Mining, petroleum, construction, farming bosses and small businesses are campaigning against a federal plan which would require bosses to pay labour hire workers doing the same job at the same site the same as those on award wages.
The Australian Council of Trade Unions (ACTU) estimates that about 600,000 workers — about 3.5–4.5% of the workforce — are employed through labour hire: they earn about $4700 a year less than other workers.
The “same job, same pay” workplace reform, which Labor says it plans to introduce later in the year, aims to amend the law to allow bosses to access labour hire for work surges, but not as a loophole to suppress wages.
The Mining and Energy Union (MEU) criticised business groups for running a “scare campaign” and said bosses should reward skills and experience.
“Contractors deserve to be paid more if they are specialist or meeting genuine short-term demand. Instead, employers are using the labour hire loophole to drive down wages and conditions for whole sections of the workforce,” the MEU told the ABC.
The MEU has been campaigning for such a reform for years. Then-opposition Labor leader Anthony Albanese introduced a private members bill in 2021. The MEU said then that Labour hire workers in the coal industry typically earn 30 to 40% less than permanent miners employed by the same mine operator.
“The ‘Same Job, Same Pay’ laws proposed by Labor would end the business model that provides an economic incentive for companies to undercut the wages of workers in permanent jobs, who have been able to improve their position through collective bargaining. Having permanent jobs is essential for mineworkers to organise and stand up for better pay and conditions.”
The Australian Bureau of Statistics (ABS) has estimated that 84% of workers on labour hire contracts do not have access to paid leave entitlements. In 2019–20, the median annual earnings (in main job) of people employed in labour supply services was $33,100. Sixty one per cent of people in labour supply services were men, and 27% were labourers.
The ABS also found that last June, 319,900 people had a job in labour supply services and for 83% of these it was their main job. It also found 84% did not have paid leave entitlements and 18% would prefer to work more hours.
Those in insecure and poorly compensated labour hire work are also more likely to sustain workplace injuries, due to inadequate training and management practices.
“When the labour hire industry has annual revenue of $30 billion to $40 billion while workers’ wages are going backwards because business has worked out how to game the system to cut wages and job security, this is not fair,” ACTU president Michele O’Neil said on May 29.
“Some big businesses are using loopholes in our current laws to get out of paying proper wages and entitlements, such as sick leave and annual leave. Businesses are upset that they have been exposed manipulating the system to cut wages and now we have a cost-of-living crisis.”
The Australian Financial Review reported on June 5 that Labor will introduce “same job, same pay” rules for Pacific migrant workers in July, even while it is consulting over the labour hire workers’ amendment.
The Pacific Australia Labour Mobility scheme, which includes a “pay parity” clause, will cover thousands of visa workers from nine Pacific Island countries and Timor-Leste from July 1. It will require labour hire firms and other employers to pay the workers in line with locals doing the same job.
Australian Meat Industry Employees Union federal secretary Matt Journeaux told AFR the rule change would be “hugely significant”. “We’ve been campaigning to get this off the ground with [meat giant] Teys since 2013, but they reneged on the deal.”
Journeaux said employers’ claim that the laws would not reward more skilled workers was “nonsensical,” as labour hire workers would just be paid in line with their relevant classification.