• Compliance & enforcement

The Labour Hire Authority (LHA) Annual Report 2024-25 highlights the progress made towards its strategic objective of creating and maintaining a fair and lawful labour hire industry.

LHA continued to improve compliance and fairness in the labour hire industry in 2024-25, including through its licence application assessment practices.

These practices help to ensure providers understand and are accountable for compliance with relevant workplace, occupational health and safety, taxation, superannuation, migration and labour hire industry laws, and accommodation standards.

Using a risk-based and intelligence-led approach, LHA identifies high-risk applications through data analysis and information from other agencies.

Licence applications are refused where the business or persons running it are not fit and proper or fail to meet legal obligations, creating a barrier to entry into the industry. LHA supports operators who are willing to meet their obligations by providing education and, where necessary, setting licence conditions.

Ultimately, these measures act to improve industry integrity and help to prevent worker exploitation.

The role of accountants, advisers and enablers

Accountants and other advisers can play an important role in helping applicants make informed decisions. When assessing declarations made in an application, LHA considers whether the applicant has understood the matters they’ve declared.

In 2024-25, LHA refused applications where third parties, such as accountants:

• falsely declared they were the applicant
• declared matters without the applicant having knowledge of the contents
• authored business plans which the nominated officer was unable to recall or understand.

Circumstances such as these call into question the role of the accountant in the business and whether they are an undeclared relevant person to the application.

LHA cannot rely on the business plan to ensure an applicant will comply with relevant legal obligations where the applicant has no role in creating or understanding the business plan.

For more information, read Protect your business: The importance of choosing the right adviser.

Insolvency and external administration

Insolvencies of labour hire providers are of particular interest to LHA, as they often result in workers losing wages and other entitlements, causing recurrent harm.

Even if workers are not harmed directly, external administration processes can sometimes be used by directors to avoid legal obligations.

When labour hire companies engage in non-compliant activity, they may gain a competitive advantage on price over lawful industry participants. For example, a provider may be able to undercut competitors for a period of time by not making tax payments and meeting other obligations.

In 2024-25, LHA cancelled the licence of a large horticulture company due to significant concerns about their ability to meet their obligations, following administration.

In 2023, LHA had granted a licence to the business - an approved employer with the Pacific Australia Labour Mobility (PALM) scheme - which was providing over 1,000 workers to farms and factories in Victoria.

The same year, the company entered into external administration with over $10 million owing to the Australian Taxation Office (ATO) and over $3 million owing to its workers for superannuation.

Although it entered into a Deed of Company Arrangement with its creditors in late 2023, the company re-entered external administration in 2024, owing more debt to its workers and other creditors.

LHA engaged with the new administrator who said that he was considering the sale of the business as a possible option for allowing the company to meet its obligations and trade out of its difficulties.

However, LHA had significant concerns about this proposal, including the likelihood that workers would not receive their overdue entitlements if the business was sold.

LHA also engaged productively with officers from the PALM scheme to ensure all workers employed by the company would be redeployed to other approved employers if LHA cancelled the company’s licence.

LHA cancelled the business’s licence because it could not be satisfied the business had remedied the significant issues that led to its first external administration, and there was a continuing risk that vulnerable workers would be denied their entitlements.

Read the full report

You can read the Labour Hire Authority Annual Report 2024-25 in full on the LHA website.