Labour Hire Update
Three states now have labour hire licensing laws – Queensland, Victoria and South Australia.
Is this a national trend? Will growers in the other states find it more difficult to prove ethical sourcing of labour for their markets without the support of a licensing regime for their labour hire contractors (LHC)?
Queensland set the pace by establishing labour hire licensing first, in August 2018.
Read the one year Anniversary Report at www.labourhire.qld.gov.au/news-media/media-releases/anniversary-report-australias-first-labour-hire-licensing-scheme
Overall it appears the licensing system has got off the ground effectively with no major negative outcomes. There has been comment from a few farms that some LHCs have disappeared, but that may be a case of good riddance! If a LHC has chosen not to apply for a licence, or has had their application refused, there is likely to be a good reason for that.
Of the 3,344 applications in the first year 3,132 were granted – almost 94% were successful. During the year just two licences were cancelled, with another 68 suspended. The report states that;
“The scheme is weeding out unscrupulous and unethical labour hire operators”.
The next stage of the process is now under way.
“The focus will shift over the next 12 months from education and assistance to enforcement…”.
Many growers have expressed relief that the system is now in place because they felt that when they complied with their employment obligations they were at a disadvantage from those that did not. It will now be more difficult for a dodgy operator to unfairly compete by undercutting prices in opposition to a producer doing the right thing, with full priced, legal overheads.
The report refers to this, saying;
“Focussing at the industry level enables LHLCU (Labour Hire Licensing Compliance Unit) to assist good operators by ensuring they are not undercut by non-compliant labour hire providers”
Victoria’s system is similar to Queensland and is now transitioning from the registration phase to the application phase. By 30 October 2019 any labour hire supplier in Victoria must be licensed, and any business who engages one has an obligation to check they are licensed.
Some labour hire contractors have indicated they have no intention of applying, for which a common response has been ‘no loss’. There will be a reason for taking that decision.
South Australia was slated to repeal labour hire licensing legislation established by the previous government, but that has not happened. Consumer and Business Affairs is the authority charged with managing the licensing system, and in the absence of that repeal has kicked off the process as is its obligation under the legislation.
There are now exemptions for certain classes of businesses which were unintentionally caught up in the definitions under the initial legislation. Details can be found at www.sa.gov.au/topics/business-and-trade/licensing/labour-hire-licence.
Applications for licences must have been lodged by 31 August 2019, and labour hire providers are expected to be licensed by 1 November. A simple check from the same web page will advise a grower whether the labour hire supplier they are considering engaging is licensed.
Keeping red-tape to a minimum
Each state has heavy penalties for businesses or individuals that on-hire labour without a licence. Any business, such as a farmer, who engages a LHC who is not licensed also risks penalties.
In Queensland the obligation on a business owner who wishes to engage a LHC is to check that the LHC is registered, and this can be done simply and for free from their website at www.labourhire.qld.gov.au.
Victoria has a similar system with checks being available from www.labourhireauthority.vic.gov.au.
When South Australia’s system comes into force checks will be able to be made from www.sa.gov.au/topics/business-and-trade/licensing/labour-hire-licence.
While red tape is detested by the farming community, keeping the process simple will minimise any extra obligations.
Both major political parties are committed to some form of national LHC regulation. The Federal Government has indicated a preference to introduce a ‘light touch’ approach, but as yet have not provided any indication of how they intend to approach the issue. There has been a suggestion that there is a distinction between a licensing arrangement and a registration process, with registration being far less onerous on labour suppliers. Details, including timing, are yet to be confirmed.
National coordination to minimise differences between the states is the preferred outcome. LHC businesses and agribusinesses that operate in multiple states will be pleased if some form of consistency can be achieved. No doubt buyers of produce such as the big supermarkets, who have made announcements about ethical sourcing of products with labour included in their auditing, will also welcome a consistent approach.