Bad Gig: industrial relations “reform” bill delivers flexibility … for employers

by | Dec 15, 2020 | Economy & Markets

When one-third of casuals work full-time hours, almost 60% have been with their employer for more than a year, and more than half cannot choose the days they work, is the “flexibility” of a casual job really for the benefit of employees? Professor David Peetz reports.

The federal government’s industrial relations “reform” bill offers a new definition of “casual” employment that creates more problems than it solves.

The new bill effectively defines a casual job as anything described that way by the employer at the time a job commences, so long as the employer initially makes “no firm advance commitment to continuing and indefinite work”.

I’ve drilled into previously unpublished data from the Australian Bureau of Statistics to get a better sense of what “casual employment” means for those employed as such.

What I’ve found suggests “casual” employment is not about doing work for which employers need flexibility. It’s not about workers doing things that need doing at varying times for short periods.

The flexibility is all about the employers’ ability to hire and fire, thereby increasing their power. For many casual employees there’s only permanent insecurity. And rather than solving permanent insecurity, the bill will reinforce it.

Furthermore, under the bill anyone in a casual job will lose any entitlement to leave they might otherwise have got thanks to two recent Federal Court decisions. These found that employees improperly treated as casual workers were entitled to holiday and sick leave.

Theory versus reality

The ABS data I’ve analysed includes statistics collected before 2012. But since the proportion of employees without leave entitlements has been relatively stable since the mid-1990s, the results remain relevant. They show:

  • about 33% of “casuals” worked full-time hours
  • about 53% had the same working hours from week to week, and were not on standby
  • about 56% could not choose the days on which they worked
  • almost 60% had been with their employer for more than a year
  • about 80% expected to be with the same employer in a year’s time and
  • just 6% of “casuals” work varying hours or are on standby, have been with their employer for a short time, and expect to be there for a short time.

There are many reasons to question whether an employee without leave entitlements could really be defined as a genuinely flexible casual worker. It’s better to call them “leave-deprived” employees.

Casual definitions

Technically the ABS does not routinely estimate the numbers of casual employees. For a few years (to 2013) it published data on workers who received a casual loading, and it occasionally asks people to self-identify whether they are casuals. But mostly its data on “workers without leave entitlements” (collected quarterly) is used as a proxy measure of casual employment.

About 24% of Australian employees were in this boat in 2019 – a high proportion compared with most other industrialised countries.

Australian workers without leave entitlements

A common feature: powerlessness

The common features of all leave-deprived employees are permanent insecurity and low power.

Leave-deprived employees are about twice as likely as “permanent” workers (those with leave entitlements) to have variable hours. But almost all “permanent” workers with variable hours have a guaranteed number of minimum hours. Yet less than a third of leave-deprived employees have that guarantee.

Overall, 27% of leave-deprived employees have variable hours and no minimum guarantee of hours. That is the case for only 2% of “permanent” workers (see chart).

Permanently casual, permanently insecure

We can think of variable hours as reflecting employers’ flexibility needs, and a guarantee of minimum hours as reflecting employees’ power. The big difference between leave-deprived employees and “permanents” is in the power employees have.

Sometimes you hear the term “permanent casuals”. They should more accurately be called “permanently insecure”.

Casual loading

Another sign of low power is how few leave-deprived workers receive the casual loading – the 25% extra pay meant to compensate them for their lack of leave entitlements.

When the ABS used to ask about casual loading, less than half of leave-deprived workers said they got it. That’s hardly surprising, given how often breaches of awards have been uncovered.

study published in 2019 found low-paid leave-deprived workers in Australia, on average, were paid less than equivalent “permanent” employees.

Low power is what should be expected when an employment contract only lasts as long as the current shift. A worker might not even get formally terminated, just not be given any more hours.

Why have casual employment?

There may be good reasons to have casual employment when work is genuinely intermittent and uncertain.

But that’s not the case for most leave-deprived jobs. They are, instead, long-term and stable – yet still insecure for the employee. The only flexibility in them lies with the employer’s power to withhold work.

Allowing employers to overrule previous court decisions and define who is and is not a casual, as proposed in the current bill, will not overcome any of these problems.

Instead, it will just entrench the practice of employers using “casual employment” to increase their power.

This is an edited version of an article that first appeared on The Conversation. Republished with permission.

ABOUT THE AUTHOR

David Peetz

David Peetz

David Peetz is Professor of Employment Relations in the Centre for Work, Organisation and Wellbeing at Griffith University. He previously worked at the ANU and in the then Commonwealth Department of Industrial Relations, spending more than five years in its Senior Executive Service.

1 Comment

  1. Avatar

    Thank you for your article David, and finally highlighting what many ‘casual’ employees have known for the past 20 years.
    This has been endemic in both Private and Government institutions, and Government has certainly set the standard here, which it continues to this very day.

    The fact that taxpayers money is used for ‘Economic’ reports by the big four KPMG, PWC, EY and Deloitt’s is another ruse that is used to justify these flawed ‘policies’ in conjunction with their supposed ‘Audit’ work for the Corporations involved in this chicanery, is and has been a clear conflict of interest.

    “But that’s not the case for most leave-deprived jobs. They are, instead, long-term and stable – yet still insecure for the employee. The only flexibility in them lies with the employer’s power to withhold work.”

    With all and sundry skimming off every benefit that was meant to be paid as part of the award and trade-offs, $25:00 an hour flat rate does not make up for lack of annual leave, sick leave or other direct costs that must be borne by the ‘contractor’, fuel, motor vehicle repairs and insurance overheads https://www.paycalculator.com.au/classic/ the example I have used here is for 2016-2017 which is the year that I ‘officially’ retired.

    Welcome to modern day slavery in all forms and variations. I will turn to John Ruskin for the final observation:

    “It’s unwise to pay too much, but it’s worse to pay too little. When you pay too much, you lose a little money – that’s all. When you pay too little, you sometimes lose everything, because the thing you bought was incapable of doing the thing it was bought to do. The common law of business balance prohibits paying a little and getting a lot – it can’t be done. If you deal with the lowest bidder, it is well to add something for the risk you run, and if you do that you will have enough to pay for something better.”

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