Same Job, Same Pay Legislation
Tania Constable, Chief Executive Officer

Same Job, Same Pay Legislation

Tania Constable, CEO of the Minerals Council of Australia writes…..

Either the Albanese Government has made a series of colossal errors and omissions in the drafting of its so-called Same Job, Same Pay legislation, or it’s just not telling you the full story.

Either way, the answer is alarming. But do government’s really make wholesale mistakes in the wording of important legislation, when the economic consequences are so profound, when the impacts are so broad?

When the government tabled its latest upheaval to industrial relations law to parliament earlier this month, it paraded a rather sensible-sounding political slogan that it says sits at the heart of its legislation: “Closing labour hire loopholes.”

In its sights, it says, were one or two mining and aviation companies that were allegedly undercutting workers’ pay by using labour hire companies to perform the same task as full-time employees, just on a cheaper rate.

Of course there was no proof provided of such spurious claims, which were more the grumblings of unions pushing for more power and access.

Just an empty, misleading slogan designed to pull the wool over the eyes of the public, appease the broader business community and woo powerful crossbench senators with false notions of fairness and equity.

The Albanese Government’s ill-timed industrial relations changes are not merely about “closing labour hire loopholes”.

The scope of Same Job, Same Pay is extraordinarily broad, capturing any business that provides workers, services or skills to another company, roping in millions of Australian workers right across the economy.

For Western Australia, that realisation is profound, given the vast numbers of contractors, service providers and skills companies that not only service the mining sector, but wholly rely upon it, together with the suburbs and communities those workers call home.

Despite the government’s denials and dance-arounds, the reality is this: all businesses that contract to another business are caught up in Same Job, Same Pay, till they litigate their way out through the Fair Work Commission, at their own expense and time. The wording in the bill is crystal clear. There is no ambiguity.

So as if running your own business isn’t difficult enough, the Albanese Government wants business owners to lawyer up, head to the Fair Work Commission and prove via a complex 12-point test that they shouldn’t be captured by the legislation. Even if they can satisfy the Commission that they are a service contractor, there is no guarantee that they will escape the clutches of Same Job, Same Pay. It is simply one element of the 12 point multi-factor test.

For those that fail the test _ and given the broad definitions and vagueness of the test, many will _ you will be required to pay your employees the same full-rate of pay and entitlements, including bonuses, share entitlements, and health care of a full-time worker in that host business.

No matter the experience, age or qualification level.

It is a burden that will crush small and medium operators who simply cannot compete on wages with what are some of the biggest companies in the world. In some cases, big businesses will simply stop hiring contractors. It will be uneconomical to outsource, not to mention the enormous red tape complexity that will smother their operations.

The pain will be felt right across the economy, whether you are a farmer, a barista, own your own construction company, run your own hairdressing salon, consult on IT and technology. The net goes wide and captures many.

And ultimately, this is a burden that will be carried by households through higher cost of living, an increase in insecure work and less jobs.

For Western Australia, the implications are more pronounced than any other state. If you sever the link between mining companies and the vast array of local contractors that service the industry _ from engineers, builders, machinists, cleaners, catering and even IT support _ you restrict the industry’s ability to expand their operations, to flexibly ride the bumps of a commodity cycle, attract investment, unlock deposits, or continue to pay what are the highest average wages in the country.

You effectively put a straight jacket on the most productive industry in the nation, and thus imperil Australia’s future prosperity.

This is not the mining community running distraction with hype. The broad nature of this policy is in fact the qualified legal opinion of some of Australia’s leading experts on industrial relations.

“Now, the government says that it is not meant to cover … specialist contracting services. It’s not what the legislation says,’’ Adelaide University professor Andrew Stewart told the annual Minerals Week Conference in Canberra this month.

“In fact the legislation, as I read it, says the exact opposite. It says specialist contracting services are covered.”

The legislation does not even include a definition of ‘labour hire’. Rather, it treats labour hire and service contractors in the same way.

Professor Stewart says the fundamental “flaw” in the legislation is a mistake; a drafting error.

But it is increasingly clear that this broad scope is in fact, the point. It is intentional; a trojan horse designed to kill off short-term contracting and seasonal workers, and force more companies to expand their internal workforces so unions can expand their field of play.

Mistake or intent.

You be the judge.