Security Industry

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Security companies that supply guards or crowd controllers to work in ‘host’ businesses are labour hire providers.

Under Victorian law, labour hire providers must hold a licence, and anyone using their services must only use licensed providers.

Licensing helps to ensure labour hire companies meet their obligations to workers, and supports fairness, transparency, and integrity in the industry.

Significant penalties can apply to unlicensed providers, as well as to any business using their services.

Penalties also apply for advertising labour hire services without a licence, or before a licence application is approved. Any subcontractors to a labour hire provider must also be licensed.

The Labour Hire Licensing Act 2018 (Vic) defines which businesses require a licence, as well as limited circumstances where a licence may not be required.

All licensed providers are listed on the Labour Hire Licence Register.

Businesses can also opt to be notified of any changes in the status of a licence, such as if it is cancelled or suspended, at Follow my Providers.

Scenarios

The examples provided below are for illustrative purposes only, and do not constitute legal advice. Providers should consider their circumstances when determining whether they require a labour hire licence. If they are unsure, they should seek legal advice.

Scenario 1

Shop with Us Ltd (Shop with Us) owns and operates several large shopping centres. It is required to ensure the safety and security of its retailers and customers, under business and insurance obligations. Shop with Us arranges for external security to fulfil these requirements and obligations. Shop with Us is of the view that its arrangement is a services contract.

  • Safety First Pty Ltd (Safety First) provides security guards to Shop with Us. Safety First security guards patrol the Shop with Us shopping centre during retail opening hours and are subject to overall direction of the shopping centre management
  • Gardit Pty Ltd (Gardit) provides a ‘gate checking’ service to perform after hours checks to Shop with Us. These checks verify that the facility is secured, provide an alarm monitoring service, report damage and refer matters to police where appropriate

The two security businesses (Safety First and Gardit) are licensed under the Private Security Act 2004 (Vic), administered by Victoria Police. One of the requirements of their licences is that Safety First, Gardit and their respective staff meet certain character tests and related other requirements. 

Is a private security licence enough for an individual or business to comply with the Labour Hire Licensing Act 2018?

No. It is a mandatory requirement for a business providing labour hire services to hold a licence under the Labour Hire Licensing Act 2018. 

A business may be required to hold multiple licences or accreditations, for example in this scenario:

  • Safety First is required to hold a valid labour hire licence and security licences.
  • Gardit is only required to hold a security licence. 

Is Safety First a labour hire provider?

Yes. Under the Labour Hire Licensing Act 2018 and the Labour Hire Licensing Regulations 2018, Safety First is supplying workers to perform work in and as part of the business or undertaking of the Shop with Us shopping centre. It is irrelevant how Shop with Us describes the arrangement.

Is Gardit a labour hire provider?

No. Gardit is not supplying workers to work in and as part of the business or undertaking of the Shop with Us shopping centre. It is supplying a service.

Scenario 2

Market Festival Pty Ltd (Market Festival) holds weekly night markets in Melbourne. Market Festival employs 20 security guards to fulfill their contractual obligation to have security guards present when the market operates. They must have a minimum of 20 guards present per their contract.

A security guard employed by Market Festival phones in sick on the day of the night market. To cover the sick security guard, Market Festival enters into an arrangement with a business that provides security guards to other businesses who run public events, Protect Pty Ltd (Protect).

Sam, an employee of Protect, Sam patrols alongside the remaining 19 security guards employed by Market Festival to cover the sick security guard.

Is the arrangement between Protect and Market Festival a labour hire arrangement?

Yes, the arrangement between Protect and Market Festival is a labour hire arrangement. 

  • Protect is a labour hire provider – it supplies Sam to Market Festival to perform work in and as part of Market Festival’s business and must pay Sam.
  • Market Festival is a host – Market Festival is running a business and uses a labour hire worker (Sam) to work in its business.
  • Sam is a worker – he has an arrangement with Protect under which Protect supplies him to Market Festival to perform work.

Protect must hold a labour hire licence under the Labour Hire Licensing Act 2018. Protect is a labour hire provider whether they supply Sam on a temporary or ongoing basis.

Scenario 3

SafeParty Pty Ltd (SafeParty) is a company that provides security guards for birthday parties held at residential homes. It does not provide any other services.

SafeParty enters into a contract with John and Joan Smith (the Smiths) to provide a security service for their daughter Mary’s 18th birthday. The Smiths pay an agreed fee to SafeParty.

SafeParty sends one of its employees, Matt, to be the security guard for Mary’s party. The contract between SafeParty and the Smiths states that Matt’s job will be to attend the Smiths’ home for 4 hours on the day of Mary’s birthday party. Matt’s main task is to ensure that only invited guests gain entry to the party.

Does SafeParty require a licence?

No. In this scenario, SafeParty is not a labour hire provider. Although Matt is a ‘worker’ and is paid by SafeParty, he has only been provided to the Smiths to provide a service at their home.  He has not been provided by SafeParty to work ‘in and as part of’ a business or undertaking run by the Smiths.