Our future Australian government’s approach to the Future of Work

In the context of ‘Remote / Controlled’: Herbert Smith Freehills’ 2021 Future of Work Report.

In 2021 Herbert Smith Freehills undertook a significant Future of Work project, with the final report (published here) discussing key trends shaping the future of the workplace. These trends arise in an extraordinary time of change in the way many people work and in expectations regarding corporate responsiveness to social issues, the environment, and promoting and driving wellbeing.

The Liberal party and ALP policies going into the Federal Election largely avoid directly grappling with these societal-defining trends, yet they drive policy in important ways. This article explores those ways, by reference to both parties’ policy and by noting how the perceived lack of vision in respect of these trends is arguably a key driver behind the rise of the ‘teal independents’.

The Future of Work Report

The 2021 Report considered 375 interviews with senior leaders across the world, of companies with more than 1,000 employees and more than 250 million in revenue.

It provided a useful comparison and update to HSF’s previous (pre-pandemic) 2019 survey, which identified the disruptive effect of automation in the workplace and growing levels of work-related activism across the globe.

The Report identified changes in expectations arising in the landscape of a global pandemic and the ongoing impacts of BLM, climate change protests, and the global interest in the unionisation of workers at corporations that are household names. Labour trends have accelerated and, in some cases, been distorted in this extraordinary landscape, with arguably long-term implications for the employer – worker relationship (described in the Report by reference to the ‘new trust equation’). Specifically, the Report identified the emerging flashpoints as including:

• ESG and stakeholder capitalism;
• Rights in a hybrid working model;
• Employee surveillance and monitoring; and
• Wellbeing.

The rise of the independents as the champions for climate change, integrity reform and gender equity

These topics – climate change, integrity reform, and gender equity - are of key relevance to employers from an ESG perspective and in the context of workers’ expectations and activism. In 2021 the Report noted that respondents identified sustainability and environmental issues as the biggest potential risk to corporate reputation. That finding continues to have relevance in the context of the federal election. These topics continue to drive global social movements, and remain core drivers to many peoples’ voting preferences.

There is clear dissatisfaction with the position of the major parties, particularly with younger voters in respect of climate change policy.

Concern is similarly held in relation to gender equity and integrity reform.

Labour proposes to concurrently prohibit pay secrecy clauses, and legislate that employers with more than 250 employees be required to publicly report gender pay gaps. It has thrown its support behind implementing the remaining 55 recommendations of the Respect@Work report, including the introduction of a positive legislative duty on employers take reasonable and proportionate measures to eliminate sex discrimination, sexual harassment and victimisation.

The Liberal party included a $2.1 billion ‘Women’s Budget Statement’ in the 2022-23 budget, and announced a focus on five key priorities, including repairing and rebuilding women’s workforce participation and further closing the gender pay gap. In March 2022 it released a review report into the Workplace Gender Equality Act 2012 (Cth) and proposed 10 recommendations to accelerate workplace gender equity. No election commitment has been made. Last month the Liberal Party announced its response to the Respect@Work report, preferencing a slightly more watered-down approach: agreeing to (in full, in-principle, or in-part) or indeed simply note the 55 recommendations in its ‘A Roadmap for Respect’ report.

Difference in approach can also be seen with respect to integrity reform. Labour has proposed an independent National Anti-Corruption Commission. For the Coalition, despite pledging before the 2019 election to legislate a federal integrity body, nothing has since been achieved.

Both parties have a significant credibility issue in respect of these topics that is unlikely to be overcome by these policies.

It should perhaps be no surprise then - and is arguably consistent with the trends identified in the Report - to see interest in the bolder environmental and social positions of new independents, particularly the ‘Climate 200’ backed independents (i.e. the ‘teal independents’). And, for these individuals to potentially be a real alternative for constituents frustrated with the major parties’ positions on environmental and social issues.

Safeguards for vulnerable workers and those in the gig economy

The Report addressed how Covid-19 saw the distortion of economic and workplace trends: influencing the rise of the gig economy and (arguably) demise of workers’ wellbeing. Safeguards for vulnerable workers continues to be part of our national conversation. Across all industries in Australia underpayment of wages continues to present a potential risk to corporate regulatory compliance and reputation. The Report also considered the provision of safety net features for all workers, and the right to collective bargaining and union representation.

This is somewhat traditional territory in terms of the political parties’ policies.

The Liberal party advocates for workforce flexibility and cautions against the costs and restrictive nature of Labour’s proposals. It proposes to reintroduce the aspects of the Omnibus Bill that were abandoned in 2021, such as tougher penalties on companies that systematically underpay their employees, by introducing a criminal offence.

These issues are at the heart of Labour’s IR policies, with a focus on:

• Security for labour hire employees, via a labour hire scheme and by legislating to ensure workers employed through a labour hire provider receive the same pay and conditions as those employed directly by the host employer;
• Limiting the use of fixed term employees;
• Limiting the definition of casual employees to remove the concept of permanent casuals;
• Legislating the criminalisation of wage theft across Australia and increasing the civil penalties; and
• Expanding employees’ right to access union representation at work.

Ordinary options, during extraordinary times

These positions are unlikely to fill many people with confidence that our next government intends to find opportunities from the upheaval experienced in the way we work. While many Australian workplaces are reimagining the future of work, we are offered industrial relations policies that shift very little from earlier (pre-pandemic) elections.

According to the 2021 Future of Work Report, the workplace (in the various forms that takes) is increasingly a platform for employees to voice their environmental, political and social views, and expectations of change. And this is only becoming more so as Millennials, who are more inclined to seek that platform, become comfortable in their role as the dominant generation in the workforce supported by their Gen Z colleagues.

The demand for greater action in relation to the global movement on climate change and on social issues including gender equity, sexual harassment, racism and inclusion, will continue regardless of who ultimately forms government and how effectively they avoid issues during this campaign. Employers, and workplaces, will unavoidably continue to be central to those campaigns, and in turn, to government response.