FAIR WORK ACT

Adjourned debate on motion of Hon. R.D. Lawson:

That the regulations under the Fair Work Act 1994, concerning clothing outworkers, made on 18 October 2007 and laid on the table of this council on 23 October 2007, be disallowed.

(Continued from 27 February 2008. Page 1876.)

The Hon. R.P. WORTLEY (16:46): In opposing this motion, I want to cover five issues: the exploitation of clothing workers as a serious industrial and social problem; how vital the code is to ensuring that there is a consistent national framework for protecting clothing outworkers; the fact that the Australian Retailers Association and other key stakeholders support the code; having all retailers placed on a level playing field; and, the economic impact it has on business and how it furthers the government's social inclusion. The Rann government introduced legislation in 2005 to enable the establishment of a code of practice to ensure that outworkers are treated fairly and in a manner consistent with the Fair Work Act 1994.

Clothing outworkers are amongst the most vulnerable workers in our Australian society. As predominantly migrant women working from their homes they have limited ability to negotiate rates of pay or any other working conditions, and they are beholden to their employer and those in the supply chain above them. The exploitation of clothing workers is a serious industrial and social problem in Australia. The industry is structured in a complicated chain of outsourced production, which often ends with socially isolated and grossly underpaid workers who subsidise the profits of others in the production chain. The outworkers, their families and the broader community bear the costs of those exploitative employment conditions.

The Outworker Code of Practice provides a fair system and supports the integrity of those employers who act responsibly in the production and sale of clothing. The code clearly outlines responsibilities of all parties in the clothing trade, including retailers, suppliers, manufacturers, contractors and outworkers. In particular, the code is an important step in ensuring that there is a consistent national framework for protecting clothing outworkers. The code endeavours to secure the fair treatment of outworkers consistent with best practice in the industry and the principles and objectives of the Fair Work Act 1994. This consistency creates a commercial and competitive standard which is understood and which reasonably reflects the social expectations of the Australian community.

The introduction of the code will be of benefit to complying retailers. Any competitive advantage that those not complying previously enjoyed will be eliminated as all retailers are placed on a level playing field. The economic impact on business, if any, is expected to be minor. If businesses have artificially reduced minimum terms and conditions of employment through the exploitation of outworkers, they will incur additional costs. The record-keeping requirements for manufacturers are no greater than those which exist under the Clothing Trades Award. Retailers subject to the requirements of the code have particular reporting requirements, which, to a large extent, mirror what is required of manufacturers under the state award.

Of course, retailers have the opportunity to become a signatory to the national and voluntary Homeworkers Code of Practice. A business will be exempted from the code if it signs up to the voluntary code. This approach recognises that the voluntary code may suit some retailers and is consistent with modern regulatory practice.

The impact of the code on retail businesses is a of minor machinery nature and does not substantially alter existing arrangements in terms of record-keeping. In any event, the requirements under the code allow retailers to have greater control over and understanding of what happens in the supply and production chains. It allows for greater certainty in regard to supply chains and delivery times and financial costs of garments.

The code is built upon the New South Wales mandatory code and maintains consistency with the Fair Work Act 1994, the Clothing Trades Award and the national and voluntary Homeworkers Code of Practice. Consistency with the New South Wales code was important, given that the chains of supply for clothing products operate nationally and internationally. The code is also closely aligned with the Fair Wear Campaign, which aims to encourage all Australians to think about where and how their clothing is produced.

The code was released for a three-month public consultation period, which concluded in early February 2007. Key stakeholders and other organisations that might be affected by the draft code were given an opportunity to provide a submission. The Australian Retailers Association and the Textile, Clothing and Footwear Union of Australia provided a joint submission which fully supports the introduction of the code. This is an important recognition that the implementation of the code is a vital step in creating a unified national regulatory system. It also recognises the role of the code in creating an acceptable and effective incentive to encourage retailer adherence to the national voluntary code.

Business SA, as a key member of the outworkers group (which comprises representatives from the Working Women's Centre, the Textile, Clothing and Footwear Union, SafeWork SA and the Office of Employee Ombudsman) is assisting with the promulgation of the code, including by its agreement to participate in the distribution of the explanatory pamphlet (which bears its logo) to its members. A positive social and family impact is anticipated by facilitating fairer access to minimum award pay and conditions. This will enhance the income of some of the lowest paid workers in South Australia.

The provision of the appropriate living wage for workers should contribute positively to the achievement of the government's social inclusion objective. The introduction of the code will help South Australia meet some of the key objectives of the State Strategic Plan. In particular, the code will improve the quality of life and wellbeing of South Australians through improvements to outworkers' workplaces in order to ensure secure and fair employment. This also furthers the government's policy of providing a fair go at work for all South Australians. In conclusion, we oppose the motion.

Debate adjourned on motion of Hon. J.M. Gazzola.