Labour hire workers

“A labour hire worker is someone who enters into a work contract with a labour hire agency. The labour hire agency has a commercial contract to supply labour with a host firm. The worker performs work for the host firm. The host firm pays the labour hire agency, and the labour hire agency then pays the worker. The worker has no contract with the host firm and as a result cannot make an unfair dismissal claim against the host firm. An example of this is a nurse working for a nursing agency……………………………………………..

Australian Courts have found that the interposition of a labour hiring agency between the agency’s clients and the workers the agency hires out to them does not result in an employee-employer relationship between the client and the worker. In those cases, in general, the hiring agency interviewed and selected the workers, and determined their remuneration, without reference to the client. Usually, a client requesting a worker with particular skills was provided with one, who may or may not have been ‘on the books’ of the hiring agency at the time the order was placed. The workers of such hiring agencies were usually meant to keep the agency informed of their availability to work, and in many cases were not to agree to undertake work for the client which had not been arranged or directed by the hiring agency. Equipment was either supplied by the worker themselves, or by the hiring agency, except for specialist safety equipment which the client often supplied.

Dismissal of a worker was only able to be effected by the hiring agency. The client can only advise the hiring agency that the particular worker is no longer required by it. 28

In some situations the labour hire agency and the host employer may be related entities. If this is the case, the host employer may be found to be the employer, regardless of the contract for work with the labour hire agency.

Powers of the host firm

A number of cases have considered the manner in which the matters in s.387 of the Fair Work Act are considered in circumstances where an employer provides labour to a client and the client directs the employer to remove the employee from a site.29 Labour hire arrangements in which a host employer has the right to exclude a labour hire employee from its workplace, are becoming a

the business of supplying labour is that they frequently have little if any control in the workplaces at which their employees are placed and the rights of such companies in circumstances where a client seeks the removal of an employee are limited. However, this is not a basis upon which companies in the business of supplying labour to clients can ignore their own responsibility for treating employees fairly when dismissal is the result of removal from a particular site, and the fairness of the dismissal is considered with reference to the matters in s.387 of the Fair Work Act.31 The refusal of a client to have an employee of a labour hire company returned to a particular site may form the basis of a valid reason for dismissal (based on capacity), however consideration would also need to be given to whether the employee could work at another site where labour is supplied by the employer.”