Labour hire reduced to its most basic definition, is the supply of workers to a host employer. Labour hire workers are the employees of the labour hire agency, so they are responsible for their pay, superannuation and all other aspects related to their employment. These labour hire workers are lent out to a third party organisation when the need arises. Labour hire is a popular employment solution in a range of industries, such as building and construction, mining, retail, and warehousing. This is because these industries are often subject to fluctuations in workloads, due to seasonal demand, additional/delayed projects, etc.
Even though labour hire presents benefits for both the host employer and the labour hire worker, it has also been shrouded in controversy.
The controversy mainly surrounds the treatment and pay of labour hire workers, as well as the sometimes unclear delineation of responsibilities between the labour hire agency and the host employer.
A few labour hire agencies have been exposed for exploiting labour hire workers and serially underpaying them for the work that they have completed.
This has prompted authorities to take a closer look at the industry as a whole and ensure that labour hire agencies treat their workers fairly.
In light of the improper labour hire practices that some agencies have been partaking in, several state governments have begun cracking down on the labour hire industry.
Queensland has successfully implemented a labour hire licensing scheme that requires all labour hire companies that operate in Queensland, regardless of where they are actually based, to hold a labour hire licence. In order to acquire a labour hire licence under this scheme, labour hire providers need to be a 'fit and proper' person to provide workers, be financially sound, and comply with all relevant legislation.
A register of all compliant labour hire companies in Queensland has been created. This enables labour hire users to find and connect with authorised labour hire providers.
For more information about Queensland's Licensing Scheme, click here.
The South Australian government is also set to launch its own Labour Hire Licensing Scheme on the 1st of February 2019. South Australia had already launched a Labour Hire Licensing Scheme from the 1st of March 2018 with compliance to commence from the 1st of September 2018. However, a number of issues were raised, and the commissioner advising that the Consumer and Business Services (CBS) will not enforce the licensing scheme before the 1st of February 2019.
For more information on South Australia's Licensing Scheme, Click here.
Also, the current Labor party has set its sights on increasing regulations in the labour hire industry and creating an objective way to classify a 'casual' worker, so that workers get the fair pay for their work.
The purpose of these licensing schemes and other proposed legislations around Australia, is to maintain the integrity of the labour hire industry and safeguard workers from being mistreated and taken advantage of. However, there has been push back from labour hire agencies and businesses regarding the increased regulation.
Click here for a map of where Labour Hire Licensing Schemes have/will be enacted in Australia.
Why Labour Hire is Growing & Changing
The flexibility that labour hire agencies provide, through the supply of a contingent workforce, enables businesses to stay agile and cope with fluctuating demand, without incurring the costs associated with taking on part-time or full-time workers. Flexibility is one of the most prominent reasons why organisations in a range of industries are drawn to labour hire service, as it allows them to scale their businesses easily.
Businesses, particularly those operating in the construction, mining, manufacturing and warehousing industries, heavily rely on the use of labour hire agencies, as they often experience peaks and troughs in demand and need require workers on the fly.
Labour hire is also a great employment solution for businesses that require workers with specialised skills. This is because labour hire agencies often possess an extensive database of workers with a range of skills, qualifications and experiences, enabling them to have a suitable worker already available. If not, labour hire agencies have the expertise to find workers that are best-suited to the role, based on the brief provided by the client. Labour hire agencies allow businesses to outsource their recruitment processes, focus on the core functions of their business and access certain skills easily.
Previously, the lack of regulatory framework in the labour hire agency put labour hire workers at risk of being of being underpaid and taken advantage of.
Labour hire licensing schemes are a good way to safeguard the rights of workers and ensure that the remuneration they receive is all above board and fair for the work that they provide.
Under most Labour Hire Licensing Schemes being introduced, or in the pipelines, labour hire agencies are required to become registered providers, and be subject to stricter regulations and regular auditing. Host clients, or the businesses employing the services of labour hire agencies, will be required to only use labour hire workers from licensed agencies.
Overall, the inevitable roll out of Labour Hire Licensing Schemes across Australia will help to elevate the industry and ensure that the workers who rely on labour hire agencies are taken care of. It's a positive step towards a more accountable labour hire industry.
It is expected that Australia's labour hire industry will continue to evolve as its use continues to grow in a variety of sectors.
At Workfast Labour Hire, our workers are our top priority. We ensure that they are treated fairly and receive wages above award, and that Workfast is compliant with all schemes, legislations and policies relevant to the labour hire industry.
If you're looking to join a quality labour hire agency that values its workers, or looking to use a registered labour hire agency, look no further than Workfast!
Sign up as a worker online, or fill in our Staff Request Form if you require workers to help you out.