With the Federal Election coming up in May we wanted to take a look at some of the prospective Workplace Relations changes that are on the cards and offer some insights around the practical challenges they may have on the ground in your business.  To keep these videos shorter we have broken this series up into the various political parties and today we will focus on the Workplace Relations policies that we understand that labor is taking to the election.

If you would like to see the breakdown of the Workplace Relation policies of the other major parties, please visit ondemandhr.com.au where you will be able to find them as soon as they are released.

Labor has indicated that they have 4 key Workplace Relations policies it is looking to take to the May election and today we are going to cover their policy on the same job, same pay for Labour Hire companies.

This policy is targeted towards businesses who engage labour hire firms to supplement their workforce.  As we understand it, Labors position on this is to introduce legislation which makes it effectively illegal for a business to pay labour hire employees less than internal full time employees for doing the same job.

On the surface this appears to be a reasonable policy with Labor attempting to stop businesses from trying to reduce their overall wage bill through engaging cheaper labour hire employees.  From On Demand HR’s perspective there is a key flaw to this policy.

Many of these labour hire companies are subject to their own Enterprise Bargaining Agreement which has been independently approved by the Fair Work Commission.  Throughout the negotiation an approval process there are many factors considered above and beyond the headline wages of the employees to ensure that they are better off overall against the Modern Award that would otherwise cover their employment.

So consider the scenario of a labour hire company whose EBA disrates that they pay their employee $30 per hour for caring out a particular type of work, lets say working on a production line.

They are placed with a company needing additional employees where a production line worker is paid $32 per hour.

However, the employee of the labour hire company gets additional benefits under their EBA, lets say an additional weeks holiday each year.

If Labors election policy was in place and the employee was required to be paid $32 per hour, the labour hire company would now be required to not only comply with the terms of their EBA and provide an additional weeks holiday per year, but they would also be required to now pay $32 per hour for that employee for that additional week as a result of Labors same job, same pay policy.  Is this fair?

So as you can see, like anything policy the devil is always in the detail as well as how these changes interact with other legislation and policy already in force.

We would be interested to hear your thoughts regardless if you are liberal labor or other, an employer or employee.  We all deserve a voice and the ability to make informed decisions.