On Monday, the Fair Work Commission commenced hearing a major test case on the boundaries of “same job same pay” laws. Assurances were given during the parliamentary phase that the legislation clearly delineates between labour hire and service contractors and limits orders to labour-hire providers. Now the minister has submitted to the FWC that the concepts of labour hire and services are “not mutually exclusive”, and the difference is one “of degree”.

Aside from immediate implications for the identified host and contractor parties in the current FWC matter (which include BHP), the critical issue for the economy is the breadth of the power to spread host wage levels onto businesses that supply labour as part of their service offering. Many businesses that have not been considered labour hire do precisely that. If the minister’s approach is adopted, the scope of potential orders will be very uncertain and there is potential for host wage levels to be imposed on numerous contractors in large businesses.