SA to Introduce Labour-Hire Licensing to Stamp Out Worker Exploitation

The SA State Government is planning to introduce a bill to parliament which will require all labour-hire companies operating in the state to be licensed.

The new policy has been put forward as a means of dealing with the ongoing instances of illegal worker exploitation. Although there are already requirements in place to regulate the safety of workplaces and payment of wages, thus far they have had little effect on reducing the levels exploitation for foreign national workers.

If passed, the new program will require any business that supplies workers to pay a licensing fee, provide regular reporting, and pass a fit-and-proper person test. The government hopes this will help to clean up the industry and prevent the underpayment of exploited foreign workers.

The labour hire industry has been under increasing scrutiny in recent years, thanks in part to 2015 report from Four Corners which highlighted the black market workforce—comprised primarily of illegal foreign nationals—that was present throughout Australia’s farms and factories.

The South Australian Attorney-General, John Rau, has issued a statement addressing the new licensing bill, saying that unscrupulous operators were exploiting workers and damaging the reputation of honest employers by engaging in underpayment and abusive work practices.

Rau promised that under the new state-based licensing scheme there will be “significant penalties” for employers that decide to make use of unlicensed labour hire firms.

“It is critical that we crack down on dodgy operators exploiting workers and driving honest employers to the wall,” Rau said.

“Rogue operators are underpaying workers, failing to ensure proper safety standards and abusing worker visas.”

“These actions undermine minimum standards of employment for workers and undercut those businesses doing the right thing,” he said.

While the Victorian and Queensland State Government is also in the process of establishing its own licensing scheme—with Victoria’s announced in May this year—Rau said he would also like to see a national licensing program established.

However, the bill is already receiving opposition from the labour hire industry, with the CEO of the Recruitment and Consulting Services Association, Charles Cameron, saying “we need a market solution, not a political solution”.

“We need a solution that uses market power to change behaviour rather than a piece of law that says “no you can’t do that” and then is very difficult and expensive to enforce. History shows that licencing schemes tie legitimate operators up in more bureaucracy and don’t deal effectively with dodgy operators,” Cameron said.

“Experience also shows that illegal labour-hire firms are unlikely to apply for a licence in the first place. All this proposed bill will do is put more pressure and financial restraints on legitimate firms that are doing the right thing and drive illegal practices to become more inventive in getting around another law.”

“It will also reduce business flexibility and confidence, at a time when they need to be nimble and adaptable to changing economic and social conditions,” he said.

The CEO of Absolute Immigration, Jamie Lingham, expressed his support for the legislation, calling it a long overdue step in the government’s attempt to push back against businesses that engage in the exploitation of foreign workers.

“We applaud this move by the South Australian government and believe that the move toward greater regulation in this industry is significantly overdue,”  Lingham said.

“Over the years there have been too many highly publicized reports of worker exploitation committed by unscrupulous labour-hire firms who prey on vulnerable visa holders, and we believe that this behavior needs to be addressed and stopped.”

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Jamie Lingham

Chief Executive Officer

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