'Fake job' case prompts call for investigation into employment providers

17 Jul 2020

NXT MP Rebekha Sharkie is calling on the Federal Government to investigate unscrupulous practices among some employment providers.

Raising the plight of a constituent owed $12,000 after being put forward for a “fake job” by a ‘for profit’ employment provider, the Member for Mayo wants more scrutiny of the Government’s jobactive employment service and the job outcomes claimed by its contracted providers.

“How many other Australians have been ripped off by the system, put forward for fake jobs and then left in debt?” Ms Sharkie said today.

“These providers get paid hundreds, often thousands of dollars, to place people into jobs there doesn’t appear to be anyone independently checking if they are doing their job.”

In Question Time on Thursday Ms Sharkie raised the case of 63-year-old ‘Rick’ who had been unemployed for more than two years when he registered with an employment service provider through jobactive.

The provider sent Rick to a job interview with a construction business.

Rick won the job but soon realised he wasn’t an employee but a self-employed subcontractor who was required to submit invoices and wait for payments.

He had no Workcover or superannuation provisions.

jobactive requires people to be placed in ‘employment’ in order for providers to receive Outcome Payments for certain categories of unemployed clients.

Rick’s employment provider stood to receive more than $10,000 for placing a mature age worker in a job.

“Rick told the employment provider several times that he wasn’t getting paid but they just told him to go and see the Fair Work Commission,” Ms Sharkie said.

“Rick is owed more than $12,000, he has no money for a lawyer and he no longer hears from the provider.

“The construction business is now being wound up.

“As a ‘subbie’, Rick is highly unlikely to get any payment for his months of labour.

“His only hope is to attend the winding up hearing and hope for the best.”

jobactive has a $1.5 billion budget this financial year. Who is checking that the money is actually being spent putting Australians into real jobs?”

The Coalition Government changed the delivery of employment services last year, seeking a system that was more performance-based.

Job Active Australia contracts expired on June 30, 2015. Contracts for jobactive started July 1, 2015.

“As a result of this change the number of employment service providers has shrunk from 79 organisations to 44 and the not-for-profit market share has fallen from 70 per cent to 55 per cent,” Ms Sharkie said.

“Contract regions have grown in size and payment is focussed more on outcomes rather than providers receiving money up front.

“I don’t have a problem with performance-based funding but I do have a problem when there appears to be inadequate checks and balances of these performances when it involves billions of dollars of taxpayer money.

“This is also about people’s lives. Rick and many like him have no choice but to accept the jobs these providers put them into, otherwise they risk losing income support.

“How can we do this to a 63-year-old job seeker?

“I am calling on the Government to investigate the industry and put in greater scrutiny of outcomes.”

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