Australian small business representatives have joined the resources sector to challenge the Labor government’s Same Job, Same Pay reforms, claiming a rushed crackdown on the practices of the nation’s biggest companies could have unintended consequences for local businesses.
The Albanese government is pursuing legislation to ensure labour hire workers are paid the same rate as their full-time employee colleagues when completing the same job, over fears that the nation’s biggest employers are skirting pay responsibilities by outsourcing their labour.
Minister for Employment and Workplace Relations Tony Burke has long challenged a “loophole” which permits big businesses to undermine staff pay deals by negotiating cheaper work through external labour providers.
Major mining and resource companies are among the biggest users of labour hire services, and big names in the sector are opposing what they see as harsh overregulation.
BHP says Same Job, Same Pay‘ rules could add $1.3 billion to its annual wage bill, equivalent to the labour costs of 5,000 workers at full-time employee rates, a toll it claims would hamper its domestic operations and the nation’s productivity.
The powerful Minerals Council of Australia has now launched its new ‘Find a Better Way’ campaign to combat impending same job, same pay rules, and has enlisted major employer groups like the Australian Petroleum Production & Exploration Association and Business Council of Australia for the fight.
“This retrograde policy will deny Australian workers flexibility and the capacity to be treated individually,” the groups said in a joint statement.
“It will deny them the opportunity to negotiate more pay for harder work.”
While the alliance is dominated by groups representing big business, the Council of Small Business Organisations Australia (COSBOA) has also signed up for the campaign, claiming new legislation could unwittingly hamper SMEs.
Matthew Addison, COSBOA chair, said the organisation is first and foremost seeking clarity over what the government hopes to achieve.
It is currently unclear if ‘locum’ medical staff could come under Same Job, Same Pay rules, a move which could see temporary workers paid the same “as somebody who’s on staff permanently and vice versa,” Addison said.
How the government will distinguish between labour hire regulation and short-term contracting is yet to be determined, he added.
A hypothetical small business “‘might need some expertise for an hour, we might need some expertise for a day or week,’” Addison said.
“‘I also have other staff that arguably are doing the same job, based on that same description. So if we’re bringing that expertise in, do I have to pay all my existing staff what I would pay a short-term contractor?’”
“If this is rushed through we are really concerned about the unintended consequences,” Addison added.
The federal government has already tabled a consultation paper asking if Same Job, Same Pay rules should apply differently to small businesses.
Further consultation is underway before the laws are introduced to Parliament in the second half of the year.
As big business leads the charge against Same Job, Same Pay regulation, Addison said their alignment with SME concerns means the voices of smaller operators won’t be overlooked in the consultation process.
“It is really easy for small business to align [with big business] when we all have exactly the same concerns about the way this legislation is coming forward,” he said.
“Sure, labour hire has prevalence in big business operations and in the way that it provides a solution to big business,” Addison added.
“Labour hire is also used by small business in different circumstances… What problem are we trying to solve? Which community are we trying to address?
“Let’s talk about what will be the impact on business if Same Job, Same Pay is applied to these different communities.”
As concerns mount, the federal government has already disputed some arguments put forward by the ‘Find a Better Way’ Campaign.
Responding to the new ads on Monday morning, Treasurer Jim Chalmers brushed off fears that Same Job, Same Pay legislation will put new constraints on how small businesses pay their own employees — as suggested in the ‘Find a Better Way’ garden centre ad.
It is “not about trying to prevent businesses from recognising differently the levels of experience that their workers have”, Chalmers told RN.
Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
