Australian inquiry wants more Fair Work powers to hold gig economy accountable

The Senate committee tasked with leading an inquiry into Australia’s gig economy for the past two years has released another set of findings. These latest findings contain various recommendations that look to minimise “Uberisation” — the exploitation of contractors by on-demand platforms such as Uber.  

“There will always be a place for genuine independent contractors in Australia’s workforce, but governments cannot allow companies to use technological and legal gymnastics to disguise what are essentially employment relationships as something they are not,” the Select Committee on Job Security wrote in its fourth interim report [PDF].

To address the exploitation of contractors, the committee has called for the Fair Work Commission (FWC) to gain regulatory powers that extend “beyond employment” so more accountability can be placed on on-demand platforms. 

The select committee envisions this expansion of the FWC’s remit would allow the regulator to set minimum wages, standards, and conditions for contracted workers that are commensurate with those enjoyed by employees; arbitrate contract termination disputes; and make orders relating to classes or groups of workers, such as to be able to order for a group of workers be classed as employees, not contractors.

The select committee had previously recommended changing the definitions of “employment” and “employee” in the Fair Work Act 2009, but decided to walk back from this recommendation after feedback that expanding the FWC’s remit would be better for minimising “Uberisation” without risking unintended consequences.

This latest recommendation marks the conclusion of the committee’s evidence-gathering for the inquiry. The committee is set to table the inquiry’s final report at the end of next month, but that will contain the same recommendations along with additional findings that are in relation to a “potential privilege matter”.

As part of this final set of evidence-gathering for the inquiry, the committee also found that gig economy workers had a limited understanding of their rights and responsibilities due to the way on-demand platforms operate. The committee also found these workers had a limited right to raise concerns, as well as a limited right to be heard and respected.

In light of this, the committee has recommended the federal government support independent contractors who are sole traders by establishing and promoting accessible low-cost pathways for dispute resolution.

“The committee believes the issue of mechanised management through platforms is related to the issue of dispute resolution, and we believe this is an area that warrants further consideration,” the report said.

While the committee said it was now hesitant to back changes to the legal definitions of “employee” and “employment”, it blasted companies like Uber and Deliveroo for their attempts to “avoid formal regulation” through incrementally offering benefits and insurances to contractors.

By that same token, the committee commended Menulog for its decision to move towards an employment model. Menulog still uses a contractor model, but it began trials last year to deliver through “employed couriers”.

“The committee believes that food delivery in particular is better suited to an employment model, and the relative certainty of protection that could be offered by the coverage of state-based workers’ compensation schemes. Voluntary, self-assessed, industry-based codes of conduct are no substitute for proper regulation,” the committee said.

“Companies like Uber and Deliveroo should see the writing on the wall and join Menulog in seeking to provide a minimum wage and entitlements to their workers.”

The committee also warned of the growing shift towards casual employment and independent contractors through on-demand platforms in publicly-funded employment sectors, specifically noting the state of aged care and disability care services.

“This committee is increasingly convinced of the urgent need for regulatory intervention in relation to platform work in the disability and other care sectors,” the report said.

“All disability service providers should compete on a level playing field, including online platforms that supply workers to clients. The business model that Mable and similar platforms have created sees them treat workers in an employee-like fashion and take a cut of their earnings, while failing to provide superannuation or penalty rates, encouraging workers to charge less than award wages, and providing insufficient support.”

Acknowledging the lack of support for a large portion of aged and disability care workers, the committee said it supported an amendment to National Disability Insurance Scheme legislation that would see all workers engaged under the scheme to be covered by the relevant modern award, regardless of their work status.

Last year, federal opposition leader Anthony Albanese vowed the Labor party would legislate job security, pay, and entitlements for gig economy workers as part of its policy pitch that the party would take to the next election.

“It’s time for a national approach. That’s why a Labor government that I lead will consult with state and territory governments, unions, and industry, to develop, where it is practical, portable entitlements for annual leave, sick leave, and long service leave for Australians in insecure work,” he said.

Labor’s plan to take a national approach to protecting gig economy workers answers calls that were made by the Victorian government back in July when it handed down 20 recommendations as part of the state government’s inquiry into the on-demand workforce.

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