Labour hire workers and WHS

Labour hire involves a host organisation using workers from a labour hire agency, for a temporary period of time. The first company is responsible for payment and other employee entitlements. The second company directs the worker tasks. Labour hire workers are “temporary workers.”

Both the labour hire agency and the host organisation are persons conducting a business or undertaking (PCBUs) and are both responsible for the health and safety of the labour hire worker they provide for work as per Section 19 of the WHS Act. A PCBU is a business entity. See here: What or Who is a PCBU? (courtenell.com.au)

Labour hire PCBUs and host PCBUs cannot contract out of or transfer their WHS duties to each other or to another party. WHS duties are non-delegable, meaning responsibilities cannot be relinquished to someone else.

Multiple PCBUs

In some situations, there may be multiple labour hire or host PCBUs. For example, one agency may provide workers to another agency which in turn supplies workers to a host. Both the labour hire agency and host organisation are responsible for making sure risk assessments of potential hazards are undertaken and appropriate safety measures are put into place for the benefit of their temporary workers.

Workers may not be experienced in the work and may need training. Therefore, monitoring of labour hire workers is important and good communication between the labour-hire agency and host employer must exist to identify changes to the work tasks or environment. It is important that both PCBUs can verify that job training has been completed.

Workers compensation and WHS responsibilities

In NSW it is the labour hire PCBU and not the host PCBU that provides workers’ compensation to the worker. The problems for injured labour-hire workers are compounded when they do not have a specific work site to return to for rehabilitation and return to work duties. Both PCBUs need to work together to: 

• coordinate return to work arrangements  

• support workers through the return-to-work process.  

PCBU duty to consult other PCBUs

PCBUs must consult with each other on shared WHS matters. Labour hire situations are a clear example of when a PCBU must consult with another PCBU. The WHS Act states:

46   Duty to consult with other duty holders

If more than one person has a duty in relation to the same matter under this Act, each person with the duty must, so far as is reasonably practicable, consult, co-operate and co-ordinate activities with all other persons who have a duty in relation to the same matter.

A person employed as a contractor or sub-contractor, or through a labour hire recruiter or agency, is a worker.  The individual worker still has an obligation to look after their own and others health and safety in the workplace as per their duties as "workers" under WHS Law. This applies to all workers, no matter their type of employment. The WHS Act states:

28   Duties of workers

While at work, a worker must—

(a)  take reasonable care for his or her own health and safety, and

(b)  take reasonable care that his or her acts or omissions do not adversely affect the health and safety of other persons, and

(c)  comply, so far as the worker is reasonably able, with any reasonable instruction that is given by the person conducting the business or undertaking to allow the person to comply with this Act, and

(d)  co-operate with any reasonable policy or procedure of the person conducting the business or undertaking relating to health or safety at the workplace that has been notified to workers.

Safe Work Australia have recently published a case study that describes correct procedures and best practice for labour hire companies in placing workers to host employers. It clearly describes how PCBUs consult other PCBUs, using the scenario of a labour hire company providing additional staff for a food and beverages provider that operates at large festivals.

Boland v Trainee and Apprentice Placement Service Inc [2016] SAIRC 14 is an example of a labour hire PCBU being prosecuted for failing to consult with a host employer which resulted in a worker they placed sustaining serious injuries while performing work for the host employer. In this court case, the labour hire company was fined $70,000.

For more information on WHS training or WHS compliance services, or if you would like help to make your WHS management system even more robust, please feel free to contact us at train@courtenell.com.au or phone us on 02 9552 2066