“A tripartite arrangement should not be involved in granting licences under the scheme,” the BCA said.

The BCA submission warns that if a “tripartite board” were permitted to have oversight of the FWO, it would compromise the ombudsman’s independence; expose the FWO to allegations of bias and partisan behaviour; damage public confidence and create privacy and confidentiality concerns for thousands of businesses and individuals.

“This would compromise the independence and impartiality of the scheme and significantly impact public confidence in it. There are additional concerns with third parties having access to licence applications where it is proposed to require voluminous amounts of highly sensitive and confidential information about individuals and entities,” the BCA submission warns.

The department is consulting on a second tranche of workplace reforms – following multi-employer bargaining measures brought in last year – including the “same job, same pay” laws for labour hire, minimum rates for gig workers and jail time for wage underpayments.

Among the key proposals, the wage theft proposals reveal that the government will go beyond its promises of jail time and seek fines of more than $4 million for breaching workplace laws.

BCA members such as BHP, Qantas and Wesfarmers are likely to be among those most affected by the government’s second tranche of workplace reforms because of the high use of labour hire in mining and aviation, and casuals in retail.

“At a time when we want business to be innovating and have the flexibility to grow, this sends the wrong message,” Business Council chief executive Jennifer Westacott warns.

She said that a fit for purpose scheme for the licensing of labour hire businesses should be targeted to address real problems and provide specific solutions, such as those identified by the Migrant Workers’ Taskforce Report.

“Before jumping to cumbersome, complex and technical policy change we need absolute clarity about the problems we’re trying to solve,” she said. “The path to unnecessary complexity that leaves everyone worse off starts with overreach that goes beyond the identified problems.”

The BCA argued that the scheme should only cover companies whose core business was “labour hire”, defined as the on-hiring of its workers to a host business for a service fee.

“While the BCA’s primary position is that the scheme should be limited to high-risk industries as identified in the MWT Report, a scheme that covers all sectors of the economy, and not just the most ‘at risk’ sectors [as in SA], may be acceptable, provided it is properly designed,” the BCA submission says.

The BCA also argues in its submission that civil penalties for breaches should apply rather than criminal sanctions.

However, Australian Council of Trade Unions secretary Sally McManus has been highly critical of the BCA’s response on the issue.

“When big business profits are skyrocketing and workers’ wages are going backwards because business has worked out how to game the system to cut wages and job security – Australia has a problem,” she has said. “But for the BCA, ‘There is nothing to see here’.”