The story is that they have change the law slightly to make the default position of someone working in the film industry from employee to a independent contractor.
It is to give clarification to the role of a person in the film industry, they can still negotiate to work conditions etc.
The union got involved and suggested that non-union actors were getting a advantage with contracts etc, which gave Warners the chance to threaten to go elsewhere.
Warners took the advantage of using it to get a better tax break from the govt, but it is worth 600 million or so of extra money coming into the economy.
Plus the toursists it may bring as well.
Extra Hobbit subsidy will be staff tax break
The extra $20 million subsidy for The Hobbit will be paid as a tax break on a pool of profits to be shared by actors and other workers on the films, including director Sir Peter Jackson, it is understood. Ref. Source 9