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Legal and Constitutional Affairs Legislation Committee
02/08/2018

MAKSIMOVIC, Ms Andrea, Associate Director, International and Civil Society, Australian Council of Trade Unions

[15:09]

CHAIR: Welcome. Thank you very much for coming along and also for your written submission. We've provided you with some information on parliamentary privilege and the protection of witnesses and evidence. We invite you to make an opening statement.

Ms Maksimovic : I would like to thank you for the opportunity to discuss with you the ACTU's view of the proposed modern slavery bill. We are, of course, very happy to see that there is such a bill being proposed. I could start my statement today with figures about slavery but I'm sure that you've heard enough of those already, so I'd like to start by talking about today's context. Many of you would have seen the report yesterday of a man who came to Australia to work as a chef and earn good money for his family but found himself being forced to work 12 hours a day, six days a week, and was underpaid by $220,000. I'm sure you've talked about it today. Last week we learned that seasonal farm workers from Vanuatu were going to sue their labour hire company for $10 million after earning $8 an hour and having constant nosebleeds because of the chemicals they were exposed to. Every week, for almost a decade, we hear such a story. Those are the ones we hear—I was going to mention the domestic workers in embassies in Canberra, and the fact that many of their stories will remain untold.

The proposed modern slavery act is just a small part of what we need to do in Australia and overseas to deal with these daily stories. But it could play a key role. The ACTU is particularly supportive of a number of features of the bill, some of which we called for, including the mandatory criteria, the fact that the government will report as well and the central registry.

Modern slavery is a complex problem of abuse and exploitation. The ACTU is excited about the idea that we could have robust legislation to help us in eradicating it. But we firmly believe that unless there are penalties attached to the legislation, we're not going to get very far. Greater transparency, as any expert on business and human rights can tell you, is the very important first step in changing company culture. This is because it is information which enables public scrutiny that can be used to persuade companies to lift their standards. But you can't lift company standards if companies don't want to publish information about their actions in supply chains.

In the UK, the MSA experience has taught us a lot. I'm sure you've all heard that, in fact, only 30 per cent of companies thus far have provided their statements. By not implementing fines, the UK Modern Slavery Act has had such a low response rate that, really, you could call it a voluntary scheme. We would like to note that the New South Wales parliament just passed the Modern Slavery Act, with penalties. If the government wants to introduce an act on modern slavery that will have an effect, penalties must form part of that legislation. Secondly, there must be a list of companies required to report. I think my colleague, Dr Mark Zirnsak, explained that quite well.

There is an assumption that the modern slavery reporting requirement will create transparency, which will drive greater accountability. However, in the absence of public information about which entities are required to report, the efficacy of the modern slavery reporting requirement as a transparency measure is curtailed. A public list is critical because it will enable the government, companies, investors, civil society, consumers and the public at large to be aware of non-compliant companies. A public list will also incentivise companies to comply with the reporting requirement and drive higher legislative compliance levels.

In addition, the ACTU believes the bill would be greatly strengthened by including a provision that prohibits suppliers who fail to comply with the reporting requirement from participating in public tender processes. This is something that I think the original Senate committee report also recommended.

Senator MOLAN: That it did or it did not?

Ms Maksimovic : It did. We also believe that the proposed legislation should establish an independent antislavery commissioner to lead and coordinate Australia's response to combating modern slavery. The commissioner would promote best practice, focused on the prevention of modern slavery, in partnership with statutory bodies, civil society and the private sector and lead community engagement around the new legislation. Potentially the commissioner may also have a role in identifying and supporting victims of modern slavery. Thank you for your time.

Senator PRATT: Thank you and thank you for the ACTU's submission here today. You've made some clear statements in relation to penalties, reporting requirements and thresholds in the commission around procurement which coalesce very strongly with what the rest of civil society has said about the directions that we need to be going in. I'm interested, in particular, in the role of an independent commissioner, given the ACTU's experience in dealing with a whole range of other workplace complexities—some of which you touched on before, in terms of the chef who'd been underpaid by some $220,000 and the other examples that you gave—where such a commissioner will be able to work with other agencies to address those kinds of situations. We know that there are limitations to what the Fair Work Ombudsman or the Fair Work Commission can do. We know there are also limitations to what the immigration department can do. What kind of role might a commissioner play in an Australian context? Should they have a role in working with those agencies or should they just be focused on the supply chain part for reporting entities?

Ms Maksimovic : I think that probably broadly most of us in the civil society groups that have been participating in these kinds of conversations believe that they should have a responsibility for ensuring that those other statutory bodies, like the Fair Work Ombudsman, for example, are involved in ensuring that they provide some advice to them. If they have had someone come to them, for example, then they can provide that advice to the Fair Work Ombudsman, and that case can go forward. Or, if they think it's something that would be more under the Criminal Code, then that would go to the AFP. I think that there is a role that for that, because currently what we face—and I think probably you've heard this from other people—is a lot of disconnection between the various departments. I think someone in that role could be independent but at the same time work with all those government and semigovernment bodies to bring them together and to also understand—because we've had a lot of problems with people's fundamental understanding of what modern slavery is, because it is a spectrum. We're not the people to talk about things like forced marriage or sexual slavery. But there is a spectrum even within the question of labour exploitation that goes from what happened to the chef we just talked about today, to another chef who was actually a slave because he was locked in the kitchen, which happened a few years ago. I think you also remember. I think that those kinds of things need someone talking to all those agencies about them and also making sure that the programs work together, because there are a number of programs that are running currently around trying to deal with particular kinds of modern slavery. But I think that having someone who will be, I guess, overseeing it, on top of it all, having a good kind of outlook, would be useful.

Senator PRATT: Can I ask how the ACTU and other unions see this in the context of the labour market, because clearly, when people don't have free access to a labour market, they can be vulnerable to other forms of control because they can't leave and find another employer, because someone has control over their immigration status, for example. For example, the chefs that you spoke of in all likelihood were therefore tied to a particular sponsor. Or there are agricultural workers who again come in to work for a particular employer, so they find themselves in that. Or sex workers who want to come in and work—perhaps they do choose to work in the sex industry, but because the sex industry is not legal they then also find themselves in these kinds of exploitative conditions with people exercising control over them. How do we work with the Australian community to legitimately say, 'Well, we want to limit the number of people that come into Australia to access our labour market so that we can keep wages high enough for Australians as well as avoid people who want to access the labour market falling into these slave-like exploitative conditions'? It's a complicated question.

Ms Maksimovic : It's a complicated question because by now we have 10 or 12 different types of visa classes. And what has really happened is that we have created so many visa classes, and there are so many ways in which people can come in, that each one of those has its own particular issues. The working holiday visa—

Senator PRATT: The student visa.

Ms Maksimovic : has the 88 days. It has that particular issue which makes people go into regional areas because they have to, and then sometimes they work for free. Sometimes they get terribly, terribly abused. Then you've got the student visas. The student visas have also a particular question because people—

Senator PRATT: They limit the number of hours you can do, which might then—

Ms Maksimovic : They have limited hours, but also they've paid $6,000, $7,000 or $8,000 to be in a course which they don't attend, because sometimes—well, there's the whole question of the VET system and the rorting in all of that, but sometimes they're being made to work extra hours. But they know that if they report that, if they say, 'I'm going to go to the police or the Fair Work Ombudsman,' if they know about the Fair Work Ombudsman, then their employer would say, 'Well, if you do that then you're breaching your visa, and then you'll get deported.'

This is another reason why I don't think that this particular business unit that is going to be set up in the Department of Home Affairs actually fits in there, because mostly what these people who come here and face this kind of exploitation fear is deportation, and that has been the case previously. Now increasingly, I think, there are some discussions between various departments about at which point do you deport someone—before they've had a chance to maybe get some of the money back or have some kind of justice in terms of what has happened to them? But this is what people mostly fear.

We've created this system of so many particular types of visas that I don't think anybody knows how to get on top of this now. The only way to get on top of it really is to say: okay, (1) we will have, let's say, a skilled visa when actually there are labour shortages—say what used to be called a 457 visa—and (2) we will have student visas, but actually those students will also have to make sure that the university is going to have to be involved in knowing and monitoring whether those people are (a) being exploited or (b) attending class. Of course, we have a massive education industry, so we know we have to have those people, and we also don't want them to only be rich people who can afford to study. They should have the right to work, but it's a question of how much. And then I think for everything else we have a permanent migration system, so we don't need other things.

In terms of seasonal work, I accept that there are definitely some issues in agriculture. I know that we're supportive of the Seasonal Worker Program because it does actually involve some union interaction, so people at least have explained to them what their rights are.

Senator PRATT: That makes sense in terms of the contribution that a commissioner might be able to make to participating at a national level in unpicking some of that labour exploitation—

Ms Maksimovic : Yes.

Senator PRATT: where exploitation can lead to slavery-like conditions, so thank you for that. And I think you've also outlined quite clearly why the office should be independent. Can you tell us a little bit more about how, in the ACTU's view, corporate social responsibility schemes have failed in terms of the nature of voluntary codes of practice, guidelines and schemes in relation to these issues?

Ms Maksimovic : Yes. I think one of our greatest fears is that, if the Modern Slavery Act just turns into something that's voluntary, it will not be effective. And that's because we've had years and years of experience of dealing with things like audits and initiatives that are voluntary.

My first job was at the Textile Clothing and Footwear Union, and we worked on this thing called the Homeworkers Code of Practice, which was all about outworkers who were sewing in garages for piecework or something like that. The first thing we did was that we tried to get companies to sign on voluntarily to this code of practice so that they would pay them properly and make sure that they weren't working in unhealthy kinds of environments. But, even though some companies could be sort of dragged into signing through the usual name-and-shame kind of stuff, in the end the code itself could not do what something like regulation could do. We didn't have the capacity to also go in and see if what they were saying was true in terms of what they reported to us around supply chains. So in the end what happened is that we campaigned very strongly to get what's called the outworkers act, and that outworkers act now is probably one of the best pieces of supply chain legislation left in Australia, even though I think the current government has tried to change it and defunded some of the mechanisms a little bit.

I think that the problem with all kinds of voluntary mechanisms is that they are something that companies can sign up to, and they often have very nice words written on pieces of paper, but then, when it comes to actually making sure that that their workers are being treated properly, it's often the case that this is not true. I can give you many examples of many companies that have great codes of conduct—including, for example, Apple, which we all know have many, many issues with their Foxconn workers in places like China. So these kinds of codes of conduct where you get independent auditors to come and verify something et cetera just don't work.

What we have found works, of course, is the law and unions organising. This is how, for example, it started off in places like Indonesia, when I was a young activist and we were all standing outside of Nike at some ungodly hour. What started off there was pressure on the companies, but, at the same time, we were able to support workers in Indonesia learning how to organise, and that's how you get something like Indonesia currently being a reasonably high-standard labour-rights country. But that didn't happen just through voluntary schemes.

Senator PRATT: Should we be including transparency around labour rights in our supply-chain reporting?

Ms Maksimovic : I assume that this is what the legislation will do—that companies will. Now the lingo is ESG—environment, social, governance. This is the latest lingo around what companies are supposed to be reporting about.

CHAIR: Sorry—can you spell that?

Ms Maksimovic : E-S-G.

Senator MOLAN: Environmental, social—what's the G?

Ms Maksimovic : Governance.

CHAIR: Okay.

Ms Maksimovic : So I'm assuming that in that 'S' there is this question of labour rights. Labour rights are one of the biggest issues that I think we face in supply chains—apart from the environment, I suspect.

Senator MOLAN: But not slavery? That's not slavery, is it?

Ms Maksimovic : Sorry?

Senator MOLAN: Are you categorising that in the context of slavery and a slavery bill?

Ms Maksimovic : Labour?

Senator MOLAN: Yes.

Ms Maksimovic : Well, in the context of—

Senator MOLAN: No—transparency of labour rights within a country such as Indonesia?

Ms Maksimovic : Not transparency of labour rights within a country such as Indonesia.

Senator PRATT: That was my question. I was speculating on whether it should be included.

Ms Maksimovic : Not in this bill. Generally, of course, we are working with many companies and investors and other bodies, particularly around: how do you make sure that, where you are investing, the core labour conventions are being adhered to? That's a very key question for us.

Senator MOLAN: But not for the bill?

Ms Maksimovic : Not for this bill.

Senator PRATT: No, no—but nevertheless companies might point—

Ms Maksimovic : As I said, this is the beginning. This is where you start, which is just transparency. Then you need to go further.

Senator MOLAN: You need to do it! I don't know whether we do!

Senator PRATT: Companies might, for example, point to their work with unions in overseas jurisdictions as part of their transparency in addressing the issues in their reporting. That is just an example.

Ms Maksimovic : Yes. I can give you one good example. Take Rio Tinto—which of course we know is a massive company and has many, many sites throughout the world. For a long time, their code of practice was really amazing, but the one thing that they never did was to actually deal very well with labour. And there were many, many abuses—including people getting killed and jailed and stuff like that, in places where they were working—until, eventually, they ended up making a deal with the international trade union. That was the way that it happened. But it didn't happen through their code.

Senator MOLAN: But they weren't conducting modern slavery, were they?

Senator PRATT: In some instances.

Senator MOLAN: Is that right?

Ms Maksimovic : Well, it depends on whether or not you think that someone who is getting shot for demonstrating or for demanding that they get paid is in slavery or not.

Senator MOLAN: Is that how we define slavery in the bill? It's not, is it.

Ms Maksimovic : No.

Senator PRATT: Thank you, Chair. I don't have any more questions.

CHAIR: Senator Molan?

Senator MOLAN: I only have one question. I was a bit surprised to hear that the current government had tried to lessen the home piece-worker regulation. Can you explain to me how that happened?

Ms Maksimovic : The outworker act basically has very good provisions around unions being able to enter the workplace to check the books of the outworkers, and also, up the stream, to check the books of the people who have hired them to do the work. What has happened now is that those provisions about unions being able to access workplaces have been cut.

Senator MOLAN: They certainly have. But there were a range of other reasons. So we can look at the same fact, can't we, and interpret it from two different perspectives. One of the main reasons for the cut was that unions were exploiting that right, using intimidation and bullying when they went in. If you look at what the Fair Work Ombudsman has done and what cases have done, it was not something related to modern slavery, was it?

Ms Maksimovic : I think—

Senator MOLAN: We didn't restrict the ability of union delegates to enter workplaces to stop them investigating slavery problems.

Ms Maksimovic : But in effect you did, because by doing that you've stopped people like TCFUA being able to go and find out what's happening to outworkers in garages in Springvale.

Senator MOLAN: Well, maybe the cause of that was union thuggery and intimidation in other situations. Maybe you should look at your own organisation rather than the current government.

Ms Maksimovic : We could argue about that for a while.

Senator MOLAN: We could, and we probably will. I just wanted that to be on the record so that we don't have that, as though the current government has reduced it so that we prevent people solving slavery problems.

Ms Maksimovic : Yes.

Senator MOLAN: Thank you.

CHAIR: Again, as I asked previous witnesses—domestic slavery is really a matter for the Australian Federal Police, isn't it, rather than naming and shaming big employers?

Ms Maksimovic : It's not about naming and shaming employers. It depends on what kind of domestic workers you're talking about to start with. There are domestic workers—

CHAIR: Well, cases of modern slavery in a domestic sense.Are there any cases of what is defined as modern slavery that really aren't matters for the police under the various acts that make those practices illegal?

Ms Maksimovic : There are two issues there. One is: are you talking about domestic workers in general or are you talking about people who are working in embassies? Because the biggest problem of course is—

CHAIR: I'm not familiar with your reference to embassies. That's news to me.

Ms Maksimovic : There was a Four Corners report recently where—

CHAIR: I never watch Four Corners.

Ms Maksimovic : It told a story of a couple of people who, because the diplomats have immunity under law, can't go to the police. That's one of the issues that we've been supporting the Salvation Army on.

CHAIR: But this Modern Slavery Bill is not going to in any way impact upon domestic staff in embassies.

Ms Maksimovic : No, it's not. It was just a point to say that we have problems with slavery generally. And those cases were actually real cases of slavery.

CHAIR: Well, they involve foreign governments and the way they do things under foreign laws. But in other cases, mainly in the sex trade industry, those things are illegal by specific criminal codes or other legislation.

Ms Maksimovic : Correct.

CHAIR: They're matters for the Federal Police rather than the Modern Slavery Bill. Do you agree with that?

Ms Maksimovic : Yes.

CHAIR: Just finally from me—Senator Pratt asked all of the questions that we all wanted to ask, I think—has the ACTU been involved in the consultation for the preparation of this bill?

Ms Maksimovic : It depends what you mean by consultation.

CHAIR: Most people who've been here, when I've asked that question, have said: 'Yes, we did get involved. We were consulted in the drafting of the bill and in the lead-up to this whole process.'

Ms Maksimovic : In the drafting the bill—no. We've written three submissions, but we weren't involved in the drafting of the bill.

CHAIR: You haven't had discussions with bureaucrats directly?

Ms Maksimovic : No.

CHAIR: Okay. Thanks very much for your evidence, your written submission and the work that you've obviously done towards the Modern Slavery Bill. The committee appreciates all of that. Thank you for coming along today.

Ms Maksimovic : Thank you.

CHAIR: And with that, I'll adjourn the hearing until tomorrow in Canberra.

Committee adjourned at 15:39