Labour Hire Compliance Under Scrutiny as Fair Work Action Highlights Employer Risks

Recent legal action in Queensland has highlighted the increasing scrutiny on labour hire arrangements and the serious consequences for employers who fail to meet their workplace law obligations. The case serves as a timely reminder for organisations—particularly those operating in high-risk sectors such as agriculture—that record-keeping, transparency and compliance are non-negotiable.

A Queensland-based labour hire provider and its manager are facing proceedings in the Federal Circuit and Family Court following allegations that false documents were knowingly supplied to Fair Work inspectors during a compliance audit. The action stems from a proactive Fair Work compliance campaign conducted in 2023, which targeted pay and entitlement practices across the horticulture sector.

As part of the audit, Fair Work inspectors sought to review time and wage records for workers engaged on a strawberry farm in the Glass House Mountains. When advised that labour had been supplied by a third-party provider, inspectors requested employment records from that business. 

It is alleged that the company subsequently provided falsified documents on multiple occasions, including payslips, bank payment records and piecework agreements required under the Horticulture Award.

According to the regulator, the documents appeared to show that workers had been paid directly by the labour hire provider, when in fact those payments had not occurred. It is further alleged that responsibility for paying wages had been subcontracted to other entities, despite documentation suggesting otherwise.

The matter is particularly significant given that several of the affected workers were reportedly migrant visa holders. Regulators have consistently emphasised that workers on temporary visas can be especially vulnerable to exploitation due to limited awareness of their rights or reluctance to raise concerns.

The Fair Work Ombudsman is seeking substantial financial penalties for multiple alleged breaches of the Fair Work Act, with potential fines reaching tens of thousands of dollars per contravention for both companies and individuals. A directions hearing has been scheduled in Brisbane in May 2026.

For employers, this case reinforces several critical lessons. Labour hire arrangements do not dilute accountability. Businesses engaging labour—whether directly or through third parties—must ensure pay practices are lawful, records are accurate and award requirements are met. Providing misleading or incomplete information to regulators significantly escalates legal risk and reputational damage.

At Performance Advantage, we regularly see organisations underestimate the complexity of labour hire compliance and the personal exposure faced by managers and directors. Proactive audits, clear contractual arrangements and robust record-keeping systems are essential safeguards.

How Performance Advantage Can Help

Performance Advantage supports organisations to navigate complex workplace relations obligations, strengthen compliance frameworks and reduce regulatory risk. If you would like expert guidance on labour hire compliance, audits or Fair Work readiness, contact us on 0408 897 079 or email suzanne@performanceadvantage.com.au to discuss how we can help.

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