What is labour hire?
Under the Labour Hire Licensing Act 2017 (Qld) (Act), labour hire means “a person (a provider) provides labour hire services if, in the course of carrying on a business, the person supplies, to another person, a worker to do work”. The Act goes on to state “a provider provides labour hire services regardless of:
- Whether or not the worker is an employee of the provider; and
- Whether or not a contract is entered into between the worker and the provider, or between the provider and the person to whom the worker is supplied; and
- Whether the worker is supplied by the provider to another person directly or indirectly through 1 or more agents or intermediaries; and
- Whether the work done by the worker is under the control of the provider, the person to whom the worker is supplied or another person.”
The Act does not apply to workers doing volunteer work, or students who are placed in work experience positions. However, businesses that utilise contractors or subcontractors (unless the are contractors within the meaning of the Building and Construction Industry Payments Act 2004) are also bound by the Act.
Who needs a licence?
The Act establishes a mandatory licensing scheme for all labour hire providers operating in Queensland. The Act commenced on 16 April 2018, supported by the Labour Hire Licensing Regulation 2018.
A labour hire provider is a business or person who supplies workers to undertake services for another business or person (Labour Hire User). The Labour Hire User can only use licensed labour hire providers. If a business or person is operating as a labour hire provider, they need to apply for a licence.
What are the requirements to obtain a licence?
To obtain a licence, labour hire providers must:
- satisfy a fit and proper person test;
- establish that they can provide labour hire services in compliance with all relevant laws, including workers’ compensation, wages and superannuation, for example, by showing the contract agreement;
- establish that their business is financially viable; Financially viable means the person can pay the person’s debt as and when they become due and payable;
- provide a report online through the labour hire licensing website every six months in relation to their labour hire operations and associated activities. It applies from the date the licence is granted; and
- pay a licence fee (as per the table outlined below).
Fit and proper person test
The following matters are considered in a fit and proper person test. They include:
- the person’s character, for example, the person’s honesty, integrity and professionalism;
- the history of compliance with relevant laws or the ability to comply with relevant laws;
- cancellation or suspension of any previously held licence;
- any offence conviction against a relevant law or another law that affects the person’s suitability to provide labour hire services;
- the insolvency of an individual or, administration, receivership or liquidation of a corporation; and
- disqualification from managing corporations under the Corporations Act.
What information must be included in the report?
In relation to the six-monthly report, it must include the following information:
- the number of workers supplied during the reporting period;
- the type of employment arrangements, for example, whether the employment relationship is causal or permanent, contractual arrangements, apprenticeship or traineeship arrangements;
- the type of work carried out by the workers;
- details of the accommodation provided to the workers;
- the locations in Queensland where workers undertake services;
- other services provided to workers, the examples of other services are meals and transport; and
- the number of notifiable health and safety incidents and the number of applications for compensation made by the workers.
How much does a licence cost?
Licence fees are calculated according to the total amount of wages or salaries paid during the last financial year. Licence fees must be paid at application, annual renewal and restoration. The following table shows the three tiers of businesses which are determined according to the total amount of wages paid.
|Total amount of wages paid in the financial year preceding the day the application is made||Tier||Licence fee|
|$1.5 million or less||1||$1,000|
|$1.5 million and up to $5 million||2||$3,000|
|Over $5 million||3||$5,000|
When to apply for a licence?
All labour hire providers who already operate a labour hire business, they must lodge an application by 15 June 2018. The businesses can continue to operate while their application is being processed. For all new labour hire service businesses, they must be licensed before they can commerce operations.
How to apply for a licence?
The labour hire providers need to register for an online account through the Labour Hire Licensing Queensland portal. Only the applicant or an authorised administrative user can register the online account. The decision on the application will be made within 28 business days once the labour hire providers have made application and paid licence fee.
If you have any questions whether the Act will apply to your business or would like to discuss your requirements in relation to a Labour Hire Licence, please contact our office on (07) 3876 5111 for a consultation.
About the authors
Jonathan Mamaril leads a team of handpicked experts in the areas of employment law and commercial law who focus on educating clients to avoid headaches, provide advice on issues before they fester and when action needs to be taken and there is a problem mitigate risk and liability.
Kayleigh Whittaker is a lawyer on our Commercial and Property team who also assists with Employment Law matters. With a high level of experience in commercial and retail leasing, voluntary and involuntary purchase and sale acquisitions, property development and employee relations, Kayleigh provides practical advice to ensure smooth business transactions.