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Education and Employment Legislation Committee
23/10/2019
Estimates
EMPLOYMENT, SKILLS, SMALL AND FAMILY BUSINESS
Attorney-General's Department

Attorney-General's Department

CHAIR: It is quarter past the hour, so we will recommence. I have the email from Senator Sheldon that you indicated before that you wish to table. Unless anyone has any objection to this, it is the will of the committee that we accept it as a tabled document.

The committee will now move to industrial relations matters, commencing with the Industrial Relations Group in the Attorney-General's Department. I welcome the Minister representing the Attorney-General, Senator the Hon. Marise Payne, and representatives from the Attorney-General's Department. I remind senators that questions concerning industrial relations corporate matters should be pursued in the Legal and Constitutional Affairs Legislation Committee hearing. Minister Payne, do you wish to make an opening statement?

Senator Payne: No, thank you, Chair.

CHAIR: Welcome, Mr Moraitis. Do you wish to make an opening statement?

Mr Moraitis : Given it's the first time we've appeared in this new configuration and, as you alluded to, corporate matters will be discussed in a separate committee, I thought it would be worthwhile just to summarise for this committee the context of the machinery-of-government changes that have occurred and how that's operating—if you would indulge me on that for a few minutes.

CHAIR: Certainly.

Mr Moraitis : I would very quickly like to say a few things about the machinery-of-government changes, and then I'll table the rest.

CHAIR: Thank you.

Mr Moraitis : I wanted to take the opportunity to outline the fact that, following the Administrative Arrangement Orders of 29 May this year, there was a transfer in responsibilities of industrial relations to the Attorney-General's portfolio. Our finances and staff were involved in that transfer. The date of effect of that transfer was 25 July this year. For your information, the full average staffing level transfer was 325.2 staff, including four staff from the service delivery office of the finance department. The full-year departmental funding transfer was about $62½ million, and administered funding was also transferred. These will form a separate outcome in our additional estimates statements in the future. I also should note that seven agencies from that portfolio of jobs have moved to this portfolio, and they will also be included in the additional estimates statements.

I'm sure you're aware of the role that the Attorney-General's Department plays, and I won't go into the details. That will be in the statement that I submit. I just want to make the point that, while this is a relatively new area for the current part of Attorney-General's, what's struck me in the last few months is the fact that there are synergies in terms of policy, in terms of how we go about stakeholder engagement and in terms of the legal matters that we deal with. So far the machinery-of-government process, in terms of structure, in terms of policy approach, is very similar, and we've already hit the ground running as a department. We've worked very hard and assiduously, certainly from my perspective and the perspective of my staff and the crew working to engage with all our colleagues in Industrial Relations. We've progressed quite a bit in engaging in that space. There are a few outstanding issues such as accommodation. The department are still accommodated in their current office space in Civic, and in the next five or six months we hope to move all Industrial Relations staff into our building, the Robert Garran building, in Barton. We also want to finalise some of the IT transfers. We're quite committed to ensuring this happens smoothly and seamlessly so that we can support the Attorney in his role as Attorney but also as Minister for Industrial Relations—and, let me say, so far, so good.

I've spelt out in the statement some of the specific things we've done to ensure that we can maintain a positive level of engagement, given the two organisations coming together in the last few months. That will be outlined in the Hansard if you wish to peruse that in the future. Thank you for the opportunity to make that opening statement.

CHAIR: Thank you, Mr Secretary. It is the will of your committee that your opening statement is tabled, unless anyone objects to that. There being no objections, it is so resolved. Senator Keneally, I think you wish to kick off.

Senator KENEALLY: I'd like to start on the Senate inquiry into stillbirth. The government has accepted, in principle, all of the recommendations of the inquiry. The first recommendation of that inquiry was that the government would review and amend the Fair Work Act as it relates to paid parental leave provisions for parents of stillborn babies. Can the department advise if there has been any work commenced on this recommendation?

Mr Hehir : We are certainly aware of the report and we have been looking at the provisions in terms of the interactions within the Fair Work Act between what is allowed for live birth and stillbirth. I might pass to Ms Durbin to talk you through the detail.

Ms Durbin : At this point, there's probably not a huge amount of extra detail that I can provide. We certainly are aware of the report and aware of the government's response. We've undertaken a range of internal analysis. We briefed the previous industrial relations minister. We also have briefed the Attorney. There is work in progress in terms of working out a consultation process so that we can engage with stakeholders to get their views. We will be in a position to publicise that when we've got formal government agreement in terms of the consultation arrangements.

Senator KENEALLY: So the intention is to consult regarding what steps you might take before those steps are taken?

Ms Durbin : Absolutely.

Senator KENEALLY: Is there a time line in place? Do you have an anticipation of if there might be information available publicly before the end of the year?

Ms Durbin : I can't comment on that, I'm afraid.

Senator KENEALLY: Are you aware that the Minister for Health will commence a roundtable on 2 December regarding progressing the recommendations out of the stillbirth inquiry?

Ms Durbin : Yes. We work closely with officials from the Department of Health and other coordinating agencies.

Senator KENEALLY: Will the Attorney-General's Department be present at the roundtable?

Ms Durbin : I understand whether we send someone is still being finalised. We are certainly in discussions.

Senator KENEALLY: I have some other requests regarding migrant worker exploitation. The migrant worker task force report, which was provided and which the government then responded to in March 2019, states:

Migrant workers can be particularly vulnerable to slavery and exploitation by either those who facilitate their journey to Australia, or by employers once they arrive. Many suspected victims of trafficking and slavery have entered Australia on legitimate visas.

Is that an accurate statement and do you agree with that?

Mr Hehir : That was certainly the findings of the task force and we're represented on the task force. You would be aware that the government agreed, in principle, to all 22 recommendations of that report. A number of those recommendations are currently being progressed.

Senator KENEALLY: The Attorney-General's Department was on the task force that endorses the findings of the report?

Mr Hehir : This is a timing issue. The Attorney-General's Department, at that time, was on the task force and the industrial relations group was the secretariat and on that task force, and—

Senator KENEALLY: And as such endorsed the findings of the report?

Mr Hehir : We were part of the task force making that report, yes.

Senator KENEALLY: Has anything changed your view that that's no longer an endorsable position?

Mr Hehir : No. There is no new information that's come to light.

Senator KENEALLY: The Australian Bureau of Agricultural and Resource Economics and Sciences farm survey report said:

Using contract labour companies who may use undocumented workers, engage workers outside their visa conditions or underpay their workers is a risk for the farm.

Are you concerned about the risk to workers and employers that is highlighted in this Australian Bureau of Agricultural and Resource Economics and Sciences farm survey?

Mr Hehir : That statement is very similar to some of the findings within the migrant worker task force report.

Senator KENEALLY: It is, yes.

Mr Hehir : And that is why there was a recommendation around the establishment of a labour hire registration scheme.

Senator KENEALLY: Yes. I do have some questions about that, so thank you for raising it. I quickly want to also observe that assistant minister Jason Wood, when he was Chair on the Joint Parliamentary Committee on Migration, said in a chair's forward in February 2019:

Organised crime and illegitimate labour hire companies are using this loophole—

He is talking about the visa system—

to bring out illegal workers who are often vulnerable and open to exploitation.

Does the department accept the view that organised crime and illegitimate labour hire companies are using loopholes to bring workers Australia?

Mr Hehir : I am not aware that the migrant worker task force report identified organised crime as an issue. Certainly we are concerned about the behaviour of some labour hire firms.

Senator KENEALLY: You are concerned about the behaviour of some labour hire firms, why?

Mr Hehir : Certainly the principle behind the recommendation is that there seems to be some labour hire firms who are exploiting vulnerable migrant workers.

Senator KENEALLY: The migrant workers task force actually said:

Taskforce Cadena is working closely with the AFP to locate and remove victims of suspected human trafficking. This involves identifying Australian based syndicates and their offshore supply chains in order to develop appropriate disruption strategies.

That sounds like organised Australian and overseas operations are bringing people here.

Mr Hehir : Yes, certainly in terms of illegal workers or workers without appropriate documentation, yes.

Senator KENEALLY: Right. So it is a problem. Let me ask about the national labour hire scheme. When will the scheme be introduced?

Mr Hehir : At this point, the Attorney is intending to discuss this with relevant state and territory ministers to begin the process of how to establish a national labour hire registration scheme. You would be aware that three states currently have their own labour hire registration schemes and they all differ, and the recommended model from the Migrant Workers Taskforce is different again. So, rather than having multiple, varied schemes, we are looking to see whether we can coordinate a national approach.

Senator KENEALLY: Is there a time line for this work?

Mr Hehir : Certainly my understanding is that the minister intends to write to ministers shortly if he's unable to meet with them directly to discuss it.

Senator KENEALLY: So he hasn't written to them yet?

Mr Hehir : Sorry, he has written to them, yes.

Senator KENEALLY: He has written to them?

Mr Hehir : He has written to them.

Senator KENEALLY: Can you table a copy of the letter, please.

Ms Durbin : Sorry, we don't have a copy with us, but my recollection is that he wrote to state and territory colleagues on 11 October.

Senator KENEALLY: So this month. Have you had any meetings with the various stakeholder groups that have been calling for a national labour hire licensing scheme to be implemented urgently—for example, the Victorian Farmers Federation, AUSVEG or the Migrant Workers Centre?

Ms Durbin : Not recently.

Senator KENEALLY: When was the last time you would have met with stakeholder groups of that nature?

Ms Durbin : I'll have to take that on notice.

Senator KENEALLY: Can you take on notice whether you have you had any consultation with Victorian Farmers Federation, AUSVEG or the Migrant Workers Centre?

Ms Durbin : I'm happy to take the details on notice. My recollection is that, since the cessation of the task force, we've not engaged bilaterally with any organisation.

Senator KENEALLY: The government's response to the report of the Migrant Workers Taskforce was quite broad. It didn't make specific commitments to the 22 recommendations apart from in-principle support. So where is the implementation of this report up to? Can you tell us: has the government agreed to implement anything specifically beyond a national labour hire licensing scheme?

Ms Durbin : As you indicated, the government committed in principle to all 22 recommendations and there is work underway in a range of areas to progress those. Probably one of the most significant ones is the government released a discussion paper in September picking up a number of the Migrant Workers Taskforce recommendations, particularly around the penalties and compliance regime in the Fair Work Act. The task force made a number of recommendations, particularly as it applies to migrant workers, but obviously the Fair Work Act has broad coverage and would apply to all national system employees across Australia. That discussion paper looked at a range of recommendations and sought feedback. It particularly went to things like the operation of the current civil penalty under the Fair Work Act, which was a particular recommendation of the Migrant Workers Taskforce. It has sought feedback on the application of criminal penalties for the most egregious worker exploitation. That's quite deliberately spelt out in the feedback the government is seeking through that discussion paper. Similarly, it's seeking feedback on the deterrent effect about changes that the government made in 2017 under a range of vulnerable worker amendments that were made to the Fair Work Act and whether they've had the desired effect or whether further changes need to be made. That addresses a very wide-ranging number of the recommendations of the Migrant Workers Taskforce.

Senator KENEALLY: Can you specifically speak to whether the government has any plans to introduce legislation to criminalise serious worker exploitation.

Mr Hehir : That's the purpose of the discussion paper. So the government's committed, in principle, to that. The discussion paper clearly sets out and asks questions around what the possible criminality test should be and seeks feedback on that. The government has identified that we are drafting legislation at this point.

Senator KENEALLY: You are drafting legislation?

Mr Hehir : Yes. The minister and the Prime Minister have indicated that.

Senator KENEALLY: Can you please provide me—and I'm happy for this to be on notice—with the timing and actions that will be taken to deliver each of the recommendations from the response to the Migrant Workers' Taskforce report? I appreciate that you've just given me a general overview. I would just like to know what action is being taken on each, where it's up to and when they anticipate next steps and delivery.

Ms Durbin : For completeness, there is an interagency group that's been established, because a number of the recommendations go across other portfolios. Home Affairs, for example, and other portfolios have a particular interest—you've touched on the Department of Agriculture. That is the group that is overseeing the implementation of the taskforce's recommendations.

Senator KENEALLY: This is a general question. I take it you would agree that there is exploitation, trafficking and slavery occurring in Australia?

Mr Hehir : Certainly, the evidence provided to the Migrant Workers' Taskforce indicated that there was serious exploitation of migrant workers. It identified the trafficking issue, which you quoted previously. I think as part of the work with Taskforce Cadena identified potential slavery, yes.

Senator KENEALLY: For the advice of people who may be listening to this, within what sectors of the economy does this type of exploitation and trafficking and slavery mainly occur?

Mr Hehir : In relation to the recommendation, the report identified four higher-risk sectors: horticulture—

Ms Durbin : Cleaning, security, meat processing and horticulture.

Senator KENEALLY: Do any of these sectors rely on undocumented workers?

Ms Durbin : I'm not sure we could comment specifically. The Department of Home Affairs may have some intelligence, but I couldn't comment specifically.

Senator KENEALLY: Did the Migrant Workers' Taskforce not consider that issue? Did that not come out in the report?

Ms Durbin : At the general level, but certainly not to that level of specificity.

Senator KENEALLY: So, at the general level it did. Do you have a sense of how widespread the issue is? Did the report make any findings in that regard?

Mr Hehir : My recollection is that there were a number of papers published that were referenced . I'm not sure that the taskforce itself undertook any specific analysis around how widespread it was.

Senator KENEALLY: So it would be hard for someone to make a claim based on that information? Are you saying that it's not possible to say how widespread it is or isn't?

Mr Hehir : My recollection is that the taskforce looked at a number of papers produced by academics, which varied in their estimates. But the taskforce itself didn't reach a conclusion on how widespread it was, in terms of numbers of people. I'll take that on notice to make sure, but my recollection is that they looked at the academic papers.

Senator KENEALLY: That would be really useful, thank you. I'm just surprised that you don't have a view to advise us. We've got Mr Woods' report in February 2019; the Australian Criminal Intelligence Commission in 2017-18 talked about the challenge of people being trafficked here, on valid visas, to work; the inquiry into human trafficking and slavery in 2017; the Joint Parliamentary Committee on Law Enforcement; we have your own civil justice division; and your submission to the Joint Standing Committee on Foreign Affairs, Defence and Trade Committee's inquiry into establishing a modern slavery act. It seems there are multiple government reports that document and chronicle that people being trafficked on valid visas to work in exploited conditions is a significant problem for Australia. We have Taskforce Cadena. We have the work that you are doing to respond to the Migrant Workers' Taskforce. It seems odd to me that somebody might make a claim that this is not a problem in Australia.

Mr Hehir : Senator, I didn't make that claim. My—

Senator KENEALLY: No you didn't, but Peter Dutton did this morning.

Mr Hehir : As I said before, the task force identified it as a significant issue. But my recollection is that the task force itself did not attempt to quantify the level.

Senator KENEALLY: Thank you.

Senator SHELDON: Good afternoon, Mr Moraitis and Senator Payne. The Minister for Industrial Relations told the parliament on 31 July this year that under the provisions of the ensuring integrity bill, a single instance of unprotected industrial action—for example, the nurses union protesting unsafe nurse-to-patient staffing ratios—would not establish a ground for an application for a disqualification of that union. He said that the notion was 'fanciful' and 'patently absurd'. Minister, based on your understanding of the provisions contained in it, was the minister correct in this statement about the ensuring integrity bill?

Senator Payne: I don't have that detail with me, and I haven't seen the minister's comments. But I'm very happy to take your question and the details of that on notice, and respond to you through the committee.

Senator PRATT: Minister Payne, this is a policy question, so perhaps the department can explain the way the policy contrasts with the minister's statements.

Senator Payne: That's a secondary question. I was responding to Senator Sheldon's question to me.

Senator PRATT: No, that's fine. Because you've taken that on notice I thought I might assist Senator Sheldon by seeing if the secretary can explain it in a policy context.

Ms Volzke : One instance of obstructive industrial action can amount to a prima facie ground for deregistration. But unprotected industrial action without those additional features will not provide a prima facie ground for deregistration, so the action must also have relatively prevented, hindered or interfered with the activities of an employer or any relevant public service, or had a substantially adverse effect on the health, safety or welfare of the community.

Senator SHELDON: You said that the language in the bill does, in effect, turn around, and that one breach in the circumstances you've described is a ground for seeking deregistration?

Ms Volzke : One instance of obstructive industrial action. That is an existing provision and ground in the current registered organisations act as well.

Senator PRATT: But not for deregistration?

Ms Volzke : Yes, it is. It's in—

Senator Payne: It's in the current act, the official said.

Ms Volzke : Yes, it's in section 28.

CHAIR: In (1)(b)!

Senator PRATT: Thank you for clarifying that for us; we might come back to that—I just need a moment to digest the way you've put the answer to that question.

I want to begin by asking some questions about the Porter review of industrial relations that was announced back in June. What are the terms of reference for the review and what's the scope and its objective?

Mr Hehir : The Minister for Industrial Relations has been asked to examine the industrial relations system to identify where there may be impediments to shared gains for employers and employees. The Attorney-General has identified that potential reform should be measured against three criteria: driving jobs and wages growth; boosting productivity and strengthening the economy; and ensuring protection of employee's rights.

Senator PRATT: Is there anything else you can put on the public record that wasn't contained in the initial announcement of it back in June?

Ms Durbin : Probably the other public source is the information that the minister gave at the CEDA speech—I think that was 19 September—where he again reiterated the principles that Mr Hehir outlined, and outlined his intention to undertake comprehensive consultation through a range of discussion papers. The first two of those discussion papers have been released.

Senator PRATT: Sorry, the first two, did you say?

Ms Durbin : Yes.

Senator PRATT: In those discussion papers having been released, is there going to be a terms of reference for the review?

Ms Durbin : Each discussion paper, I expect, will put a caveat around what it's particularly seeking to get out of the engagement on a particular issue. The discussion papers, I think, will probably cover specific topics, so the stakeholder feedback being sought on each of those particular topics may vary but that would be outlined in each of the discussion papers.

Senator PRATT: So how will any set of particular stakeholders know whether issues of interest to them are going to come up in the context of the review, if it's just going to pop up on an ad hoc basis?

Ms Durbin : All of the discussion papers tend to be published on our website. We have stakeholders that we are in contact with. Where representative agencies have contacted us about a particular issue, certainly for the first two, we indicated to a number that we would advise them when the discussion paper was released and we followed that up. So it is really through those mainstream consultation bodies. Similarly, I am sure peak organisations will advise their members, as they would do through their normal course of business.

Senator PRATT: How many papers do you expect to be released?

Ms Durbin : It's a matter for government.

Senator PRATT: I did ask what the scope of the review is. If there've been two that have been released so far, and you don't know how many there are to come, how do we know what the scope of the review is in terms of the government's agenda in this space? We don't know how many or what topics.

Ms Durbin : I probably would again direct you to the Attorney's speech at CEDA, where he outlined the content of the two that he was releasing on that day and he foreshadowed at that point potential topics that may be considered for further discussion papers as part of the review. They're included on page 7 of his speech. I'm happy to read that out if that would assist—

Senator PRATT: No, that's fine. I can find that. In terms of the consultations that have taken place so far, which stakeholders have been consulted with in the context of the two papers that have been done? Have you started consulting with other stakeholders in the context of other papers?

Ms Durbin : They are in the public domain. They're open for any party to engage with us through written submissions. They're published on our departmental website. So we have not, as a department, engaged bilaterally with stakeholders separate to that process.

Senator PRATT: So people need to write in to the department through the website? And you haven't held any meetings or discussions, so you're not doing roundtables or travelling interstate, or anything like that?

Ms Durbin : No.

Senator PRATT: So you can't tell us yet how many discussion papers there'll be or what the other subjects are. Will the review ultimately produce a single report?

Ms Durbin : I don't think that's the intention but that's really a matter for government.

Senator PRATT: So it's not the intention to have a single report?

Ms Durbin : That's my understanding, but they've provided no indication that that would be their—

Senator PRATT: How do we know what the government's industrial relations agenda actually is, Minister Payne?

Senator Payne: I think the official has said the Attorney has set out a number of his views in his CEDA speech, and of course the Prime Minister made a speech on 24 June which indicated what he had asked the Attorney-General to do. The Minister for Industrial Relations has said that any propositions around reforms should be measured against criteria such as driving job and wages growth, boosting productivity and strengthening the economy, and ensuring the protection of employees' rights. So as submissions are called on the series of discussion papers that are already under way, we want to see, and the Attorney wants to see, widespread input into what might be possible improvements or reform outcomes.

Senator PRATT: Through a discussion paper input process but with no roundtables or dialogue with stakeholders?

Senator Payne: I think the officials are describing the process as it stands. I think the Attorney-General has made it very clear that he's interested in receiving those views, and we want to enable that to progress reform.

Ms Durbin : If I can assist, one other thing I can add is this is obviously the beginning of the process. As we go through a policy development, we are obliged to undertake a range of consultative mechanisms under the act and under the intergovernmental agreement with the states and territories. So our normal processes would involve consultation as part of that.

Senator PRATT: When you get to needing to draft legislation or anything like that, do you mean?

Ms Durbin : Generally, yes.

Senator PRATT: Is there an expectation that these discussion papers will come through in the form of a single bill or amendments to the IR system?

Mr Hehir : It's a bit hard to pre-empt that. It's likely that there will be some individual bills. I mentioned earlier that we're drafting criminalisation of wage theft at the moment, so that's likely to be a separate bill at this point. It certainly won't be one single bill at the moment. A part of that will depend on the responses. Both the Prime Minister and the minister have made clear that was the evidence. They want to see a basis for changes. They are not looking for change for change sake; they are looking for an evidence base.

Senator PRATT: Were the first two discussion papers based entirely on the information provided through the website submissions or were there things added through other sources?

Ms Durbin : Both of those consultation processes remain open. For the first discussion paper, which was on the penalties and compliance regime I mentioned previously, that consultation closes this Friday, on the 25th. The second discussion paper, which is on greenfield enterprise agreements, closes on 1 November.

Senator PRATT: Thank you for clarifying that for us. Has the department been advised of the ACTU correspondence with the minister? Let me clarify. The ACTU wrote to the minister requesting that the review focus on the wage crisis, wage theft, insecure work and on providing equal pay for women. Will these issues all be included in your review process?

Ms Durbin : I'm certainly aware of that correspondence.

Senator PRATT: Is the department aware of correspondence from employer groups covering the review?

Ms Durbin : Similarly, I certainly can recall, off the top of my head, correspondence from other peak bodies who've taken the opportunity to write to the Attorney in his capacity as the new Minister for Industrial Relations.

Senator PRATT: Can I just clarify, you spoke of single bills and separate bills—

Mr Hehir : I spoke of a bill in terms of criminalising wage theft.

Senator PRATT: And that is currently being drafted. Is that right?

Mr Hehir : It's being drafted but, before it's finalised, we're awaiting the outcome of the consultation process.

Senator PRATT: The ACTU and other unions have asked to be consulted as part of these review processes. When will this happen?

Mr Hehir : The ACTU are welcome to make a submission into the discussion papers. There's certainly the opportunity for them to make that submission. Whether there's subsequent consultations required will depend on the inputs and how varied the input into those papers is. There are of course also the formal processes where the Workplace Relations Consultative Council committee meets, which includes representatives from the ACTU.

Senator PRATT: Can I ask why you're not running public consultations for employers, workers, unions and employer groups to be heard?

Mr Hehir : The decision was made to release them as discussion papers and to seek feedback broadly.

Senator PRATT: Do you think perhaps there's a role for talking to workers about their individual experiences of how the current policy settings affect them?

Mr Hehir : That's certainly a possibility depending on the subject matter. In relation to the penalties discussion paper, it's based on the extensive work undertaken by the migrant worker taskforce and as Ms Durban identified, while it's based on that, it will certainly have broader application than just migrant workers.

Senator PRATT: Can I ask what consultants have been engaged as part of the review of the IR system, for what purpose and at what cost?

Ms Durbin : The department, as part of this overarching process, has engaged one consultant—the Boston Consulting Group. They commenced work on 14 October, is my recollection. They have been tasked to do quite a specific and defined task, which is to develop some process maps to support the current enterprise bargaining and agreement-making process. That is being done in consultation with stakeholders. That consultant is in the process of reaching out now to employers and to employee representatives to seek their feedback on the processes that they have experienced in negotiating a single enterprise agreement. I think you asked about the cost. It was $137,500.

Senator PRATT: Sorry? How much?

Ms Durbin : Their quote was $137,500.

Senator PRATT: In that context, I understand the minister has already announced that the government is going ahead with lifetime greenfields agreements, even though consultations on that one close on 1 November. Is that correct? Why has the government pre-empted policy consultations by making an announcement like that?

Ms Durbin : Certainly we are aware that there have been reports in the press that have been putting that position forward. A better source is the response that the Attorney gave to question time—I think it was on Tuesday—where he quite clearly indicated that greenfields was in scope of one of the discussion papers that he had issued and he was looking forward to getting feedback on that.

Senator PRATT: What's the point of these consultation processes if essentially the government is pre-empting a commitment to implementing what's in the consultation paper? It is not true consultation then if an idea is not worth pursuing?

Senator O'SULLIVAN: Haven't they put a paper out?

Ms Durbin : That's correct. The Attorney is clear that he supports this idea. He thinks it is a good idea and that it would bring significant productivity and other benefits to large-scale infrastructure projects but it remains under consultation. He will consider the feedback both on the idea and on the technical detail about how such an idea could be legislated and put into operation.

Senator PRATT: What is the consultant's brief for Boston Consulting and when are they due to report?

Ms Durbin : They've been engaged for 20 days of work. That includes developing an end-to-end process map of the bargaining process, engaging with stakeholders and getting their feedback. They're due to report to us on 8 November.

Senator PRATT: So that's 20 days to do the substantive consultation and they're reporting on 8 November. Is that what you said?

Ms Durbin : That's when they're due to give the final product to us, yes.

Senator PRATT: That's a call-out to anyone who's listening to this estimates as to whether they've actually heard from Boston Consulting, if they've got an interest in these issues. Are you able to tell us how many stakeholders Boston Consulting Group are meeting with in that time?

Ms Durbin : I'll have to take the specifics on notice but we're certainly aware that they are engaging directly with employers, bargaining representatives and unions to get their feedback.

Senator PRATT: Did you give them a list of unions, peak councils, employers and employer groups you wanted them to talk to?

Ms Durbin : We've certainly given them some parameters around where we think it will be most beneficial to engage what is actually a very short-term and truncated project. We would be looking at people who've gone through this experience very recently, so have recently concluded a bargaining process.

Senator PRATT: But in that sense, it being mid-October now, which means they have 20 days, would you expect people to have heard from Boston Consulting by now if they were going to be part of this consultation on bargaining?

Ms Durbin : There is a consultative group that operates within the Fair Work Commission, which obviously has a key role in this, that comprises unions and employer representatives. We've used them as a first point of contact. We're in the process of contacting them to see if they're interested in participating in that project. I know some have indicated an interest and some have not, but we've not completed that process yet.

Senator O'SULLIVAN: Senator Pratt, if I may, it sounds like it's a very narrow body of work that Boston Consulting are doing. They're just mapping out—what are they doing? Are they looking at the current process map, is that right, and then giving that advice back?

Mr Hehir : Yes, they're certainly looking at the process map. They're looking to see whether there are duplicative steps within the process, whether there are redundant steps within the process. As part of that, they've been tasked to make sure that employee rights are maintained. As part of the consultation process with the employee and employer reps, they're looking at their personal experience in terms of use, or what we would describe as 'pain points'—what has worked well and what hasn't worked well; where are the frustrations—to try to identify, through that, if there are possible improvements to the process.

Senator PRATT: So you can't give us a list yet of which union peak councils that the department or Boston Consulting Group will talk to, other than you would expect they would be talked to if they're part of the existing consultation processes within the department. Is that what you're saying?

Ms Durbin : Within the Fair Work Commission, so they already operate a consultative forum across a range of bargaining issues that comprises unions and employers.

Senator PRATT: Okay. So if they don't hear from Boston Consulting then they need to get on to the Fair Work Commission to make sure they can be part of that if they want?

Ms Durbin : I can't comment on the process for engaging with the Fair Work Commission in terms of its normal consultative business, but if people have a particular interest, I'm sure I can say we'd be happy to hear from them.

Senator PRATT: How does the use of external consultants fit with the department's announced process of issuing discussion papers on specific topics? What's going to happen to this work on bargaining?

Mr Hehir : Bargaining is one of the potential papers, so part of this is a technical exercise to identify whether there are issues or areas of redundancy within the process, and whether there are any suggestions from parties on an evidence base that could improve the process. If there is then it's possible a discussion paper could be issued on it. But, really, the first point was trying to get a technical exercise done.

Senator PRATT: The Treasurer recently declared from Washington that industrial relations was a 'key target in a three-phase reform plan to expand the economy'. Does this mean the review will be fast-tracked or managed differently than was previously thought?

Mr Hehir : Not to my knowledge. The attorney has been working with us systemically, and that continues.

Senator PRATT: Okay, so is or is not industrial relations part of the government's approach to managing the economy?

Mr Hehir : Certainly when you have a look at what the potential reforms need to be measured against—driving jobs and wages growth, boosting productivity and strengthening the economy, and ensuring protection of employees rights—it's clearly a key part of looking at boosting productivity across the economy.

Senator PRATT: The stated aims of the IR reforms under consultation are to 'create jobs, put upward pressure on wages and to help business by boosting productivity'. Can I ask what that means? And is decreasing the labour cost of a major project by having a project-length agreement rather than a three-year pay deal a productivity improvement?

Ms Durbin : Again, if you look at the preface of each of the discussion papers, it's quite clear that the objectives need to also ensure the protection of employee rights.

Senator PRATT: So in terms of the enterprise bargaining agreement processes, will you be using that assessment to look at this greenfields policy?

Ms Durbin : If I understand your question correctly, the Boston Consulting Group process that we talked about is just looking at single enterprise bargain making. It's not looking at greenfields, which is a separate bargaining process.

Senator PRATT: So you don't know yet how many unions have been contacted by Boston Consulting Group. I'm aware that perhaps one or two have, but it seems pretty extraordinary to me that—you say they're going to report on 8 November. Is that right?

Ms Durbin : That's correct.

Senator PRATT: So if people wanted to have input into working through this or putting their view about how bargaining works—and it can be very different in different parts of the economy, even though they're all working within the same laws—how do you make sure that what Boston Consulting maps out matches the diversity of what actually happens in the bargaining process?

Ms Durbin : Again, Senator, it's around the scope of this exercise, which really is around the process mapping. This is step 1, in terms of what will be an ongoing consultation process. Should the government wish to go forward with further ideas or reforms in the bargaining space there would be lots of further opportunities. This is purely just process mapping, building in some of the user-centred design principles that Mr Hehir talked about.

Mr Hehir : Certainly my recollection is that Boston Consulting have been in contact with at least four unions, and they're spread across a range of industries.

Senator PRATT: Are you going to tell us which four they are?

Mr Hehir : I can, but I'm going to need to search my document.

Senator PRATT: I'm sure they can probably tell us. I am concerned that the scope of how bargaining happens is pretty diverse. Are you going to make the mapping process public? Are you going to consult on whether you have got it right before the government leaps into making policy decisions based on what that mapping process looks like?

Mr Hehir : Do you mind if answer your previous question?

Senator PRATT: Go for it.

Mr Hehir : The four unions that have agreed to date are the AMWU, the AWU, the IEU and the ANF. Sorry; apparently I have a further email, which I will check, but that's is my understanding at this point. I'll clarify that if I need to. But they go across a range of sectors.

Senator PRATT: Okay. And would those unions be aware that not all unions have been invited to participate in this process? That they've been singled out as—

Mr Hehir : They've been approached based on their membership of the Fair Work Commission consultative group.

Senator PRATT: So all members of the consultative group have been asked to participate in this?

Mr Hehir : I'd need to check that as that isn't quite what I said. I said that they've been approached based on their membership of that consultative group. I'd need to check to see whether everyone has been approached.

Ms Durbin : At this point, no, they wouldn't. As you can tell by the fact that we are checking emails, it's actually underway at the moment. I know my staff are in the process of doing it throughout the morning, so I doubt they have completed it.

Senator PRATT: In terms of the invitations to unions to participate?

Ms Durbin : Yes.

Senator PRATT: So that's not being done by Boston Consulting. That's being done by the department or the Fair Work Commission, because they're members of the consultative group?

Ms Durbin : That's right. My recollection is we were providing an opening in terms of the department having engaged the consultant, and then the follow-up mechanics of organising meetings is being handled by the consultant.

Senator PRATT: We seem to have gone round in a little bit of a circle, because I asked quite clearly: who was being asked? You said, 'We're going to do it through the consultative group.' Therefore, it sounded like it was at arm's length from the department, but clearly that's not the case. What is the rationale for approaching these unions and not other unions? Is it just because they're members of the consultative group?

Mr Hehir : When we looked at this matter, we thought the most appropriate mechanism was people who were already part of the consultative group. As Ms Durbin has just said, we are facilitating the invitation. We're not sure how well known BCG is to some of the union groups, so we're opening the discussion with them to say whether they'd be interested or not. And then it's over to the consultants to go from there. All we're doing is the introduction and testing their interest, and then we're back out of it.

Senator PRATT: But you're expecting who you've approached is going to be representative of the diversity of bargaining that takes place?

Mr Hehir : We're looking to get a range of views, including people who have recently bargained, people who are part of the consultative process who understand the bargaining system well. We're also looking to engage with people who may not have bargained recently, who may have bargained previously but not recently, to talk to them about why they may not have bargained recently. So we're looking for a range of views to inform it. It's part of normal process that I'm used to in looking at user centred design processes.

CHAIR: Senator O'Sullivan has a quick clarifying question.

Senator O'SULLIVAN: So, a future discussion paper would be created on enterprise bargaining—is my understanding correct that the work that Boston Consulting are doing is going to be used in that discussion paper so that there can be a broader discussion, so it's not just narrow?

Mr Hehir : That will depend. If there's nothing that comes out of this discussion process in terms of possible improvements to the bargaining process, then there may not be a discussion paper on it. That's still to be considered. This is a technical piece to identify if there are possible improvements.

Senator PRATT: In context of why this review has been divided up into all of these little pieces, is it because you don't want to reveal the scope of the agenda? It's just that it demonstrates that the government is being quite secretive about its approach to industrial relations.

Mr Hehir : In terms of the approach being taken, it's been determined by the Attorney-General. I think the fact that we're having discussion papers out there, that we are seeking to engage as broadly as we can, would say that's not a secret process.

Senator PRATT: No. But we don't know what's coming up as far as the rest of the agenda because there are no terms of reference and no scope for the review.

Mr Hehir : As I said, the minister's been clear and the Prime Minister's been clear on the need for an evidence base, so they're looking to identify where there are possible improvements. I think in the CEDA speech the Attorney said that there's got to be a will to do this as well, so there's no point in taking forward ideas that aren't going to be able to be progressed. So they're looking to try to establish an evidence base about what can be done.

Senator SHELDON: You've mentioned some unions that you've spoken to. Have you looked at unions that are covering the new economy? Have you looked at unions that are in the nursing profession? Have you looked at unions in the servicing industry? We've just had a long discussion about the exploitation of migrant workers. It seems like there's a very narrow cast—of course, we're not aware exactly what the details of those discussions are as yet.

Mr Hehir : I need to clarify. I'm told that, with the update that Ms Durbin referred to, the AMWU is not participating; it is the AWU, the IEU and the ANF, so, yes, the nurses' federation is included. I'm not sure this is the final list; this is the list to date. As Ms Durbin said, our team are reaching out to engage further. I can come back with further information because we don't have a finalised list yet. As I said, we are approaching this from the existing Fair Work Commission's consultative group because they're already established and they know. There are also some broader issues that we're looking for in terms of some of the employer reps, including those who have engaged recently and those who haven't engaged for a while in terms of the bargaining process.

Senator PRATT: Have you started drafting a greenfields bill?

Mr Hehir : No.

Senator PRATT: You haven't started to draft the greenfields agreement bill?

Mr Hehir : That's correct.

Senator PRATT: No, even though the minister's made clear his like and support for that and you're engaging in a consultation process. Is that consultation process going to be based on the evidence or the minister's opinion of these issues?

Mr Moraitis : That's why we had a discussion paper go out—to get as much evidence as we can with some clear questions. In the case of the wage theft and criminalisation process, there was a corpus of evidence that was a sufficient basis to start on the process.

Senator PRATT: What I am worried about, Secretary Moraitis, is that the government has a consultation process for these discussion papers that is entirely in a written form and that is all the department is doing. In the meantime, we know what the government's natural constituency base is and who they're talking to and who they have active conversations with. I just worry about what has more weight in the final outcome on these issues. How do we see where the weight of balance comes through on these questions?

Mr Moraitis : As you know, Senator, I'm pretty new to this, but I've watched the way it's been outlined and have referred to the terms of reference, and the terms of reference have been outlined by the team here and that provides a pretty balanced, broad approach. We're adopting a process that's, from my perspective, pretty clear. It's aligned with how we as a department in the past have done legal matters. We consult. We have discussion papers that go out that ask a specific series of questions where we can progress things while the consultation process continues. On the greenfields, yes, the attorney has been out there saying what his preference is, but he certainly—as I know from experience having worked now for over a year for him—looks at the facts and the evidence before coming to a conclusion.

Senator SHELDON: So who are the employer groups that have been consulted?

Mr Hehir : I'm sorry, I don't have that list in front of me. I'm happy to take that on notice.

Senator SHELDON: Righto. I just wanted to clarify a question from before in the answer to the ensuring integrity bill and the comments from the minister in the House, which I was referring to before. I've got a copy of Hansard here, which may be of assistance to Senator Payne. I can read—

CHAIR: Are you able to table that?

Senator SHELDON: I'm happy to table it. I referred to it before. In the grounds of 28G and with the understanding that the minister has made a series of suggestions that associated interested parties, the minister and the registered organisation commission can make application—there's an expanded piece of legislation being proposed. The minister, in Hansard, said that it's not correct, that it's fanciful to say that one issue can be used for de-registration. In a reply, the minister said that, under the existing legislation, this new regime of deregistering unions is now not so fanciful, and it certainly is correct to say that if a union, such as the nurses union, were to take action regarding patient-nurse ratios, they could be deregistered.

Ms Volzke : Senator, if I can just unpack that. The way that the test works for deregistration is that the onus is always on the applicant to prove that, first of all, a ground has been made out and also that it would not be unjust to make the order that is being sought. So a mere assertion of a ground, whether it be the obstructive industrial action or another, will not suffice to meet that legal onus. Indeed, in relevance to the ground this we are talking to, 28G states:

(2) A finding of fact in proceedings in any court is admissible as prima 14 facie evidence of the fact—

Senator SHELDON: Can I put this to you: if a ground is found that there was illegal industrial action by nurses on patient-nurse ratios—evidence was given during the Senate inquiry that the unions identified that that action is likely to be seen as illegal industrial action—and the ground is found on one action to that case, an application can be made for deregistration of that union.

Ms Volzke : As I said previously, that instance of industrial action would have to have those additional characteristics in order to provide a ground under 28G, so it's not sufficient for it just to be the industrial action; it also has to have hindered or obstructed or had that substantial adverse effect.

Ms Kuzma : Could I just add to that. These bills are before another committee in terms of the technical detail, and I understand that committee is reporting on Friday.

CHAIR: I think we are going to move on from this area; I don't want to be in breach of standing orders. If Labor could move on to another area of questioning, please. Before you do, I think Senator Davey has a quick question.

Senator DAVEY: Just a clarifying question. On that very example that Senator Sheldon raised, am I right, though, in my reading of the legislation, that it is still the court that decides who is going the be deregistered? It's not up to the minister and it's not up to the applicant who has made the application for deregistration?

Ms Kuzma : Yes, that's correct.

Senator DAVEY: Thank you.

CHAIR: Back to Labor, please.

Senator WALSH: These questions relate to appointments to the Fair Work Commission, and I think they are for you, Secretary Moraitis. In December 2018, the former minister made six new appointments to the Fair Work Commission to replace one vacancy. Is that correct? Can you confirm that?

Mr Moraitis : I personally don't know. I'll have to get someone who is aware of that.

Ms Kuzma : Yes, there were appointments to the Fair Work Commission in December 2018.

Senator WALSH: My understanding is that all of those six appointments were individuals with employer backgrounds. Are you able to comment on that or confirm that?

Ms Kuzma : I think we would be able to provide you with information about the backgrounds that I think was released at the time of the appointments.

Senator WALSH: Thank you. My understanding is that those additional appointments brought the total number of appointments by this government to 20 appointments in a row of people who had an employer background, and I understand from your previous answer that you'd need to take that on notice. But can you explain to the committee what the process is for the appointment of commissioners to the Fair Work Commission?

Ms Kuzma : Certainly. I'll just pull up the legislative provisions about the qualifications. The qualifications are set out in the Fair Work Act, so we'll just pull that up for you. I won't be a moment.

Senator WALSH: What I'm interested in is whether the department is involved, whether it makes recommendations to the minister and how the appointments are made.

Ms Kuzma : So these appointments are made by the Governor-General. That is also set out in the act. For commissioners, it states:

(3) Before the Governor-General appoints a person as a Commissioner, the Minister must be satisfied that the person is qualified for appointment because the person has knowledge of, or experience in, one or more of the following fields:

(a) workplace relations;

(b) law;

(c) business, industry or commerce.

That is the qualifications for a commissioner. For a Deputy President, it states:

(2) Before the Governor-General appoints a person as a Deputy President, the Minister must be satisfied that the person:

…   …   …

(b) has a high level of experience in the field of workplace relations, including a high level of experience that has been acquired:

(i) through legal practice; or

(ii) in the service of a peak council or another association representing the interests of employers or employees; or

(iii) in the service of government or an authority of government; or

(iv) in academia.

That is section 627 of the Fair Work Act.

Senator WALSH: Are you aware or able to speak to what process the minister goes through to satisfy himself or herself that the potential commissioners to be recommended to the Governor-General meet those criteria?

Ms Kuzma : I think that, if you look at the qualifications that were announced at that time, the minister was satisfied on the basis of the qualifications of those individuals.

Senator WALSH: Is the department involved in making any recommendations to the minister, or is it purely up to the minister to make that determination?

Ms Kuzma : The statutory process is that the minister makes a recommendation to the Governor-General and the department supports that briefing process.

Senator WALSH: I think this question, then, is for the minister representing the minister. Can you give an assurance to this committee that all future appointments will be made not only in the spirit of appointing on the basis of merit but also with the spirit of maintaining the balance between employee representatives and employer representatives?

Senator Payne: I'm sure that the minister and the Attorney-General will propose appointments that are in accordance with the fair work legislation.

Senator WALSH: Does that mean that the minister doesn't think it's important to maintain balance between employer and employee representatives?

Senator Payne: No. I think that would be a completely unfair imputation. I think the fair work legislation outlines, as the officers have provided to you, the qualifications and requirements for members of the commission, and you would also always expect the minister to make appointments in accordance with the act.

Senator PRATT: Has the minister's office been the one supplying the names to the department, or have all of the appointments been generated by the department and put up to the minister?

Ms Kuzma : I'd have to take that on notice, Senator, from December 2018.

Senator PRATT: Secretary Moraitis, you'd be familiar with similar debates on appointments in the context of the AAT et cetera.

Mr Moraitis : I'm having echoes of other contexts, yes.

Senator PRATT: Can you outline at which point the minister influences this decision? Are these all the appointments that were made?

Mr Moraitis : You're alluding to the appointments of December last year as outlined? This is all based on my assumptions about how the department would work. They would prepare the paperwork for the minister's office to go to Executive Council and, in the case of the Attorney-General Department, we're usually informed of decisions and names and CVs and issues such as that or conflict-of-interest issues, and then we process that based on advice that we've been given by the relevant minister. In the case of the AAT, that has happened. There've been some changes, which we outlined yesterday.

CHAIR: We might break for now and then come back for 10 minutes.

Senator WALSH: Chair, can I just finish with one question on this?

CHAIR: Okay, as long as it's one question—not a Deb O'Neill one question!

Senator WALSH: I promise. I just want to conclude my question to the minister, and thank you for your previous responses. Do you think that 20 appointments to the Fair Work Commission of employer representatives represents merit and balance?

Senator Payne: I think that the appointments to the commission should be in accordance with the requirements of the legislation—the fair work legislation in this case—and I am confident that Attorney-General Porter is making appointments in that way.

CHAIR: On that cheerful note, we will break for afternoon tea. We'll have 10 minutes left of this group.

Proceedings suspended from 15:30 to 15:45

CHAIR: Thank you very much. We have 10 minutes left in this section.

Senator WALSH: These questions follow on about my questions about appointments to the Fair Work Commission. These questions are about appointments to the Fair Work Commission expert panel—that is, the panel that determines minimum wage and award rates for millions of Australians. We've heard, in the previous section, about concerns about the number of appointments with employer experience and the complete absence of any appointments, as far as we're aware, of any commissioners with employee advocacy experience. Can the department confirm that there are vacancies on that Fair Work Commission expert panel that will need to be filled and the number of those vacancies?

Ms Kuzma : Yes, there are vacancies on the expert panel.

Senator WALSH: Again, this expert panel deals with the needs of, particularly, low-paid workers, many of whom are on full-time wages of around $38,000 a year, so well below the poverty line and in many cases doing it tough. I'm sure everyone would agree that they need attention and assistance. My question for the minister is: will the minister give an undertaking to maintain balance on the panel between people with employer experience and people who have experience and knowledge of the needs of low-paid workers or employees in general?

Senator Payne: The minister would always make appointments consistent with the Fair Work legislation, but, in relation to the specific vacancies that you're asking about and prospective appointments, I will take that on notice. The minister will always make appointments according to the requirements under the law. I think that that is the appropriate rubric under which the minister should operate.

Senator WALSH: Do you think that, particularly in the case of assisting the Fair Work Commission to make a decision in relation to the wages of very low-paid workers, that it would be appropriate, if not entirely required by the act, for the minister to ensure that there are employee advocates or people with experience of advocating for low-paid workers on that panel?

Senator Payne: It is not necessarily for me to say what is or is not appropriate from the perspective of your question. What I have said and will consistently say is any minister will always make appointments that are consistent with the requirements of the legislation, which is the Fair Work legislation in this case. I'm sure Minister Porter will take that approach.

Senator WALSH: So, Minister, if it were consistent with the act to appoint six employer representatives to that panel, you would think that that would be appropriate?

Senator Payne: I said that the minister should always make appointments consistent with the requirements of the legislation.

Senator WALSH: Could you assist us to understand how the minister might go about making recommendations for appointments to this panel? What are the considerations or the processes that he might undertake?

Senator Payne: I can't speak for the Minister for Industrial Relations in terms of what might be in his mind on that, but I can take questions of that nature on notice.

Senator WALSH: We talked before about the review into industrial relations. We know that wage growth across the country is very low. We know there is a particular struggle for people who are on award minimum wages—people who are low-paid workers. Is it the intention of the government to give special consideration to the needs of low-paid workers in its review of industrial relations?

Mr Hehir : The topics for discussion papers haven't been finalised; I can't pre-empt what the minister's intention is for that. I note that the Fair Work Commission, in its minimum-wage decisions over the past three years—of course, minimum-wage decisions then flow into the awards—has made increases by three per cent or above. So, in actual fact, wages set by the independent body for minimum-wage and awards increases have been higher than the average wage increases.

Senator Payne: And, as I said earlier in response to a question from Senator Sheldon, the Attorney-General and the Minister for Industrial Relations has said that there are three criteria against which to measure the addressing of potential reform: driving of jobs and wages growth; boosting productivity and strengthening the economy; and ensuring the protection of employees' rights. That is the focus of any potential reform.

Senator WALSH: Is there scope in the review to consider how low-paid workers might be disproportionately locked out of the bargaining system and to consider measures that might assist low-paid workers? Do we understand that that may be a strong focus of the review?

Mr Hehir : I might be able to give an answer to a previous question which might help with that. The unions that we're contacting which are from the Fair Work Commission's consultancy group—my understanding is it is the User Group—are the AMWU, the ANMF, the AWU, the CEPU, the CFMMEU, the HSU, the IEU, the CPSU, the SDA, the NUW and UV—so United Voice. So there are quite a broad range of unions and representatives—

Senator PRATT: That's in relation to the bargaining stakeholder assessment?

Mr Hehir : I think that's where the question was going in terms of the bargaining process. It's entirely possible that United Voice, for example, may say, 'We have trouble at bargaining.' I don't want to pre-empt them, but there is that possibility given the range of people contacted.

Senator WALSH: Thank you.

Senator SHELDON: That doesn't include peak employee bodies?

Mr Hehir : That's the list of unions that we're contacting; as I said before, we're going through that process at the moment. I don't have the list in front of me for the—

Senator SHELDON: I just note it doesn't include all the unions in the gig economy area, in that future-of-work area. Since the Fair Work Commission ruling in 2017, penalty rates in the retail, fast-food, hospitality and pharmacy sectors have been abolished in wages for hundreds of thousands of workers across the country. The final cut to penalty rates in the pharmacy sector is due to take effect on 1 July 2020. How many extra jobs have been created through the cuts to penalty rates that have already occurred?

Mr Hehir : I can start on that question before I pass to Ms Durbin. The penalty rates weren't abolished; they were reduced, my understanding is, for Sundays. In addition to that, the Fair Work Commission has more recently increased penalty rates for casuals in some awards. So it hasn't been a universal cut; we've had increases and decreases. It was, from my recollection, for awards and Sundays only. In terms of the substance of your question, in terms of jobs, I might pass to Ms Durbin or Ms Wang.

Ms Durbin : As you know, both the Fair Work Commission, as part of its four-yearly review, and the Productivity Commission, prior to that, looked at the issue of penalty rates. Both indicated that it was their view that changes to Sunday penalty rates based on the issue around the disutility of Sunday would increase services for consumers and therefore lead to a range of other changes, including an increase in jobs and hours. The issue we have is that it is very difficult to measure that, because you can't detangle the range of economic factors that change over time, and employers' behaviour is obviously influenced by a very wide range of factors.

There are other issues. As Mr Hehir said, it is a subset of awards that apply across the retail, trade, accommodation and food services industries—so it was not all awards. Similarly, it was not all workers under those awards; for example, casual employees under the hospitality award did not have their penalty rates affected. Similarly, the changes to the fast-food award only applied to one level of employees; it didn't apply across the board. So not all workers under those awards were affected anyway.

As you just indicated, Senator, the Fair Work Commission made a decision to phase in the changes to penalty rates. A number of those awards have now finished the transition, and a number of the awards are now in year 3 of a four-year transition—so there was a phased approach. The commission also took the decision that changes to penalty rates would come into effect on 1 July each year; that is the same time that the annual wage review decisions also come into effect. As Mr Hehir said, those decisions by the Fair Work Commission have seen award wage increases of at least three per cent over the last three years. That's a long answer to say that, unfortunately, we cannot detangle the effects to provide a quantitative indication of the change.

Senator SHELDON: Thank you. The Council of Small Business, which has given subsequent consideration to the question of jobs being created as a result of penalty rates being abolished, says:

There's no extra jobs on Sunday. There's been no extra hours. Certainly, I don't know anyone ... It's been just a waste of time.

That was on 26 April 2019. What new research have you taken out—or do I take from your answer that there is no research that verifies the fact that one single job has been created from tens of thousands of workers losing their weekend penalty rates?

Mr Hehir : That wasn't quite the evidence given by Ms Durbin. Her evidence was that it isn't possible to detangle all the other influences that are happening. The economy doesn't operate in a steady state. There are a number of other factors that can change at any point in time, and it's impossible to detangle those effects from each other when we look at what the actual job numbers are.

CHAIR: The committee will now move on to the next section. We will release the Industrial Relations group within the Attorney-General's Department. Thank you for coming along this afternoon.