Youth and employment advocacy services have shared their doubts about the government's controversial PaTH internship program, as Labor signalled it would oppose the measure.
Announced in this year's budget, the PaTH -- Prepare, Trial, Hire -- program would get unemployed people into a workplace training program, equip them with work skills, and help them get into 120,000 'internship' positions with employers. For working up to 25 hours a week, interns would get another $100 on top of their welfare payments, while businesses that take on interns (examples in budget papers included newsagents and supermarkets) would receive thousands in financial incentives.
Since being unveiled in May, the plan has come under criticism for the below minimum wage top-up payment, the fact that workers would be classed as 'interns' and possibly miss out on the workplace protections of ordinary workers, and fears that the financial bonuses for businesses would create incentives to 'churn' through interns instead of offering interns more permanent positions.
A Senate inquiry into the program released its findings on Monday. While the final report from the committee -- chaired by Nationals senator Bridget McKenzie and with three of its six members from the government -- said it "recommends that the bill be passed", submissions from the likes of Interns Australia, Uniting Care, Anglicare, the Australian Council of Trade Unions and Jobs Australia have raised doubts about the program.
In addition, the report included a "dissenting report" from the Labor members of the committee. The Labor senators claimed the PaTH scheme was "poorly constructed", citing concerns about the below minimum wage payment, safety concerns, and questions over workers rights. Labor on Tuesday confirmed that it would oppose the PaTH plan in parliament, leaving the government to negotiate with crossbench senators to get the bill passed.
In a statement, Labor's shadow employment minister Brendan O'Connor said significant reforms needed to be made to the PaTH concept.
"The Turnbull Government should fix their likely damaging and exploitative Youth Jobs PaTH program. Labor believes in measures to improve the employability of young people but the intern phase of PaTH is deeply flawed," he said.
"There is a growing view that the Social Security Legislation Amendment (Youth Jobs Path: Prepare, Trial, Hire) Bill should not be supported until the Government shows they take the welfare, safety and job prospects of young Australians seriously by fixing the glaring problems in its PaTH program."
Interns Australia, the peak body for internships and work placements, wrote in a submission that it opposed the term 'intern' to describe the positions created under the program, as well as the payments offered and the lack of detail in the legislation.
"We strongly encourage the Committee to consider examining an alternative definition of 'intern' under Australian employment law, with clearly defined rights and protections, before this Bill is passed," the organisation said in its submission.
"Not only does the use of this term [intern] create confusion about the rights of the participants in the Youth Jobs PaTH program, it creates confusion about the rights of individuals undertaking internships in other areas, intensifying the creation of a corrosive unpaid internships 'culture'."
"It would be preferable for the payments to reflect minimum wage, or equal between $600 - $1000 per fortnight. Alternatively, the interns could be required to work fewer hours."
Interns Australia also questioned whether the subsidies to employers would create a "churn culture".
"As employers will receive a subsidy for employing these individuals, we have concerns this provision may encourage employers to hire an employee to receive the subsidy, terminate their employment, then hire another employee to receive the subsidy again," it said.
The Australian Council of Social Services raised concerns over worker rights and exploitation of interns, as well as over the payments to interns.
"The change in direction is welcome, especially the expansion of wage subsidies, but the internship component must be carefully designed to protect young people from exploitation and maximise employment outcomes," it said in its submission.
"Specifically the number of hours in internships should be capped, or the $100 per week 'incentive' payment increased, to ensure that the combination of income support and incentive payments provides the equivalent of a minimum hourly wage or training wage."
Of the 15 submissions posted to the committee's website, at least six call for the program to at least raise the top-up payment to minimum wage or higher, for working hours to be reduced so that the equivalent hourly payment increases, or for more payments such as travel allowance to be granted to interns.
The Australian Council of Trade Unions bluntly called PaTH "a poorly considered and ineffective response to the significant issue of youth unemployment in Australia".
"The ACTU is concerned that the scheme may encourage employers to replace existing minimum wage workforces with government sponsored interns or to reduce their wages or conditions. Interns are not paid superannuation or subject to worker's compensation and so represent a significant saving to employers when compared to regular employees," it said in a submission.
After the budget, employment minister Michaelia Cash said businesses would have to commit to not displacing existing workers and replacing them with the lower-paid interns. She said the Department of Employment would be monitoring employers, and if they "rorted" the program, they would be struck from the list of eligible intern employers.
Per Capita, a think tank focused on inequality, claimed the subsidies for employers to take interns may see full-time positions converted to internships.
"The potential exists for employers to replace positions that are fully paid with PaTH program participants purely as a cost-saving measure. While this provides the PaTH participant with potentially valuable experience, it comes at the cost of a job for somebody else," it said in a submission.
"The inclusion of safeguards such as ensuring that the PaTH participant's hours result in a net increase in total employee hours at the organisation and that there had not been recent layoffs could reduce the likelihood of PaTH program participants displacing current workers."
See all the submissions to the inquiry here.