Parmar ParmjeetDr PARMJEET PARMAR (National): Thank you for the opportunity to speak in the second reading of the Minimum Wage (Contractor Remuneration) Amendment Bill in the name of the Hon David Parker. As a member of the Transport and Industrial Relations Committee I want to acknowledge the Hon David Parker for the work that he has done on the bill and the work that he did on this bill during the select committee process but I am taking this call to oppose this bill because this bill is to apply the minimum wage to contractors in the same way it applies to employees. This would mean that individuals and businesses hiring contractors will be required to keep a record of their remuneration and if broken down to an hourly rate it should come down to at least the minimum wage so this means that they will also have to keep a record of their number of hours. It is not just one side—a business or an individual hiring a contractor—but the contractor providing their services would also be required to keep a record of their hours as proof if required. To me this is just adding unnecessary rules for businesses and businesses do not need that. In my view businesses need to be set free so that they can invest reinvest and create more jobs. We want our businesses to grow. We do not want unnecessary rules and regulations imposed on our businesses. I was not surprised to see that a number of submitters opposed this bill for these reasons. Those submitters who opposed this bill were from the business sector—business representatives or firms—and they had a very very similar view because these are the people who are out there in the field and we should be listening to them. Some very interesting points came out during the select committee process. A submitter said that moving to a time-based model for contractors in the way we have it for employees would actually restrict contracting opportunities because contractors like to have flexibility. Some of them just work part-time. What people look at when they go out to hire a contractor is the time line they can provide their service in and also the fees for their service and normally businesses or individuals wanting to hire a contractor will be going out and asking for more than one quotation. Once they have compared that quotation they will give that job to the one who is most satisfactory according to their business or their needs. Sometimes these people going out to hire contractors have no idea about the number of hours that job will take to finish so it is really unfair to put this responsibility on these businesses or individuals to make sure that the contractor they are hiring is going to earn at least the minimum wage when the total amount the contractor is charging is broken down to an hourly rate. Coming from a manufacturing background I have first-hand experience of dealing with contractors and I know that contractors know what they are doing. Coming from a manufacturing background where there are several machines I know that on a regular basis these machines are serviced and these companies that service these machines do not provide that service for just one company but that is their job. They go out and service machines in several businesses. What they do is they come in on a regular basis they grease and oil the machines run them and show that they are running fine and they do that after hours so that the regular business is not interrupted. So no one is actually sitting there and monitoring the number of hours those people who come to service those machines spend on those machines. Sometimes in such businesses where there are lots of machines machines can break down and my experience is that contractors will never provide a quote over the phone. What they do is they will come to the site they will assess the machine and then they will provide their quote and most of the time the quote is subject to various conditions such as if they find there was another fault inside the machine or if they require a new part which of course would require an additional quotation for buying that part and also for the time they spend on sourcing that part. If the machine is small—I am just picking one example from one industry—then sometimes these people will offer to take the machine to their workshop because that is convenient for them. That works well for them and in gaps they can fix that machine and then deliver it back to the site where it is required. And if the machine that has broken down is huge and cannot be transported in those situations these people will come on site and fix that machine and normally again it is done after hours because no one wants to interrupt their business during normal working hours. Again when they come to fix any broken machines normally they will be given access in my experience to the factory or the site. They come and do the job they take 5 hours or 10 hours—no one is sitting there and monitoring the number of hours they actually spend on that machine. No one wants to know whether they are just sitting in the tearoom and having their dinner; what they want is the assurance that the machine is fixed and they know how much they are paying for the job that the contractor is doing for the business. So in my view this bill is underestimating contractors out there and this bill would do the opposite of what the member actually wants to achieve. I believe there are enough protection mechanisms for contractors if they feel they are being exploited. What we should actually do is spread the awareness that there are provisions available for contractors if they feel that they are being exploited. I also feel that this bill will bind contractors to the minimum wage because if this bill goes through the signal will be that contractors should be earning just the minimum wage. As a result of this bill people will start looking at the number of hours they will be asking contractors to break—the number of hours—and will also start calculating the amount that they are charging based on the minimum wage. I am a supporter of having a free market. I think we need the flexibility that is in the market place and we do not want to bind contractors to just the minimum wage because some contractors are more efficient than others some contractors like flexibility and some contractors just like to work part-time. That is why a lot of people come out from their regular professions and start up their own business as a contractor. So we would be taking away that freedom from contractors because as I said before it is not just the business or an individual hiring a contractor who would be required to keep those records but the contractor offering those services would also be required to keep those records. We want to see that the market is giving that flexibility for businesses to grow and for people to do well and to support our businesses. I do not understand why the member is so fixated on the minimum wage. On this side we are focused on growing our economy because if the economy is strong we have more new jobs and higher-paying jobs and that is what we want our businesses to do. To support our businesses we are diversifying our economy. We are getting free-trade agreements signed—for example we already have a free-trade agreement with Korea. We are very supportive of the Trans-Pacific Partnership agreement which is going to be worth $2.7 billion by 2030. These things are to support our businesses. We know that wages are rising faster than inflation and there will be around 195000 more people employed by mid-2020. These are the things we need to do to support our businesses. If the economy is strong then people will have higher earning power. As one submitter said it is not a good idea to mix two models—the employee model and the contractor model. First of all it is not desired by the business sector and also it is not practical. My colleague who spoke before me from this side gave an example of where contractors will actually be earning less than employees if they are put on just the minimum wage because they will have to pay ACC levies and also they do not get holiday pay. It is not a good idea so I oppose this bill. Thank you.