Unemployed Worker’s Union Report Reveals Shocking Job Network Failures

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The Australian Unemployed Workers’ Union’s (AUWU) National Advocacy Hotline Yearly Report has exposed a job agency system in crisis. AUWU President Owen Bennett explains.

Last week, the AUWU released its 2015-16 National Advocacy Hotline Report. Run entirely by unemployed volunteers, the National Advocacy Hotline provides free advice to the 880,606 unemployed workers attending job agencies. It is the first and only service of its kind ever offered in Australia.

In its findings, the report concluded that the Coalition’s multi-billion dollar employment services industry is “deeply dysfunctional and punitive” and in need of a “complete overhaul”.

“Job agencies routinely fail to uphold the requirements of the jobactive and DES deeds and unemployed workers are given no meaningful recourse to dispute unfair treatment,” the report found.

The data gathered by the hotline offers a rare insight into the experiences of unemployed workers as they interact with their job agencies. Below is a breakdown of the issues raised by callers:

Notes: Based on a Representative Sample of 170 calls. Callers can raise more than one issue.
Notes: Based on a Representative Sample of 170 calls. Callers can raise more than one issue.

Alarmingly, the report found that there were little to no consequences for job agencies that failed to uphold the government’s rules. The current mechanisms designed to reign in badly behaving job agencies have failed.

However, the crisis uncovered by this report is not just a product of the Coalition failing to adequately regulate the industry. The roots of this crisis go back to 2014 when the then Abbott Government began to overhaul the employment services industry.

As part of its objective of “cutting red-tape” throughout the sector, the Abbott Government began deregulating crucial aspects of the employment services industry. In late 2014, it was announced that Commonwealth Rehabilitation Service (CRS) Australia – the state-run component of the Disability Employment Service (DES) – would be shut down.

auwu-table-2As 47 per cent of unemployed workers within the DES were with CRS, this constituted a significant change in the sector and completely opened up the DES to private enterprise. The closure of CRS Australia meant that, for the first time ever, Australia’s employment services were completely privatised.

With the previous Jobs Services Australia (JSA) employment services system still in effect until 2015, the Abbott Government had to wait until July 2015 to introduce the jobactive (2015-2020) and Disability Employment Service/Disability Management Service (2015-18) deeds at a cost of $6.8 billion and $3.2 billion respectively.

These deeds turned the employment services industry on its head. Unlike the funding model of the previous JSA system that prioritised service delivery over outcomes, jobactive flipped it around and tied 60 per percent of total funds to outcomes.

As a result, the new system gave job agencies perverse financial incentives to place unemployed workers into ‘outcomes’ no matter how appropriate – be it a job, training program, or a Work for the Dole activity. As the new system forced job agencies to develop “outcome-driven” business models, not-for-profit companies were increasingly pushed out of the industry. More than ever before, employment services became a moneymaking industry.

The effect of these changes on unemployed workers has been catastrophic. Due to the outcome-driven focus of the current contracts, job agencies began to cynically utilise their penalising powers to bully unemployed workers into unfair activities and appointments. There is little doubt that this was a deliberate policy intention of the jobactive system – why else would the Coalition have given job agencies unprecedented new powers to financially penalise unemployed workers?

Since the introduction of the new system, the number of penalties imposed by job agencies on unemployed workers increased by more than half – the biggest increase in penalties ever recorded.

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The compliance focus of jobactive system has caused untold misery on unemployed Australians and their families. Furthermore, as has become the norm within Australia’s social security system, the Coalition government has gone out of its way to inflict particularly cruel and unusual punishments on Indigenous Australians.

Of the 261,529 financial penalties imposed on unemployed workers this year, 56 per cent were inflicted on Community Development Program (CDP) participants – an all-year-round Work for the Dole program targeted specially at Indigenous areas. Considering that there are 34,000 CDP participants – or approximately 4 per cent of the total number of people who attend job agencies – this is a shocking reminder of the Coalition’s discriminative approach to First Nations people.

ANU research Lisa Fowkes pointed out recently that for every 1,000 people in CDP there are 1,358 financial penalties imposed, compared to 36 in the jobactive system.

The government’s punitive approach to the unemployed is not only hurting unemployed workers financially, it is also placing them in physical danger. As more unemployed workers than ever before are being forced into Work for the Dole programs under threat of penalties, the number of injuries occurring at government-approved Work for the Dole injuries has skyrocketed.

During 2015-16, unemployed workers reported 500 injuries at Work for the Dole sites compared to 90 the year before – an increase of more than five times. The tragic death of Josh Park-Fing at a Toowoomba Work for the Dole site, and the exposure of unemployed workers to asbestos at a site in Adelaide are just a few examples.

The Coalition responded to these shocking figures by arrogantly claiming that the increased number of Work for the Dole injuries was a result of better education and awareness procedures.

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“A corresponding increase in the reporting of incidents is therefore not unexpected due to the heightened awareness,” a spokesman said in a statement.

That the Coalition government can spin increasing Work for the Dole injuries as some sort of policy success – and get away with it without a peep from the media – perfectly encapsulates the level of the social security debate in Australia.

It is the worst time in post-war Australian history to be unemployed. Not only are unemployed workers forced into a punitive, dangerous and dysfunctional employment services industry in a no-jobs market, they are also forced to live on a payment that is just under $400 below the poverty line per fortnight.

Decades of inaction from progressive forces in Australia have allowed both sides of politics to get away with this shameful abuse of the unemployed.

With the government preparing to introduce a bill early next year to give even more powers to employment services, this has to change, and fast.

Click here to read and endorse the recommendations of AUWU’s National Advocacy Hotline Report

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Owen Bennett

Owen Bennett is the president of the Australian Unemployed Workers Union, an organisation dedicated to fighting for the rights and dignity of the unemployed. He is currently writing his PhD thesis on the employment services industry.

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