Julie Mills, managing director, APSCo Australia charts the complex licensing scenarios across the country.
The licensing merry go round.
This week I was discussing the business opportunities for a company wanting to commence operations in Australia and, as always I go through the various state legislation and requirements. NSW seems to be the most popular entry point because requirements are clear so cost of business is a reasonable calculation. Even the myriad of other statutory requirements do not phase most companies I speak to and then the licensing conversation commences – and suddenly Australia is less attractive and, even for locals some states will just be off their radar – particularly Victoria.
The cost to business in Australia, not just in fees but in time to report and to delay opportunities if new business comes your way is yet to be determined but it will be in 4 digit figures and more.
For now, in summary here is where I think we are at – but it is a watch and wait scenario.
Queensland has been place since April last year and have suspended 123 licences for failure to report and there have been a further 7 licence cancellations along with one recently reported fine. There has been no indication of any penalties for the companies engaging unlicensed or cancelled licence holders. Failure to report is not necessarily a bad operator, just a business drowning in paperwork.
The Licence Support program supported by APSCo Australia provides a fee for service record and reporting service to assist small businesses from application through to regular reporting and is proving extremely popular for companies who don’t want to, by an accident of book keeping, appear on these lists as brand damage and business loss are irretrievable. There are more than 60 pending licences that have been on the list for more than 12 months – and depending on their application – they can still operate or have to wait BUT if the licence isn’t successful then clients must not use them. So how are they managing their business?
What is more concerning in the QLD jurisdiction are the number of exemptions being issued by the Labour Hire Licensing Compliance Unit (LHLCU) which then leads to an unfair playing field and, more importantly, the number of companies still operating and not licensed.
Depending on the project involved this is proving difficult as evidenced by a conversation with a provider in a very niche space last week. APSCo Australia interviewed three potential Member companies last week who are trading in Queensland with reasonable numbers of talent, were not aware of the requirement, had not been asked by the client and therefore had no licence. Their clients are also oblivious and, in one case, a major project could be at risk!
These companies achieve high scores on all areas of the Business Verification Review, which predicates Membership, but are in breach of the fundamental licence requirement – so steps are underway to address the issue, including voluntary reporting – but this is a business risk as they have now been made aware and need to take steps to not supply because the fines and suspensions are far greater than any income earned. Education is as important as the big stick approach and it is clear there is still lots to do.
To Victoria who, with great fanfare conducted the most comprehensive review of the sector. The long awaited regulations and application process is now in place. Unlike Queensland they have undertaken a comprehensive information campaign through the media, for clients and candidates. Unfortunately once again using negative language to describe the sector, but, to their credit, they are raising awareness. Ignorance is never an excuse but sometimes you don’t know what you don’t know!
In Victoria many companies who are wanting to apply for a licence are being constantly challenged by a number of requirements in the application that have not been clarified by the Labour Hire Licensing Authority in Victoria despite numerous questions being raised through the appropriate channels.
It is also interesting to note that there is only a 14 day window to lodge any objections to applications – and that only 294 applications have been lodged to date but no approvals – or at least none showing on the Register. Not sure if those who have applied have answers we haven’t been able to get to questions or have just applied regardless. Here is a sample of outstanding questions:
- Extent to which non-Victorian placements are included
- To include short term/visits to Victoria of non-Victorian placements?
- In multiple entity groups which entity should be licensed – or should all?
- Confirmation that annual turnover includes business wide income – or Victorian only income
- Are small body corporates exempt from reporting?
- Does the Victorian Labour Hire Licence Authority require police checks from Australia non-resident Directors and can this be done in country of origin?
- What is the need for client details, including deeds of agreement and any enforceable undertakings
APSCo Australia has been informed there will be amendments to the Victorian application process but the question is when and will it be in time for everyone to have their applications in, reviewed and approved?
It’s on then it’s off now it’s on again – South Australia aimed to repeal its labour hire licensing but this didn’t pass the required votes – so now it is officially re-commenced with applications to be completed by 31st August , to be licensed by 1 November 2019 so not a great amount of time.
A couple of extra exemptions which have small relevance to APSCo’s sector have been included. The association with outlawed organisations remains in place and the requirement for certain levels of education that, for a sector as diverse as this one, is almost tragic in its lack of understanding of the dynamics and growth of business in this sector. In most cases business is driven by entrepreneurs and skilled personnel from the fields in which they recruit OR they are just great business owners. Applications that were in train, before the vote to repeal the legislation can now be re-commenced as well as new applications. Businesses that lodged applications for the SA scheme last year should have
Despite the SA Government’s Upper House reluctance to repeal the scheme in its entirety there is some recognition that there may need to be amendments considered – this is, as always, not leaving much time for the changes to be made.
And then this – late last week. The ACT Government has committed to developing a labour hire licensing scheme in the ACT to improve responsible practices in the ACT labour hire industry. A Discussion Paper has been prepared and there is feedback sought on the Scheme. Interestingly, the Discussion Paper uses each of the other State models as exemplar in the Discussion Paper so we can only hope that this Scheme will benefit from the learnings of the other Schemes – and ensure the Scheme does what the original driver of this development – The Inquiry into Insecure Work set out to do – protect vulnerable workers.
Harmonisation of legislation in Australia takes small steps forward then a series of changes such as this occur – and we are right back in another time and place!