The Labour Hire Licensing Bill 2017 (SA) (the SA Bill) was passed on 29 November 2017 by the Legislative Council of the South Australian Parliament and the licensing scheme is set to commence on 1 March 2018. Labour hire service providers will have six months from commencement to obtain a licence. The Bill closely follows the Labour Hire Licensing Act 2017 (Qld) which was passed in September 2017. Please see our earlier article relating to the scheme in Queensland for further detail.

A timeline for the publication of the Regulations supporting the SA Bill has not been made public. We expect that Regulations will be published before the scheme commences.

Broad scope and wide applicability

The scope of the SA Bill is, according to the Minister for Sustainability, Environment and Conservation Ian Hunter MLC, deliberately wide. The SA Bill is not industry or sector specific and, subject to an exception for registered group training organisations and any regulations that might limit its scope, will apply to any labour hire arrangements in South Australia. This is consistent with the design of the Queensland licensing scheme.

The broad scope of the SA Bill, according to Ian Hunter MLC in his Second Reading Speech, is necessary and appropriate to achieve the purpose of the scheme. However, he did note that the bill provides a regulation-making provision by which the scheme could exclude other arrangements which are “genuinely not within the scope of labour hire” and went on to explain:

“…businesses that undertake recruitment leading to direct employment or permanent job placement, genuine independent contracting arrangement and workforce consulting services are not in the scope of the bill, neither is work experience or student practical placements organised by an educational institution as part of a course.”

As with the Queensland scheme, businesses will eagerly await these Regulations which will hopefully go some way to clarifying the scope of the scheme. At this stage though, there is significant ambiguity about whether labour supplies that are not generally understood as “labour hire” (for example, intra-group labour supplies between related entities or professional secondments) will be the subject of licensing arrangements under the scheme.

Amendments in the Legislative Council

The Legislative Council (South Australia’s upper house) introduced a number of amendments to the SA Bill. The late amendments were the subject of significant criticism from the LNP opposition and minor party members. Ultimately the third reading of the SA Bill was carried by a vote of 10 ayes to 9 noes. The opposition reiterated its position that they remained “implacably opposed” to the SA Bill and considered that many of the goals of the scheme could be achieved by existing provisions at both the federal and state level.

The South Australian State election will take place on 17 March 2018. Given the opposition’s stance regarding the scheme, it may be that the legislation is repealed or watered down significantly if the LNP form a majority government at the election.