Submission 167 Australian Council of Trade Unions Workplace Relations Framework Public inquiry

The National Employment Standards are inviolable minimum standards in their truest sense. They are directly enforceable through civil proceedings and are not able to be “traded off” on a “Better off overall” basis through agreement making.

The content of the National Employment Standards is largely based on safety net standards developed by the AIRC through the Award system. In broad terms that content is uncontroversial and unobjectionable, however there are some particular features of the National Employment Standards that warrant further development.

Right to Request a Change in Work Arrangements (s. 65) and Extension of Parental Leave (s. 76) FWA

Balancing work and family is critical. The majority of modern families now have both parents in paid work and most rely on two incomes to meet their financial obligations.³⁰⁷ The inability of workplace practices and workplace laws to keep pace with modern working families, presents significant difficulties for working families. This is notwithstanding the fact that the collective bargaining framework has permitted bargaining on work and family matters since its inception.

The ACTU Census of 40,000 workers in 2011 found that the 2^nd most important issue of concern for both men and women was balancing work and family and, in particular, ‘sandwich generation’ employees, caring for both children and parents, indicated the single biggest thing that would improve their work life was having the flexibility to balance work and family.³⁰⁸ Similarly, in the 2014 FW Commission Australian Workplace Relations Study, employees ranked ‘the flexibility to balance work and non-work commitments’ as the most important driver of job satisfaction.³⁰⁹

The barriers employees face in balancing work and caring commitments has a direct effect on their ability to participate fully in the labour market, with ABS data demonstrating that as many as one quarter of Australian mothers leave the workforce permanently. Four out of five mothers that do return to their employment required flexible work arrangements to do so.³¹⁰

It is generally acknowledged that the benefits of labour market participation of parents, and in particular mothers, include an increase in government revenue through income tax; increased diversity and quality of the labour market; increase in aggregate demand through higher household wealth and spending; improved economic independence for women and less reliance on welfare.

Indeed, reducing the gender labour market participation gap in G20 countries by 25% by 2025 would bring in as many as 100 million women to the paid workforce.  In Australia alone if women’s participation in the paid labour market increased by 6% from current levels, GDP could increase by as much as $25 billion.

Whilst significant attention has been given to the provision of paid parental leave and affordable, accessible childcare, employment regulation and workplace practices have not kept pace with the changes in modern working families and in the labourforce generally.

Sections 65 and 76 of the FWA purport to give a right to employees to assist them in balancing their work and family responsibilities.

However, the provisions are drafted so that:

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  No obligation is placed on employers to reasonably accommodate a request;
  
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  Employers are only required to give an employee (in writing) the reasons for the refusal which can be on a very wide range of ‘reasonable business grounds’;³¹¹and
  
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  Under s. 739 of the FWA employees are specifically denied a right to appeal an employer’s unreasonable refusal of a request for both sections 65(5) and 76(4), unless they have the bargaining strength to reach agreement with their employer to do so in a workplace agreement.³¹²
  

We are of the view that these limits on the regulatory framework have meant that it has been ineffective in driving the change in attitudes and practice that is required in order to lift the participation of mothers in the workforce.

UK legislation has enshrined the right to request flexible working arrangements since 2003. That legislation places a statutory duty on employers to give serious consideration to a request according to a set procedure. It also provides an employee with a right to appeal. The UK government noted that the most effective way to promote cultural change was to introduce statutory obligations, noting that “even a sustained and extensive campaign is unlikely to have the significant effect on employment culture sought by this policy, and a major challenge would be reaching and convincing those who are resistant to change- which promotion campaigns will always struggle to achieve without the pressure of change in the operating environment of businesses.”³¹³ Regular surveys of both employers and employees have studied the operation and impact of the UK’s request provisions since their inception. The most recent research indicates that of the 17% of employees who have requested a change to their working arrangements, approximately 60% of requests were granted. Of the 40% refused, 25% were appealed.³¹⁴

The case for further reform

Anecdotal evidence collated by the ACTU, and backed up by the available research material, is that s.65 and s. 74 have not operated effectively due to irregular, unpredictable and often unreasonable management attitudes towards employees with caring responsibilities coupled with employees’ incapacity to appeal an employer’s unreasonable refusal of their request.

Despite the issue being significant to all working parents, it is mostly women who are affected by the need to balance work and family.³¹⁵

Australian employers generally offer a very narrow range of alternative options for employees wanting to stay in the jobs they held prior to needing to balance work and family commitments.³¹⁶ In fact, Australia has one of the highest rates of part-time work in the OECD and is unique in that the solution to the needs of working parents is almost exclusively limited to part-time and casual work.³¹⁷

The limited ‘rights’ in the current flexible work arrangements provisions will continue to undermine women’s access to secure jobs and careers, and this is a significant driver of the gender pay gap, which in Australia is at a 20 year high. Forcing women with caring responsibilities into low quality, insecure work contributes to the gender wage gap because it:

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  pays low wages;
  
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  forgoes benefits such as paid leave;
  
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  does not provide for long-term accrual of entitlements;
  
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  stunts career progression and skills advancement;
  
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  places employees in vulnerable negotiating positions;
  
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  is often subject to discriminatory practices; and
  
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  restricts employees’ capacity to save for retirement.
  

There are many stories of employees with caring responsibilities simply giving up because without rights to support their employment and caring roles, it’s ‘just too hard’. Having been forced into resigning from a job, they find it very difficult to return to the workforce, having lost valuable skills, contacts and confidence.

In particular, there is a significant body of anecdotal evidence that women returning from maternity leave are denied requests for flexible work arrangements, effectively forcing mothers to choose between leaving their new baby in care every day or leaving their job and their career.

The Human Rights Commission 2014 Review of Discrimination in Pregnancy and Return to Work³¹⁸ found that one in two mothers reported being discriminated against:

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  27% during pregnancy;
  
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  32% when requesting or taking parental leave; and
  
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  35% when trying to return to work from parental leave.
  

Of those parents (mothers and fathers) reporting discrimination, one in four did not return to the workforce from parental leave as a result.

The Human Rights Commission data demonstrates that a significant number leave as a result of negative attitudes from colleagues or managers (63% ) or discrimination when requesting flexible work arrangements upon returning to work from parental leave (50%).³¹⁹

Discrimination case law also offers an insight into the reality of managerial attitudes towards working mothers. The existence of these attitudes must be acknowledged as evidence of resistance by a significant number of employers to genuinely exploring options for flexible work arrangements in order to assist employees with caring responsibilities.

In the recent past alone, the following cases have come to public attention, for example:

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  A former media agency manager, made redundant after returning to work part-time following the birth of her baby. Evidence revealed the employer’s desire to ‘weed out’ part-time staff, with one email by the Chairman, stating, ”I don’t know what has happened in the past but the way we are going to operate in the future is that we are only having full-time employees on the payroll.”³²⁰
  
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  A former director of a childcare centre demoted to ‘staff relief float’ on a casual basis and when she returned from parental leave. Upon refusing to accept the demotion, her employer terminated her employment on the grounds of ‘poor performance.’³²¹
  
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  A pregnant employee who complained at being demoted to packaging duties, was told by the male director employees should resign when they fall pregnant and then “stay at home in bed".³²²
  
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  A disability support worker, made to convert to casual employment on return from parental leave because of ‘the chief executive’s refusal to accommodate her need to work shifts that enabled her to care for her child’ and then constructively dismissed her was awarded $44,000 in damages.³²³
  

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  Two former public relations managers for Virgin Blue who were made redundant whilst on parental leave gave evidence that members of their executive management team said ‘all females should be on contract so that when they get pregnant it’s easy for the company to get rid of them’ and that finding roles for them in the organisation was’ like trying to put round pegs into square holes.’³²⁴
  

It is worth noting that these cases represent merely the tip of the iceberg as by far the majority of cases are not acted on by victims or remain unreported.³²⁵