30 November 2017

Major reform of labour hire in Queensland

The time has come for many businesses to prepare for the introduction of the Labour Hire Licensing Act 2017 (QLD).

This Act breaks new ground in regulation and is a first for any Australian jurisdiction.  The Act has the potential for very broad application.  It applies to anyone who provides labour hire services.  A party will provide labour hire services if, in the course of carrying on a business, the party supplies, to another person, a worker to do work.  The Act is broad enough to include any worker outsourcing, including secondment.

The Act was passed on 13 September 2017. It has not commenced operation.  The existing proclamation anticipates that the Act will commence operation on 16 April 2018.  The Act provides for a 60 day transitional period after commencement to allow for parties to make application to become licensed.  The penalties for operating an unlicensed labour hire business are significant ($378,450 for a corporation).

The chief executive may grant an application for a licence only if the chief executive is satisfied that:

1.           each of the following persons are fit and proper persons to provide labour hire services;

a.           each applicant;

b.           if a proposed nominated officer for the application is a person other than an applicant—the proposed nominated officer;

c.           if an applicant is a corporation—the corporation and each person who is an executive officer of the corporation; and

2.           the business to which the application relates is financially viable; and

3.           the business will comply with its legislative requirements, including the Work Health and Safety Act and the Workers’ Compensation and Rehabilitation Act 2003 (Qld).

The term executive officer, is very broadly defined.  It means any person (by whatever name called, and whether or not the person is a director of the corporation) who is concerned, or takes part in, the management of the corporation.  It suggests that businesses need to think very carefully about both the structure of their business, and compliance management.

In deciding whether a person is a fit and proper person to provide labour hire services, the chief executive must have regard to the following matters:

1.           the person’s character, including, for example, the person’s honesty, integrity and professionalism;

2.           whether the person—

a.           has a history of compliance with relevant laws; or

b.           is able to demonstrate an ability to comply with relevant laws;

3.              whether the person has previously held a licence that has been cancelled or suspended, or for which conditions have been imposed under section 29(1);

4.              whether the person has been convicted of an offence against a relevant law or another law that affects the person’s suitability to provide labour hire services;

5.              if the person is an individual—whether the person has been an insolvent under administration;

6.              whether a corporation has been placed into administration, receivership or liquidation while the person was an executive officer of the corporation;

7.              whether the person has been disqualified from managing corporations under the Corporations Act;

8.              whether the person is under the control of, or substantially influenced by, another person whom the chief executive considers is not a fit and proper person to provide labour hire services; and

9.              any other matter the chief executive considers relevant in deciding whether the person is a fit and proper person to provide labour hire

There are a many issues to think about here. Any business that may be affected needs to begin planning, including making application for a licence. It is expected that licences will be for a term of only 12 months, and may cost as much as $5,000 (for a corporation).

If you need assistance with this process, please let us know.

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