Most founders filed “Same Job Same Pay” under mining news and moved on. Understandable: the headline cases were coal mines and airlines, and the legal fight ended with BHP losing at every level — the Fair Work Commission’s Full Bench in July 2025, the Full Federal Court in December 2025, and finally the High Court, which refused special leave in April 2026. The regime is now settled law, and it reaches further than the resources sector. If your startup supplies people into other businesses — or is scaling toward using labour hire itself — Part 2-7A of the Fair Work Act 2009 (Cth) belongs on your risk map.
What the Regime Actually Does
The Fair Work Legislation Amendment (Closing Loopholes) Act 2023 inserted Part 2-7A into the Fair Work Act, effective 15 December 2023, with orders able to take effect from 1 November 2024. The mechanism is the regulated labour hire arrangement order (RLHAO). On application by a labour hire employee, an employee of the host, a union entitled to represent either, or the host business itself, section 306E requires the Commission to make an order where:
- An employer supplies (directly or indirectly) its employees to perform work for a regulated host;
- A covered employment instrument — in practice, the host’s enterprise agreement — would apply to those employees if the host employed them to do that work; and
- The host is not a small business employer (fewer than 15 employees, counting associated entities).
Even where those criteria are made out, the Commission must not make an order if satisfied it would not be fair and reasonable in all the circumstances (section 306E(2)) — having regard, where submissions are made, to matters such as the pay arrangements of the host and the employer and the history and nature of the arrangement. It is a real contest ground: the labour hire employers ran it in the BHP case, unsuccessfully on those facts.
Once an order is in force, section 306F obliges the labour hire employer — not the host — to pay each regulated employee no less than the protected rate of pay: the full rate of pay the employee would receive if the host’s enterprise agreement applied to them. Full rate of pay is defined in section 18 to include incentive-based payments and bonuses, loadings, monetary allowances, and overtime and penalty rates — not just the base rate. That is what turned orders in the Batchfire coal mine case (the first RLHAO, lifting pay for more than 300 WorkPac employees) and the BHP OS decision (around 2,200 workers, rises of roughly $20,000–$30,000 a year) into such large numbers. In aviation, the Flight Attendants’ Association’s applications against labour hire employers supplying Qantas cabin crew settled in early 2025 with orders aligning pay to Qantas rates.
Note what the regime is not: it is not an automatic entitlement. No order, no obligation — someone has to apply, and the section 306E criteria have to be met.
As a Host: Why Most Startups Are Outside the Blast Radius (For Now)
Two of the three criteria do most of the protective work for early-stage companies:
- No enterprise agreement, no order. The protected rate is anchored to a covered employment instrument applying to the host. A host whose workforce sits on awards and individual contracts — which is nearly every startup — has nothing for an order to attach to. Modern awards are not covered employment instruments for this purpose.
- Small business employers can’t be regulated hosts. Under 15 employees (including regular casuals, and aggregating associated entities), the Commission cannot make an order against work performed for you at all.
But neither shield is permanent. Startups inherit enterprise agreements through acquisitions; startups in care, logistics, hospitality and events — sectors where agreements are common — can end up making one sooner than a SaaS company would; and the 15-employee line is crossed quickly once you count regular casuals across group entities. The moment an agreement applies to your workforce, any labour hire arrangement supplementing that workforce becomes orderable, and the application can come from the supplied workers’ union without your involvement.
As a Provider: The Risk Startups Actually Carry
Here is the angle the generic commentary misses. The order’s payment obligation lands on the supplier of labour. If your startup’s business model involves placing your employees into other organisations — workforce marketplaces, on-demand staffing platforms, nurse and care staffing, tech talent deployment, embedded engineering — then you are the labour hire employer Part 2-7A regulates, and your enterprise customers’ pay structures can be imposed on your cost base by Commission order. The Qantas cabin crew orders were not made against the host, Qantas Airways; they were made against the labour hire employers supplying it — including Qantas’s own subsidiary, Qantas Domestic.
For a staffing startup, an RLHAO can rewrite unit economics mid-contract: your placement margin was priced against your pay rates, and the order substitutes the host agreement’s full rate — loadings, penalties and allowances included. Three design consequences follow:
- Price for the possibility. Supply agreements with enterprise hosts that have (or may make) enterprise agreements should carry rate-review and pass-through clauses triggered by an RLHAO, so the uplift flows to the host rather than eating your margin.
- Short engagements are only a narrow exception. Section 306G excepts placements within an exemption period — three months by default, which the Commission can lengthen or shorten by determination under section 306J — and genuine training arrangements. But the anti-avoidance provisions (sections 306S–306V) attach civil penalties to schemes designed to dodge orders or the protected rate, with successive sub-three-month engagements the textbook example. Structuring around the exemption is precisely what the provisions were drafted to catch.
- The “we’re a service company” label won’t save you by itself. Which brings us to the line that matters most.
The Service Exemption Is About Substance, Not Branding
Section 306E(1A) prevents an order where the work performed is for the provision of a service, rather than the supply of labour. This is the boundary that keeps genuine outsourced services — a dev shop delivering a product, a managed security provider running a SOC, a consultancy owning a deliverable — outside the regime.
BHP ran exactly this argument for its in-house Operations Services entities and lost comprehensively. The Commission looks at practical indicators: who directs and supervises the workers day to day, whose systems, plant and processes they use, whether the provider is accountable for a defined outcome or simply for supplying competent people, and how distinguishable the workers are from the host’s own employees. Workers attending the host’s pre-start meetings, operating the host’s equipment, wearing the host’s uniform and following the host’s rosters look like supplied labour whatever the contract calls them — the same substance-over-label logic that now runs through the contractor-versus-employee rules and the casual definition.
For B2B services startups that embed staff with enterprise clients, the structuring lesson is to sell outcomes: statements of work with defined deliverables, your own management layer supervising your people, your own tooling and methodology, and pricing tied to the service rather than a per-person day rate. That is not a loophole — it is the actual statutory distinction, and it needs to be true in practice, not just in the MSA.
Don’t Forget State Licensing
Separately from Same Job Same Pay, Queensland, Victoria, South Australia and the ACT run labour hire licensing schemes. If you supply workers in those jurisdictions you likely need a licence, and your customers face penalties for using unlicensed providers — which is why enterprise procurement teams now ask for licence numbers during onboarding. A staffing startup operating nationally needs to clear each scheme; a startup using labour hire should verify its providers hold current licences.
What to Do
Map both directions of exposure. As a host: do you have (or will an acquisition bring) an enterprise agreement, and are you past 15 employees? As a provider: which of your customers have enterprise agreements covering work your people perform?
Fix the contracts before an application lands. RLHAO pass-through and rate-review clauses in supply agreements; genuine outcome-based statements of work where the service exemption is the plan; licence warranties both ways.
Treat an application seriously and early. Once the criteria are made out, an order must follow unless the Commission is persuaded it would not be fair and reasonable — a case that has to be built on evidence, early — and BHP has already spent the money finding out where the appeals end.
This article is general information only, not legal advice — whether an arrangement is the supply of labour or the provision of a service, and whether an order could be made, turns on the practical detail of each engagement. Viridian Lawyers advises Australian startups on employment, contractor and workforce-platform arrangements. If your model involves placing people into enterprise customers — or a union has come knocking about one of your labour hire arrangements — get in touch.
