Workers’ experiences under the Howard Government’s industrial relations laws
Decent rights in the workplace are critical to Australian workers and their families. This booklet tells the stories of just a few of a small number of Australian workers who have suffered injustice or unfair treatment in their workplaces. But these stories are indicative of the experience of the thousands of Australians whose jobs and working conditions have already been affected by unjust or unfair treatment.
The case studies focus on unfair dismissals and individual contracts or Australian Workplace Agreements (AWAs). These two issues directly affect job security and the wages and conditions of working people. The Howard Government’s proposed changes to workplace laws will expose many others to the risk of losing their job in totally unreasonable circumstances, and being forced to accept individual contracts that cut pay and working conditions.
Unfair dismissal laws protect people from being dismissed for a reason that is harsh, unjust or unreasonable. The vast majority of applications are settled before they go to a full hearing – usually because it is blatantly obvious that the employer has done the wrong thing. If unfair dismissal laws are taken away, bad behaviour by employers like that described on pages 2 and 3 will be considered acceptable. Should we encourage this sort of mistreatment of Australian working people, many of whom rely on each week’s pay just to keep their heads above water?
AWA individual contracts were introduced by the Howard Government in 1996. These individual contracts were specifically designed to make it easier for employers to drive down wages and conditions of employment. Although in theory AWAs are, overall, meant to be at least as favourable as the award, this has not been many people’s experience. The proposal to remove any requirement to meet award standards will allow more employers to use AWAs to cut take-home pay and extend working hours. AWAs have also been used to intimidate workers. Although it is technically illegal, the offer of an AWA is often accompanied by the threat of dismissal or retribution if it is not signed.
These stories show that AWAs are not about negotiation and choice – they are about allowing employers to intimidate individual employees to accept less favourable working conditions.
More facts about unfair dismissals and AWAs are on page 8.
There is no economic or social justification for making the lives of working families even harder.
With the Government’s proposal to remove most basic work rights many more workers will be exploited, bullied and treated unfairly. Is this the sort of country we aspire to live in?
The case studies have been collected from calls to the ACTU’s call centre, unions and community legal centres. Most of the case studies are anonymous because the people affected are in vulnerable work situations or are worried that speaking out will harm their job and career prospects. The settlement of most unfair dismissal cases also includes a confidentiality agreement, restricting those workers’ capacity to tell their story and name their employer. Accordingly, all names have been changed in the short case studies.
Natalie worked at a warehouse which employed ten people for about three years. She started as a customer service officer and was promoted to accounts manager and then national sales manager, earning around $39,000 pa full time, working around 50 hours a week. She was often praised for her performance. One Monday, Natalie came to work early for a staff meeting with four other staff, including the owner of the business. Natalie mentioned that warehouse staff were reluctant to work with a particular product as it contained a toxic chemical. The owner became angry and threw a glass across the table, which hit Natalie in the chest. The owner then screamed “Get out and don’t come back” and swore at Natalie in front of the other staff. Natalie was able to negotiate a settlement of six weeks pay compensation.
Dismissed after questioning pay or entitlements
Jane had been at her workplace for four and a half years when she questioned whether she was being paid correctly. The employer then called her to dismiss her, saying that he couldn’t possibly work with Jane any more because she had questioned him.
Tom, 17 years old, was a part time waiter at a pizza restaurant for 15 months. Tom complained to his employer about the conditions, about being paid cash in hand and not being paid penalty rates or overtime. After he complained Tom was sacked.
Valerie, 54 years old, was a full time manager at a small transport company. She had worked there for over two years and had never been paid any superannuation. Valerie raised the issue of the non payment of superannuation with her employer before she went on annual leave. Valerie’s left abusive messages on her mobile phone while she was on leave. When Valerie returned she was asked to go on annual leave again the following week. While on leave she was not paid. When she contacted her employer about payment for the annual leave he was abusive and dismissed her over the phone. Valerie was also told to come into the office the following week to return her key and security pass. She went to the office as requested, with a friend as a witness, and was verbally abused by her employer. Valerie was very distressed about her employer’s behaviour.
Replaced by employer’s relative just before qualifying for long service leave
Ana was an administrative worker for a small company. Two months before her long service leave was due she was sacked. The reason given for her dismissal was that her employer’s niece was coming into the business.
Fred, in his 60s, worked as a permanent part time gardener at a recreational facility. He was dismissed from his job by the Board of Management. Fred was given no warnings about his performance. Fred’s job was given to a Board member’s son. Fred had been there for nearly ten years and was not far from qualifying for long service leave. He challenged his dismissal and got his job back.
Bullied by supervisor and told to leave
Mandy was an accounts receivable clerk, working directly for a financial controller who bullied her and other staff. The staff, including Mandy, complained about this behaviour to management who refused to do anything. Mandy found out that her job had been advertised as a vacancy in the newspaper. When Mandy went to the manager he told her they were getting rid of her because she can’t get on with the financial controller.
Sacked after miscarriage
Helen had been working as a receptionist at a medical practice for just over ten months. During this time she had a miscarriage and had to attend several follow-up medical appointments. The employers made it difficult for her, and were not happy that she had to leave work for these appointments. One day Helen was upset and teary at work and notified her supervisor that she needed to take a break. She was gone for an hour. She was then accused of abandoning her position and dismissed for this reason. Helen lodged an unfair dismissal claim. At the conciliation conference the employer raised a number of performance issues that had never been raised with Helen before. The matter settled and Helen received 13 weeks compensation.
Dismissed due to child care commitments
Suzy, 35 years old, was a clerk at a local wholesale company for over a year. She worked between 10 am to 4 pm, which suited her child care arrangements. Suzy’s employer asked her to extend her hours to 5 pm. When she said she couldn’t because of the high cost of after school care, Suzy was told she had to do the extended hours or leave. She refused and was dismissed.
All of these employees would lose their legal protection from unfair dismissal under the Howard Government’s plans to exempt workplaces with less than 100 employees. Some of these employees may not currently have access to unfair dismissal relief, for example because they were serving their probationary period, but all of their dismissals highlight the kinds of harsh practices that working people have to contend with in today’s workplaces.
JODIE WAS SACKED FOR GOING TO HER SISTER-IN-LAW’S FUNERAL Sales assistant Jodie Heffernan had a lot on her mind when she applied for a full time job with an automotive parts franchise in Adelaide.
Jodie’s sister-in-law had been fighting cancer for 18 months and was only expected to live for a few more weeks. Despite her worries, 23 year old Jodie got the job and started as a probationary employee.
Three weeks later, Jodie told her manager that her brother’s wife was close to death. She asked about arrangements to attend the funeral and was told she would have to take leave without pay because she was on probation.
Jodie’s sister-in-law died two days later. The store manager was away, so Jodie notified three other senior staff members about the funeral date. She was told to ask if her workmates could swap shifts but no one was available, so the assistant manager asked Jodie to make a note in the staff diary and said he would find a replacement.
“He also told me I could take an extra day off after the funeral to spend with the family,” said Jodie. “I was emotionally wrecked on the day of the funeral. I rang work at 4pm to ask if I could take the extra day off so I could be with my brother. The store manager blasted me. He said I had let him down because I didn’t tell him about the funeral. I said I had told three other people and put it in the staff diary.
“Then he said he would have to start looking for someone else. I said it wasn’t my fault, but that was it. I was in tears, I felt horrible. I got back from the funeral and I had no job. My family were horrified.”
“The boss said I was a really good worker and that he would give me a reference. But why sack me? Part of me feels like this was a set-up. I was brought up to do the right thing — and I did the right thing. I’ve been out of work now for a month and I’m going crazy.
“My mother returned my uniform yesterday because I didn’t want to go back in there. People like them make it hard for people like me to get jobs. These new laws are ridiculous because it will be even harder.”
AMIE WAS SACKED WHILE SHE WAS MINDING HER SICK DAUGHTER
Single mother Amie Howes was sacked from her job of five years on the day she stayed home to care for her sick daughter.
Amie’s five-year-old daughter Natasha had spent the night vomiting. The next morning, Amie telephoned the Adelaide real estate office where she worked and told the office manager she needed to take Natasha to the doctor. In the afternoon, the office manager arrived at Amie’s house and handed her a letter of dismissal.
“I had no idea she was coming,” said Amie. “I was shocked, I didn’t know what to think. I felt powerless because I couldn’t do anything. My boss had signed the letter but I couldn’t contact him because he had gone on holiday that day. The office manager said I was sacked because my work was too slow. She told me not to go back to the office and collect my stuff. She told me I had to wait until the weekend so no one would know.”
Two weeks before, Amie had asked the office manager to approve a one off change to her lunch hour so she could attend a function at her daughter’s school.
“The office manager refused. But I took it to the boss, and he said yes. I think the office manager was upset with me for doing that. This was nothing to do with my work, it was personal. I’m good at my job.
“When I was sacked, I was most worried about paying the mortgage — I didn’t want to lose my house and I didn’t know how I would pay the bills. I feel disgusted. You can’t play with people’s lives like that.”
Amie was lucky. She found another job a few days later and has not filed an unfair dismissal claim against her employer. But she opposes any legislation that will remove unfair dismissal protection from Australian workplaces.
“I don’t understand why we would need these new laws. Why should it be easier for someone to be sacked? We need better systems and I think we should all kick up a stink.”
AUSTRALIAN WORKPLACE AGREEMENTS
Forced to leave after not signing AWA
Susannah was a permanent part time employee at a large city bookstore for over two years. She worked three days a week and minded her granddaughter the other two days.
Management called a staff meeting to advise that they would be distributing AWA individual contracts and made it clear that people were expected to sign them and told not to discuss them with each other. The AWAs had no weekend or public holiday rates, two weeks annual leave, and cut bereavement leave cut from seven to three days. When the union came to talk to employees about the AWA they were not given the chance to do so and information left by the union was put in a cupboard. When Susannah found the information and gave it to staff she was told off.
Susannah handed back her AWA, refusing to sign it. Shortly afterwards she was told she was no longer permanent part time and would be casual, working half a day 5 days a week. When Susannah said she could not do so because of her child-minding commitments, she was told this was her problem. She asked if this was being done to force her to leave and was met with silence. Susannah decided to leave and did not take any further action at the time. Her mother was dying and she was very demoralized by the whole experience.
Threatened with dismissal if did not sign AWAs which removed weekend and public holiday rates
Heather was a casual cleaner in a small country town, working regular part time hours for over two years. Her employer presented her with an AWA individual contract that took away any entitlement to penalties such as weekend rates and public holiday rates. Heather was told if she didn’t sign the AWA she would lose her hours or be dismissed. She was worried that she would not be able to find other work in the town, so she signed the AWA.
Joan, 58 years old, had worked as a cook for nearly ten years, early morning to lunchtime Wednesday to Sunday. Joan’s employer handed her an AWA individual contract to look at overnight and told her if she refused to sign it she could look for another job. The AWA provided no sick or annual leave, no public holiday penalties, and she would have to be available on call seven days a week until 10 pm.
Anne, in her 50s, was part time sales assistant. She and other employees were presented with AWA individual contracts which changed their pay structure, removing cash bonuses and weekend pay rates. Anne worked primarily on weekends so this would have a big impact on her take home pay. Her employer told Anne if she refused to sign the AWA her wages would be reduced from $16 an hour to the minimum rate of $13 per hour. Other employees were threatened with dismissal if they refused to sign.
Sacked for not signing AWA
Jared, 19 years old, was a casual security guard working full time hours for two years. He was called into a meeting with his employer where he was given an AWA individual contract and told he had to sign it. Jared asked whether he could read the AWA and seek advice on it. His employer refused his request, threatened him and then sacked him. Jared then agreed to sign the AWA and got his job back.
A rural mushroom farm gave 45 employees AWA individual contracts which cut their pay by a quarter ($150 a week) by putting them on to piece rates. The five women who did not sign the AWA were sacked. After the union lodged unfair dismissal applications the women were given their jobs back.
Phil, a 52 year old father of three, had been working as a carpenter with the same company for 26 years. He refused to sign an AWA individual contract which would have cut his rate of pay, overtime pay and RDOs. A week later he was sacked.
Larry, in his 30s with three kids, had been a builder’s labourer with his company for around three months before he was told to sign an AWA, which had rates of pay lower than the right award rate, no paid leave and no allowances. He was the only one who didn’t sign the AWA, and was told not to come in the next Monday. The union started an unfair dismissal action and the company reinstated him. When Larry returned to work he was given different tasks and isolated from work mates. Eventually Larry suffered severe stress and had to stop work.
Wages cut after not signing AWA
Nelly had been employed as a veterinary nurse for over ten years. She was presented with an AWA by her employer and told her if she didn’t sign her wages would be cut by $3 per hour. Nelly was also told that under the AWA she would not receive any long service leave. She didn’t sign the AWA and her wages were reduced.
Harassed after not signing AWA
Katie worked at a hotel as a cleaner for over two years. The hotel employed about 20 people. The owner decided that she wanted to put everyone on AWA individual contracts, which paid $2 an hour less with no benefits (such as paid leave). Under the AWA staff would have to pay for all breakages and any training was to be carried out on their own time and expense. The owner was very anti-union and hated the fact that Katie was in the union. Katie and another woman refused to sign the AWA. After Katie refused to sign the AWA, her boss embarked on a campaign of harassment against her, canceling her shifts at the last minute and increasing her workload, even goading Katie about her dead son. A few weeks later Katie’s doctor ordered her to stop work due to stress. The other worker who didn’t sign the AWA had her hours drastically reduced.
AARON HAD HIS SHIFTS CUT FOR NOT SIGNING AN AWA In the weeks after security guard Aaron Mulligan refused to sign an AWA, he fielded numerous calls at home from managers pressuring him to change his mind. He refused to yield and was finally sacked ten weeks after being offered the new contract.
Aaron and his flatmate, who both work at a Brisbane oil refinery, were the only employees to hold out against the AWA individual contracts. All their workmates gradually succumbed to relentless pressure from management at the security company.
“I lost count of the number of times they phoned me at home,” said 20-year-old Aaron. “The bosses said it’s just a piece of paper and that it didn’t mean anything.”
But that’s far from the truth. Under the AWAs, the security guards lose their overtime, sick leave, bereavement leave and long service leave, are downgraded from full time to part-time, and are placed on probation for three months after signing.
“One morning I finished work at 6a.m. and two hours later the security supervisor phoned me at home. He knew I would be tired but he still called me and told me to sign. They had my phone number in confidence and they abused that. We should be able to make our own decisions without them phoning us at home. I felt a lot of pressure, having all these people hammering me to sign. It’s not a nice feeling. The other guards said they wouldn’t sign at first, but they did because of the pressure.”
Aaron was vocal in his criticism of the tactics employed by his managers. Three days after he told his story to a television current affairs show, his name disappeared from the full-time roster. He was downgraded to five casual shifts a fortnight – cutting his pay packet by $800. Later that day, he received a letter saying he no longer had a job.
“I was on probation and I’m taking advice from my union, the LHMU, about an unfair dismissal case,” said Aaron. “I feel singled out because I tried to stick up for myself and I’m being punished. I will work part time as an undertaker to help in the meantime.
“If this is what companies can do now, how is this new legislation going to make it better for us. It’s already bad now, why make it worse? Everybody will lose. The only people who will make money will be the business owners.”
EMPLOYERS OF ALL SIZES ARE PUSHING PEOPLE ON TO AWAS
Telstra has had a long term aim to get people off collective agreements and on to AWA individual contracts. About 20,000 of its 38,000 employees are now on AWAs.
In 2001, Telstra was fined $74,500 when the Federal Court found that it had discriminated against its award employees Its group managing director of Employee Relations, Rob Cartwright, emailed his line managers urging favourable treatment for employees on AWAs.
Other tactics used to get people on to AWA individual contracts include:
New employees are only offered employment if they accept an AWA.
Managers often offer promotions or transfers within Telstra as ‘AWA positions’.
Employees have gone through spill and fill redundancy processes (referred to as ‘resource rebalancing processes’) and once successfully obtaining a position, were offered those jobs as ‘AWA positions’.
Telstra uses restructuring processes to move employees from collective agreement coverage to AWAs. For example, Telstra has created a new business unit, Telstra Country Wide, which only offers employment on AWAs.
Extensive salary packaging options are only offered to AWA employees. Non-AWA employees can only access salary packaging for superannuation.
Telstra managers’ performance reviews include assessment of the number of AWAs among the manager’s staff.
Telstra reduces its wage costs through AWAs in three ways. First, AWAs do not provide for fixed wage increases over their three year nominal life, leaving pay rises at Telstra’s discretion. Second, AWAs absorb statutory employer superannuation contribution into remuneration, distorting the amount of take-home pay provided to employees. Third, annual leave loading is included in the wage rate.
In addition, Telstra’s standard AWA allows it to alter or increase the working hours of the employee without limitation and for no additional pay, and allows Telstra to require the employee to work on any or all public holidays for no additional pay:
6.4 The actual hours of work may change from time to time. Your manager will notify you of any change to your hours.
6.5 Unless you are required to work, you will be eligible for paid public holidays There is no choice or flexibility for employees in respect of Telstra’s AWAs – Telstra does not allow employees to negotiate their AWAs at all. Its ‘Information Kit for Employees and their Managers’ states:
Can I vary the wording of my AWA? No, the wording in the body of the AWA must not be changed in any way.
The government appointed Chair of Telstra’s Board is Donald McGauchie, who championed the Farmers Federation’s involvement in the 1998 waterfront dispute.
The Minister for Workplace Relations’ own department, DEWR, is at the forefront of pushing people on to AWA individual contracts and refusing to bargain collectively with employees and their union, the CPSU. It employs over 2,000 people across Australia.
After the last federal election (where the Howard Government gained control of the Senate), DEWR made it a condition of employment for all new staff that they must sign an AWA individual contract. The corporate manager of DEWR, Jeremy O’Sullivan, has said (Herald Sun, 29 June 2005):
“People can decide where they work. In this department, new employees will only be offered AWAs”. DEWR AWAs remove access to dispute settling processes in the Industrial Relations Commission, reduce redundancy pay for those older than 45, remove allowances and alter salary progression to make it harder for workers to get ahead.
As with Telstra, managers’ performance benchmarks include a measure about how many of their employees are on AWAs.
These tactics are hurting staff morale. DEWR has the highest turnover rate in the public service, wasting taxpayers’ money on finding and retraining new staff.
Sunfresh Linen is a commercial laundry in Ipswich, Queensland, employing around 35 people. The management is strongly anti-union and has put all staff on AWAs. The AWAs state that employees are casuals, although many have been there for six years or more and work 3am-3pm, six days a week, earning $14.88 per hour. The award rate of pay for casuals is $16.
Sunfresh staff are also dismissed every Christmas and re-employed under a new AWA at the start of the next year, even though some have been there for 6 years or more.
The right to protection from unfair dismissal is an internationally recognised employment right: “An employee’s right not to be unfairly or unjustifiably dismissed is a modern cornerstone of the law relating to termination of employment”1.
Exempting small business from unfair dismissal law is almost unheard of internationally. In the two OECD countries that do have such exemptions, only microbusinesses are exempted – in Germany only those with less than 10 employees are exempted, in Austria it is less than 5 employees.2
Only around 1 per cent of dismissals in Australia are contested by unfair dismissal applications. This is much lower than other OECD countries. A similar figure in the UK is 7 per cent, in New Zealand 5.8 per cent, in Ireland 4.8 per cent.3
There is no evidence to support the Government’s often repeated propaganda that removing unfair dismissal laws will create more jobs:
“The committee finds that there is no empirical evidence or research to support the Government's claim that exempting small business from unfair dismissal laws will create 77,000 jobs. The proposition at the heart of this argument is breathtaking for its lack of logic and empirical support. A review of the evidence shows conclusively that the claims made by the Government and employer groups are fuelled by misinformation and wishful thinking rather than objective appraisal of the facts.”4
Employers use AWAs to reduce working conditions and to prevent unions from representing employees.5
AWAs are not good for families. Only 7 per cent of private sector AWAs contain improved family friendly provisions,6 and one in three (32 per cent) people on individual contracts are working more hours than they did two years prior7.
AWAs take away people’s basic entitlements: there is no provision for penalty rates in more than half (54 per cent) of AWAs, no annual leave in one in three (34 per cent) AWAs, and no sick leave in one in four (28 per cent) AWAs.8
Individual agreements provide lower wage rates to working people, in addition to taking away leave and other entitlements. According to ABS statistics, middle income earners on individual agreements are paid an average of $90 a week less than those on collective agreements.9
1 ILO, Termination of Employment Digest, 1998, page 11
3 OECD, Employment Outlook 2004, Table 2.1
4 Report of the Senate Employment, Workplace Relations and Education References Committee inquiry into Unfair Dismissal and Small Business Employment, June 2005, page 31
5 Van Barneveld and Nassif, Motivations for the Introduction of Australian Workplace Agreements, Labour and Industry, Dec 2003
6 Whitehouse, Australian Workplace Agreements and Work/Family Provisions, ACIRRT conference paper,
2001, page 8
7 Office of the Employment Advocate, AWA Employee Attitude Survey Report, September 2001
8 DEWR, Agreement Making in Australia under the Workplace Relations Act 2002-3
9 ABS, Employee Earnings and Hours, Cat 6306.0, May 2004. Median weekly total earnings for non-managerial employees on collective agreements - $904, on individual agreements - $814.