Jobmaker: discrimination law exemptions could protect employers who turn away older applicants

Employers who tell older workers not to apply for jobs they intend to create with jobmaker wage subsidies for young employees may be protected from discrimination law, according to the Treasury.

Officials told a Senate inquiry into the jobmaker hiring credits bill on Monday that exemptions in the Age Discrimination Act could protect employers in such cases, a position supported by the Australian Human Rights Commission, although both said employers needed to seek their own legal advice.

But employers who cut the hours of older workers to hire younger staff could be in breach of general rules to stop the scheme being exploited, the Treasury warned.

Labor is yet to decide its position on the bill but is under pressure from Australian unions to seek substantial amendments to build safeguards into the legislation.

On Monday the Australian Council of Trade Unions president, Michele O’Neil, told the inquiry it was a “major concern” that there was no dispute resolution process if an employer cut the hours of existing workers to hire new workers on wage subsidies.

Council of the Ageing joins unions in warning jobmaker could harm older workers

Employers can collect $200 a week for new hires aged 30 and under and $100 a week for those aged between 30 and 35 – provided they increase their organisation’s total headcount and payroll.

O’Neil called for the Fair Work Commission to be granted powers to arbitrate disputes to prevent the “very real risk that an existing worker would have their hours reduced”.

The jobmaker hiring credit program will apply to new employees engaged after 6 October and some employers have already begun to advertise for workers eligible for subsidies – a practice some older workers have complained is discriminatory.

A search of the job website Seek shows several dozen employers have advertised for jobmaker-eligible staff in roles including marketing, tax and as administrative assistants, sales staff and forklift operators.

Philippa Brown, a principal adviser in the Treasury’s social policy team, told the inquiry that exemptions to age discrimination law existed for commonwealth programs and for “positive discrimination”.

“Acting in accordance with a government program would not be a breach of the Age Discrimination Act,” she said.

The independent senator, Rex Patrick, suggested that the legality of the job ads was as “clear as mud” because the employers were not acting on behalf of the commonwealth so the exemption may not apply. Officials took the question on notice.

The Australian Human Rights Commission told Guardian Australia “there are exemptions in the Age Discrimination Act that may make it lawful for employers to discriminate on the ground of age in determining who should be offered employment”.

“One exemption in the Act allows for positive discrimination on the ground of age. This exemption makes it lawful to discriminate on the ground of age by an act that … is intended to reduce disadvantage experienced by people of a particular age.”

Brown told the inquiry that age discrimination exemptions would not apply “in a circumstance where an older worker loses their job or has their hours cut” – although this could be prevented by laws against unfair dismissal and taking adverse action against employees.

Earlier, O’Neil noted that casuals lack the protection of unfair dismissal laws, while adverse action laws had been “read down” to the point they were unusable.

Rules for the jobmaker program claim that schemes to “artificially inflate employee headcount and/or payroll for a jobmaker period … would be prevented” by the integrity provisions in the coronavirus economic response laws.

They cite the example of “terminating, or reducing the hours of, an existing older employee in order to make it appear that they have hired additional employees where there has been no substantive increase in their overall employment levels”.

In that case the tax commissioner could determine that employers needed to pay back jobmaker hiring credits.

In addition to dispute resolution mechanisms, the ACTU wants employers who have underpaid workers or have been found to have breached work health and safety laws to be excluded from the scheme.

The Greens agree with the call to exclude companies that have underpaid workers but would also ban those that have paid a dividend during the pandemic – excluding some of Australia’s largest companies.

Labor’s shadow employment minister, Brendan O’Connor, has said he does “not quibble with the government focusing on 18- to 35-year-old” workers but wants to prevent older workers from being “displaced” by the scheme.

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