Morrison’s COVID-19 response puts profits ahead of people

April 10, 2020
Many workers, including casuals and those on special visas, will miss out on the new JobKeeper subsidy.

Federal parliament passed the Coronavirus Economic Response Package (Payments and Benefits) Bill 2020 on April 8, which provided the enabling legislation for a range of stimulus measures the government has already announced, including the JobKeeper allowance.

While the creation of the JobKeeper allowance is significant, and has been welcomed by Australian Council of Trade Unions (ACTU) secretary Sally McManus as a “victory”, the package has several significant weaknesses.

Essentially, it outlines that the bulk of the economic crisis will be passed on to working people, particularly more marginalised workers.

The JobKeeper payment will provide qualifying employers with $1500 a fortnight per qualifying employee for six months.

There are qualifying thresholds for employers: those with less than $1 billion in turnover must also have lost more than 30% of their revenue; those with more than $1 billion in turnover must have lost more than 50%; and charities must have lost more than 15%.

When it became clear that there was to be a special category for charities, TAFEs and universities had hoped to be included under charitable organisations. But the government has since made it clear that the payment would only go to organisations providing direct charitable support.

For a worker to qualify, they must be either a permanent or fixed-term employee, and employed prior to March 1. A qualifying casual employee must also have been working for their employer for more than 12 months.

The JobKeeper payment essentially establishes a new income floor for qualifying employees, paid for by the government.

For about 30% of workers the subsidy reflects either an improvement on, or a maintenance of, their current incomes.

But for the majority of workers, it represents a wage cut and, for many, a significant one.

As the new act amends the Fair Work Act to make it easier for affected employers to change workers’ hours, direct them to take leave, relocate them and make changes to the work they do, any reduction in hours will result in a corresponding reduction in pay for workers, down to a minimum of $1500.

The subsidy is not the starting pay. Rather, a worker will need to work towards and surpass the equivalent number of hours if they are to receive close to their normal pay, as employers are only required to pay a qualifying worker whichever is greater of the $1500, or whatever the worker earns in a fortnight.

For companies still employing people in work, the subsidy is more a subsidy to their profits rather than a wages subsidy, with workers in effect providing $1500 labour each to the employer, courtesy of the taxpayer.

The failure of the government’s stimulus package to sufficiently protect workers’ incomes was highlighted by an ABC report on April 9 which stated 617,000 people have told the Australian Tax Office (up from 360,000 on April 3) that they will be seeking to draw on their superannuation accounts this financial year (after April 20).

If each of these draws the full $10,000 eligible, that will amount to $6 billion. This will not only undermine the future retirement of those workers, but will impact all working people.

However, as inadequate as the package is, a far greater problem are the hundreds of thousands of workers who do not qualify for any subsidy right now.

These include more than 1 million casuals, workers on visas and those employed in firms that have not met the revenue loss threshold, but are dismissing or standing down workers nonetheless.

The ACTU had been lobbying for a broader qualifying definition for casual workers, based on a reasonable expectation of further work, which is part of the test for casual employees qualifying for unfair dismissal protections.

Attorney-General Christian Porter rejected the ACTU's definition on the basis that it is “too broad”. He justified the government’s decision not to include more casuals on the basis that “casuals move between multiple employers”.

Porter would know that many casual workers rely on a single employer. It also ignores the reality that, while some new work is being created, that is dwarfed by the numbers losing work.

The government’s refusal to include all visa holders in its wage subsidy protections, combined with Prime Minister Scott Morrison’s April 3 statement that struggling international students should “go home if they can’t support themselves”, is consistent with successive governments’ view that international students and other visa-holding workers are sources of income and cheap labour that can be disposed of at whim.

Leaving Australia is not a viable option; the government's callousness will simply force these workers into extremely insecure and exploitative situations.

The United Workers Union has launched an important campaign for no worker to be left behind, irrespective of visa status, with an amnesty for undocumented workers. It should be supported. We also need to demand that workers be given permanent residency and citizenship, should they request that.

[Lisbeth Latham is a union activist and trans feminist writer. She blogs at Revitalising Labour and is a contributing writer with Irish Broad Left].

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