Labour Hire Licensing Laws in Australia

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Table of Contents

• Queensland
• Victoria
• South Australia
• ACT
• Key Takeaways
• Frequently Asked Questions

If you are a labour-hire service provider in Queensland, Victoria, South Australia and the Australian Capital Territory (ACT), you need to have a licence, or you could face penalties. Engaging an unlicensed labour hire service provider in these three states is also an offence. This licensing regime ensures that only individuals and companies that meet financial and character standards can provide labour hire services. In this article, we detail and compare some of the critical features of the labour-hire licensing regimes in Queensland, Victoria, and South Australia.

Queensland

In Queensland, you must have a licence to operate as a labour hire provider. Labour hire licences are valid for 12 months, and you need to renew them yearly. A contractor who provides a farmer with fruit pickers would require a labour hire licence. 

The requirements to obtain a licence are that:

• you can apply for a labour hire licence as an individual or as a company;
• you or the nominated officer are a fit and proper person for the purposes of a labour licence; 
• your business is financially viable and can meet operating costs and expenses, pay employees promptly, and is prepared for additional costs;
• you or the executive officers of the company have not been found guilty of a severe criminal offence, had a labour hire licence refused, suspended or cancelled, been insolvent, or been an executive officer of a company that was made insolvent; and
• you can demonstrate previous compliance with workplace, immigration, workplace health and safety and worker’s compensation laws. 

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Generally, a person is not a fit and proper person if they have been found guilty of an offence, contravened a workplace law, been insolvent or been disqualified from managing a corporation within the last 5 to 10 years. However, the definition of ‘fit and proper person’ will depend on the nature of your application and in which state you are applying for a licence. 

You should note that you cannot apply for a labour hire licence if the Industrial Relations Office has:

• cancelled your labour licence within the last two years; or 
• refused your application for a labour licence within the last three months. 

When You Will Not Need a Licence

You do not need a labour hire licence in Queensland if you:

• provide recruitment and permanent placement services;
• are organising volunteer placements;
• provide workplace consultants; or
• engage in a genuine subcontracting arrangement.

Penalties

If you are an unlicensed labour hire provider or conduct labour hire services without a licence, you could face fines up to $142,537 or three years imprisonment as an individual. Alternatively, your company could face up to $413,550 in fines if you operate the business as a company.

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Victoria

In Victoria, you must either be licensed or have applied for a licence if you are a labour hire service provider. Labour hire licences can last for a period of up to three years, although annual renewal fees apply.

In Victoria, labour hire service providers are businesses with an arrangement with one or more individuals where the business supplies the individuals to perform work in a different business. The businesses themselves pay the individual for the performance of the work.

The Victorian definition of labour hire covers specific recruitment or placement services and contractor management services.

The requirements to obtain a licence are that:

• you can apply for a labour hire licence as an individual or as a company. 
• if you provide transport or accommodation to your workers, you will need to make a declaration and demonstrate that the accommodation and transport meet minimum acceptable standards; and
• you, or the company’s executive officers, have not been convicted of a serious criminal offence in the past ten years, or, in the last five years, broken workplace laws, had a labour hire licence suspended or cancelled, or been insolvent.

When You Will Not Need a Licence

You do not need a labour hire licence in Victoria if:

• your business provides a worker as a secondee to another organisation;
• you are providing workers between a group of related companies; or
• you are arranging students in placement and work experience.

A secondee is where you loan one of your employees to another organisation, but your employee remains employed by your business. 

Penalties

Penalties of up to $145,392 for individuals and $581,568 for corporations apply if you supply labour hire services without a licence or engage an unlicensed provider.

South Australia

In South Australia, you must either be licensed or have applied for a licence. Labour hire licences are valid for 12 months, and you must renew them annually. In South Australia, Labour hire is where:

• your business provides workers for someone else to work in as part of that other person’s business;
• you have an arrangement with your workers to supply them to another person to do work; and
• the workers you provide to the other person, whether in full or part, are paid for by your business, and this is even if payment is only for accommodation or some other expense.

Requirements

If you are applying for a licence as an individual, you must be able to prove that you:

• are financially solvent;
• have the required knowledge and experience;
• have at least two fit and proper people who are responsible for the day-to-day management of your business; and 
• ensure you and each of these responsible people hold a current National Police Certificate. 

To satisfy the knowledge and experience requirements when applying for a labour licence as an individual or a body corporate, you must demonstrate one of the following:

1. you have completed accredited courses in risk management for small businesses and in remuneration and employee benefits;
2. you have completed an economics, business, accounting or humanities degree from Australia or New Zealand; 
3. your company is on the Australian stock exchange; and
4. you have an equivalent labour hire licence in another state.

If you are applying for a licence as a company, you must be able to prove that:

• your company is financially solvent; 
• at least one director has the required knowledge and experience;
• you have at least two fit and proper people who are responsible for the day-to-day management of your business; and
• all directors and responsible people hold a current National Police Certificate. 

When You Will Not Need a Licence

You do not need a labour hire licence in South Australia if:

• you are providing services and not labour hire;
• there is a genuine subcontracting arrangement in place;
• the workers are  ‘in-house’ employees of the business; or
• you are acting as an intermediary or agent, meaning you contract with a business to supply workers, but you do not have an arrangement with workers. Consequently, you source workers from a separate labour hire service provider. 

Penalties

If you supply labour hire services or engage an unlicensed labour hire service provider, you could face a penalty of up to $140,000 and three years imprisonment for individuals and $400,000 for corporations. 

ACT

On 27 May 2021, the ACT introduced a licensing scheme for labour hire providers. If you are a labour hire provider who applied for a licence before 26 November 2021, you can continue to provide labour hire services whilst your application is pending. 

You can apply for a labour hire licence as an individual. In saying that, the requirements for obtaining a licence are that:

• you or the nominated officer are a suitable person; 
• your business is financially viable and can meet operating costs and expenses, pay employees promptly, and is prepared for additional costs; and
• you can demonstrate previous compliance with the workplace, immigration, workplace health and safety and worker’s compensation laws. 

When You Will Not Need a Licence

You do not need a labour hire licence if you employ the following workers under a labour hire arrangement;  

• public servants;
• high-income workers;
• secondees or in-house workers who are engaged temporarily; and
• a director or senior manager if your corporation has no more than two directors and that person the corporation supplies to undertake work for another person. 

Penalties

If you supply labour hire services or engage an unlicensed labour hire service provider, you could face a penalty of up to $128,000 for individuals and $2,430,000 for corporations. 

Key Takeaways

It is mandatory to either apply for or hold a labour hire licence in Victoria, Queensland, South Australia and the ACT if you provide labour hire services. There are penalties for operating without a licence or trading with an unlicensed provider. Given the definitions of ‘labour hire provider’ vary between states and territories, it would be wise to seek legal advice before obtaining a labour licence. 

If you need help applying for a labour licence, our experienced employment lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page.

Frequently Asked Questions