Unions threaten to use wage theft laws against Andrews government
“If that means, at some stage, we have to test the wage theft laws against the government, then we’re happy to find those examples and make sure they get prosecuted,” Mr Hilakari said.
“If the government has, for example, decided not to train and hire their own security guards or cleaners and they’ve hired someone else to do that, they need to make sure those wages get paid properly.”
The Andrews government, through Jobs Minister Martin Pakula, is in advanced negotiations with unions and industry groups over the Fair Jobs Code, which would set safety, industrial and diversity standards for companies seeking government contracts. Parties remain some distance apart in their demands but the second round of consultations has begun, with unions and the government hopeful of an agreement by the end of the year.
Mr Hilakari, backed by Community and Public Sector Union secretary Karen Batt, is seeking a ban on firms subcontracting to reduce wages, and wants preference given to local businesses with strong safety records and employment arrangements that fulfil minimum standards.
He is pushing for the code to eventually be legislated and a jobs czar who would police the vast number of departmental contracts awarded to businesses.
Ms Batt highlighted what she said was “hypocrisy” in the government’s “practice of using companies who do not follow and abide by the government’s industrial relations principles”.
In the past month, the CPSU has been in an industrial battle with Serco Asia Pacific, owned by $2 billion British public service provider Serco Citizen Services, which was initially offering zero-hour contracts to speed-camera operators.
In July, Serco stood down 450 workers, mostly casuals, without pay at a Centrelink call centre because of a COVID-19 outbreak that a union claimed was sparked by the company ignoring physical distancing requirements. The company denies the claim.
The Premier has repeatedly identified the prevalence of insecure work, which leaves a significant chunk of the workforce with no sick leave and working multiple jobs, as a key factor in driving the second wave of infections as employees attended work despite being symptomatic in order to maintain income. He has flagged industrial relations reform to create more permanent or part-time jobs when the effects of the pandemic subside.
Shadow attorney-general Ed O’Donohue said underpayment by security companies – laid bare in the hotel quarantine program – was the “norm for Victorian government contracts”.
Mr O’Donohue used parliamentary privilege last month to air claims that MA Services Group, a cut-rate security firm, has likely underpaid workers on the Metro Tunnel and West Gate Tunnel projects.
Mr O’Donohue said: “Labor members often talk about wage theft, but do they condone it, or turn a blind eye to it, on their own much-trumpeted major projects?”
State regulators WorkSafe, the Fair Work Ombudsman and the Labour Hire Authority are looking into the company. The Fair Work Ombudsman previously found the company underpaid workers on the level-crossing removal project and has launched a fresh probe into its supply chain.
WorkSafe is examining the company’s payment of WorkCover premiums. If a company’s premium payments, paid for each worker, do not correspond to its turnover, it is an indication the company is engaging in subcontracting to other workers. The $4.8 billion infrastructure company Acciona severed ties with MA because it suspected the company was sham contracting on a level-crossing removal project.
The Victorian Labour Hire Authority, a statutory body launched last, is making enquiries into MA due to allegations of workplace law breaches. It has not yet approved its application for a labour hire licence – which the company requires to work on major projects – and may block the company’s request, jeopardising its ability to win contracts.
The company has become a major player in the security industry and has won lucrative contracts – including from the City of Melbourne, Coles and Geelong Football Club’s home ground, the Kardinia Park Stadium Trust – with significantly lower quotations for its services than competitors.
Tullamarine-based MA Services Group is a rapidly growing security company run by Micky Ahuja, who declined to answer questions when called by The Age. In December, Mr Ahuja said guards were paid correctly and denied knowledge of sham contracting.
Do you know about underpayment by government contractors? Contact the reporter at email@example.com.
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Paul is a reporter for The Age.