That's according to BHP chief financial officer David Lamont, who's concerned about the cost impacts of the government's proposed changes to the Fair Work Act.
We'll get to those concerns, and the potential size of the hit it poses for the BHP dividend, in a tick.
First, a spot of background.
How is the ASX 200 miner performing?
BHP reported its FY 2023 results on 22 August.
While those results were mostly down from FY 2022 amid a slide in iron ore and copper prices, the S&P/ASX 200 Index (ASX: XJO) mining giant still achieved some impressive numbers.
Those included revenue of US$54 billion and underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) of US$28 billion.
Indeed, as the miner reports on its website:
BHP contributed $60 billion in economic value to the Australian economy in the 2023 financial year, through wages, dividends, supplier payments, taxes, royalties and community investments.
Adding in the interim BHP dividend of $1.364 per share, the mining giant paid out a total of $2.614 per share in FY 2023. At the current BHP share price of $45.38, that equates to a trailing yield of 5.8%, fully franked.
Commenting on the value of ASX 200 miner's dividends, BHP CFO David Lamont said:
BHP's dividends benefit roughly 17 million Australians who hold shares in the company, either as direct investors or through their superannuation.
BHP was the largest dividend payer on the ASX100 over the past two financial years, paying around one fifth of all dividends on that index.
Which brings us back to the government's proposed amendments to the Fair Work Act.
Could this take a bite out of the BHP dividend?
As you're likely aware, the government introduced its "same job, same pay" legislation back in May. The idea is to ensure labour-hire workers are paid as much as full-time employed workers for doing the same job.
But it could come with a hefty price tag that could impact BHP's profits and potentially slash the BHP dividend.
In response to the proposal in May, BHP said:
BHP estimates the financial impact of [same job, same pay] SJSP to our Australian operations will be up to $1.3 billion annually.
This cost is equivalent to the labour cost of approximately 5000 full-time employees across our operational workforce.
Workplace relations minister Tony Burke wasn't impressed with that argument.
"If you close a loophole to stop workers being ripped off, it will result in an increase in the wages budget of any company that was using the loophole. We make no apologies for that," he said at the time.
Fast forward to September, and now it looks like BHP's $1.3 billion cost estimate might have undershot the real impact. That's because the ASX 200 miner hadn't originally factored in the additional increased costs of the workers it employs indirectly via its subsidiaries.
Yesterday Lamont said (quoted by The Australian Financial Review), "The original estimate that we did have of $1.3 billion, we think now is actually light on."
As for the BHP dividend, Lamont added:
This will have a direct impact to our shareholders. $1.3 billion will come directly off our earnings each year that will then flow directly to dividends, we estimate that to be about 30 cents on a dividend payout.
A 30 cent per share reduction of the BHP dividend would represent around an 11% cut from the FY 2023 payout.
Debate on the legislation continues.