As of 30 October 2019, substantial penalties apply to labour hire providers who don’t have a licence and to businesses that use an unlicensed provider.
The penalties will be imposed by the Labour Hire Licensing Authority, which was established in April 2019, as part of the Victorian Labour Hire Licensing scheme created by the Labour Hire Licensing Act 2018. The Authority is responsible for regulating the labour hire industry in Victoria to minimise the potential for worker exploitation.
What is a labour hire provider?
A business will be considered a ‘labour hire provider’ for the purposes of the scheme if that business:
- Supplies the individuals to perform work in, and as part of, a host’s business or undertaking and the provider is obliged to pay the individual for performance of the work; or
- In the course of providing recruitment or placement services, recruits individuals for or places the individuals with a host, who has to pay the individuals to perform work in and as part of the host’s business or undertaking, and the provider procures or provides accommodation for the individuals for some or all of the period that they are working with the host; or
- In the course of conducting contractor management services, individuals are recruited as independent contractors to perform work in and as part of a host’s business or undertaking, and manages the contract performance by the independent contractors.
Under the Labour Hire Licensing Act 2018, all labour hire providers must be licensed. Providers who fail to obtain a licence by 30 October, face fines of up to $120,000 for an individual or more than $500,000 for a body corporate.
Fit and Proper Person requirement
For every application received, the Labour Hire Authority will conduct a fit and proper person assessment of each person included on the application. A 'person’ for the purposes of the application will include relevant individuals and all officers of a body corporate.
A person will be not be deemed a fit and proper person and will not be granted a licence under the scheme if they have:
Within the last 10 years:
- Been found guilty of an indictable offence against a person, or an offence involving fraud, dishonesty or drug trafficking that was punishable by imprisonment of three months or more (or an equivalent offence committed outside Victoria); and/or
Within the last five years:
- Been found to have contravened a workplace law, labour hire industry law or minimum accommodation standard, or given an enforceable undertaking in respect of a contravention of one of those laws;
- Had a licence under a labour hire industry law cancelled, suspended or revoked other than at the licence holder’s initiative;
- Been insolvent or under external administration;
- Where an applicant is a body corporate, an officer of the body corporate was an officer of another body corporate whose licence was cancelled other than at the licence holder’s initiative; or
- The applicant was an officer of a body corporate and was disqualified from managing corporations under the Corporations Act 2001.
Compliance with obligations
In addition to the fit and proper person requirement, an applicant will also need to declare that, to their knowledge, they are compliant with relevant laws including taxation, superannuation, occupational health and safety, workers compensation; labour hire industry; workplace; migration and applicable minimum accommodation standards.
What if my business uses labour hire?
Businesses that use labour hire providers must ensure they are aware of the requirements under the scheme. As of 30 October, it will be an offence under the Labour Hire Licensing Act 2018 to use any provider that is unlicensed and may result in penalties in excess of $500,000 for a body corporate.
Before engaging a labour hire, businesses should check the online register of Licensed Labour Hire Providers to determine if the provider is appropriately licenced. The register and further details can be found at https://labourhireauthority.vic.gov.au/