Labour Hire Arrangements – Do you need to Register?
Recent changes under the Queensland Labour Hire Licensing Act 2017 has meant that from April 2018, all employers who engage in the hire of labour to other entities will need to be registered.
** The Act provides that Labour Hire Providers : **
Will hold mandatory licencing for operations conducted within Queensland (with licences renewed annually)
- Will be subject to substantial penalties if they are found to be providing labour hire services without proper licencing or engaging another Labour Hire Entity which does not hold the correct licencing
- Must satisfy a fit and proper person test, for all individuals involved in the management and control of the entity, to establish that they are capable of providing these services whilst complying with all relevant laws
- Must be conducting a financially viable business
- Will be subject to reporting requirements and inspections of the premises .
Whilst you may believe you don’t formally engage in the provision of labour to other entities, the definition of “Labour Hire” in the Act is quite broad.
** The Act defines a provider of labour hire services as: **
** “A person (a provider) provides labour hire services if, in the course of carrying on a business, the person supplies, to another person, a worker to do work”**
Due to the broad nature of the definition, we anticipate that these legislative changes will impact widely on many business arrangements, as they encompass the use of employees engaged by one entity, also being used by another entity within a business / family group.
Therefore, a simple secondment of an employee to an associated company will deem that the original engaging entity is providing a labour hire arrangement and needs to hold a Labour Hire Licence.
Your core operation does not need to be that of a typical Labour Hire / Employment business.
Unfortunately, at this time there is no provision for a simple carve out for internal employee arrangements within a business group and dealings will be are assessed on a case by case basis, with application needing to be made to negate licencing.
** How does this affect you? **
From 16th April 2018 all labour hire providers will be required to register for a Labour Hire Licence within 60 days, to avoid penalties being imposed.
Through our various resources and information feeds, we are monitoring any developments on this matter to ensure that the correct outcomes are achieved for you and your business.
Please contact us if you require further information on this or any other issue concerning you, and continue to monitor our blogs for the latest information from the ATO, Legal and business communities.