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Published: 13 July 2013
Author: Ryan Carlisle Thomas

Insecure work and you

Part 4: Labour hire workers do have rights

Are you a labour hire worker?

In Part 3 of this series - Casual workers do have rights - I wrote about the casual workers and their WorkCover rights, but now we will discuss the WorkCover rights of Labour hire workers.

The growing level of job insecurity among workers is mirrored by the emergence of labour hire agencies that are now a dominant force in our labour market.

Many companies have displaced their permanent and directly employed staff with hire-in personnel from labour hire agencies or independent contractors. Independent contractors are self-employed and work for businesses under a contract for their services. The business for which an independent contractor works is referred to as their 'principal'. Labour hire agencies engage workers and then hire them out to a business to perform work for that business. The business where the worker actually performs work is often referred to as the 'host'. Most labour hire workers are casual employees.

The attraction for host employers is that the risk or responsibility for guaranteeing continuing work to their staff is diminished, and sometimes completed avoided. The effect of this business strategy however is an erosion of the level of legal protection afforded to the worker.

Generally, labour hire workers are legally employed by the labour hire agency, and not the host. This is even though their 'boss' or the person they report to works at the host. It is usually the labour hire agency that pays the wages and has the legal contract of employment with the worker. The worker is then hired out to the host under a contract between the agency and the host, and the worker is not a party to that contract.

This three-way relationship between the parties can make it confusing when it comes to trying to work out who is responsible for working conditions and entitlements, or who is responsible if the worker is injured at work, dismissed or suffers discrimination. Unfortunately, the answer isn't simple; it depends on the particular circumstances.

Labour hire workers are most vulnerable when their host cuts back on the hours worked, or eliminates them entirely. This can feel like being sacked, when in fact there has been no dismissal because the worker remains legally employed by the labour hire agency. This may be the case even if the labour hire agency offers the worker no other work. Your rights depend on the particular circumstances and you should get advice as soon as possible if your host or labour hire agency stops giving you work, because strict time limits can apply if you want to take action.

Unfair dismissal

Casual workers, whether they are labour hire or not, can be protected from unfair dismissal if they:

  • are employed on a regular and systematic basis, and can expect to continue to be employed on that basis, and
  • have been employed for at least 6 months (if their employer has 15 or more employees) or 1 year (if their employer has less than 15 employees).

Employees only have 21 days from when they are dismissed to make an unfair dismissal application.

It is difficult for a labour hire worker to succeed in an unfair dismissal application. A labour hire worker who is no longer offered shifts by the host may continue to be legally employed by his or her labour hire agency so that there is no actual dismissal. However, if the labour hire agency does not offer the worker shifts elsewhere, it may constitute a dismissal. If a labour hire worker's host or labour hire agency reduces the amount of work he or she is being offered, it is important to get advice as soon as possible because it may be arguable that there has been a dismissal.

General Protections and Anti-Discrimination

Casual employees, labour hire workers and contractors may be protected from being dismissed for unlawful reasons. Workers cannot be dismissed because they have exercised a workplace right, which could for example be an employee's enquiry about unpaid carer's leave or some other employment condition.

A worker cannot be dismissed on the basis of race, colour, sex, sexual preference, age, physical or mental disability, marital status, family or carer's responsibilities, pregnancy, religion, political opinion, national extraction or social origin. Equally, an employee cannot be sacked for being temporarily absent from work because of illness or injury.

These safeguards not only protect employees against dismissal for an unlawful reason, but also protect workers (including independent contractors and labour hire workers) against other types of 'adverse action' because of an unlawful reason. Those found in breach of these general protections and discrimination provisions can face stiff penalties.

As with unfair dismissal applications, general protections applications and discrimination claims can be particularly difficult for labour hire workers. If you believe you've been dismissed for an unlawful reason you should seek advice as soon as possible. Workers only have 21 days within which to make a general protections application, and generally only 12 months within which to make a discrimination claim under State or Federal laws.

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