Duty on labour hire providers and host employers to consult, cooperate and coordinate

Changes to OHS Act from 22 March 2022

From 22 March 2022, changes to the Occupational Health and Safety Act 2004 (OHS Act) extend the definitions of 'employer' and 'employee'. The changes ensure labour hire workers are considered employees of their host employer for the purposes of the OHS Act. From 22 March 2022, changes to the OHS Act also include a duty for labour hire providers and host employers to consult, cooperate and coordinate activities with each other where they share OHS Act duties to the same worker, so far as reasonably practicable.

The following information explains changes to labour hire arrangements under the OHS Act:

New definitions

New definitions for 'labour hire services', 'provider' and 'worker' have been inserted into the OHS Act. These terms have the same meaning as they do in the Labour Hire Licensing Act 2018.

Section 5A extends the OHS Act’s definitions of 'employer' and 'employee'. From 22 March 2022, section 5A states that, for the purposes of the OHS Act, a person is taken to be an 'employer' of a labour hire worker if a provider of labour hire services:

• supplies the worker to,
• recruits the worker for, or
• places the worker with

the person to perform work for the person.

This is consistent with the definition provided in the Labour Hire Licensing Act 2018.

Before the changes, a labour hire worker was typically the employee of a labour hire provider, and the labour hire provider was the employer of that worker.

The host employer owed some health and safety duties to the labour hire worker under the OHS Act, however they did not owe all employer duties to the worker. This is because the worker was not considered an employee of the host employer under the previous definition in the OHS Act. Labour hire workers were at a disadvantage when compared with a person directly employed by the host employer.

The extended definition under the OHS Act aims to remove the disadvantage by defining a labour hire worker as an employee of their host employer as well as an employee of their labour hire provider.

From 22 March 2022, host employers owe the same duties towards labour hire workers as they do towards their direct employees.

WorkSafe has guidance on the OHS Act duties of employers and employees.

The change means that labour hire providers and host employers will share more duties towards labour hire workers. It is not intended that labour hire providers and host employers duplicate efforts to fulfil those duties. Instead, it is expected that labour hire providers and host employers work together to ensure that all duties to labour hire workers are met.

Duty to consult, cooperate and coordinate

To facilitate this, a new duty will be inserted into the OHS Act. From 22 March 2022, labour hire providers and host employers must, so far as is reasonably practicable, consult, cooperate and coordinate activities with each other where they share OHS duties to labour hire workers.

This duty is only intended to apply to labour hire providers and host employers who share employer duties under the OHS Act in relation to the same labour hire workers. It is not intended to apply outside of labour hire arrangements.

Workers compensation arrangements

There are no changes to the Workplace Injury Rehabilitation and Compensation Act 2013 or workers compensation arrangements as a result of:

• the changes to include labour hire workers as employees under the OHS Act; or
• from the new duty for labour hire providers and host employers to consult, cooperate and coordinate

Who must consult, cooperate and coordinate?

The duty to consult, cooperate and coordinate only relates to labour hire providers and host employers. It does not require labour hire providers or host employers to consult, cooperate and coordinate with employees or labour hire workers. Employers already have a duty to consult with employees, including independent contractors and labour hire workers, under section 35 of the OHS Act.

Some labour hire arrangements can involve more than two host employers of a labour hire worker. In these cases, the labour hire provider and the host employers must all consult, cooperate and coordinate with each other.

When must you consult, cooperate and coordinate?

Consultation, cooperation and coordination of activities between the labour hire provider and host employer should begin before a labour hire worker is placed at the workplace. It should be an ongoing process throughout the term of the contractual arrangements.

If any circumstances change during the course of the employment, such as a change in work location or role, further consultation is likely to be required to ensure all health and safety matters are assessed and addressed.

What does consultation, cooperation and coordination mean?

Both the labour hire provider and host employer have shared responsibilities under the OHS Act for the health and safety of the labour hire worker. The shared responsibilities include:

• providing for and maintaining a working environment that is safe and without risks to health
• providing information and training
• monitoring the health of labour hire workers
• consulting with labour hire workers

The labour hire provider and host employer must also ensure the labour hire worker is capable of undertaking the work and is provided with everything needed to do the job safely.

Where there is more than one employer with duties to a labour hire worker, there is a risk that each duty holder may assume the other is taking action for certain health and safety matters. The duty to consult, cooperate and coordinate activities is designed to ensure this does not happen in labour hire arrangements.

The labour hire provider and host employer must, so far as is reasonably practicable, consult, cooperate and coordinate activities about:

• providing information to labour hire workers about health and safety, including in other languages (OHS Act s22(1)(c))
• monitoring the health of labour hire workers and keeping information and records relating to health and safety of labour hire workers (OHS Act s22(1)(a) and s22(2)(a))
• providing information, instruction, training and supervision to labour hire workers (OHS Act s21(2)(e))
• consultation arrangements with labour hire workers, including negotiations on the establishment of a designated work group (DWG) within 14 days after receiving a request from a labour hire worker (OHS Act s35 and s43)

In most circumstances, it is expected that it would be 'reasonably practicable' for such consultation, cooperation and coordination to take place.

Under section 21 of the OHS Act, the labour hire provider and host employer must provide and maintain a working environment that is safe and without risks to health, so far as is reasonably practicable. In order to meet their shared duties under section 21, the labour hire provider and host employer should also consult, cooperate and coordinate activities on:

• the nature of work to be carried out and any associated hazards or risks
• risk control measures and who is responsible for each control measure, including the provision of personal protective equipment and other equipment where required
• reviewing risk control measures, particularly if there are any changes to the nature of the roles or workplace
• the roles of each duty holder in responding to an incident

The new duty to consult, cooperate and coordinate does not change the duty under section 38 of the OHS Act to notify WorkSafe of incidents. The duty to notify WorkSafe of a notifiable incident at a workplace remains the duty of the employer or self-employed person with management and control of the workplace where the incident occurred.

In labour hire arrangements, it is likely to be the host employer who is responsible for notifying WorkSafe of a notifiable incident as they are likely to have management and control of the workplace where the incident occurred. However, it is recommended that the labour hire provider and host employer confirm these arrangements through consultation, cooperation and coordination of activities.

Consultation, cooperation and coordination of activities between labour hire providers and host employers will:

• ensure they understand how their health and safety duties are shared and assist them to comply with their duties
• ensure they are aware of risks to the health and safety of labour hire workers and take steps to respond to those risks
• make the control of risks more effective and more efficient

Under the OHS Act, both the labour hire provider and the host employer are still responsible for meeting their duties. The new duty to consult, cooperate and coordinate is intended to assist labour hire providers and host employers to meet their shared duties under the OHS Act.

For example, labour hire providers and host employers may work together, through consultation, cooperation and coordination of activities, to ensure that only one employer needs to:

• monitor the health of labour hire workers under section 22(1)(a)
• provide information to labour hire workers concerning health and safety in the workplace under section 22(1)(c)
• keep information and records relating to health and safety under section 22(2)(a)

Consultation

In this context, consultation means that labour hire providers and host employers who share duties towards a labour hire worker will exchange information that allows them to jointly manage health and safety.

Consultation between the labour hire provider and host employer should start before the labour hire worker commences work with the host employer and should involve:

• sharing information between the labour hire provider and host employer about health and safety matters
• giving each other a reasonable opportunity to express views about the matter
• taking those views into account when deciding how to fulfil the labour hire provider and host employer’s shared duties
• documenting what is expected of the labour hire provider and host employer in regards to the shared duties and how each will cooperate and coordinate with each other to fulfil their health and safety obligations 

Further consultation is likely to be required if any circumstances change during the course of the employment, such as a change in the nature of the work or work location.

This new duty only requires labour hire providers and host employers to consult, cooperate and coordinate with each other. Section 35 of the OHS Act already requires employers to consult with employees, including independent contractors and labour hire workers, on certain matters regarding workplace health and safety.

Cooperation

Cooperation means that the labour hire provider and host employer will implement the health and safety arrangements identified as being necessary during the consultation process. It also means that the labour hire provider and host employer will respond to reasonable requests from any other person who has a shared duty towards the same labour hire worker and not obstruct communication with them.

Cooperation should include:

• responding as soon as possible to reasonable requests from the labour hire provider or host employer when they are seeking to consult, cooperate and coordinate activities about shared duties
• implementing health and safety arrangements agreed to during the consultation process
• ensuring the labour hire provider has reasonable access to the workplace where this is required and related to their occupational health and safety (OHS) duties
• ensuring the labour hire provider has reasonable access to OHS policies and procedures of the host employer
• providing the labour hire provider and host employer with a nominated contact for health and safety matters related to the labour hire workers
• providing the labour hire provider and host employer with relevant information related to health and safety matters
• exploring solutions with the other employer with shared duties to address health and safety matters

Coordination

Coordination means that labour hire providers and host employers work together so that they can each meet their duties without leaving gaps in health and safety for the labour hire worker.

Coordination of activities should involve:

• identifying and planning activities together
• ensuring any control measures implemented by the labour hire provider or host employer work together effectively 
• ensuring all health and safety matters are addressed and all OHS duties are met

Cooperation and coordination between the labour hire provider and the host employer should be an ongoing process throughout the term of the contractual arrangements.

What if a duty holder refuses to consult or cooperate or coordinate?

A labour hire provider or host employer may report any non-compliance with this duty to WorkSafe.

The maximum penalty for a breach of this duty is 180 penalty units for a natural person and 900 penalty units for a body corporate. This is the same penalty which applies if an employer breaches the duty to consult with employees on matters relating to health and safety at section 35 of the OHS Act.

Information about penalty units and their current value is available from the Department of Justice and Community Safety.