Landmark FWC Hearing: The First Same-Job, Same-Pay Dispute

In a groundbreaking case, the Fair Work Commission (FWC) this week heard its first dispute under the new Same-Job, Same-Pay (SJSP) provisions, a move that could set significant precedents for the labour hire industry in Australia. This initial dispute, involving the Mining and Energy Union (MEU) and labour hire giant Workpac, revolved around payments to on-hire workers at a major coal mining operation in Queensland.

Landmark FWC Hearing: The First Same-Job, Same-Pay Dispute

Background of the Dispute

On Thursday, Deputy President Nicholas Lake presided over the hearing in Brisbane, addressing Workpac's controversial proposal to pay labour hire workers at the Stanmore Resources’ Poitrel coal mine only two months of an annual 12-month bonus.

Previously, in late 2024, on-hire workers at Poitrel mine benefited from substantial annual pay increases, some receiving up to $60,000 extra per year under Regulated Labour Hire Arrangement (RLHA) orders. These increases were facilitated by the recently introduced SJSP regime, designed to ensure fairness in pay and conditions for labour hire workers, placing them on par with their directly employed counterparts.

Workpac argued that since the RLHA orders only took effect in November, it was only required to distribute bonuses proportionately—covering just two months of the year. This stance was strongly contested by the MEU, triggering the dispute and making it the inaugural case under the SJSP regulations.

The Stakes and Arguments

The dispute centres around an annual incentive scheme at the Poitrel mine valued at approximately $16,000 per worker. Workpac’s interpretation would significantly reduce the bonus payments to on-hire workers, limiting their earnings under the scheme to roughly $2,667, a substantial financial difference.

In an unusual alignment, Stanmore Resources joined Workpac's side, supporting its submission in the hearing. Both companies maintained that their position aligned with legal obligations set under the RLHA orders.

In opposition, the MEU emphasised the principle of fairness that underpins the SJSP regime. The union argued that limiting payments to labour hire employees violates the intended spirit of the SJSP policy, designed explicitly to eradicate pay disparities between labour hire and directly employed workers performing identical roles.

Wider Implications for Labour Hire Industry

This dispute comes at a critical juncture. Since the introduction of the SJSP regime, the MEU has been at the forefront, using these provisions effectively to secure better conditions for thousands of workers, including notable victories on BHP’s Bowen Basin sites.

A recent high-profile case, Loudon v WorkPac Pty Ltd Trading as WorkPac, underscored the importance of these provisions. In that case, the MEU, alongside the Australian Manufacturing Workers Union (AMWU), successfully argued that BHP's internal labour hire could not exploit service contractor exemptions to avoid equitable pay conditions for over 2,000 workers.

The outcome of this current dispute could significantly impact the interpretation and implementation of SJSP orders across the industry. A decision in favour of the MEU could solidify workers' rights, reinforcing the fundamental principle of equal pay for equal work.

Conversely, a decision siding with Workpac may encourage other employers to limit the scope of financial benefits provided to labour hire workers, potentially sparking further disputes.

The Path Forward

Following an intensive half-day hearing, Deputy President Nicholas Lake has reserved his decision. This anticipated judgment will likely influence ongoing negotiations and future disputes across the mining and resources sector, setting a critical benchmark for fair pay and conditions under the SJSP framework.

As unions continue to champion the cause of equitable pay, the significance of the outcome of this inaugural dispute cannot be overstated. It serves as an essential test of Australia's commitment to fair and transparent labour practices, setting the tone for workplace relations well into the future.