It’s an interesting time for Victorian recruiters and host businesses. Five months after the state’s labour-hire licensing scheme came into effect, the industry is anxiously awaiting to see the impact the legislative changes will have on operators and host businesses.
They may not have to wait long. Similar schemes were launched in South Australia and Queensland as recently as last year, providing fresh, ample opportunity for reflection and analysis. In this blog, Oncore examines the Queensland and South Australia schemes, comparing them with the Victorian scheme and helping you better understand what it could mean for you as a recruiter or a host business.
What is the scope of the Victorian scheme?
Passed on June 20 2018, the Labour Hire Licensing Act 2018 provides a way to regulate the activities of host businesses and labour hire services providers. In scope and powers, it is broadly similar to equivalent legislation in Queensland and South Australia, requiring that all labour-hire service providers acquire a licence from the relevant state government, and that host businesses do not use unlicensed labour-hire services providers.
Providers of labour hire services have until October 29 to complete the licensing process, after which they will not be able to provide these services. Businesses will only be able to enter into arrangements with licensed providers from that date, creating a potential risk for organisations currently hosting workers from unlicensed providers. Additionally, providers will not be able to advertise themselves as providers of labour-hire without a licence, and entities may not enter into an agreement they suspect is designed to circumvent or avoid obligations under the Act. Breaches of the Act can result in fines of up to $126,856 for natural persons, and $507,424 for corporate bodies.
To apply for a licence, providers will be required to disclose a significant amount of data about their operations. This data includes the number of workers supplied, the types of visas held by workers and whether the provider is currently or has been recently (within the last 12 months) involved in court proceedings or investigation regarding potential breaches of labour-hire laws.
How does it differ from comparable schemes?
Some key differences in the schemes include the definition of ‘provider of labour-hire services’ and the penalties stipulated for providing or accessing unlicensed labour-hire services.
In some ways, the Victorian scheme is narrower. For example, the Queensland scheme captures non-traditional labour-hire providers through a broader definition of the term, meaning that some operators may be exempt from the licencing requirements of the scheme altogether. Additionally, the Victorian scheme requires a reporting period of every 12 months for licensees, compared to 6 for the Queensland scheme.
The Victorian scheme prescribes less punitive penalties for breaches of the Act. While the Queensland scheme stipulates a lower maximum financial penalty for individuals and corporations ($130,439 and $378,450 respectively), courts in that state are empowered to seek prison sentences for entities in breach of the Act. Under the Victorian schemes, the only penalties prescribed are financial.
The SA Government has also recently announced it plans to reduce the scheme to specific industries it deems are in a higher risk for sham contracting and exploitation like the horticultural and hospitality industries, meat processing, seafood processing, cleaning, and trolley collection industries. Anyone currently captured under the existing scheme must still ensure they are licensed by 1 November 2019. It will be interesting to see if the plan is passed and if these changes will also affect QLD and VIC schemes.
As each scheme is currently state-based, it will require companies and providers of labour-hire to be aware of the different regulations, particularly if placing workers in a range of states and territories.
A smarter approach to labour-hire
Navigating this new legal landscape takes a smarter approach that responds in an agile way to new regulatory requirements and restrictions. Oncore is a fully integrated contractor management service built from the ground up with risk management and compliance for our clients first in mind.
If you’re looking for a smarter way to manage your compliance in Victoria, speak to the team at Oncore today.