Portable Long Service Leave for Tasmania: Discussion Paper

Portable Long Service Leave Scheme

for the Tasmanian community services, disability and aged care, contract cleaning and security sectors

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Contents The Health and Community Services Union and United Voice

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Why is a Tasmanian Portable Long Service Leave Scheme required in community services, cleaning and security?

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Tasmanian community services, cleaning and security employees are currently missing out

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Benefits for employers

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Benefits for employees

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Aligning Tasmania with the standard set by other states

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Expanding Portable Long Service Leave

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Portable Long Service Leave in Tasmania

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Case Studies

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Recommendations

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References

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A joint campaign from HACSU and United Voice.

Authorised by Tim Jacobson, HACSU State Secretary & Jannette Armstrong, United Voice Branch Secretary.

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The Health and Community Services Union and United Voice The Health and Community Services Union (HACSU) is Tasmania’s largest union, with around 8,000 members working in health and community services in the public, private and not-for-profit sectors.

United Voice is a national union of workers organising to win better jobs, stronger communities, a fairer society and a sustainable future. Members work in a diverse range of industries including aged care, early childhood education and care, cleaning, hospitality, healthcare, security, emergency services and manufacturing.

This discussion paper explains why Tasmania needs a Portable Long Service Leave (LSL) scheme in community services, aged and disability care, contract cleaning and contract security. For ease of expression, the term ‘community services, cleaning and security’ will be used in this document to refer to these sectors collectively. It builds upon discussions with a range of stakeholders at a forum convened in 2012 by the then Minister for Workplace Relations, David O’Byrne, in which strong interest was expressed from all parties in further exploring the benefits of a Portable LSL scheme in sectors beyond the construction industry.

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Why is a Tasmanian Portable Long Service Leave Scheme required in community services, cleaning and security?

A portable long service leave scheme for Tasmanian employees in community services, cleaning and security is necessary to:

• Restore an entitlement intended to apply to all Tasmanian workers to groups of employees who are missing out, through no fault of their own • Deliver benefits to employers and the community

• Address particular disadvantages which arise when low-paid workers are deprived of long service leave • Align Tasmania with the standard set by other states The introduction of a Tasmanian Portable LSL scheme will reduce many of the chronic problems in these sectors relating to non-compliance, and ensure that workers are receiving the paid time away from long term employment that is intended by our Australian long service leave system. This, in turn, will ensure a healthy workforce, a more stable industry and a more productive and prosperous Tasmania.

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Tasmanian community services, cleaning and security employees are currently missing out Long service leave is an entitlement that is intended to apply to all Tasmanian workers.

However, many workers in community services, cleaning and security do not get the opportunity to take long service leave because, through no fault of their own, they are unable to work with the same employer long enough to qualify. A Portable LSL would provide equity to these workers.

In the case of community services, employees are often unable to stay with the same employer for the qualifying period due to the short-term, project-based nature of funding in community services.

This funding model means that full-time, permanent jobs in community service are rare. Employees are forced to find alternative employment soon after, or even in advance of, the de-funding of their roles, which entails a break in continuity of service for LSL purposes. Community service employees are overwhelmingly female, and disproportionately primary carers for dependents outside their paid work.1 Their caring obligations outside their paid work means that they take employment breaks more frequently than other workers, which contributes further to their difficulties in qualifying for LSL under present arrangements.

Cleaners and security guards are extremely vulnerable to losing their entitlements to LSL every three to four years. The cleaning and security industries operate on a contract model. Organisations that require cleaning and/or security services advertise their service needs by tender, and providers bid for the right to supply these services. Contracts are commonly re-tendered every three to four years, which can result in a change of provider. If cleaning and security workers are hired by the incoming provider, they will have a different employer even though they continue to work the same job at the same site. When the contract is switched, workers’ long service leave entitlements are rarely transferred to the incoming contractor.2 Many contract cleaning and security employers do whatever they can to avoid passing on the accrued Long Service Leave of their employees. United Voice pursues claims against recalcitrant contractors on behalf of members but this can be a very costly and exhaustive exercise. Investigations can lead to companies who have since folded and no longer exist.

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Benefits for employers A range of benefits have been identified for employers in states and territories where portable LSL schemes are in place. These include: • Retention of workers and a reduction in high levels of workforce transition and mobility • Higher productivity • The attraction of employees and reputation advantages for best-practice employers • A reduction in non-compliance • A reduction in problems of ‘free-riding’ • Administrative benefits • Cost certainty • Tax benefits Portable LSL can improve staff recruitment and retention, providing a positive impact that is disproportionate to its cost. A Victorian study by PricewaterhouseCoopers found that a scheme which costs ‘between 1 and 2 per cent of wages, provides a more noticeable and tangible benefit to employees than a pay rise of the same amount.’3 With increases in staff retention come savings for employers through reduced recruitment and training costs. Portable LSL may also provide an incentive for employees to continue working in the industry, even if they do not stay with the same employer for 10 years.

Portable LSL schemes also remove the temptation which exists in competitive contracting industries to compete on contract price by not paying employees their proper entitlements. Unfortunately, rates of inappropriate and exploitative labour practices in the Tasmanian contract cleaning and security industries are significant. The contracting system applies continuous pressure on employers to rationalise operating costs. In an effort to gain a competitive advantage, some employers not do pay LSL entitlements to their workers. In some cases, this can lead to a ‘race to the bottom’ among providers, as the proper payment of entitlements is seen as incompatible with the successful acquisition of contracts.

A portable LSL scheme diffuses this exploitative dynamic, levels the playing field, and ensures that employers are not punished by the market for adhering to employment law.

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Benefits for employees Employees in these sectors receive low pay. Currently, a full time adult cleaner can earn as little as $718.40 a week4; a security guard $755.805; and a home care employee $724.00.6 These rates of pay mean that most community services workers, security officers and cleaners are unable to meet essential needs for themselves and their families, such as health care and education.

Without entitlements like long service leave these workers are placed under a heightened financial burden, which impacts their physical and mental health.

Many of these workers have limited superannuation, and long service leave is one of their major, if not their only, savings. The loss of long service leave entitlements has a disproportionately large impact on their financial situation.

Work in community services, cleaning and security industries is also physically and mentally demanding.

There are notoriously high rates of burnout in community services,7 and cleaning and security both have high rates of shift work, the health effects of which are widely acknowledged. The respite offered by long service leave is profoundly significant for these workers.

LSL Basics

• Long service leave is uniquely Australian, having evolved in the colonial public services of South Australia and Victoria.

• In 1955 New South Wales became the first state government to pass a Long Service Leave Act, which led to entitlements of three months leave for private sector employees after 15 years of service with the same employer.

• All remaining states followed suit, with similar legislation being enacted Australia wide.

• Private sector employees typically become entitled to three months leave for each ten or fifteen years of service (depending on the jurisdiction).

• Pro rata entitlements are available under certain circumstances after a lesser period - typically seven years.

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Aligning Tasmania with the standard set by other states Statutory schemes for portable long service leave presently exist for the contract cleaning industry in the Australian Capital Territory (ACT), New South Wales (NSW) and Queensland; and the community services sector and security industry in the ACT. The table below summarises the provisions of current portable industry based LSL schemes.

State NSW

PLSL Scheme Building & Construction

Contract Cleaning

ACT

Building & Construction Contract Cleaning Community Services Security

QLD

Building & Construction

Contract Cleaning

VIC

Building & Construction

SA

Building & Construction

WA

Building & Construction

Entitlement 8.67 weeks for each 10 years of service 4.33 weeks for each subsequent 5 years of service 8.67 weeks for each 10 years (3650 days) of service 4.33 weeks for each subsequent 5 years (1825 days) of service 13 weeks after 10 years of service 6.067 weeks after 7 years of service 4.333 weeks after 7 years of service 8.667 weeks after 10 years of service 8.67 weeks after 10 years (2200 days) of service Pro rata after 7 years of service 8.67 weeks after 10 years of service Pro rata after 7 years of service 42.4 days after each 7 years of service 13 weeks after 2600 days of service (260 days p.a.)

8.67 weeks after 10 years (2200 working days) of service 4.33 weeks for each 5 years (1100 days) of service thereafter

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State TAS

NT

Commonwealth

PLSL Scheme Building & Construction

Building & Construction

Coal Mining

Entitlement 13 weeks after 10 years (2200 working days) of service 4.33 weeks after each 5 years (1100 days) of service thereafter 13 weeks (65 days) after 10 years (2600 days) of service 32.5 days for each 5 years of service thereafter 13 weeks for each 8 years of service

The portable long service leave schemes operating in some Australian states and territories have common features. They all: • Require mandatory registration and participation of all industry employers

• Require employers to pay a long service leave levy which is quantified as a percentage of the ordinary hourly rate for each employee applicable to all working hours

• Require employers to have administration and management by a central body that includes equal representation from employer and employee groups

The ACT’s portable long service leave scheme, ‘ACT Leave,’ has proven to be particularly successful.

It has assisted employers in managing accrued entitlements, as well as ensuring that incoming contractors are not disadvantaged by retaining employees who are nearing a trigger point for an accrued entitlement. The scheme was established in the early eighties, and was expanded to encompass the cleaning industry in 2000, the community sector in 2010 and the security services industry in 2013.

The expansion of the scheme into security services was favourably accepted by all stakeholders, and the Authority’s 2014-2015 Annual Report shows strong financial performance.8 The ACT Government is currently in the detailed design stage for expanding portable LSL to the aged care and waste disposal sectors, and has indicated that it could introduce amending legislation to cover these sectors in 2016.

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Expanding Portable Long Service Leave The further expansion of portable LSL into other industries in other jurisdictions has also been considered by a number of inquiries in recent years, including:

• The Victorian Inquiry into Portability of Long Service Leave Entitlements (2016), which recommended that the Victorian Government commission a feasibility study into the introduction of a portable long service leave scheme for the contract cleaning and security industries9

• The Senate Education and Employment References Committee Inquiry into the feasibility of a national Long Service Standard (2016), which recommended that State, Territory and Commonwealth Governments review existing LSL arrangements and consider developing a national standard10

• Review of the Fair Work Act (2012), which recommended that the Commonwealth, State and Territory governments expedite the development of a uniform national standard for long service leave to standardise workers’ entitlements across jurisdictions11

Tasmanian LSL Basics The long service leave entitlements for most employees employed in the private sector in Tasmania are normally subject to the provisions of the Long Service Leave Act 1976 [Tas], which was last amended in 2012.

• Employees are entitled to 8.66 weeks long service leave in respect of the first 10 years of continuous employment with the employer

• Employees are also entitled to 4.33 weeks long service leave in respect of each additional 5 years of continuous employment.

• Long service leave is accrued at 0.8667 weeks per year of employment.

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Portable Long Service Leave in Tasmania At present, the only portable LSL in Tasmania is TasBuild, which operates in the building and construction industry. The scheme commenced in 1972, pursuant to the Construction Industry (Long Service) Act 1971. It enables workers employed in the construction industry to accumulate broken service with different employers whilst establishing an entitlement to long service leave. An entitlement to long service leave accrues on the completion of fifteen years of assessable service, with pro-rata long service leave entitlements provided in certain specified circumstances on the termination of employment after at least seven years of assessable service.

Responsibility for the administration of the Scheme rests with TasBuild Limited, the Trustee for the Construction Industry Long Service Fund. It is possible that TasBuild may have the capacity to take on administration of a portable LSL scheme for the community services, security and cleaning sectors.

We believe it is appropriate to initiate discussions with TasBuild, to explore if it is a possibility for them to take on administration of the scheme.

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Case Study: David Ball “I’ve worked 20-plus years in lots of different areas in the Community Services sector. I work in an area that’s highly specialised, dealing with a lot of behavioural issues in a secure facility or out in the community.

“It’s hard - it’s very hard at times to stay focused and do the job that I love - and, you know, this is something that I’m good at. I’ve done it for many years, and I’ve never really worked in areas that aren’t with challenging behaviours or complex needs. It’s always been in that environment.

“Because of that stressful environment I’ve moved from place to place to avoid burnout, which is a real factor in this line of work. I’ve been close at times. And I’ve certainly seen other people really struggle with the stresses in working with people with complex needs and intellectual disability. It’s difficult.

“My favourite thing is seeing clients smile. I certainly have an ability to do that with some of my behaviours, quirkiness and that. I love to have a laugh with the guys and put some happiness in their life.

“I first started working in the Royal Derwent Hospital quite a long time ago. I should be coming up to my second lot of long service leave, but because we swap between organisations I still haven’t had my first lot. It’ll be 24 years before I’ll get my first bit of long service leave.

“I feel a bit disheartened when I hear of other people going out for long service leave... in our industry we don’t stay for long periods of time in any one organisation, we don’t have the opportunity to transfer our entitlements over to get the opportunity for long service leave. It would be wonderful if we could.

“I don’t know what I would do. It’s such a foreign concept.

If I did have it there would be a real opportunity for international travel, and even travel in Australia would be a great thing. Sometimes the leave we get is just not enough to plan these sort of major travel events. I’m getting to the age where I’m not a backpacker any more.

“I started in 1986 and I’m yet to have long service leave.

It’s a goal of mine.”

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Case Study: Wendy Hand “I’m a cleaner with ISS. I’ve been in contract cleaning for 12 years and I’m a proud United Voice member.

“My usual job is cleaning desks, toilets, showers, kitchens, vacuuming, dusting and rubbish collection.

“What I like about my job is that at the end of the shift that when I leave, the office is clean and ready for staff to come in the next day. It’s a really good feeling when you know you’ve done your best. The hardest thing is the workload. Even though we are proud cleaners, it’s sometimes difficult to get everything done in the time frame they give us. It would be good to have an extra half hour, and some cleaners do work that extra half hour to get the job done.

“In my time as a contract cleaner I’ve had two different employers. I’ve never actually tried to access long service leave because I didn’t think I’d worked long enough with one employer, or the next employer. I wasn’t entitled.

“If I had long service leave, I could take a holiday with my husband. You need a break to relax and recharge your batteries and long service leave gives you the ability to do that.”

Case Study: Peter and Gary Gary says, “I’ve been with Spotless at UTas for 15 years, and before that I was with another security firm for 6 and a half years. So far I haven’t attempted to use long service leave.

“We secure buildings and keep people safe. We ensure others’ occupational health and safety too by responding to security alarms, monitoring cameras, looking after people in trouble and responding to duress and doing reports.”

Peter says, “I like that I meet people from every country on earth. It is fascinating.

“If I could take long service leave, I would go to Eygpt and climb to the top of Cheops Pyramid.

“I think we should be able to have long service leave no matter how many employers we have. I would like to tell Premier Hodgman that we deserve Long Service Leave after 10 years and should not have to fight for it.”

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Case Study: Christian and Darren

Darren says, “I’ve been working in the Security Industry for about 16 years, 14 of those years has been here, at the Launceston General Hospital. We’ve worked together here for about 11 years.

“Since I started here, I’ve had 5 different employers. We were first employed by Chubb but after a few years, they lost the contract to Dyson. When Dyson was about to be liquidated, the contract was passed over to Season Buck who were just a temporary outfit before SecureCorp took over the contract.

“The Security Contract for the THS is currently out for tender, so we may well be employed by another contractor early in 2017.”

Christian says, “It’s not an easy job, but I enjoy it. It’s great to work with the public, meeting lots of different people and keeping them safe. Most of us get a lot of exercise. I walk eight to ten kilometres a night. Our job involves monitoring the hospital, general patrol, and responding to code blacks.

“We also make ID cards for staff, answer phone calls and out-of-hours reception, do patient escorts and we monitor all the alarm systems in the hospital.”

Darren says, “I used Long Service Leave to go on a motor bike holiday. I traveled through Melbourne, Wagga Wagga and Adelaide. The best thing about it was the time spent with family. It’s important to get a good paid break from work and recharge your batteries.”

Christian says, “I haven’t accessed Long Service Leave yet. I have no idea what I want to do with the time... but I would like to take a break from work and do some home renovations. I think portability of long service leave is a great idea, especially since it is already available to other industries like building and construction.”

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Case Study: Danny McCormick

“I’m a Disability Support Worker and team leader. My job involves running a share facility for disabled people and making sure they have access to choices and independence and everything people would have in a normal everyday home environment. I started in the disability sector in 1991 and in my time I’ve had more than half a dozen employers.

“I’ve changed employers because the caseloads have changed, because clients have needed different types of services. And because it’s a casualised labour force. You’re always putting together bits and pieces of work wherever you can find it. I’ve also worked with the same person across several agencies because their requirements have changed; I’ve quite often moved from one agency to another or provided different types of services through different agencies to provide continuity of care.

“I have always enjoyed working with people with disabilities and with special needs because I enjoy being able to provide something that everyone else takes for granted. And I can just use the skills that I have built up over all these years and go in and say ‘Right, I can supply this person dignity. I can supply this person with choices.’

The things they should be able to take for granted but quite often can’t. It feels very special, it feels like an honour to be able to go in and make a real change.

“I have accessed long service leave once before, years ago when I was working with the South Australian Government. I actually visited Tasmania, so it was long service leave that brought me here and gave me the opportunity to look around and decide that this is where I want to continue my life. But as far as accessing long service leave since then - well, there’s no opportunity really unless you stay with the same employer. Working short periods of time here and there, you don’t have the same capacity to access it.

“If I had access to long service leave again now, it would give me the chance to recharge my batteries and see more of the state, and spend some time with my family. It’s a role that demands a lot of you. It demands a lot of your time, and time is a precious commodity. At the end of the day it would be nice to say ‘I’ve spent all of this time doing long hours and working strange shifts and missing so many events for a reason.’ To say, ‘Here is my opportunity to have some time back for myself with my family.’

“Not having access to long service leave feels frustrating. It’s particularly frustrating knowing that they’ve got a system set up if you’re in the building industry here, but we’ve got a system that locks a lot of us out of long service leave.

“I feel like I work in a field where a lot of what we do is taken for granted. You can get long service leave for building houses, but if you provide people with dignity and with choices and security, you don’t deserve the same deal.”

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Case Study: Janine Martin “I’m a Leisure and Lifestyle Assistant in the Aged Care sector and I’m a HACSU member.

“I love my work. My favourite part of my job is when I get to talk with the residents and hear about their lives and their stories.

“In Aged Care, it’s not always possible to stay at one job. But then you have to start all over again with your entitlements. I’ve worked in two facilities because I wanted to further my career and in doing that I’ve been disadvantaged.

“The work is very fast paced and stressful - not just physically but mentally as well. I need to have long service leave to look forward to. The opportunity to recharge, for self-care to continue to do the best job possible.

“When I see others going on long service leave I’m happy for them, that they’ve been able to accumulate it, but I’m a little resentful that I don’t get that chance.”

Case Study: Rebecca Reynolds “I’m an Aged Care assistant. I’ve been in the industry for 12 years and I’ve had three employers.

“My job involves caring for dementia-specific and palliative care-specific residents. It’s a very challenging job mentally and physically, dealing with not just residents but their families and supporting them as a whole.

“I’m very passionate about palliative care and end-of-life care. I love supporting residents, giving them dignity, and supporting their families.

“I know about long service leave, but I haven’t been in one position long enough to be able to benefit from it. Missing out on long service is disappointing, because I put so much effort into my job and so much passion.

“If I had long service leave right now, I would go and take my 8 weeks with my family. I have 5 children, so I would spend some time with them and take mental health time for myself and get myself refreshed for going back to work.

“Long service leave is very important for Aged Care workers. Our work is so mentally and physically strenuous that we need some time for ourselves to be our best when we are at work.”

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Recommendations We believe that the ACT model is an appropriate model to adopt in Tasmania. The Tasmanian scheme should reflect the key features of this successful model, including: • A legislated scheme

• Compulsory registration and participation of all community services (both profit and not-for- profit), contract cleaning and contract security employers. Full-time, part time, casual, limited tenure and independent contractors should all be covered • Employer payments of a compulsory levy into a centralised fund

• Administration of the scheme by a legislated authority of representatives from both worker and employer groups that reports to government and is funded by the Tasmanian government until the scheme becomes self-sustaining

• Long service leave entitlements should be no worse than those prescribed by current long service leave entitlements

HACSU and United Voice recommend the following steps be taken to accelerate the process of community engagement in relation to portable LSL:

1. That the State Government expedite the process of progressing a Portable Long Service Leave Scheme by supporting the establishment of a PLSL Working Group comprising representatives from Unions, Employers, State Government and TasBuild

2. That the PLSL Working Group be resourced by the State Government in order to lead sector wide engagement

3. That regional forums be conducted to provide for sector engagement and feedback on key issues for the scheme

4. That the PLSL Working Group develop a proposal to inform the structure, roles and responsibilities for a Board that would oversee the governance of a Tasmanian PLSL Scheme, for presentation to the State Government

5. That the State Government commission an Actuarial Assessment to determine the practicalities of establishing the scheme

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References 1. http://www.abs.gov.au/AUSSTATS/abs@.nsf/Lookup/4102.0Main+Features30Sep+2011#3 2. Fair Work Ombudsman, When businesses change hands, <www.fairwork.gov.au/how we will help/templates and guides/fact sheets/rights and obligations/when businesses change hands> 3. PricewaterhouseCoopers, Department of Human Services Community Sector Investment Fund: Community services sector portable long service leave, report for Department of Human Services (2010), 1.

4. Cleaning Services Award 2010, from 1 July 2016 5. Security Services Industry Award 2010, from 1 July 2016 6. Social, Community, Home Care and Disability Services Industry Award 2010, from 1 July 2016.

7. ACT Council of Social Service, Community services sector portable long service leave scheme, submission to the ACT Government (2008), 3.

8. http://www.actleave.act.gov.au/files/annualreports/annualreport2015.pdf 9. http://www.parliament.vic.gov.au/images/stories/committees/eejsc/EEJSC_58-01_Text_WEB. pdf 10. http://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Education_and_ Employment/LSL_Portability/Report 11. https://docs.employment.gov.au/system/files/doc/other/towards_more_productive_and_ equitable_workplaces_an_evaluation_of_the_fair_work_legislation.pdf

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