Australia: Labour hire licensing update

Many resources companies utilise labour hire workers, or their contractors do. It is therefore important to keep abreast of recent legislative activity in a number of different Australian states in this area. 

It would be a challenge to identify a resources company in Australia that does not utilise labour supply of some kind; either ‘traditional’ labour hire, third party contractors or use of corporate group labour structures. Given the attention that ‘anti-casualisation’ campaigns currently have and the focus of unions and regulators on labour models more generally, it is important to keep across recent state based legislative activity in this area.

What legislation has been introduced or is proposed?

Recent media coverage of the alleged exploitation of workers in the agricultural and service industries in Australia has prompted a number of legislative initiatives by Labor governments around the country to protect vulnerable works.

One such initiative has been the introduction of licensing schemes, in Queensland, South Australia and Victoria, to regulate labour hire.

At a Federal level, the unions are pushing for a national scheme. The Federal Labor party has also indicated that if elected, it will introduce a national scheme.

Key issues to be aware of

• The labour hire schemes in Queensland, South Australia and Victoria make it unlawful to operate as a labour hire services provider without a licence.
• The scope of the enabling legislation is deliberately broad. The schemes generally apply to any supply of a worker to do work at a host business (capturing ‘non-traditional’ labour hire as an instance of “labour hire” for the purposes of the scheme).
• In Queensland, there are a number of important exemptions, including arrangements within a corporate group structure where employees of one entity work for operating entities in the group, and certain employees performing work on a temporary basis (such as a consultant supplied to conduct a review, or secondments).  The South Australian scheme does not have any prescribed exemptions, but there is a process under which organisations can apply for an exemption. We are yet to see what exemptions, if any, will apply under the Victorian scheme, if and when it is passed.
• It is also an offence to enter into an arrangement with an unlicensed supplier of labour hire.

The stated intention of the schemes is not to capture “genuine independent contracting arrangements”. However, except in the limited Queensland Regulation exemptions, no express distinction is drawn, in any of the schemes, between independent contracting arrangements and labour hire arrangements.

Timing

• In Queensland, providers must apply for a licence before 15 June 2018.
• In South Australia, providers have a 6-month transition period from 1 March 2018, and must be licensed by 1 September 2018.
• Legislation establishing a scheme in Victoria is expected to be passed by the Victorian Parliament in the next couple of months with a proposed commencement date of no later than 1 November 2019.

In the ACT, an inquiry is being held into the extent, nature and consequences of insecure work. The reporting date for the inquiry is the last sitting day in May 2018 and LHL legislation may follow. 

See our other articles about the Queensland scheme, the SA scheme, the Victorian scheme and LHL in other Australian Jurisdictions, including a map showing the status of LHL across Australia.

For further information, please contact Kirsty Faichen.