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Class Action against Airservices Raises Important Questions on Flexible Work

Last June almost 80 employees of Airservices Australia filed a class action against the government entity, including allegations of “sham contracting” and usage of illegal “zombie agreements.”

We feel this deserves more attention as it only further kindles the continuing negative public perception regarding all contracting arrangements.

Employees who had been with Airservices for between 10-30 years, claimed they were made redundant and then re-employed weeks later as independent contractors. It is outrageous that a company of this size might be guilty of such alarming claims.

On insecure work

It’s time to accept that the economy has changed. It is now global and flexible, and businesses need to adapt to survive and grow.

Contracting is the incubator of enterprise, the seed of opportunity. It is not evil. So many successful multinational companies have started from just one person with a vision and the will to turn it into reality.

So why the continued pursuit of casual, flexible arrangements by businesses? Does this not support the notion that full-time employment practices are too restrictive and punitive for business?

Is change needed here to allow more flexibility, to lower costs to businesses, thereby making casual or part-time employment less attractive to business?

Why the suggestion to make casual arrangements less attractive by removing flexibility rather than increasing flexibility of full-time?

Casual and contracting work

Why does business need flexible arrangements? Is there uncertainty in the market that makes business risk averse to hiring full-time (cost and lock-in), thereby needing to utilise casual arrangements or independent contracting?

Are casual and contractor arrangements actually providing or opening up man-hours/paid work that would otherwise go unfilled? Do these arrangements actually grow the pie?

As the Fair Work Commission points out, 59% of casuals are in the 25-64 year old age group. ABS figures show that, “Since August 2012, the number of workers without leave entitlements (i.e. casuals) and independent contractors have risen by 110,000 and 51,300 respectively. This has coincided with a 113,000 decrease in the number of workers with full leave entitlements.”

However, from these we can deduce that:

  • 65+ are at retirement age and are not counted;
  • 41% of all casuals are 15-25 year old; and
  • What percentage does the 15-25 year old age group make of the 15-65 year old labour market?

The statistic used in the article deliberately misrepresents and skews the perceived concentration of casuals in the labour market away from the 15-25 year old, making it look as if mature workers are deprived of “secure” employment at a time they need housing for their families – a simplified and emotive argument that seeks to cause worry and division.

In summary, contracting, in all its forms, isn’t going away and businesses and individuals don’t need to fear it. There are lots of ways that a contracting arrangement can benefit both parties. You just need to understand the lay of the land, put processes in place and make sure you mitigate your risks. I’ve spent most of my adult life in this space and I’m passionate about it. So if you want to find out more, I’d love to hear from you.

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