Local Government Update on labour hire licensing regime in South Australia

Previously, we updated readers about the current State Government’s proposed repeal of the Labour Hire Licensing Act 2017 (LHL Act). The LHL Act was enacted under the previous South Australian Government.

Since our last update, the repeal effort has failed. However, instead, the Labour Hire Licensing (Miscellaneous) Amendment Act 2020 has recently come into force to substantially limit the scope of the State’s labour hire licensing regime (while still retaining the overall licensing framework).

In short, a licence will only be required in respect of the provision of labour hire services for ‘prescribed work’. Prescribed work is defined in the LHL Act to mean only:

• cleaning work;
• horticultural processing work;
• meat processing work;
• seafood processing work;
• trolley work; and
• any other work of a kind prescribed by regulation (though no such additional work is prescribed as yet).

Accordingly, the common resource-sharing arrangements between Local Government councils that would likely have been covered by the LHL Act as originally enacted will now not be covered under the LHL Act as amended.

It is, however, important to note that the LHL Act relates not only to providers of labour hire services, but also customers of labour hire services. Accordingly, while most or all councils are unlikely to provide services which require the council to hold a licence, there may still be some limited circumstances (e.g. the engagement of cleaning staff) in which a council will need to ensure that it is dealing with a duly licensed labour hire service provider. Entering into a labour hire arrangement with an unlicensed provider may attract a maximum penalty of $400,000.

Separately, it is worth noting that councils still retain powers under the amended LHL Act to ‘object’ to the grant of a labour hire licence or to the appointment of any person as a responsible person under a licence. Such objections can only be made on the basis that the person seeking the licence (or any of its directors) or the proposed responsible person is not a ‘fit and proper person’. These powers to object can only be exercised within 14 days of the publication of a relevant notice on the website of the Commissioner for Consumer Affairs. Given the short time period to exercise these powers of objection, it would prudent that these powers (and the related power to appeal to the District Court against the granting of a licence) be delegated pursuant to section 44 of the Local Government Act 1999.

For more specific information on any of the material contained in this article please contact Sathish Dasan on +61 8 8210 1253 or sdasan@normans.com.au, or Chris Alexandrides on +61 8 8210 1299 or calexandrides@normans.com.au.