On 20 June 2018, the Victorian Parliament passed legislation implementing labour hire licensing requirements, making Victoria the third state to do so following the introduction of similar laws in Queensland and South Australia.
Each of these state laws responds to concerns about exploitation of vulnerable workers by labour hire contractors, particularly in the horticulture sector and across the fresh food supply chain.1
Evidence emerging from inquiries held in all three states in 2015-16 confirmed that many workers were being underpaid (both in terms of award minimum rates of pay and superannuation entitlements), working in unsafe conditions and staying in sub-standard accommodation linked to the provision of work.
The objectives and key features of the Victorian Labour Hire Licensing Act 2018 are similar to those in the equivalent laws in Queensland and South Australia.
The main purpose of labour hire licensing is to provide barriers to entry to the labour hire sector, ensuring that all providers are legitimate businesses and can meet strict licensing standards. These standards measure a labour hire provider's past and future capacity to comply with workplace, superannuation, tax, safety and migration laws, as well as applicable accommodation standards.
Two principal legal obligations are imposed, backed up by significant civil penalties in Victoria (and a combination of civil and criminal penalties in Queensland and South Australia):
- Providers of labour hire services must not operate without a licence. The definition of those who 'provide labour hire services' is very broad in Queensland (with some carve-outs through regulations), while in Victoria and South Australia it is narrower and focused on arrangements that are conventionally understood as third-party provision of labour to a host business.
- Hosts/users of labour hire services must only use a licensed provider. Licensed providers are, or will be, listed on a Public Register in each state.
A Labour Hire Licensing Authority will be established in Victoria, with inspectors having strong investigatory and enforcement powers. In the other two states, the licensing schemes are being administered by the Queensland Office of Industrial Relations2 and SA Business and Consumer Services.3
Queensland – Queensland's labour hire licensing scheme is now fully operational. Existing labour hire businesses had a 60-day transition period from 16 April 2018 to apply for a licence. All providers in Queensland must now be licensed.
Victoria – Victoria's legislation will commence no later than 1 November 2019, with a six-month transition period from the date of commencement.
South Australia – South Australia's legislation commenced on 1 March 2018. The new Liberal SA Government has extended the initial six-month transition period – the licensing requirements will not be enforced until 1 February 2019, amid reports that the SA scheme is under review by the Government.
A NATIONAL SCHEME?
The federal Labor Opposition has a policy to introduce a national labour hire licensing scheme if it wins the next election. Reform at the national level is also a key component of the ACTU's current campaign for significant reforms to Australia's workplace laws.
We've created a downloadable table which offers a detailed comparison of the three state labour hire licensing laws, including their:
- scope/coverage (and relevant exclusions);
- prohibitions and penalties;
- licensing standards/criteria for issuing of a licence;
- reporting obligations of licence-holders; and
- enforcement arrangements.
1 See our previous article at: http://www.corrs.com.au/thinking/insights/how-australia-is-combatting-worker-exploitation/
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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