Tiles on plywood in shower

Getting an extension done and the builder has put up plywwod on the two walls in the ensuite where the shower is going (corner quadrant base). One sheeet is on a block wall, the other on a stud. He says this is the norm and he wouldn't normally use plasterboard here?

Will need to tile the ensuite in the next week or so and was wondering if plywood is suitable to tile on to - wont it expand and contract as wood does?? He says that all I need to do is seal/waterproof the ply first.

Plywood is ocassionally used on walls as a tiling substrate, if sealed with PVA solution it provides a good background for tiling, maybe not my favourite though, as the joints are effectively open and unless treated in some way could allow water ingress if the grouting fails. I would "scrim" the joints using a self adhesive mesh tape (as used in drylining), feathering this with tile adhesive. The best backgrounds for tiling IMHO are:
1. Sand/ cement render on blockwork background or on expanded metal over plywood on timber stud.
2. Cementitious backer boards, specially produced for tiling.
3. Moisture resistant wallboard (green lining paper).
4. Gypsum wallboard (worst performer- only suitable for use in non-critical areas and certainly not suitable for use in shower enclosures).

When I was replacing my shower they used marine ply and 'tanking'. A system of painting the ply with a very waterproof sealant prior to fitting shower tray and tiling - so far so good, no leaks.

Joints have been scrimmed so I'll go with the PVA sealer and see what happens.

Cheers