Labour Hire Services Panel Overview

About the Panel

The Phase 2 – Labour Hire Services Panel (SON3965020) (the Panel) is a subset of the broader People Panel arrangement. The People Panel arrangement will be comprised of a series of panels which are being established to improve the quality, consistency and efficiency of the procurement of recruitment and search services, labour hire services and professional contractor services by Commonwealth entities (entities). Each Panel under the People Panel will have its own standing offer notice (SON), head agreement and user guide.

Scope of Services

Phase 2 covers labour hire services, defined as a “triangular employment arrangement”, involving three parties:

  • a worker supplying labour
  • an entity
  • an intermediary, such as a labour hire supplier.

Services provided under this Phase are:

  • Labour hire services: provision of labour hire workers, APS1 – SES equivalent, for a defined period.
  • Conversion services: where the labour hire worker accepts an offer of direct APS employment from that entity into a similar position.
  • Introduction services: where the service provider introduces to the entity an APS employee from another entity (s26 transfer).
  • Placement services: where the service provider facilitates the sourcing of a candidate for a non-ongoing APS position of employment.

Access the Panel

NCEs can manage Panel access for their staff through AusTender’s administration site: Dynamic Sourcing for Panels (DS4P).

Other entities such as CCEs, CCs and GBEs who wish to access the Panel and gain procurement efficiencies when sourcing labour hire services must first notify the People Panel contract management team via email: The contract management team will review your request to participate and provide you with further details including a deed of participation which establishes the conditions of participation for CCEs, CCs and GBEs. The deed of participation standardises the use of the Panel which is essential to maintain integrity and consistency for service providers. Access will be granted once an approved and executed deed of participation is provided to Finance.

Purchase Services

Labour hire services 

Labour hire workers may be engaged:

  • where there are short-term absences
  • to meet urgent unforeseeable demands or peak workloads
  • to meet specific budget allocation for projects.

The labour hire services under the Panel comprise of the provision of suitably qualified and appropriately skilled personnel to undertake work for an entity for a defined period.     
Entities seeking to engage labour hire workers should identify the following information for inclusion in the Request for Quotation (RFQ):

  • the service category
  • the job family and job role
  • the equivalent APS classification and pay scale for the level for each position to be filled
  • any security clearances required
  • the number of working hours per week (this may be standard full-time hours or part time hours)
  • the length of the engagement.

Job families and job roles are generic role descriptions that reflect the APSC Job Family Framework. Entities can use the Job Mapping Matrix to identify the service categories, job families and job roles required for the engagement. The tool includes role descriptions to assist with selecting the most appropriate job role.   
Generally, the costs for engaging a labour hire worker under the Panel comprises of the following:

  • the hourly amount paid to the worker
  • employment oncosts, which include costs such as workers compensation insurance, payroll tax and superannuation
  • the service provider’s gross profit margin
  • coordinated procurement fee.

The gross profit margin (GPM) is an hourly rate set according to the APS equivalent classification of the labour hire worker engaged and whether the worker was identified by the service provider (non-referred) or by the entity (referred).

The coordinated procurement fee (CPF) represents an administration fee payable to Finance, separate to an order under the Panel. The CPF will cover the cost of administering the Panel, reviewing its effectiveness and refreshing the Panel as required.

Referred labour hire workers

A referred labour hire worker is a specific person an entity wants to engage as a labour hire worker. Entities may apply discretion as to when a person can be referred to a service provider for engagement as a labour hire worker.  

An entity that has identified a person they wish to engage as a referred labour hire worker should negotiate the terms of the engagement directly with the person, and this may include:

  • the hourly rate paid to the worker (excluding employment oncosts such as superannuation)
  • engagement length
  • extension options
  • work location
  • any flexible work agreement, including work from home.

Once the entity has agreed the terms of the engagement, the identified person should be made aware of the service providers on the Panel that are approved for the relevant service category and APS equivalent level. The person can then select which service provider they would prefer to be engaged through. The entity should then issue an RFQ to the selected service provider.   
A non-referred labour hire worker is identified and vetted by the service provider and put forward to the entity through the RFQ process. A non-referred GPM is generally higher than referred as a service provider undertakes additional activities in sourcing potential candidate labour hire workers for a non-referred engagement.  

Bulk engagements

 Entities seeking to engage 21 or more labour hire workers on a bulk or express basis may do so by completing the ‘bulk engagements’ section of the Request for Quotation form (RFQ).     
To initiate a bulk recruitment, entities should specify in the RFQ:

  • the number and location of labour hire workers to be provided
  • the mandatory pre-engagement checks and clearances that are required for those labour hire workers.

To allow service providers to meet their reporting obligations, additional information will be sought by the service provider on the specifics of the engagement (job families, job roles etc, as with a non-bulk engagement). The bulk engagement method allows entities with large or urgent requirements for labour hire workers to initiate the process on an expedited basis, and full supporting information will remain a requirement for Panel compliance.

Service provider licencing

Various Australian states and territories require labour hire providers to hold licences to provide services, with additional obligations for host businesses to ensure that any labour hire companies they engage are appropriately licenced. 

The head agreement includes obligations for service providers to hold all licences relevant to the provision of services. 

Entities should ensure that any service provider they seek to engage via an order is properly licenced for the jurisdictions relevant to the work. The RFQ template includes drafting guidance that prompts entities to seek confirmation of licences held by a service provider. Entities are strongly encouraged to retain the licencing prompt and consider the responses when assessing quotations. 

Conversions of labour hire workers to entity employment

In certain circumstances an entity may offer a labour hire worker an opportunity to become an APS employee. Conversion occurs where a labour hire worker who is engaged through the Panel under an order accepts an offer of employment by the host entity.

The service provider that has supplied the labour hire worker to the entity may be eligible for a conversion fee if head agreement criteria are met. 

A service provider would be eligible if:

  • at the time when the offer of employment is accepted by the relevant labour hire worker, the worker has been engaged to fill the relevant position for the entity under an order for a period less than 12 months in aggregate
  • the relevant labour hire worker is made an offer of employment by the entity for either the same position which the labour hire worker has filled under the relevant order immediately prior to accepting the offer or a similar role* (including where that role is publicly advertised by the entity).

Note: A similar role is defined as being substantially similar to the role which the relevant Labour hire worker has performed under the order immediately prior to accepting the offer of employment from the host entity, and is within the same branch or branch equivalent. 

A conversion fee is not applicable if:

  • the labour hire worker has been engaged for a period of 12 months or more in aggregate by the entity under an order prior to accepting the offer of employment from the entity
  • the labour hire worker is made an offer of employment by the entity for a position other than either the position which the labour hire worker has filled under the relevant order immediately prior to accepting the offer or a similar role
  • the offer of employment to the labour hire worker is made as a result of the labour hire worker applying for any position (other than the position the labour hire worker has filled under the relevant order or a similar role) that is publicly advertised by the entity
  • the labour hire worker was referred by the entity to the service provider.

If the criteria for a conversion fee have been met, the entity or service provider can initiate the fee process by varying the order under which the worker was engaged. The variation form can be found via DS4P. The fee amount is determined via the formula, available in the head agreement (Schedule 3, clause 2.4). 

Introduction services

Introduction services facilitate the introduction of an entity to an APS employee from another entity for the purposes of a section 26 transfer under the Public Service Act 1999. 

Introduction fees are only payable if the initiating entity has a contract in place with the facilitating service provider and the APS employee subsequently moves to the entity under a section 26 transfer. Fees are structured on the APS equivalent classification of the role being filled.  

Placement services

Placement services facilitate the sourcing of a candidate for a non-ongoing position of APS employment for a one off fee. Fees are structured on the APS equivalent classification of the role being filled.  

Pricing and service category approval

The pricing matrix for service providers fees for approved service categories for labour hire, introduction and placement services is available in the DS4P. Due to the confidential nature of service provider pricing, access to the pricing matrix is restricted to DS4P.

Panel Refresh

Finance administers the People Panel for the benefit of participating Entities, including reviewing and refreshing each phase under the People Panel as required. Finance will determine the process for refreshing the People Panel during the relevant term. This may include adding or removing Service Categories or Service Providers to the People Panel in one or more phases or Service Categories. 

Finance will publish news about a refresh on this page and will approach the market via AusTender website at Interested parties are encouraged to register on AusTender to receive notification when a Request for Tender is released. 

Approaches from industry to join the People Panel will not be considered outside of a formal refresh process.

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