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First conviction under state labour hire licensing scheme

Australia’s first labour hire licensing conviction comes as a Queensland labour hire provider was found to have supplied workers to a business without a license under the Labour Hire Licensing Act 2017 (Qld).

A & J Group Services had its labour hire licence application withdrawn for failing to provide information about its compliance record. It had been notified in writing that the application had been withdrawn and was no longer permitted to provide labour hire services in Queensland.

A member of the community contacted the Labour Hire Licensing Compliance Unit claiming the provider was still supplying workers to a Cottonvale strawberry farm for a period up to 15 January 2019.  The labour hire licensing legislation prohibits a provider from supplying workers to a business to carry out work without a valid license.

On 18 June 2019, a Queensland magistrate found A & J Group Services guilty of operating without a licence and the labour hire provider was fined $60,000 under the Act. The maximum penalty for a corporation found operating without a licence under the state legislation is $391,650.

Although this was the labour hire provider’s first offence, the magistrate said it had pursued a deliberate course of conduct in supplying labour after having been notified that it was not permitted to provide labour hire services in Queensland. The magistrate also noted the provider’s lack of cooperation in the investigation and failure to appear in court was an extension of its conduct.

As of 21 June 2019, the Labour Hire Licensing Compliance unit had suspended 123 Queensland licenses for failing to lodge a six-monthly report. Labour hire providers are reminded of their obligations to report before the due date and where it fails to do so, the compliance unit provides education and assistance to ensure providers are compliant.

Suspensions remain in place for 90 days before the compliance unit considers whether it is appropriate to cancel the licence.

Labour hire a necessary employment model

Labour hire is a valuable, responsible and commercially necessary employment model, particularly in the resources and energy industry.

In response to the Migrant Workers Taskforce, the Coalition will seek to introduce a national labour hire registration scheme through bills hoped to be passed before the end of the year. The introduction of a national scheme will seek to address the systematic and deliberate underpayment of migrant workers and impose criminal sanctions on businesses found to be underpaying workers.  The exploitation of labour hire employees has only been identified in a limited number of sectors including horticulture, cleaning, meat processing and security industries.

A key basis for AREEA’s position on the introduction of labour hire licensing schemes, including the proposed national scheme, is that these schemes should focus on those high risk sectors found to be exploiting migrant workers. The introduction of a national labour hire licensing or registration scheme should replace those already in place or proposed for various states and territories to avoid any conflict in operation and unnecessary compliance on businesses.

The business community, including AREEA, has long held the position that introducing criminal sanctions into workplace relations law is unnecessary given existing criminal law can already be applied in the most serious cases of unlawful treatment of employees.

As governments and the broader community continue to support the introduction of the these registration  schemes, labour hire licensing must be a low regulatory burden to ensure it is workable for labour hire providers without impacting their business models and the job prospects of labour hire employees.

Implications for employers

With labour hire licensing legislation now in effect across Queensland, Victoria and South Australia, labour hire providers operating in these States need to understand their obligations under each of the schemes.

Despite the common objective of each State’s legislation to protect workers from exploitation by labour hire providers and promote the integrity of the labour hire industry, there are some important distinctions employers should be aware of.

A brief comparison table is available here to assist employers navigating each State’s distinct labour hire licensing scheme.

For more information or a discussion on how labour hire licensing will impact your business operating in the relevant states, contact [email protected].


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