Labour Hire Licensing Scheme transition period ended on 30 October 2019: Large penalties for ‘providing’ or ‘using’ unlicensed labour hire.

29 November 2019

The Labour Hire Licensing Act 2018 (Act) establishes a licensing scheme to regulate labour hire providers and labour hire users in Victoria.

  • The Act applies far beyond traditional labour hire providers and the scheme commenced on 30 October 2019.
    • Businesses that provide persons to do work for third parties (whether as employees or contractors) could be labour hire providers that were required to have applied for a licence from the Victorian Labour Hire Licensing Authority (Authority) by 29 October 2019 in order to continue providing labour hire services.
    • Businesses are still able to apply for licences from the Authority to provide labour hire services but are unable to legally provide labour hire services until the licence is issued. However, the Authority announced on 29 November 2019 that if a labour hire provider submits a complete application to it before midnight on 31 December 2019, and there is no evidence of non-compliance, it will not take action against the labour hire provider for providing services without a licence or any user of labour hire services entering into an arrangement with that labour hire services provider.
    • Businesses that use labour supplied by third parties must ensure the labour hire provider has a licence or has applied for a license by 29 October 2019 but not yet had their licence application assessed by the Authority. If not they should ensure the labour hire provider makes a licence application before midnight on 31 December 2019 and obtain legal advice.1

Potential Penalties

  • Labour hire providers operating without licences, or without having made a licence application before 30 October 2019 and that application is still pending assessment, risk being unable to obtain a licence in the future and risk prosecution and fines in excess of $500,000.
  • Labour hire users that obtain labour hire services from anyone other than a licensed provider, or a provider that made a licence application before 30 October 2019 and is awaiting a decision from the Authority, risk prosecution and fines in excess of $500,000.
  • Labour hire users that do not report schemes set up by labour hire providers to avoid the Act, to the Labour Hire Licensing Authority risk prosecution.
  • Managers or directors ‘involved in’ contraventions of the Act may be prosecuted and subject to personal penalties in excess of $132,000.

Key Industries

  • The licensing scheme applies to all industries but businesses in the contract cleaning, horticulture, meat processing, meat manufacturing and poultry processing industries will be subject to specific scrutiny and will likely be affected by the scheme.
  • All cleaning businesses supplying cleaners to commercial premises require a licence. All users of commercial cleaning businesses will be required to use licensed businesses or risk penalties.

Contact us

If you would like advice or assistance with any of the above issues, please contact a member of our Workplace Relations team.

1 Exceptions Apply – For example: secondees, labour supplied within one recognisable business, directors of body corporates supplied and vocational placements as defined by the Fair Work Act.


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