Emerging labour market requires new regulation

12 October 2023
Industrial relations expert supports reform to gig economy, labour hire
New protections are needed to account for the emergence of the gig economy and the rise of labour hire operators, and to allow these new and evolving forms of business to maintain their social licence to operate, writes Associate Professor Chris F Wright in his submission to the Senate Education and Employment Legislation Committee Inquiry on the Fair Work Legislation Amendment (Closing Loopholes) Bill 2023.
Associate Professor Chris F Wright

Associate Professor Chris F Wright

Chris F Wright is an Associate Professor of Work and Organisational Studies at the University of Sydney Business School, where his research specialises in industrial relations and labour market regulation, with a particular focus on national industrial relations systems worldwide.

He will appear before the Senate Education and Employment Legislation Committee this morning to discuss his submission, which focuses on provisions relating to wage theft, platform or ‘gig’ work, and labour hire.

“The Closing Loopholes Bill will help address wide cracks in Australia’s regulatory framework, which have undermined its effectiveness and led to problems of inequality, insecure work and staff shortages,” Associate Professor Wright said.

“Key features of the contemporary labour market, such as the gig economy and the rise of labour hire operators, were not envisaged when enterprise bargaining was first introduced in the early 1990s. Back then, wage theft was not the major problem it is today.

"The emergence of these changes threatens the integrity of Australia’s system of employment regulation if not addressed.

As the structure of business and the labour market evolves, it is necessary for the regulatory framework to evolve with it.

Claims the bill will hurt productivity and innovation generally lack supporting evidence, according to Associate Professor Wright.

“The research evidence suggests the Closing Loopholes Bill’s provisions have the potential to replace poor-quality jobs with good-quality jobs, and to reduce the scope for businesses to compete by undercutting rather than by being more productive and innovative.”

Associate Professor Wright believes regulatory reform is necessary to address the most urgent problems of the Australian labour market: making insecure work more secure, addressing the scourge of wage theft, and restoring integrity to the bargaining system and, by extension, to the competitive playing field and social safety net.

Achieving these outcomes is integral for encouraging businesses and industries to compete in a race to the top, that Australia’s continued and future prosperity hinges on, rather than engaging in a futile race to the bottom that Australia can never win.

“English Prime Minister Winston Churchill once said that without an effective framework of employment regulation, ‘the good employer is undercut by the bad and the bad by the worst … Where these conditions prevail you have not a condition of progress, but a condition of progressive degeneration’.

“The Closing Loopholes Bill’s provisions are necessary to avoid a situation like the one Churchill described.”

Read Associate Professor Chris F Wright’s submission in full.

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