​SA drafting bill for dodgy labour hire company crack down

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​SA drafting bill for dodgy labour hire company crack down

South Australia has announced it will introduce legislation to weed out “dodgy” labour hire companies and to make the labour hire industry safer.

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South Australia has announced it will introduce legislation to weed out “dodgy” labour hire companies and to make the labour hire industry safer.

The state government will introduce a state-based licensing scheme that would make it unlawful to operate as a labour hire provider without a licence. Significant penalties may be introduced for employers that use unlicensed labour hire companies.

This will hold the labour hire industry accountable if a company, for example, breaches work health and safety regulations.

Other measures that may be included in the draft bill are a ‘fit and proper person’ test for owners and directors, annual reporting requirements and a fee to partially fund compliance and enforcement.

“Rogue operators are underpaying workers, failing to ensure proper safety standards and abuse worker visas. These actions undermine minimum standards of employment for workers and undercut those businesses doing the right thing,” Attorney-General John Rau said.

“Every inquiry in this area has highlighted the issue of “phoenixing”. This is where people avoid legal obligations such as tax, workers’ compensation, superannuation, wages and the most basic of working conditions by winding up dodgy companies and re-incorporating them under a new name.”

The government is enacting recommendations of the South Australian the Economic and Finance Committee’s final report, Inquiry into the Labour Hire industry.

It made seven recommendations, including that the State Government assist the introduction of a state-based scheme in the absence of a federal scheme.

In the ministerial response to the report the government said it is “cognisant of the need to provide protection to those that are vulnerable as well as the need to minimise the administrative burden and red tape on business, particularly for those that operate within existing laws”.

Since then ReturnToWorkSA (RTWSA) has begun investigations into labour hire companies. The regulator has identified hundreds of millions of dollars in remuneration discrepancies. Premium avoidance and phoenix identifying is now a dedicated function of RTWSA.

Attorney-General John Rau said that “in the absence of any meaningful action by the Federal Government, South Australia along with other states will introduce a complementary licensing scheme”.

“There is a need for increased cooperation between State and Federal Governments. We will continue to push for a national licensing scheme,” he said.

Queensland has already introduced the Labour Hire Licensing Bill 2017 to require labour hire companies to obtain a licence and demonstrate compliance with WHS, workers compensation and other employment laws. The Victorian government is also establishing a state-based scheme.

See also: Victoria moves to rein in labour hire cowboys (WorkplaceInfo) 
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