Contributed by Joe Montero

Employers may soon be able to offer part-time workers extra hours without paying them more. Penalty rates will be out. This is written in a change to the law expected to be tabled in the parliament today.

Attorney General Christian Porter revealed the intention to change the law, which will bring the change to the retail and hospitality industries.

Change is sought by breaking industrial agreements protecting wages, through the introduction and use of individual contracts.

On paper, this is an agreement between the employer and individual worker. In practice, it’s an arrangement imposed under the threat of not having a job. There is no free choice in this.

The minister said it’s to resolve “a trio of ills in the current labour market- underemployment, the need for more flexibility, and a desire by some employees for more permanent employment”.

Exactly how paying lower wages will translate into this was not explained.

Well, it can’t. If shrinking the share going to wages, something which has lately been taking place across the economy, was going to do this, underemployment and insecure work would already have disappeared.

That they remain a reality, is testimony to the bankruptcy of Porter’s claim.

He tries to counter this by suggesting that the new provisions will mandate a minimum 16 hours a week and at least 3-hour shifts. This is marginal at best.

Another part of the proposed change is, to allow employers to take away holiday pay and other entitlements. Imposing a $1.1 maximum fine and $5.5 million for corporations, plus up to 4 years imprisonment for systematic wage theft, as the proposal does, is pointless, when employers are to be given the legal right to do the same thing.  

Greater authority will be given to the Fair Work Ombudsman to shift away from prosecution and let those caught of wage theft to get off the hook if they show it’s a mistake, are prepared to make restitution, and promise not to do it again.

About labour market flexibility. This is the real intent. It means is giving employers greater scope in deciding who they will hire, for how long, and under what conditions. This is about ratcheting down the wages’ share of income.

This is being brought about to shift from making a profit by relying on performance of businesses in the market, to making a profit from increasing the exploitation of the workforce.

This is seen as the road to economic recovery.

Putting aside the question of fairness, still leaves the assumption dead wrong. Those who make it, overlook that what might be good for an individual employer, does not make it good for all employers and the economy.

At the economy wide level, cutting the wages creates an illusion of growth where there is no real growth. Ultimately, businesses and the economy depend on real growth for their survival.

Shrinking the wages share imposes economic costs on individuals and society. Debt crisis and housing affordability failure become more intense. Ultimately, as households hold back on discretionary purchases, the market begins to shrink.

Isn’t this picture a good description of Australia already?

Retail and hospitality are the kicking off point, because being less unionised, not having a tradition of militancy, and mainly employing the inexperienced young, they are a relative soft touch.

Photo from the Telegraph: Retail and hospitality industries are soft targets

If it does succeed, the same will soon be spread to other industries.

Further proof of the current direction of the Australian government is in raft of legislation either on the table now or about to be. The overtime measure is only one part of it.

A particularly important piece gets rid of the no disadvantage clause. The clause means that any changes to agreements cannot leave any worker less well off.

New legislation to weaken the capacity of unions to represent and defend their members has been strongly hinted at. If the government is going to extend the application of its view of increased labour market flexibility, this will come about.

A cornerstone of John Howard’s WorkChoices at the start of the twenty first century was, to increase labour market flexibility through the replacement of industrial agreements with individual contracts. A union and community alliance defeated this.

Another law to be introduced by Christian Porter is to make it easier for the factions of unions to break away. Although the publicity is that this is targeting the Construction Forestry Maritime Mining and Energy Union, it is really directed against the whole union movement, to weaken it and open the door to the government’s industrial relations agenda.

The wheel has turned a full circle. The same challenge of the is on again.