The decentralisation of production by various means has been a major feature of Australian labour law and relations since the 1980s. Since the recession of the early 1980s, many businesses have pursued financial savings through outsourcing of labour. Many companies did so firstly as a means of focusing on their core business activities and shifting to program-based accounting systems. More recently it has been part of the process of continuous cost-cutting and downsizing, associated with the preoccupation with shareholder value. Decentralisation is usually accompanied by reduction of the internal workforce and intensification of work remaining within the business. These trends are not surprising given the high degree of foreign ownership and control of large business in Australia, and the exposure of the Australian economy to diversification, deregulation and global competition in the last two decades. Decentralisation was in fact championed by conservative governments which began outsourcing (“contracting out”) or privatising government businesses and services from the late 1980s. This paper examines recent Australian Law concerning productive decentralisation. The paper was prepared as a national report for the XVIII World Congress of Labour and Social Security Law, Paris, 5-8 September 2006, on behalf of the Australian Labour Law Association, with contributions by Mr Toby Borgeest.