Monday, September 28, 2015

Sham Contracting - Howard's individual contracts by another name

Ned K.
The recent 4 Corners story about the super exploitation of workers at Seven 11 convenience stores shocked many people. It took a lot of courage for workers on temporary visas to speak out about the sham employment contracts masquerading as respectable, legitimate franchisor- franchisee relationships.

The Seven 11 story is just the tip of the iceberg. In other industries such as construction, transport and contract cleaning, union representatives have been fighting sham contracts for years with differing degrees of success.Now these sham contracts are appearing in community services sector like disabilities and aged care to name a couple. Instead of "Jim's Mowing" franchisees cutting your lawn, they will care for your disabled relative or aged parents as well! All at race-to-the-bottom competitive prices emanating from the Labor and Liberal Parties' models of "consumer directed care"!

Franchisees and subcontracting in these industries have accelerated since the defeat by the Your Rights Of Work campaign of the Howard Government's Australian Workplace Agreements (individual contracts). In terms of impact on take home pay of workers who actually perform the work, these sham contracts are more sinister than the attempt by big business and the now Turnbull Government to reduce Sunday penalty rates on weekends. In contract cleaning for example, wealthy shopping centre owners often give cleaning contracts to companies that are well known for sub-contracting out the work, requiring all cleaners to have their own ABN, Or they award the contract to a cleaning company that has a franchise business model. The largest franchising cleaning company is Jani King, from the USA.

Under the franchise model, the cleaning companies usually target migrant workers who are attracted to this type of work because it gives them the appearance of self employment or owning a business and the hope of regular work. The latter is often essential for progressing the status of their visas towards permanent residency. However the franchisee has to pay a fee up front of up to $5,000 and is then provided with a one-off issue of basic equipment and materials such as a vacuum cleaner. The amount the franchisee is paid on a monthly basis is converted to an hourly rate of somewhere between $24 per hour and $30 per hour. On the surface this appears reasonable compared with a casual day rate under the award of $23 per hour for day work. The catch is that from the hourly rate the franchisor, the cleaning company in this example, takes out a royalty of up to 25%. leaving the person performing the cleaning on less than the award. Then there is workers' compensation levy of up to 7% to pay in some cases and the franchisee may also have to pay public liability insurance as well.

Depending on the size of the place to be cleaned, the franchisee may also need to find cleaners to help complete the work. The cleaning company sometimes pays the franchisee the same equivalent hourly rate for additional cleaners. As the franchisee him or herself receives less than the award, they try and find cleaners who will accept working for even less than the franchisee. $15 to $16 per hour on an ABN is common, or it could be cash in hand. Overseas students are prime targets for franchisees, or older workers who may be eeking out an existence on a pension or some other miserable government benefit. Often these workers work on the flat rate even if working on weekends or in the middle of the night. If overseas students work over 20 hours a week to keep their job, they are locked in to illegal work with respect to immigration visa restrictions on their hours of work to 20 per week. So they become unlikely to report their exploitation to an authority and are reluctant to join a union. One, because their earnings are so low and every dollar counts and secondly, because they think if they belong to a union, they will lose their job if the boss or property owner finds out.

Then there is the question of unpaid superannuation.

Since the 4 Corners story broke, there is anecdotal evidence that more migrant workers trapped in these exploitative situations are deciding to speak out and looking for help in how to tackle their exploiters. Unions have an opportunity to organize thousands of workers in these situations, but will they?

Cases that have reached the prosecution stage or public exposure have so far been due to support from Fair Work Ombudsman or community based or consumer associations or concerned individual activists. It is time for unions to engage with this growing, super exploited section of the workforce who have the appearance of being 'their own boss'. After all, unions in Europe, especially the UK, grew out of individual self-employed artisans joining together as early as the 1500s and more extensively in the late 1700s and early 1800s.

For unions to put these workers in the 'too hard basket' would be short sighted and damaging to their exisiting core membership base whose very existence as weekly paid employees is threatened the longer the exploitation of the 'be-your-own-boss' workers goes unchallenged.

Monday, September 21, 2015

Book review: Older Australians - Living On The Edge

Ned K.

The federal Labor Party Member for Port Adelaide, Mark Butler, has written a book called "Advanced Australia - The Politics Of Ageing". It worth reading to gain a better understanding of the impact of economic rationalism on the elderly, both materially and culturally.

Butler is well positioned to have written such a book given that he spent years representing aged care workers as an Industrial Officer in the then Miscellaneous Workers Union and then in his capacity as Minister For Mental Health and Ageing in the Gillard Government.

His book focuses on the growing aged population initiated by the "Baby Boomer" generation as they enter their "Third Age" which usually begins at the time of formal retirement from paid employment which for most Baby Boomers is between 55 and 65 years of age. He is highly critical of the reactionary view expressed in some mainstream media that older Australians are too costly for younger Australians to support financially and a social burden.

"So much of the public debate in Australia around ageing focuses on the downside: the pressure on the federal budget or the thinning out of the labour market. The Baby Boomers are the first generation to start to reap the full benefits of the twentieth century's longevity revolution. Instead of a spirit of celebration, their retirement is being greeted as a doomsday event by too many commentators."

Before writing the book, Butler had many conversations with older Australians in both rural and urban environments and concluded from these conversations that "Older Australians are generally living on the edge financially, and are very nervous about the constant chatter about the unsustainability of existing pension entitlements. They are resentful - and often shocked - by the way in which the rest of society treats them as they age."

The "constant chatter" against the aged has seen media like the Murdoch press give plenty of air to the argument that older people should be responsible for their own retirement survival which is really an attack on the aged pension. However as Butler rightly points out in his book, employer-paid superannuation was meant to supplement the aged pension, not eliminate it. His book contains some alarming OECD statistics about Australia's aged pension.

The public spending on Age Pensions as a percentage of GDP for all OECD countries was 9.3% in 2010. For Australia it was 3.6%, even lower than the USA which was 4.6%.

Even more striking information in the book is from an ACOSS 2014 Report on Poverty which found that when using the European definition of poverty line as 60% of the median disposable household income, "...the number of over sixty-fives rated as living in poverty climbs much more dramatically when using the European definition. Applying that definition to Age Pensioners causes the poverty rate to climb to 40 percent; for single older Australians, the rate soars to almost 60%."!

Butler's book is an attempt to awaken people to the precarious situation of older Australians and his book is a well-researched and convincing contribution to countering the ideology of capitalism which sees older Australians as an economic burden and disposable.

The book does not delve in to the profiteering of private capitalist interests at the expense of older Australians confined to residential aged care facilities. However the former Minister is well aware of the growing dominance of private equity capital in the aged care sector and the need for more regulation by the government on how residential care providers use taxpayers’ money in the sector.
Perhaps that issue will be tackled in his next book and awaits him if even a mildly progressive federal Labor Government sees the light of day in the not too distant future!

Amidst instability, illusions about the state persist.

Nick G.


In the space of a few days three events have occurred which are significant for the people of the countries concerned.  They are the replacement of Tony Abbott as Australian Prime Minister, the election of Jeremy Corbyn as Opposition leader in the UK, and the latest Greek elections.

They are not events from the battlefields of revolutionary struggle but events of an entirely parliamentary nature.

Nor will they lead to revolutionary struggle if the illusions that underline them persist.

At the heart of these illusions is a failure to grasp the distinction between parliamentary struggles under the conditions of the dictatorship of the bourgeoisie and the existence of the entire apparatus of the state as the instrument through which bourgeois dictatorship is maintained and exercised.

The capitalist state is the instrument for the suppression of classes below the capitalist class, the instrument through which capitalist class rule is maintained and reinforced.  The socialist state is the instrument for the suppression of classes that formerly exploited the working class, the instrument through which the workers elevate themselves to the position of the class that rules socialist society and preserves its socialist orientation.

All states, whether they be of the slave-owners, the feudal lords, the capitalists or the working class have certain essential components in common.

These include bodies of armed enforcers, a more or less consistent and generally known set of rules or laws to be enforced, institutions for the punishment of those who rebel against the state, trained ideologues who explain and justify and rationalise the given mode of production.  In different countries and at different times, but associated particularly with the rise of the original middle class, the bourgeoisie, representative bodies arose to challenge and then to work with or replace the absolute authority of monarchs and emperors.  We collectively call these bodies parliaments.

The modern bourgeois rights of universal suffrage and secret ballot, and the principle that the elected leaders are supreme over the armed forces, the courts and the jails, were won by struggles of the people.  When they are challenged or under attack from the capitalists and their reactionary bodies, it is correct that they are defended.  Their exercise, however, is not the be all and end all of the elevation of the working class to the dominant position in society, nor of the change from the capitalist mode of production to the socialist.

In fact, the economic, social, political, military, cultural and ideological ties between the members of the capitalist class, politicians who choose to work for the capitalists within the parliamentary process, and the senior members of the police, the armed forces, the judiciary and other state institutions will invariably make a peaceful transition from capitalism to socialism an impossibility.  This is independent of the desire of the working class and its allies for the avoidance of jail or bloodshed.  It is unavoidably the case that the bourgeoisie will never willingly surrender the means of production and hence the basis for its viability as a privileged class, to the workers.

So we see a general rejoicing in the demise of Tony Abbott but also a preoccupation with what this will mean for the Labor Party as if, in some fundamental way, the interests of Australian workers can be permanently enhanced, protected and enshrined through the exercise of the ballot. It reflects an illusion that Labor (or the Greens or some miraculous rise of a populist coalition of candidates) can ever move the people’s agenda in a direction that will not ultimately bring it into conflict, not with another parliamentary party, but with the state as the ultimate obstacle to fundamental social change.

Precisely this sort of social democratic or reformist illusion permeates the ranks of those associated with the British Labour Party who are currently exhilarating in the vote that presented that party’s leadership to the “old-time socialist”, Jeremy Corbyn (above).  Of course it is important not to write off the significance of Corbyn’s ascendancy.  It reflects a genuine desire on the part of many in Britain to bring to an end the embrace of reactionary neo-liberalism personified by Blair and Brown.  It reflects a genuine desire on the part of many in Britain to see the reactionary neo-liberalism of David Cameron’s Conservatives replaced by a caring Labour government committed to social justice and a “fair” sharing of wealth.

These genuine sentiments, worthy as they are, reflect a double illusion: the first, that a party of capitalism and imperialism such as British Labour will enact any measures that fundamentally change the nature of capitalism; and the second that, if indeed British Labour under Corbyn did enact such measures, that the coercive apparatus of the British bourgeois dictatorship would not be used to discipline the government into “playing by the rules”, and failing that, to dismiss it and restore to office a trusted Conservative regime.

Just such a warning has already been issued by sections of the bourgeoisie, and Corbyn is still in Opposition!   Business and financial interests will find no ethical objections to cultivating reactionary sections of the armed forces.  Indeed the latter have already indicated that if Corbyn, in government, tried to scrap Trident, pull out of Nato or announce “any plans to emasculate and shrink the size of the armed forces…(then) people would use whatever means possible, fair or foul to prevent that” (The Independent, Sept 21, 2015).

If the prospect of the UK under a Colonels’ dictatorship seems far-fetched, then let us remember what happened in the birthplace of democracy, Greece, during the years of the Junta, from 1966 to 1974.  The military seized power on behalf of the US imperialists and their Greek bourgeois collaborators.  Working class activists and democrats were arrested, imprisoned, tortured and killed. Civil rights ceased to exist and Communists singled out for special repression.

However, recent years have seen the rise of a coalition of left-wing parties and organisations, SYRIZA, which has had electoral success of a sort in opposing austerity measures demanded by the European finance capitalists.  Some Communist organisations participated in SYRIZA, some refused to participate.  Probably in the early days of SYRIZA there were opportunities for Communists to work in this coalition and strengthen its anti-imperialist base; those opportunities were obliterated by Prime Minister Tsipras’s referendum on the austerity measures and subsequent calling of the September snap election, correctly described by former Finance Minister Varoufakis as a “legitimation of capitulation”.

It was certainly a weakness of SYRIZA that it led the masses down a parliamentary path that, had it retained its original anti-austerity and anti-imperialist focus, would have led it into conflict with the descendants of the Colonels of the former Junta.  All attention seems to have been focussed on parliamentary manoeuvres; little attention seems to have been paid to questions of the role of the state and of the loyalties of its central components.  In concentrating very largely on economic matters, SYRIZA left in place all the structures that bound its armed forces to NATO and the US imperialists.  There is no doubt how they would have acted had push ever really come to shove.


The most interesting and informative studies of the nature and role of the bourgeois state are the several histories of France written by Marx in the early 1850s.  In The Class Struggles in France 1848 to 1850 Marx approvingly quoted the “bold slogan of the revolutionary struggle: Overthrow the bourgeoisie! Dictatorship of the working class!   In the same work, he drew the conclusion that “Socialism is the declaration of the permanence of the revolution, the class dictatorship of the proletariat…” 

In 1852 he disputed certain claims about the significance of class struggle as a “Marxist” concept when those concepts were not linked to an understanding of the class nature of the state.  Writing to Joseph Weydemeyer, he said “No credit is due to me for discovering the existence of classes in modern society, nor yet the struggle between them. Long before me, bourgeois historians had described the historical development of this struggle between the classes, as had bourgeois economists their economic anatomy. My own contribution was (1) to show that the existence of classes is merely bound up with certain historical phases in the development of production; (2) that the class struggle necessarily leads to the dictatorship of the proletariat; [and] (3) that this dictatorship, itself, constitutes no more than a transition to the abolition of all classes and to a classless society.” 
Twenty years later, writing of the experience of the Paris Commune, he drew further conclusions about the transition to socialism, saying that “the working class cannot simply lay hold of the ready-made state-machinery and wield it for their own purpose. The political instrument of their enslavement cannot serve as the political instrument of their emancipation.”  He described the government that emanated from bourgeois parliaments as a “huge governmental parasite, entoiling the social body like a boa constrictor in the ubiquitous meshes of its bureaucracy, police, standing army, clergy and magistrature…”

At around the same time, in a speech on the seventh anniversary of the International, he said: “In destroying the existing conditions of oppression by transferring all the means of labour to the productive labourer, and thereby compelling every able-bodied individual to work for a living, the only base for class rule and oppression would be removed. But before such a change can be consummated, a dictatorship of the proletariat is necessary, and its first premise is an army of the proletariat.”

These correct, scientific conclusions on the nature of the state, and on the necessity of a proletarian state to create and maintain the conditions for the survival of socialism originated with Marx and his great collaborator Engels, and have been central to the works of their pupils in Lenin, Stalin and Mao Zedong.

They were central to the writings of the founding Chairperson of the CPA (M-L), E.F. (Ted) Hill.  Those writings have a particular resonance for Australian revolutionaries, locating the Marxist theory of the state and revolution in an Australian context.

The three events discussed above reflect the instability of contemporary parliamentary politics in the era of imperialism’s uneven development. 
Amidst this instability, illusions about the state persist, illusions which prevent the advanced, leading elements of the workers from raising the ideological and political level of middle and backward elements.

The task remains for politically advanced workers to take the lead in developing an independent working class agenda, an agenda that is not merely different in content to that of the reformists and social democrats, but different in the methods is requires for its realisation.