In the next phase of the Labor government’s changes to Australian employment regulations in 2023:

“Same Job, Same Pay”

The government has shared some details about their new “same job, same pay” plan. They’ve put out a document this week containing some ideas about how they’ll figure out what “same job” and “same pay” means and are seeking responses prior to legislating the Policy later in 2023.

Basically, we’re talking about situations where a company hires someone through a labour hire provider instead of hiring them directly. If the first company has an enterprise agreement that pays direct hires more, then the labour hire employee doing the same job will get an ‘uplift’ payment to match the enterprise agreement rates of pay.

This will extend to internal labour hire, which is a model some larger organisations have been adopting gradually over the last 10 or so years.

Even employers without Enterprise Bargaining Agreements should pay attention to this emerging legislation. Why?

What will this mean for workers in the ‘Gig-Economy’, Independent Contractors, and other types of workers who, just like labour hire employees, aren’t covered by the Enterprise Agreements that will dictate ‘uplift’ payments that must be made, outside of Modern Awards?

If this Government can find a way to impose EBA conditions on workers who, in accordance with the Fair Work Act are excluded by the EBA itself, what will stop Same Job, Same Pay laws extending to any person performing tasks covered by an EBA, regardless of the type of engagement?

The purpose is clearly achieving an ACTU agenda item, as they continue to wage their war on any type of employment that provides businesses with flexible options.

I’d imagine this will also impact other businesses who issue ‘secondments’ of staff to their clients during projects and on-charge clients for said secondments.

While we don’t have all the details yet, this will certainly shake things up in the labour hire industry.

For Labour Hire providers:

Labour hire service providers won’t be able to compete on wages anymore, which often can be a motivating reason to use them. That means labour hire service providers will have to focus on other ways to stay competitive, like being more efficient administratively or charging lower fees.

I would imagine smaller labour hire service providers will find it easier to be nimble and more productive, over the largest labour hire organisations out there. Those labour hire providers who already implement this same-job-same-pay approach will be a step ahead of all other competitors who aren’t.

What can we expect?

Some companies might just decide to stop using labour hire altogether and hire people directly. Others might try to negotiate agreements that only apply to certain types of work to minimise the reach that same-job-same-pay has within their business, or even apply to cancel their enterprise agreements altogether.

But, we have the ACTU and militant unions beating down the door of the Labor government who took millions of dollars in donations from Unions who now want their debt repaid.

We know who’s really calling the shots here – so expect to see some rules put in place to stop or limit companies finding a way to avoid Same Job, Same Pay legislation.

Click here to access the consultation paper and learn more.