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What is a Labour Hire Contract?

Under the labour hire work model, there are three parties at play. A worker, a labour hire company and an organisation. Workers (labour) are directly employed by the labour hire company, which then allocate the labour to the organisations that need them.

Workers are paid by the labour hire company, who is then paid by the host organisation. Put simply, the labour hire company is the intermediary between worker and workplace. As the labourer is working for the organisation indirectly, there are extra considerations to ensure lawful work standards.

Labour hire contracts are documents that outline the terms and conditions of the relationship between labour hire company and organisation. As this host organisation has no contract with labour hire workers themselves, it’s extremely important for this agreement to protect the interests of all three parties.

The Labour Hire Contract Checklist

A labour hire contract can vary between industries, as well as the exact nature of the work. With that said, there are some fundamental aspects that are shared across all sorts of labour hire agreements. If you’re going to use labour hire for your business, it’s useful to know some of these details:

  • Services and Fees: a clear outline of the services provided and fees payable
  • Terms of Employment: essentially the job description, which applies to such things as employee expectations and working hours
  • Insurance & Tax:a declaration that the labour hire company is the party responsible for the insurance and tax of the worker
  • Health and Safety: a clear description of the parties responsible for ensuring a safe work environment for the worker, which applies to both host organisation and labour hire company
  • Dispute Resolution:steps of procedure for dispute resolution, which includes the liabilities and indemnities of all parties
  • Termination of Employment: a clear outline on the circumstance in which the contract could be terminated, essentially the how and why of ending the agreement 
  • Non-Solicitation:a clause to prevent the host organisation from directly negotiating with the worker, ensuring the business of the labour hire company

The relationship between worker, labour hire company and host organisation can be complicated, thus having a solid labour hire contract is the key to long-term success. It is of course possible to review the labour hire contract and make amendments as business needs change.

Hiring Labour for your Business

Hiring labour isn’t always straightforward, so it’s integral to come up with a sound labour hire contract that protects everyone involved. While it’s always recommended to get advice from a legal professional, you can avoid a lot of risk by choosing trusted labour hire companies, like UVS Group.

As a leading provider of labour hire in Sydney, we know business is much better when everyone feels comfortable with the paperwork. If you’ve got any questions about labour hire contracts, or would like enquire about hiring labour for a day or more, get in touch today.

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