A further spike in the cost of groceries, an increase in cash-in-hand work and greater cost burdens for major events are just some the potential impacts of the Federal Government’s proposed industrial relations (IR) changes.  

Business NSW says the proposed reforms will irreversibly alter the way the state’s 840,000-plus businesses operate and thrive. 

The proposed Same Job Same Pay provisions and suggested changes to entitlements for casual employees are key concerns for business that will undoubtedly lead to heavy administrative burdens and higher costs which will be passed on to customers. 

Business NSW CEO Daniel Hunter said while businesses are not opposed to reasonable alterations of wage theft and small business redundancy laws, he urged the Federal Government to carefully consider making major changes.  

“Many small businesses are run by families and these changes will impact them and the local communities in which they operate,” Mr Hunter said.    

“Why is the government going to introduce rigidity into the system which will make employers think twice about hiring new staff? 

“Businesses are only just getting their heads around the first tranche of IR reforms from the Federal Government and the implications of this next round would upend enduring and fundamentally important characteristics of the Australian economy.”  

New industry data shows federal departments and agencies alone have engaged more than $1.2 billon in labour hire contracts since the election.  

“Labour hire and the casual workforce have been a key enabler for Australian businesses to respond to rapid changes in demand - something that is happening more and more often,” Mr Hunter said.  

“Casual positions are where many young Australians get their first start in the workforce.”  

Mr Hunter said the cost burden of what is being proposed with respect to labour hire must be carefully considered.  

“This comes at a time when businesses are fighting against a multitude of economic challenges, including what is likely to be a relatively high annual wage increase,” Mr Hunter said.    

“The public and private sector rely upon and benefit from the flexibility of labour hire, and any disruption to this model will impact workforce availability, business viability and, ultimately, the services available to the public.” 

There are 2.7 million casual workers across Australia, accounting for 23.5 per cent of all employees in August 2022. 

Details on the Federal Government changes remain limited, with the bill due to appear before Federal Parliament in the coming months.  

Mr Hunter said “the increase in labour costs for already stretched employers means there could be a black market in cash jobs opening up”.   

“There is also a significant compliance burden and potential impact on major events,” Mr Hunter said.  

“Labour hire providers will have to pay the same pay and benefits that a regular host employer would.  

“This could also include sick leave, annual leave, superannuation and other benefits, significantly increasing compliance costs for employers. 

“The new laws also propose to introduce far ranging regulation of road transport contracts, which will add to the cost of groceries.   

“The unintentional consequences of some well-intentioned changes could strike at the heart of the Australian way of doing business, sharing scarce human resources and growing our economy across one of the world’s largest nations.    

“From agriculture to healthcare, we have learnt that one size does not fit all when it comes to a nation that thrives on choice, flexibility and mobility.” 

Key areas of proposed change identified by Business NSW: 

Information released by the Department of Employment and Workplace Relations (DEWR) lists 11 topics for which legislative changes may occur. The following are the most significant: 

1) Entitlements of casual employees 

2) “Same job, same pay” provisions 

3) Changes to “gig work” provisions via introducing “employee-like work” provisions 

4) Criminalising “wage theft” 

5) Allowing workers to challenge “unfair” work contract provisions 

6) Regulation of road transport industry, including issuing of new minimum contract provisions for road transport contractors.