The Senate Committee Inquiry into Job Security released an interim report last week pushing the ALP’s ‘same job, same pay’ policy and framing the “mining industry” as being increasingly casualised and over-reliant on labour hire.

The release of the ALP-led committee’s report follows the Federal Opposition confirming that a key element of its 2022 Federal Election industrial relations campaign will centre on labour hire and the theme of “insecure work”.

Central to this, Opposition leader Anthony Albanese introduced the Fair Work Amendment (Same Job, Same Pay) Bill 2021 in the House of Representatives, self-described as “A Bill for an Act to give Australian workers the right to same job, same pay, and for related purposes”.

This private members’ bill would create an obligation on labour hire businesses to provide workers with pay and conditions no less favourable than those provided to employees who are performing “the same work” directly for the host enterprise.

Only days later, the Committee report mirrored many arguments within the bill, claiming the mining industry attracts pay rates up to 40% lower than direct hired employees on the same sites.

Job security report

The committee’s third interim report is themed “labour hire and contracting” and includes a chapter devoting 24 pages to “workforce arrangements in the mining sector”.

It includes areas focusing on the supposed “trend towards labour hire and casualisation in the mining industry”, with the “proposals for reform and committee view” section declaring to “implement (the) ‘same job, same pay’ principle across the mining industry”.

Specifically, it targets BHP’s workforce practices, with the Committee believing there is “something seriously and systemically wrong… when more than half of BHP’s national mine site workforce is hired through labour hire and other external contractors, rising to more than 70 per cent at BHP’s Australian coal operations”.

Report’s key recommendations

• Recommendation 6 – The committee recommends that the Australian Government requires mining operators to conduct local labour market testing prior to engaging fly-in-fly-out and drive-in-drive out workforces.
• Recommendation 7 – The committee recommends that the Australian Government requires mining operators to meet best-practice in managing the physical and mental health and safety of their fly-in-fly-out and drive-in-drive-out workforces.
• Recommendation 8 – The committee recommends that the Australian Government commissions comprehensive contemporary research into the economic and health impacts resulting from mining operators utilising fly-in-fly-out and drive-in-drive-out workforces. Amongst other things, such research would assess the impacts on:
  • demand for services delivered by local governments;
  • the ability of local governments to raise revenues through taxation;
  • small and medium businesses located in towns located close to mine sites; and
  • the physical and mental health of workers and their families.
• Recommendation 9 – The committee recommends that the Australian Government commissions comprehensive research to determine the specific impacts of insecure employment on workers in the mining industry, with a focus on determining its effects on their ability to secure home loans; and on decisions such as place of residence, schooling, and major purchases; and their mental health.

On ‘same job, same pay’

The report said the committee is “very concerned” by the overwhelming evidence indicating that labour-hire workers commonly receive lower pay and conditions than those workers who are directly employed.

Further, it said that it appears that contracted labour is being utilised in the mining industry:

• to undermine labour standards;
• weaken, or entirely remove, the presence of union on worksites; and
• as a substitute workforce that is seen as more compliant due to its temporary nature.

It also believes labour hire has, and continues to, drive down wages and conditions across Australian mining operations.

AREEA’s representations to Committee

On 28 July 2021, AREEA appeared before the Senate Committee Inquiry into Job Security to provide evidence on behalf of the resources and energy industry.

In this opening statement, Head of Policy and Public Affairs Tom Reid explains how the industry is “incredibly diverse and involves numerous employment and contracting arrangements”.

“Labour hire, independent contracting and casual employment represent small but important functions within this mix. These arrangements are especially useful for engaging skilled workers for short-term work in the more cyclical, project-based areas of the industry,” he said.

“Ultimately, non-permanent forms of work including fixed term and casual labour hire and independent contracting offers choice to both employers and employees. This is particularly relevant for the resources and energy industry where the workforce is highly mobile, moving between projects and operating sites at various stages throughout the life of the operation.

“However, it is not a dominant feature of the industry – which at 10.3% now has a casual employment portion well under half of the all-industries average of 25%.”

AREEA Reaction to ‘same job, same pay’

AREEA has been heavily involved in this debate during 2021 and will continue to push back against misleading, over-simplistic political campaigns seeking to demonise our industry as one that mistreats or underpays people.

Further, we will be an active voice within the broader business community campaign to defend casual arrangements as legitimate forms of employment and reinforce that the Government served the national interest by legislating in March to protect Australian businesses from potentially $40bn in “double dipping” entitlements claims. This action was further vindicated by the High Court’s Rossato ruling in August.

Like the industrial relations platform taken to the 2019 Federal Election, AREEA’s assessment is the ALP’s announced policies contain significant new costs and regulation for Australian businesses, but little vision for encouraging investment and creating jobs during the nation’s post-pandemic recovery.

AREEA will continue engaging with the ALP to ask several important questions, including:

• How could the ALP’s IR policies reduce the employment regulatory burden on employers to encourage job creation in the pandemic recovery period?
• How could the ALP restore faith in enterprise agreement making and speed up the Fair Work Commission’s approvals process to give employees their pay rises sooner?
• How could the ALP’s policies assist the resources and energy industry in securing the $334 billion of potential major project capital in its investment pipeline?

“It is disappointing to hear (Shadow IR Minister) Tony Burke recycling the same old “change the rules” style policy platform that failed to grab the attention of voters in 2019,” AREEA CEO Steve Knott said.

“AREEA looks forward to constructive dialogue with the Federal Opposition in which we will detail the policy needs of the resources sector to attract new investment, create jobs and lead the economic recovery from COVID-19.

“Unfortunately, at this stage we are seeing nothing from the Opposition to suggest it has learnt its lessons from past failed campaigns, pushing protectionist 1970s-style regulation.”

To get involved with AREEA’s industrial relations advocacy and pre-election campaigns, contact [email protected] for more information.