Excluded classes of workers

Under the Labour Hire Licensing Regulations 2018 (Vic.) (the LHL Regulations), there are some circumstances in which an individual is not considered to be a worker under the Labour Hire Licensing Act 2018 (Vic.) (the LHL Act). Businesses that only provide workers in the circumstances described below will not require a licence.

The examples provided on this page are for illustrative purposes only and do not constitute legal advice. You should consider your particular circumstances when determining whether you require a labour hire licence.

If you are unsure, you should seek legal advice.

Secondees

No licence is required to supply workers who are considered to be ‘secondees’.

A secondee is an individual who is an employee of the provider, who is provided to another person to do work on a temporary basis, who:

• works for the provider on a regular and systematic basis; and
• has a reasonable expectation that their employment with the provider will continue (i.e. when the secondment ends, they expect to go back to working directly for the provider); and
• primarily performs work directly for the provider, other than as a worker who is supplied to another person to do work for that other person.

However, a business cannot rely on this exemption where they are predominantly in the business of providing the services of workers to other persons. This means that even if all the workers you provide meet the definition of a secondee, you will still require a licence if the main activity of your business is labour hire services.

Scenario 1:

A lawyer employed by a law firm is seconded to a client of the law firm to do work for the client. The lawyer works for the law firm on a regular and systematic basis, expects that their employment will continue and primarily works directly for the law firm, other than as someone who is provided to clients. The lawyer is provided to the client is on a temporary basis.  As a result, the lawyer is considered to meet the definition of a secondee.

The law firm is not predominantly in the business of providing the services of workers to other persons.   In these circumstances, the law firm does not require a labour hire licence to provide a lawyer to the client.

However, a law firm that is in the business of providing lawyers to clients to work in and as part of the client’s business will be a labour hire provider and will require a licence.

Scenario 2:

A farmer employs a farm worker on a regular and systematic basis with the expectation that the employment will continue and assigns a worker (the secondee) to work on a neighbouring farm to fulfil an immediate need at the neighbouring farm. This may be on a goodwill basis or for payment and is on a temporary basis.

In this example,  the farm worker falls within the definition of a secondee and the farmer is not predominantly in the business of providing the services of workers to other persons.  As a result, in these circumstances, the farmer does not require a labour hire licence to supply the farm worker to the neighbouring farm.

Providing workers within a group

No licence is required to provide a worker where the provider and the host are each part of an entity or group of entities that carry on a business collectively as one recognisable business (that is, ‘within group’).

However, a business cannot rely on this exemption where they are predominantly in the business of providing the services of workers to other persons who are not within the group.

Scenario 1:

A landscaping business is comprised of a number of companies that are responsible for different aspects of the business. The business’s workers are all employed by one of the companies (sometimes known as the ‘employing entity’) and are supplied to work for one or more of the other companies within the business (usually the entity that carries on the substantive trading function of the group). The companies are operating collectively as one recognisable landscaping business.

Scenario 2:

A business that operates a group of medical centres employs workers for the centres through a trust entity. The workers, including doctors, nurses and reception staff, are supplied to the medical centres to perform work. The trust and the medical centre entities operate collectively and are recognisable as one business.  Therefore, this is not a labour hire arrangement.

Small body corporate provides a director

No licence is required to provide for a director of a body corporate, where that director participates in the management of the body corporate or shares in its profits, and the body corporate has no more than two directors.

Scenario 1:

Mr Mason and his wife, Ms Mason, are directors of Best Boilermaker Pty Ltd. Both Mr and Ms Mason participate in the management of Best Boilermaker Pty Ltd. Best Boilermaker Pty Ltd provides Mr Mason to a labour hire company, who then on-hires Mr Mason to various mine sites.

Best Boilermaker Pty Ltd will not require a licence to provide Mr Mason, as it is a two-director company, provide a director who participates in the management of the company.

However, the labour hire company that provides Mr. Mason will require a labour hire licence.

Public sector employees

No labour hire licence is required to provide a person who is employed by a public sector body within the meaning of the Public Administration Act 2004 (Vic.) who is seconded, transferred, provided or made available to do work for another person, however, described, pursuant to an Act.

Students

No labour hire licence is required to provide students who are performing work under:

• a work experience arrangement or structured workplace learning arrangement under Division 1 of the Education and Training Reform Act 2006 (Vic.); or
• a practical placement under Division 2 of the Education and Training Reform Act 2006 (Vic.).

Information about work experience arrangements, structured workplace learning arrangements or practical placements, can be found at the Victorian Legislations and Parliamentary Documentswebsite. Click on ‘Victorian Law Today’, select ‘Acts’ and search by name or browse the list of Acts by letter.  

Vocational placements

No labour hire licence is required to provide persons undertaking work or services under a vocational placement within the meaning of the Fair Work Act 2009 (Cth).

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Disclaimer:

The information in this post is strictly for informational and educational purposes only and should not be construed as legal advice. It is not intended to express specific opinions about specific cases. Before acting on any of the issues discussed in this post, seek additional advice. The information provided should not be relied on for any purpose other than to assist you to understand how Workers’ Compensation insurance works. It is for illustrative purposes only and My WorkCover Solutions Pty Ltd does not accept liability for any loss or damage suffered by any person resulting in any way from the use of or reliance on, the information provided. The information in this article is believed to be correct as of the date of publication. However, changes in the applicable laws may have an impact on the accuracy of the material. This article contains general information that is not tailored to any specific person’s situation. This publication may contain information that relates to the regulation of Workers’ Compensation insurance in your State or Territory. To ensure you comply with your legal obligations, we would recommend you refer to the appropriate legislation as currently in force in the State or Territory you conduct your business. You can find up-to-date legislation by visiting each state’s WorkCover Authority website, alternatively contact myWorkCover for updated information.