Contract commercial cleaning has a dirty secret
Low-paid contract commercial cleaning staff are working harder for less as some unscrupulous employers cut wages in a bid to remain competitive. Pressure to improve profits by not only underpaying staff but also cutting corners has led to poor standards of hygiene in some of our public places.
The cleaning industry seems to be getting dirtier by the day for some, especially some minority groups, as they are becoming major victims of scams wherein they lose up to $15000 a year in wages and benefits.
What’s the problem?
Imagine you were trying to provide a living for your family. You are struggling with a heavy workload and then your pay is cut by over 20 per cent.
A change of cleaning contractors at your place of work could result in your Saturday casual pay rate dropping by $7 or more per hour.
If you worked eight-hour shifts, the change in contractors could result in a pay drop of around $56 per shift.
Aside from pay, the workload demands by contract employers and a shortage of equipment are also major issues in the cleaning industry.
Some contractors really do treat their staff poorly.
“It can be a struggle to finish work,” a worker said.
“The workload was too big. There was not enough equipment to clean the items which made it hard for us…There was not enough chemicals and they were not maintaining the machines properly.”
This issue doesn’t just affect cleaners, but everyone
There are many cleaners in Australia whose pay and working conditions have been adversely affected by the use of contracts in the cleaning industry. Sadly this is all perfectly legal – but it is a threat to the ability of workers to survive financially. But that’s not all… this issues affects everyone who uses public places like shopping centres, because standards in hygiene deteriorate in the places they clean. A recent scientific audit of major Melbourne shopping malls revealed that shoppers and their children risk catching potentially fatal diseases, from extreme levels of dangerous bacteria.
Cleaning is in crisis
The report revealed an underworld of bullying, intimidation and fear and that students working as cleaners are subject to exploitation and are under extreme stress in terms of job insecurity.
Shockingly, the report also found that some building owners are duped of up to $150000 a year by cleaning firms promising to pay their staff award hourly rates or above, but instead pay only $15 or less.
Furthermore, a United Voice report on the cleaning industry ‘A Dirty Business – The Exploitation of International Students in Melbourne’s Office Cleaning Industry’, found that overseas students, who are part of a $15 billion national education export industry, are regularly subjected to bullying, intimidation and racism, and threatened with the sack if they discuss their plight.
An independent survey found that more than half the cleaners employed in our cities are international students. Many of the international students employed in cleaning were born in India, Sri Lanka, Nepal, Bangladesh and Colombia. The investigation found that some are paid as little as $15 an hour, $9.35 an hour below the rate paid under the Clean Start city-wide agreement. This is also $7 below the award. According to CleanStart, Australia is a much more expensive educational destination than the US and the UK. Figures released recently revealed that fees and living expenses for international students averaged $38,000 annually, and not surprisingly, data from Australian Education International showed student numbers down 20 per cent from their peak some five years ago.
Jess Walsh United Voice state secretary said, “Glad Group, one of the biggest companies responsible for the cut price subcontracting of cleaners in the CBD, must commit to eradicating the practice.”
Walsh warned that the abuse of international students could inflict major damage to the education industry. The solution is to treat all cleaners equally as proposed in Clean Start 2013.
“Cut price subcontractors, working for companies like the Glad Group, have created poisonous environments to hide illegally low wages and other abuses. The ‘ghost workers’ who do this work are some of the most vulnerable members of our community: migrants and international students who often don’t know their rights,” said Walsh.
“This appalling situation has come about because ‘reputable’ companies, such as the Glad Group, are cutting corners by subcontracting to unscrupulous fly-by-night outfits that underpay and abuse their workers. We call on major companies, like the Glad Group, to show leadership in cleaning up this industry by committing to new Clean Start collective agreements,” he added.
“We want cleaning companies to clean up their act by no longer resorting to dodgy subcontractors and pay all cleaners the same. A significant proportion of contractors have indicated they will recommit to Clean Start, but major players like Glad must do so too. We were shocked by the findings of this investigation. Alarm bells should be ringing in our universities and colleges. If not stopped, this exploitation of students will threaten the long term future of Australia’s international education industry,” he added.
As per the report, 62 percent of Indians think Australia remains a dangerous place for Indian students. The seven-month covert investigation across 100 of Melbourne’s largest office buildings found that about half the contractors operating in the CBD engage sub-contractors for part of their work, and this is where abuse occurs. Inquiries began after union organisers heard anecdotally about international students working for sub-contractors who were known to under-pay and to deny basic employment conditions.
The way to end the abuse is to treat cleaners equally by ensuring the Clean Start agreement applies to all, whether they are employed by contractors or by sub-contractors. Extending Clean Start to all workers will destroy the incentive for the rip-offs exposed by the United Voice investigation.
More recent industry reports in the media
The ABC’s 7:30 presenter Leigh Sales has drawn attention to disputes between cleaning contractors and their cleaners in regard to pay and working conditions. The ABC program reports “A cleaner at retail giant Myer has been sacked following a 7.30 story about his employment conditions.”
These unethical practices have been going on for years. Spotless, an international services contractor, received media attention following the Walk for Cleaners on March 28, 2012. This followed a series of strikes by Spotless-employed shopping centre cleaners in demand of better pay and working conditions.
Our industry is in crisis
The dispute only scratches the surface of a much wider crisis in the industry, which critics say has been caused by the predominant use of contracts.
The commercial cleaning industry produces over $8 billion in revenue according to market research company IbisWorld.
Many have argued that a large portion of Australian cleaning contractors are lowering or avoiding minimum pay and working conditions in a race to the bottom-line to secure cleaning contracts, resulting in substandard pay and working conditions for cleaners.
Low Pay, Compressed Schedules and High Work Intensity: A Study of Contract Cleaners in Australia, by RMIT University’s Iain Campbell and Manu Peeters, described the contract system as involving a manager or owner of a site releasing a tender outlining the cleaning services needed. Contract cleaning companies then competed to win the tender.
“The competition is fierce and the successful bidder will usually be the one offering the lowest price,” the report found.
Monash University’s Professor Anthony Forsyth said most cleaners – the majority employed by contractors – were subject to minimum award employment conditions.
“Mining, transport and so on get above award pay and conditions through negotiating or having their union negotiate enterprise agreements on their behalf,” he said.
“That doesn’t happen a lot in the cleaning industry so a lot of these workers are stuck, for want of a better term, on minimum award conditions and have little bargaining power.”
There are concerns that there are some people who might not have the same level of ability to represent themselves in the workplace or inclination to join unions, and the cleaning industry is one industry where that number is certainly higher than in many other industries.
As a long-standing company in the cleaning industry I can say that “competition between contractors is still an extreme problem in the industry, resulting in a culture of subcontracting and the exploitation of cleaners”.
Until WorkChoices, subcontracting was never really considered in the cleaning industry because it was presumed that the main contractor would lose control and it would add to costs rather than reduce costs. Unfortunately, individual workplace agreements were introduced too late to prevent subcontracting.
It is well-known in the industry that many contractors subcontract at least part of their work to relieve the burden of worker’s compensation, payroll tax, superannuation and long service leave.
What this means is that they have created an illegal system where subcontractors have taken up work of previously employed people and the contractors are then paying them at rates far below those they would have received under the Cleaning Services Award.
If this was done simply to avoid payroll tax then it may be legal but it goes far beyond that. Subcontractors may also subcontract their work, leading to cases where cleaners may be paid as little as $7 an hour in cash. Inevitably, the reality of lowering the price of a job to undercut the competition is that workers don’t get paid what they’re entitled to for their hard work.
The Fair Work Ombudsman’s National Cleaning Services Campaign was launched back in 2010 as an opportunity to educate the Australian cleaning industry about changes to legislation. During the campaign, 366 cleaning firms were audited, with 315 audits finalised by the release of a final report in June 2011.
The report found a non-compliance level of 37.1 per cent, which meant that 117 employers contravened legislation. The audit also found a number of Victorian businesses engaged in sub-contracting.
One reason is that it is difficult to keep up with changes to legislation.
The rules seem to change often, so at The Havencab Group we ensure we are kept informed about any updates or changes to legislation. As a business, we pride ourselves on being ethical and doing the right thing.
Competition is fierce in the cleaning industry
Although competition in the industry is fierce, we would rather walk away from a prospective job than not comply with legislation. According to “The Retail Cleaning Crisis: It’s everyone’s problem”, a report by trade union United Voice, cleaning contractors who bid below cost hope to cut corners to secure a profit.
The report also found that sites releasing tenders, such as shopping centres, can be “unrealistic when they consider the capacity of contractors to meet their stringent cleaning specifications”.
Some of the tenders we are unsuccessful on, are fine-costed and we still don’t win based on cost. This should be made illegal.
“This downward trend in the industry has negative implications for all stakeholders, with the trap of cost-based competition leading to massive employee turnover, a lack of training, an unstable and transient workforce, security risks, Work Health and Safety (WHS) problems and lower standards of cleaning,” according to the report findings.
Many health and safety risks were highlighted in a hygiene audit of Melbourne shopping centres.
Melbourne Shopping Centre Hygiene Audit 2012, conducted by Bio-Clean director Peter Guerin on behalf of United Voice, found unacceptable hygiene levels in seven major shopping centres.
The report found toilet door latches, food court table surfaces and high chair surfaces to be three of the most unhygienic areas in the shopping centres examined.
“Of the more than 70 individual swab tests conducted in the shopping centres, all but one found levels of bacteria that were far in excess of acceptable hygiene levels,” the report found.
“High workloads of cleaners could be a significant factor contributing to poor hygiene standards in these shopping centres. In turn, these workload issues are increasing the risk of shoppers contracting infectious diseases.
“While for most shoppers, that could mean at least severe discomfort and pain, for those with vulnerable immune systems like babies, children and the elderly, these diseases could even kill.”
I wonder what a similar audit of Sydney’s shopping centres would show?