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Is your company unknowingly an illegal labour hire provider? It’s more common than you think.

by Sirius People

Accountant
Estimated Reading Time: minutes

Labour Hire Licensing is upon us!

So, what does that mean for your business? (And how can you avoid the half million dollar fine and 3-year prison sentence, if you’re not compliant?)

We’ve put together this informational blog post to provide you with a general overview to help you navigate these new Labour Hire Licensing Acts that have come to Queensland and Victoria in the last year.

DISCLAIMER: Please note, this blog post does not outline all legal obligations of the Labour Hire Licensing Acts in Queensland and Victoria, and is to be used as an informational starting point and guide only. We encourage you to seek legal advice to ensure your company is up-to-date and compliant with the Labour Hire Licensing Act in your respective state.

Let’s start with the basics.

 

What is the Labour Hire Licensing Act?

The Labour Hire Licensing Act is a mandatory licensing scheme to protect labour hire workers against the widespread abuse and exploitation across Queensland and Victoria, and ensure responsible labour hire providers have a level playing field in their industry.

It has already come into effect in Queensland, as of April 16, 2018, and is set to come into effect in Victoria, as of October 30, 2019.

The key elements of the licensing act are:

  • Labour hire providers must be licensed to operate in Queensland and Victoria;
  • ‘Host organisations’ who use labour hire providers must only engage licensed providers; and
  • Labour hire providers must report bi-annually (Queensland) / annually (Victoria) on their Labour hire activities.

While it may appear that this act only affects recruitment agencies — it affects anyone who engages labour hire providers and businesses who fall under a particular employment outsourcing organisational structure.

 

How will Labour Hire Licensing affect your business?

As mentioned above, the Labour Hire Licensing Act affects anyone who engages a labour hire provider, or outsources one of their staff members to temporarily work at another business (the ‘host’ organisation), as part of their business’ operational structure.

In the case of engaging a labour hire provider, it is your responsibility to check for license registration of any business you’d like to engage to avoid heavy fines.

In Queensland, you can use the license register search or check for pending applications for any labour hire provider.

In Victoria, you can check a provider’s licensing status on the Labour Hire Authority’s site. However, the Act doesn’t come into effect until October 30, 2019.

Your business may also be affected by the new laws if you fall under the Labour Hire Authority’s definition of ‘labour hire provider.’

While many companies have internal Hiring Managers who may source casual or temporary employees for particular projects, the key difference between labour hire workers and casual or temporary employees is that labour hire workers do not work for the host organisation. They are employed by the labour hire organisation.

For instance, an event requires crowd controllers for a Saturday night function. A security company supplies the crowd controllers and invoices the event for the supply of these workers. In this case, the security company would be considered a labour hire provider.

The Queensland government has a few typical examples of labour hire and when a business will need to apply for a license on their website, click here for more examples. Please speak to your legal team to verify whether or not your organisation will need a labour hire license.

 

If you qualify as a labour hire provider under the Act...

You will have to apply for a license to legally operate your business in Queensland and, as of October 30, 2019, in Victoria.

To apply, you will need to provide details about the owners, the business and its workers, including:

In Queensland:

  • Business name / business entity name / other trading names
  • ABN
  • Business email, address & phone number
  • The industries into which they supply workers
  • Applicant details, including name, position and contact details of executive officers and nominated officers
  • Whether you have workers on visas
  • Whether you provide accommodation for the locations where workers are placed

In Victoria:

  • Demonstrating those who run the business are ‘fit and proper persons;’
  • Registration with the ATO;
  • Registration with Work Safe Victoria
  • The number of workers supplied – actual over the last 12 months for an existing business or planned for the next 12 months for a new business.
  • The terms and conditions of those workers
  • The visa status of all workers
  • The industries into which they supply workers
  • Any relevant investigations, incidents or claims
  • Whether they supply accommodation to workers

Once the license is granted, it’s valid for two years in Queensland or three years in Victoria, when a renewal request can be submitted. License holders may be inspected and will need to provide reports for the relevant Labour Hire Authority. Any labour hire provider that operates without a license will be fined, as will the host organisation.

 

What are the penalties if you’re not compliant?

Queensland has the strictest penalties for its Labour Hire Licensing Act. Non-compliant labour hire providers and host organisations can be fined up to $391,650 (this figure is both for the labour hire business and the business who engaged the labor-hire provider), have their license suspended or cancelled, or — in the most serious cases — imprisoned for up to 3 years.

In Victoria, breaking the Labour Hire Licensing Act will not send you to prison, but it could set you back over half a million dollars in fines for both the labour-hire provider and the host organisation.

 

What does your business need to do to be compliant?

The first course of action your business should take is to double check with your legal team whether or not your business needs to apply for a labour hire license.

If you do, you’re able to easily apply through the Queensland or Victoria Labour Hire Authority websites. For Queensland businesses, you will not be able to act as a labour hire provider until your license has come through as the grace period has now passed. And in Victoria, your company has until October 30, 2019, to apply for your license.

If your business does not provide labour hire services, your course of action is very simple: Double check on the Queensland or Victoria Labour Hire Authority websites to make sure your labour hire provider is listed. Don’t use unlicensed labour hire providers and report them to the Authority to avoid fines yourself.


For more updates about Labour Hire Licensing, be sure to reach out to your APSCo Certified Recruitment Consultant.

The Association of Professional Staffing Companies (APSCo) offers risk and compliance checks for all its members so you can rest assured that any APSCo accredited business has annually undergone thorough screening on a business and individual recruitment consultant level. As the membership body is dedicated to professional recruitment, they also provide members with, and help shape, the latest regulations and legislation impacting the recruitment process.

We are proud to say that our management team is APSCo Certified and we are working toward having our recruitment consultants and business APSCo-certified by the end of the year to ensure the best, ethical service for our clients.

To learn more about working with an APSCo-recognised recruitment partner and Labour Hire Licensing, please reach out!

 

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