The Labour hire licensing compliance unit (LHLCU) recently attended a multi-agency Phoenix taskforce (taskforce) meeting focused on addressing non-compliant behaviour within a labour hire syndicate operating in Victoria, New South Wales and Queensland—predominantly in the security, hospitality and cleaning industries.
The LHLCU participates in cross-agency collaboration with the taskforce to detect, disrupt and dismantle the illegal phoenix syndicate. The taskforce brings together Commonwealth and state government agencies to work collaboratively and, where appropriate and permitted by law, share information and data to achieve outcomes in cases involving illegal phoenix activity. The LHLCU has several strategies to combat illegal phoenix behaviours—the following case study demonstrates how the LHLCU can work to prevent illegal phoenix behaviours during a licence application audit.
Case study
A license application was submitted by a new company whose director and shareholder were linked to a related entity that already held a licence. Both entities shared key characteristics, including the same business model, the same main client, familial connections and the same principal place of business. Upon investigation, the LHLCU discovered that the related entity was not compliant with its tax reporting and payment obligations. As a result, the Australian Taxation Office (ATO) registered a tax default against the related entity with credit reporting agencies.
The licence application was refused on the basis that the applicant and relevant individuals were not considered to be fit and proper persons to provide labour hire services. Additionally, conditions were placed on the related entity which resulted in the related entity coming into compliance with its tax obligations and the ATO removing the tax default. Identifying and preventing illegal phoenix behaviour is a crucial task, given the potential harm that can be caused to workers and legitimate businesses, including workers being left without entitlements such as superannuation.
If you have any concerns about a labour hire provider operating in Queensland we encourage you to contact us to report a problem or phone 1300 576 088.
