Labour Hire Licensing Regulations released – What you need to know
WHO SHOULD READ THIS
- Labour hire providers operating in Queensland and people who engage labour in addition to direct employees.
THINGS YOU NEED TO KNOW
- The licensing scheme includes requirements that management of labour hire providers are ‘fit and proper’ persons. There are also significant penalties for operating as a labour hire provider without a licence or engaging a labour hire provider which does not have a licence.
WHAT YOU NEED TO DO
- Determine whether your business is a labour hire provider and whether you need to be licensed. Review existing arrangements with current service providers to determine whether they are caught by this scheme and whether changes to contracts are required.
The Labour Hire Licensing Regulation 2018 (Qld) (Regulations) have been released today. They support the Labour Hire Licensing Act 2017 (Qld) (Act), which was passed late last year.
Snapshot of the Act
The Act provides that:
- A person who provides ‘labour hire services’ in Queensland will need a licence to do so. This licence must be renewed annually.
- ‘Labour hire services’ is broadly defined to mean supplying a worker to another person to do work. Examples of labour hire service providers include contractors who supply workers to a farmer or fruit grower to pick produce.
The Regulations give further guidance as to how the Act is to be interpreted and how the labour hire licensing scheme will operate.
Section 4 of the Regulations prescribes classes of individuals who are not considered to be ‘workers’ for the purposes of the Act. Importantly, these are:
- An employee:
- whose annual rate of earnings exceeds the high income threshold under the Fair Work Act 2009 (Cth) (currently $142,000 base remuneration per annum), and
- who is not covered by either a state award, a modern award or an enterprise agreement.
- An executive officer (usually a sole director) of a corporation who is the only employee supplied to perform work.
- An in-house employee of a provider who is supplied on a temporary basis on one or more occasions. An in-house employee is defined as an employee who is engaged on a regular and systematic basis with a reasonable expectation of continued employment, and where they primarily perform work for the provider other than as a labour hire worker.
- An individual who is provided to another person who is part of a group of entities that carry on a business collectively as one recognisable business (the group company exception).
This means that businesses which only engage individuals who fall within these exemptions will not be providers of labour hire services and therefore will not need to obtain a licence.
The Regulations have also confirmed the licence fees that will be applicable for a labour hire licence. There are three tiers of businesses, which are determined according to the wages (being the same definition as wages for WorkCover Queensland) paid by the business in the financial year before the relevant application. The tiers and the corresponding fees are:
- Tier 1 Business – wages of less than $1.5 million – $1,000 licence fee
- Tier 2 Business – wages more than $1.5 million but less than $5 million – $3,000 licence fee, and
- Tier 3 Business – wages more than $5 million – $5,000 licence fee.
For new businesses, their tier will be designated on the basis of their projected wages for the coming financial year.
A further detailed update will provide an analysis of the Regulations and what will be required in order to procure a labour hire licence closer to the start date of 16 April 2018, including the prescribed information about financial viability, work health and safety and workers’ compensation obligations, migration matters and compliance with other relevant laws.
The McCullough Robertson Employment Relations and Safety team can assist you prepare the necessary application material and advise you on any changes which may need to be made to existing or proposed contractual arrangements.
If you would like further information on this matter please contact a member of the Employment Relations and Safety team.
With the expansion of our Employment Relations and Safety practice into Sydney, we would like to introduce you to Partner Scarlet Reid and her specialist team, including Senior Associates Tom Reaburn and Nathan Roberts. Find out more about the Employment Relations and Safety team here.
This publication covers legal and technical issues in a general way. It is not designed to express opinions on specific cases. It is intended for information purposes only and should not be regarded as legal advice. Further advice should be obtained before taking action on any issue dealt with in this publication.