the-national-press-club">address</a> to the National Press Club, Canberra, March 29, 2017.</strong></p>
</blockquote>
<p>Speaking at the National Press Club in Canberra, Australian Council of Trade Unions (ACTU) Secretary Sally McManus called for an increase to Australia’s minimum wage and criticised the Fair Work Commission’s recommendation to cut Sunday and public holiday penalty rates. </p>
<p>McManus said that “679 of our biggest corporations pay not one cent of tax”.</p>
<p>Was that claim correct?</p>
<h2>Checking the source</h2>
<p>When asked for sources to support McManus’ statement, a spokesman for the ACTU pointed The Conversation to a <a href="http://www.abc.net.au/news/2016-12-09/tax-data-transparency-ato/8106178">media report</a> and to the Australian Taxation Office (ATO) <a href="https://data.gov.au/dataset/corporate-transparency/resource/1e8c8ae0-81d1-4780-a669-9e4a2a6ba1a4">Report of Entity Tax Information</a> for 2014-15, and provided this response from McManus:</p>
<blockquote>
<p>According to the most recent ATO Tax Transparency Report, 679 companies with more than $100 million in income paid no tax in Australia in 2014-15.</p>
<p>The list includes such household names as Walt Disney, Sydney Airport, Qantas, Origin Energy and News Australia.</p>
<p>These companies can collectively be considered to be amongst the biggest operating in Australia – both in terms of income, and the prominent position they enjoy in the public eye.</p>
<p>Some of them are not Australian owned, and they may pay tax in other jurisdictions. However, they all operate in Australia, generate revenue from the spending of Australians and utilise existing infrastructure – like roads and ports – that were paid for by Australians.</p>
<p>So there’s something deeply unfair about a system which allows them to not pay any tax in Australia.</p>
</blockquote>
<p>The ACTU also provided The Conversation with a <a href="https://cdn.theconversation.com/static_files/files/27/75455-2017-04-10-tax-paid-by-companies-tax-paid-by-companies-ato-data.xlsx?1518654879">spreadsheet</a> listing the corporations it said had paid no tax. </p>
<h2>Is that figure right?</h2>
<p>The best source for information on how much tax Australia’s biggest corporations pay every financial year is the ATO. The ATO’s <a href="https://data.gov.au/dataset/corporate-transparency">Report of Entity Tax Information</a> – the same report the ACTU referred to in their response – is produced annually and shares information taken from the tax returns of:</p>
<ul>
<li>Australian public and foreign-owned corporate entities with total income of A$100 million or more</li>
<li>Australian-owned resident private companies with total income of A$200 million or more</li>
<li>entities with tax payable under the petroleum resource rent tax, and</li>
<li>entities with tax payable under the minerals resource rent tax. </li>
</ul>
<p>The report includes each company’s name, total income, taxable income, and tax payable.</p>
<p>For the purpose of this FactCheck, the relevant information is the <em>tax payable</em> by each of these companies. By looking at this data, we can see which companies didn’t pay tax in 2014-15, the most recent financial year for which this information is available.</p>
<h2>How many companies don’t pay tax?</h2>
<p>There are 1,904 companies included in the ATO’s 2014-15 report. Of those, 678 – or 36% of the companies listed – had no tax payable.</p>
<p>My count – 678 – is slightly different to McManus’s count of 679, and to the figure the ATO quoted on its pie chart <a href="https://www.ato.gov.au/Business/Large-business/In-detail/Tax-transparency/Corporate-tax-transparency-report-for-the-2014-15-income-year/?anchor=Netlossesandniltaxpayable#Netlossesandniltaxpayable">here</a> (the ATO has since corrected its report to reduce the number of nil tax payable taxpayers by one to 678).</p>
<p>The ACTU provided The Conversation with a spreadsheet listing the 679 companies that, in their view, paid no taxes. When I compared my count with the ACTU’s, I noted the ACTU included a company that I did not, a company named Tal Dai-Ichi Life Australia. </p>
<p>In the <a href="https://data.gov.au/dataset/corporate-transparency">report</a> I downloaded from the ATO website, Tal Dai-Ichi Life Australia is recorded as having total tax payable of A$56,171,148 for the 2014-15 financial year, so it shouldn’t be included in the count of companies that paid no tax. </p>
<p>Nevertheless, the difference is obviously minor. McManus was essentially correct.</p>
<h2>Why do some companies pay no tax?</h2>
<p>In general, there are two reasons why corporate companies pay no tax in Australia.</p>
<p>The first is that some companies are not making any profit. The concept of “total income”, which is used to identify the companies included in the ATO report, relates to revenue – not profit.</p>
<p>So, a company can have income (or revenue) of more than A$200 million, but that doesn’t automatically mean it has made a profit. Its losses or outgoings may outweigh its income. Only companies making a profit have to pay taxes.</p>
<p>Many of the companies that didn’t pay tax in 2014-15 were those in the energy/natural resources and manufacturing sectors – two sectors that were <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/8155.0">experiencing a downturn</a> in that year and where profit margins were shrinking.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/164634/original/image-20170410-29403-1pbfxrs.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/164634/original/image-20170410-29403-1pbfxrs.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/164634/original/image-20170410-29403-1pbfxrs.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=408&fit=crop&dpr=1 600w, https://images.theconversation.com/files/164634/original/image-20170410-29403-1pbfxrs.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=408&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/164634/original/image-20170410-29403-1pbfxrs.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=408&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/164634/original/image-20170410-29403-1pbfxrs.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=513&fit=crop&dpr=1 754w, https://images.theconversation.com/files/164634/original/image-20170410-29403-1pbfxrs.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=513&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/164634/original/image-20170410-29403-1pbfxrs.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=513&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Proportion of entities with nil tax payable, by industry segment, 2013–14 and 2014–15.</span>
<span class="attribution"><a class="source" href="https://www.ato.gov.au/Business/Large-business/In-detail/Tax-transparency/Corporate-tax-transparency-report-for-the-2014-15-income-year/?anchor=Netlossesandniltaxpayable#Netlossesandniltaxpayable">ATO corporate tax transparency report for 2014-15</a></span>
</figcaption>
</figure>
<p>The second reason could be tax avoidance or profit shifting. These situations arise when companies take advantage of the international tax system to reduce the amount of tax to be paid. For instance, companies may set up complex ownership arrangements that allow them to redirect profit to countries with lower tax rates.</p>
<p>While not necessarily illegal, these situations are <a href="https://www.ato.gov.au/Business/Large-business/In-detail/Tax-transparency/Tax-transparency--reporting-of-entity-tax-information/?anchor=Ensuringcorporatetaxpayerspaythecorrecta#Ensuringcorporatetaxpayerspaythecorrecta">closely monitored by the ATO</a> to ensure that Australia receives its correct share of tax under international tax rules. </p>
<h2>Verdict</h2>
<p>Sally McManus’ claim that “679 of our biggest corporations pay not one cent of tax” was essentially correct. According to ATO records, 678 of Australia’s biggest corporations didn’t pay tax in Australia in 2014-15.</p>
<p>McManus’s figure of 679 included one company that did have tax payable in that financial year. But in percentage terms, the difference between 678 and 679 is negligible.</p>
<p>It’s important to note that when a company doesn’t pay tax, it doesn’t necessarily imply tax avoidance or profit shifting. A company might not be paying tax because it isn’t making a profit, even if its total income (that is, revenue) amounts to more than A$100 million or A$200 million. <strong>– Fabrizio Carmignani</strong></p>
<hr>
<h1>Review</h1>
<p>This is a sound FactCheck.</p>
<p>The ATO’s annual corporate tax transparency <a href="https://www.ato.gov.au/Business/Large-business/In-detail/Tax-transparency/Corporate-tax-transparency-report-for-the-2014-15-income-year/?anchor=Netlossesandniltaxpayable#Netlossesandniltaxpayable">reports</a> can provide useful insights to inform public debate regarding how effectively our tax system is working. </p>
<p>As the author rightly points out, the information must be used with caution. There are legitimate reasons why a company with substantial income does not have to pay income tax. For instance, it may make a loss in that particular year, or has substantial carried forward losses from previous years.</p>
<p>Or, as the author has also rightly noted, tax avoidance may be the reason why a large company is not paying any income tax. <strong>– Antony Ting</strong></p>
<hr>
<figure class="align-left zoomable">
<a href="https://images.theconversation.com/files/162128/original/image-20170323-13486-72k52f.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/162128/original/image-20170323-13486-72k52f.png?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/162128/original/image-20170323-13486-72k52f.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=600&fit=crop&dpr=1 600w, https://images.theconversation.com/files/162128/original/image-20170323-13486-72k52f.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=600&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/162128/original/image-20170323-13486-72k52f.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=600&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/162128/original/image-20170323-13486-72k52f.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=754&fit=crop&dpr=1 754w, https://images.theconversation.com/files/162128/original/image-20170323-13486-72k52f.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=754&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/162128/original/image-20170323-13486-72k52f.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=754&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">The Conversation FactCheck is accredited by the International Fact-Checking Network.</span>
</figcaption>
</figure>
<p><em>The Conversation’s FactCheck unit is the first fact-checking team in Australia and one of the first worldwide to be accredited by the International Fact-Checking Network, an alliance of fact-checkers hosted at the Poynter Institute in the US. <a href="https://theconversation.com/the-conversations-factcheck-granted-accreditation-by-international-fact-checking-network-at-poynter-74363">Read more here</a>.</em></p>
<p><em>Have you seen a “fact” worth checking? The Conversation’s FactCheck asks academic experts to test claims and see how true they are. We then ask a second academic to review an anonymous copy of the article. You can request a check at <a href="mailto:checkit@theconversation.edu.au">checkit@theconversation.edu.au</a>. Please include the statement you would like us to check, the date it was made, and a link if possible.</em></p><img src="https://counter.theconversation.com/content/75455/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Fabrizio Carmignani receives funding from the Australian Research Council for a project on the estimation of the piecewise linear continuous model and its macroeconomic applications.</span></em></p><p class="fine-print"><em><span>Antony Ting does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>In a speech to the National Press Club in Canberra, ACTU Secretary Sally McManus said 679 of Australia’s biggest corporations pay “not one cent of tax”. Is that right?Fabrizio Carmignani, Professor, Griffith Business School, Griffith UniversityLicensed as Creative Commons – attribution, no derivatives.