'Culture of fear': Inside Home Affairs' command-and-control culture

The turmoil even reached fever pitch in 2019 when the main public sector union campaigned for the removal of then-secretary Mike Pezzullo, off the back of a bitter pay fight.

Now, with the fall of Mr Pezzullo and the rise of a new leader, the government and the union say progress is under way to dismantle the "command-and-control" structure that has quashed cultural progress for so many years.

While slow improvements in annual scorecards show flashes of promise, the department continues to lag behind all others, and when it comes to money, its employees feel woefully underpaid.

Years of sub-par results have been punctuated with public fights over restrictive dress codes - banning sleeveless shirts and other clothing considered unsuitable attire - and a messy arbitration process over pay and conditions.

The bitter pay dispute between the union and agency management between 2016 and 2019 involved Fair Work Commission arbitration, and led to staff losing allowances and conditions.

Staff once again marked the agency down on key measures of culture and leadership in the latest Australian Public Service Census, and reported the highest levels of bullying of the main agencies, with the department admitting "there is always more we can do".

But some disagree that problems can be solved within the existing monolith, with calls from former public servants to dismantle Home Affairs growing louder in response to the recent upheaval.

Community and Public Sector Union national president Brooke Muscat blamed entrenched cultural issues on the department's "command-and-control type structure" under former secretary Mike Pezzullo, and the former Coalition government.

Mr Pezzullo was sacked in November for 14 breaches of the APS Code of Conduct in relation to allegations that included using his duty, power, status or authority to seek to gain a benefit or advantage for himself.

"Under the previous secretary and previous government, there was a move away from a collaborative and consultative approach with staff and listening to staff about ... what their views are on how they can improve the work that they do," said Ms Muscat, who was a lead organiser for Home Affairs for 12 years.

"So it's been very much, over those years, a command-and-control type structure where ... workers felt uncomfortable with raising genuine issues in the workplace or raising issues about how work could be performed better."

Speaking at a press conference this month, Home Affairs Minister Clare O'Neil acknowledged "well-documented, public concerns" about the department, and said she, Immigration Minister Andrew Giles, and newly appointed secretary Stephanie Foster shared a "deep passion" for addressing issues.

"I would say that I see - already - changes in the department since I became minister," she said.

"People are excited about being involved in a department that's at the threshold of bold policy reform for government.

"And I think that's really helping, but by no means can we fix all the problems, and it's something that [Ms Foster] and I are working really hard on."

The Prime Minister announced Ms Foster's appointment at the end of November, a day after Mr Pezzullo's position was terminated. Previously a senior immigration official, and before that a Prime Minister and Cabinet deputy secretary, she had been acting as secretary since September.

Staff satisfaction did increase in 2023 - while Mr Pezzullo was still secretary - with an overall employee engagement index of 69 per cent, compared with 67 per cent in 2022.

Results had been climbing since 2021 - under the Coalition government - when the engagement index was 66.

But those results still lag behind overall APS numbers, and when asked whether their agency was "a good place to work", staff gave particularly poor feedback. Just 57 per cent responded positively in 2023, up from 49 per cent in 2022, and 46 per cent in 2021.

Ms Muscat said these scores reflected a culture where people who raised issues or spoke against senior leadership were "ostracised, alienated, moved out of roles", and those who worked with union representatives "weren't valued or respected".

"[We've seen] a harsh culture ... very much a culture of fear, of top-down management structures, where we've seen some issues around systemic bullying and harassment, psychosocial problems and risks because of some of the command-and-control type management style of behaviours," she said.

The latest census results showed Home Affairs staff were equal most likely to say they had experienced bullying in the past 12 months of the 16 departments, along with Services Australia and the Australian Taxation Office.

The department says it is increasing its "engagement with our people to ensure they have a say in the future of the organisation and to provide them with an opportunity to contribute to a positive, empowering and supportive culture".

"While the department has seen an overall improvement across all census indices and rankings in 2023 compared to the year prior, there is always more we can do and we are committed to building a positive future for the organisation and our people."

It is difficult to lift culture at a department where the overwhelming majority of staff don't believe they're paid fairly - and still reflect sourly on the events of 2016 to 2019.

Just 34 per cent of staff said that they felt fairly remunerated for their work in 2023. This was 18 percentage points down on the APS overall result, and fell from 37 per cent in 2022.

Mr Pezzullo had previously linked pay outcomes with the culture in the department, saying he wished he could pay his employees more.

Asked at a parliamentary inquiry hearing in February whether departmental culture was positive, he responded that it was "mixed, in some respects".

"I think in terms of clarity of mission, purpose, conscientiousness of our staff, it's a very mission-driven department. I think all of the data supports that," he told the Joint Committee of Public Accounts and Audit.

"Frankly, I candidly wish I could pay my staff more without being required to offset it against key mission capability.

"I think that there's a wage apartheid that's emerging in the public service through the fragmentation of pay arrangements that has occurred over about a 10- or 15-year period."

The latest round of bargaining, in which the government has offered an 11.2 per cent pay rise, has begun to shift the dial, the union says.

A list of more than 50 common conditions for the APS - including improved paid parental leave and flexible working rights - will benefit Home Affairs staff in particular, Ms Muscat said, while at the agency level there had been "a demonstrable difference" in the tone of negotiations.

A growing union presence in Home Affairs contributed, she said, adding: "We've also got an employer that's actually willing, in this bargaining, round to work with us rather than work against us." The union, for its part, has faced criticism for its affiliation with the Labor party.

Former Department of Immigration deputy secretary Abul Rizvi said this argument "may have been partly true", but the Machinery of Government change that created the mega agency in 2017, was a crucial piece of the puzzle.

"I suspect part of the problem was that the immigration area of Home Affairs was never really compatible with the law enforcement and national security culture of other parts of Home Affairs," he said.

"That would not have been assisted by the large exodus of senior immigration staff after Home Affairs was created."

Mr Rizvi is among a group of former senior public servants who have voiced concerns about the mega agency, with some arguing it is time to dismantle Home Affairs.

The Home Affairs Minister this month hinted she would have "more to say" regarding the department's culture in the new year.

Opposition spokesperson for Home Affairs James Paterson declined to comment on this story.

The Canberra Times was unable to reach Mr Pezzullo for comment.