The idea behind the Federal Government’s policy Same Pay, Same Job Bill has some merit, but would need an overhaul including a link to performance, perhaps what they should be proposing is Same Pay, Same Performance.

There’s a lot of fanfare and doomsday arguments being touted over the proposed Bill. The peak bodies have gone all out with an upcoming ad campaign and a ‘confidential’ media statement opposing the ‘destructive changes’. 

The sky won’t fall in for businesses with enterprise agreements (EA), nor for the labour hire industry. But there are some concerns and should the Bill be passed in its present form, there will be some substantial changes to recruitment and employment arrangements.

The policy is about linking labour hire and outsourced workers' pay to enterprise agreements, see Consultation Paper recently released for public comment in April 2023.

The primary area of conjecture is the same pay for the same job, and anyone who has experience with seasonal or short-term labour hire knows that, in many instances, performance is not the same as that of experienced full-time workers. Perhaps there would be an argument after 3 months, but that would be a legitimate reason to either employ the worker full time, or pay the EA rate. The other unclear aspect is that a pay rate for a classification under an EA is often only one part of the remuneration.

On top of the pay equality conundrum, the proposed legislation has some administrative ramifications, so if you’re a business with an Enterprise Agreement, and outsource your labour, it's probably a good idea to make yourself aware of the obligations (Part2-7A—Same job, same pay: obligations of 1hosts2Division1—Obligations of host).

Many business and enterprise agreements won’t have the structural capacity to efficiently administer these proposed changes in their current form. And the very nature of outsourcing all sorts of workers, including those who are long term unemployed, have work capacity issues, or are there to fill a short-term gap, may become problematic, if not for the equal pay, then for the administrative onus on the Employer.

In its current form, the proposed Bill is complicated and if enacted, will take some adjustment. Business with EA’s are no doubt planning or considering the structure of their next EA and getting some good IR legal advice. I certainly would be!