Time to Wake Up to the Risks of Unfair Terms in Professional On-Hire Contracts!

February 28, 2023February 28, 2023Andrew C Wood Bigger Pictures, Consumer Protection, Contract, Employment Agents Tags: Consumer Protection, Contractors, Employment Law, Freelancing, Labour Hire, Recruitment Leave a comment

For years, we thought that we were “astute”, using one-sided professional on-hire contracts that were stacked in the agencies’ favour. Clients wanted compliant professional labour without the costs of employment; and on-hire agencies developed business models that met, and continue to meet, that demand – despite the inherent risks.

It should have changed as the professional contracting sector came under increasing competition from contracting platforms such as UpWork and Fiverr. It should have changed; but it didn’t.

It should have changed in 2016, when the Australian Consumer Law was amended to prohibit the use of unfair terms in standard form, small business contracts, because the independent contractors were supposedly in business on their own account. It should have changed; but it didn’t.

It should have changed in June 2021, when the ACCC granted a class exemption to allow small businesses, including professional contractors, to bargain collectively on price, terms and conditions without breaching competition law. It should have changed; but it didn’t. Though there are some encouraging signs that the bargaining exemption is being adopted by health and medical professionals and by IT professionals.

It should have changed in February 2022, when the High Court said that if you’ve set yourself up as a mere purveyor of subservient, dependent, and compliant labour, and your contractor’s promise to perform work is a “core asset” of your business, then you’re looking a lot like an employer.[i] It should have changed; but it didn’t.

In New Zealand, it should have changed in August 2022, when amendments to the Fair Trading Act, which prohibited the use of unfair terms in standard form, small business contracts, commenced. It should have changed; but it didn’t.

It should be changing as the professional contracting sector is increasingly impacted by AI-driven technologies. Ask any recruiter about the ace-up-their-sleeve against being superseded by AI-driven technology, and they’ll tell you that it has something to do with their human touch and their contractor care programs. Well, if that’s right, it should be reflected in their contracts. It should be changing; but it isn’t.

Perhaps it will change in November this year, when the Australian Consumer Law will once again be amended to increase penalties for having unfair terms in standard form, small business contracts to $50 million.

Perhaps it will change; but my guess is that, unless the professional contracting on-hire agencies wake up to the changes that have taken place in their sector over the past decade, and stop using engagement and supply models developed in the 1980s, it probably won’t … at least not until their clients and contractors also wake up to the political, economic, social, and technological environment in which they’re now operating.

Post Script: Throughout February 2023, I was privileged to conduct a sustained Tuesday TalkAbout Live! masterclass exploration of issues facing professional contracting on-hire agencies. In March, I will be extending that exploration by taking a deeper dive into the Consumer Protection & Fair Trading regulation of the sector in Australia & New Zealand. One of the outcomes of our March masterclasses will be the development of a methodology for conducting a Consumer Protection & Fair Trading self-assessment. In April, we will shift the focus of our exploration into the field of competition regulation and explore ways to take advantage of exemptions and authorisations that facilitate the development of innovative supply models.

I hope you’ll take time to follow our exploration and participate in one of the sessions.

Let’s talk again, soon!

Andrew C. Wood

[i] CFMMEU v Personnel Contracting (2022) HCA 1.

So, I asked ChatGPT about “The Voice”…

February 27, 2023February 27, 2023Andrew C Wood Bigger Pictures Tags: Artificial Intelligence, Public Debate, Technology 3 Comments

I’ve been dismayed by the vitriolic exchanges across social media platforms on the issue of “The Voice Referendum”. So, I turned to ChatGPT to see if the artificial intelligence response was any more edifying.

Now let me say, in the absence of having much detail about how it would work, that my understanding of the proposal is that Australians will be asked to vote on whether they approve changes to the Constitution that would allow the federal government to make laws for how an elected body (“The Voice”) should be established to make representations and recommendations to government on matters affecting Indigenous Australians and Torres Strait Islanders; and authorising government to take those representations and recommendations into account when setting policy or making laws.

Rather than asking ChatGPT directly about The Voice – particularly as its information source cuts off at September 2021 – I thought it better to ask it about the pros and cons of authorised lobby groups. The question I therefore formulated was:

Should governments give approved lobbyist status to selected groups?

_27/2/2023

I’d be interested to hear how you might have framed the question differently. But here’s the unabridged response I got:

As an AI language model, I do not have personal opinions or beliefs. However, I can provide some information and perspectives on the topic of approved lobbyist status for selected groups.

Lobbying is a legitimate activity that allows individuals and organizations to communicate with government officials to express their views and influence public policy. However, lobbying can also be a controversial and divisive issue, particularly when it involves the influence of special interests on government decision-making.

Some argue that giving approved lobbyist status to selected groups can help level the playing field and ensure that a wide range of voices are heard in the policymaking process. By officially recognizing certain organizations as legitimate representatives of specific interests, governments can provide these groups with greater access to decision-makers and resources to help them advocate for their causes.

On the other hand, critics argue that giving approved lobbyist status to selected groups can create an uneven playing field and give undue influence to powerful interests. By officially recognizing certain organizations as legitimate representatives, governments may be seen as endorsing their positions and granting them a privileged status that is not available to other groups. This can lead to perceptions of unfairness and undermine the legitimacy of the policymaking process.

Ultimately, the decision of whether to give approved lobbyist status to selected groups is a complex and nuanced one that will depend on a variety of factors, including the specific context and goals of the policymaking process. Governments should carefully consider the potential benefits and risks of such a policy before making a decision.
_{ChatGPT. “Should governments give approved lobbyist status to selected groups.” Response posted on GitHub, 27 February 2023. Accessed 27 February 2023.}

That seems to be not such a bad framing of the issues, and it allows me to look at the debate from two perspectives. What I’ll be thinking about in the run up to the referendum is whether it is helpful and just to “level the playing field” by allowing The Voice to be raised in this way.

OK, so the response might be “artificial”. But it seems to restore an element of humanity, and now I’m wondering if ChatGPT can be used as a tool for gaining intelligence from public discussion, whilst eliminating a lot of the diatribe. I’d love to know what you think about that.

Andrew C. Wood

If words create worlds …

October 14, 2022Andrew C Wood Bigger Pictures Tags: Recruitment Leave a comment

What would be one piece of jargon that you’d like to strike from the language of recruitment? For me, it would have to be CANDIDATE OWNERSHIP.

It’s hard to find an expression that does greater damage to the reputation of recruitment as an emerging profession.

Of course, you all know that you can’t OWN a candidate. That sort of thing was abolished with slavery. So, at best, it’s a lazy expression that must clearly mean something else.

What you can OWN is the relational asset that consists of the goodwill connection that you enjoy with your candidates and clients.

You can also own the related intellectual property, contractual and legal rights that protect that goodwill.

But let me be clear. You cannot own a candidate. For as the courts have said, “No candidate is an asset on your balance sheet to be bought and sold”.

So, if it’s true that “words make worlds”, let’s make a world that is better because it uses language that reinforces and respects candidates’ value as people rather than as commodities.

Andrew C. Wood

A National Labour Hire Scheme … Really?

May 4, 2022Andrew C Wood Bigger Pictures, Labour Hire Licensing, Regulation Leave a comment

If anyone is talking to you about a national labour hire licensing scheme, just ask them what they would do with the four current state and territory schemes.

Perhaps the only justification for visiting the regulatory burden of a another licensing scheme on the Australian labour market would be that it might pave the way to dismantle the four existing schemes – at least in part. One set of regulatory burdens in place of four. Maybe that could be justified. But can you see anyone actually doing it?

And even if it could be achieved, what would stop the states and territories from retaining local schemes to licence labour hire supply to their own public sectors, which are substantial users of labour hire services – though some of them might not like to admit it.

Those with longer memories might recall the measures that were included in the intergovernmental Competition Principles Agreement to encourage the dismantling of anti-competitive state licensing schemes during the Hilmer reform era. Perhaps that’s a history that should be revisited.

Andrew C. Wood

A Free Spirit’s Guide to Saying “No” to Employment; and “Yes” to Independent Contracting

March 4, 2022March 5, 2022Andrew C Wood Bigger Pictures, Contracting, Employment Law, Independent Contracting, On-Hire 1 Comment

Do the common law tests used to distinguish employment from independent contracting, override my decision to work for someone but not be their employee; to work for them, but not have them as my master?

We all know that there’s no longer any point in trying to define work relationships in our contracts. We can set out our respective rights and obligations; but only a court can say what the legal effect of that will be.[i] Everything else is just opinion. And, whilst some opinions are better than others, a court won’t give much weight to the label we have ascribed to our relationship – at least, not in Australia.

Is it a matter of consent rather than “labelling”?

Let’s accept, for argument’s sake, that the contract, which the court is going to interpret in order to define our work relationship, can never be any better than the consent that underpins it. So, what if, instead of “labelling” our relationship as one of “independent contract”, we were to insert a clause that made it clear that we did not consent to be an employee?

We’re talking, here, about a genuine refusal of consent to accepting the status of an employee. There’s no room for sham contracting or equivocation in this.

But, assuming that the withholding of consent is genuine, could a court, limiting its consideration of the relationship to an examination of the express terms of the contract (as it now says it must do), ignore an express withholding of consent, coupled with an interpretation provision along the lines of:

“Parties acknowledge and accept that the contractor does not consent to be an employee or to enter into any relationship of employment and reserves full capacity to perform the work required by this contract as an independent contractor (the contractor’s reservation).
The parties agree that any provision of this contract that contradicts the contractor’s reservation must be read down or severed to the extent necessary to uphold the contractor’s reservation.”
[Experimental drafting for discussion purposes only]

A bit dramatic, perhaps. But would it work? Might it tip a court’s interpretation of an obligation to “co-operate”, say, from one of “control” (importing employment)[ii] in favour of one that recognises that “the parties intended to reserve to [the worker] a degree of independence and wished to avoid a relationship of subservience”.[iii]

But who wouldn’t want to be an employee?

Why might a person not consent to be an employee? Here are some reasons that reflect the unattractive status of employment under current Australian employment laws:

I might not wish to be bound to my employer by a wide-ranging legal duty of fidelity and loyalty…
especially as I might not wish to work under a legal relationship in respect of which the common law does not recognize an implied duty of mutual trust and confidence…[iv]
… and is equivocal about whether my employer owes me any duty of good faith.

How are we doing so far? We might consider that we’d do better relying on a duty of good faith to the extent to which it has received some recognition in Australian commercial law. But let’s keep going…

I might not wish to subject myself to an employer’s vaccination and other health mandates that are based on its power to command and my duty to obey what a court considers to be the employer’s reasonable and lawful directions. [Please note: I am not advocating an anti-vax position. Do I need to say that?]
I might not wish the privacy of my personal information to be denied under the so-called “employee record exemption” in the Privacy Act.[v]
I might not wish to be subjected to an employer’s power of control over my conduct outside the workplace.
I might not agree with my employer’s position on matters of sustainability, politics, human rights, gender etc.
I might have a philosophical, ideological or religious objection to being the employee of my boss.

And now, some more positive reasons…

I might wish to maintain a greater measure of control over what work I do and how I do it.
I might wish to maintain a measure of control over where I work (eg. from home) and when I do it.
I might wish to preserve my intellectual property and not have it automatically vest in my employer.
I might wish to have the assurance of small business standard form contract fairness protections in the Australian Consumer Law.
I might wish to have the Independent Contractors Act assurance of protection against harsh and unfair terms.
I might wish to collectively negotiate terms for the supply of my services under small business class exemption protections of the Competition & Consumer Act.
I might want a labour hire agency to help find work for me with its clients, without being subservient to it merely because it has agreed to help me.[vi]

You might be able to think of some more. But perhaps there’s enough there to at least fairly ask the question.

It’s a shame, really…

It’s a shame that one would need to go to these lengths and raise these objections to avoid becoming an employee against one’s wishes.

In his dissenting judgment, Steward J in Personnel Contracting pointed out:

In 2005, the House of Representatives Standing Committee on Employment, Workplace Relations and Workforce Participation published the result of its inquiry into “independent contracting and labour hire arrangements”. The Standing Committee noted that the growth in “independent contracting and labour hire employment” had “clearly” indicated that it had “become a preferred employment choice for many Australians”. It also observed that “over 10 per cent of the workforce” at that time identified themselves as being “independent contractors across a wide variety of industries”.[vii]

That percentage has likely increased significantly by 2022 with the growth of the gig economy.

His Honour went on to trace the history of the development of the Independent Contractors Act 2006 (C’th), observing:

Section 3 of the Independent Contractors Act states that the objects of the Act include protecting “the freedom of independent contractors to enter into services contracts”; the recognition of “independent contracting as a legitimate form of work arrangement that is primarily commercial”; and the prevention of “interference with the terms of genuine independent contracting arrangements.”[viii]

Steward J, critical of the overturning of precedent which recognised the worker’s choice of status of an independent contractor, concluded that it will:

…potentially deny to workers a choice they may wish to make to supply their labour as independent contractors, thus possibly undermining one of the objects of the Independent Contractors Act.^[ix]

In his Honour’s view, it was properly a matter for the legislative branch of government to consider. [x] And perhaps it is.

If nothing else, the government will at least have to deal with the spate of “double dipping” and award breach claims that will inevitably surface, now that a model for engaging workers that has stood for 30 years has been overturned.

Andrew C. Wood

[i] CFMMEU v Contracting Personnel [2022] HCA 1 per Kiefel CJ and Keane & Edelman JJ at paras [58] and [63]; Gageler & Gleeson JJ at para [127].

[ii] Interpreted in CFMMEU v Contracting Personnel to indicate employment by a combination of control and integration tests. See: Kiefel CJ, Keane & Edelman LL at paras [71] and [75]; Gordon J at paras [195], [196], [200] and [201].

[iii] Per Steward J (dissenting) in Contracting Personnel at para [204].

[iv] Commonwealth Bank of Australia v Barker [2014] 253 CLR 169.

[v] Privacy Act 1988 (C’th) section 7B(3).

[vi] See discussion of the evolving “labour hire subservience test” in related posts: Wood AC (2022) CFMMEU v Personnel Contracting: What did the High Court really say about the “own business” test; and Wood AC (2022) Constructing the ratio of CFMMEU v Personnel Contracting.

[vii] Personnel Contracting at para [210].

[viii] At para [212].

[ix] At para [222].

[x] At para [222].

WorkAccord’s Autumn “Tuesday TalkAbout” Programme: Healthcare Workforce Recruitment & Staffing Focus

April 23, 2020May 26, 2020Andrew C Wood Aged Care Workforce, Bigger Pictures, Collaborative Practice, Employment Agents, Employment Services, Health Workforce, Locum, Procurement, Recruitment, Webinar Leave a comment

In WorkAccord’s Summer series of Tuesday TalkAbouts, we introduced the concept of “waypoints” as those points on a journey where we can pause, take stock, and choose the direction we will follow for the next stage. As the COVID-19 pandemic response has rapidly escalated, it seems that we might have rushed through several of those waypoints and might now be asking, “What comes next?”

Many within the healthcare recruitment and staffing sector are experiencing a sense of considerable uncertainty, which may become costly. For some, it has been a case of having been so busy that there has not been time to reflect on what has happened. For others, things have gone unnervingly quiet.

In our Autumn series of Tuesday TalkAbouts, we will be looking at points of continuity and change for healthcare recruitment & staffing professionals and asking, “What does it now take to be Leaders in the World of Work?”

We will also be working throughout this series to develop the Tuesday TalkAbout format to provide participants with an enhanced range of on-line/off-line and synchronous/asynchronous learning opportunities and resources. We’ll be keeping the free on-demand webinars while developing the live sessions to provide more interaction and opportunity for discussion.

I’m delighted, therefore, to extend to all a warm invitation to participate in this exciting collaborative project.

Our Autumn programme of seven free webinars is outlined below.

1. Platforms (21/04/2020)

Our first Tuesday TalkAbout presents an “under the hood” look at Recruitment Platforms for Recruitment & Staffing Professionals.

What are they? Where do they fit in the classification of recruitment & staffing services? How do we “read” them? What are some of the opportunities and risks associated with their use?

2. A Healthcare Workforce that Nobody “Owns” (28/04/2020)

A healthcare workforce is a complex, multi-actor (multi-nodal) system that possibly nobody “owns”.

What are its governance challenges? What do these challenges mean for stakeholders, including Recruitment & Staffing Professionals aspiring to be Leaders in the World of Work? How can they engage more effectively with the workforce to enhance the value of the contribution they make?

3. Healthcare Worker Engagement Models (5/05/2020)

Healthcare worker engagement models come in many different forms.

What models of healthcare worker engagement are most relevant for Recruitment & Staffing Professionals? How can they distinguish between different models to choose the ones that are the most suitable? What challenges do procurement approaches pose to the successful engagement of health workers with their workforce? How can Recruitment & Staffing Professionals meet those challenges?

4. Aged Care Workforce Update (12/05/2020)

The Royal Commission Into Aged Care Quality & Safety has been running since October 2018.

What progress has been made so far? Who making submissions? What themes are emerging that will be significant for Recruitment & Staffing Professionals working in the Aged Care sector? What will happen next? And how can we make a submission?

5. Telemedicine & Recruitment (19/05/2020)

Social distancing measures under the conditions of the COVID-19 pandemic presented many challenges to the way we have traditionally thought healthcare and health workforce recruitment should be practised.

What are the consequences for healthcare workforce recruitment and for Recruitment & Staffing Professionals working in the healthcare sector? In this Tuesday TalkAbout we will review some of the current literature and take a look at some recent practice developments in the field of Telemedicine.

6. Collaborative Supply Models: Concept (26/05/2020)

Collaborative Supply Models or “Networks” may provide useful answers to many of the challenges presently facing healthcare workforce structure and governance.

What form could they take? What role might Recruitment & Staffing Professionals working in the healthcare sector play in their development? In this Tuesday TalkAbout, we’ll look at some of the collaborative supply or network models that have been developed and deployed in Australia and overseas. We will begin to explore how they might evolve to create new opportunities for Recruitment & Staffing Professionals responding to a disrupted workforce environment.

7. Collaborative Supply Models: Topical Challenges (2/06/2020)

In this Tuesday TalkAbout, we’ll build on the concept of a Collaborative Supply Model which we developed In the previous session for Recruitment & Staffing Professionals working in the healthcare sector. We’ll focus on four topical challenges:

Candidate connection & protection
Competition
Risk & liability
Governance

You can register for this webinar here.

Let’s talk again soon!

Andrew C. Wood

“Tuesday TalkAbout” Summer 2020 Program to Address Recruitment & Staffing Sector “Waypoints”

January 6, 2020March 4, 2020Andrew C Wood Bigger Pictures, Codes of Conduct, Collaborative Practice, Competition Law, Contract, Dispute Resolution, Employment Agents, Employment Law, Employment Services, Employment Services Agreements, Recruitment Leave a comment

Tuesday TalkAbout takes a new direction for its Summer 2020 Program of free, short webinars, as we discuss some larger themes at work in the recruitment and staffing sector.

Now, I certainly don’t claim to be a seer or a futurist. I observe and interpret. So, I’m not going to attempt to predict the course of the decade or anything like that.

Instead, I’ll describe the “waypoints”, which I think the recruitment & staffing sector in Australia and New Zealand has reached in eight key areas. ‘

A “waypoint” can be understood as a place on a route or pathway, a stopping point, or a point at which one’s course can be changed.

What the future holds from that point forward largely flows from the decisions and commitments which recruitment & staffing professionals make for their own organisations and professional lives – either intentionally or by default.

The observations and insights that I hope to share reflect experience gained over four decades in legal and workforce consulting practice and in recent work done with RCSA, designing its new Code for Professional Conduct, its grievance intervention guidelines & protocols, its StaffSure certification program, and many of its key resources and templates.

The eight key areas we’ll be discussing are:

1. Professional Conduct (21^st January)

RCSA’s new Code for Professional Conduct has been authorised by the ACCC to commence on 8 August 2020. How is it different from previous codes or other industry codes? Why is it different? What statement does it make about emerging professionalism? How might recruitment & staffing professionals respond to it? How is it enforced and administered?