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Policymaking, program, services and infrastructure delivery today is complex, with professional services and labour hire playing an important role in helping to realise government priorities.
The Government is committed to becoming more efficient in how it uses public resources to drive growth and development. Central to this commitment, is a cultural and strategic emphasis on secure employment, building capacity, and sharing resources, learnings and expertise across the Victorian Public Service (VPS).
The decision to seek external support to deliver government policies, projects and programs is often driven by the need for specialist or technical skills or additional capacity to ensure new initiatives are delivered in a timely and effective manner. This is particularly true in situations where specialist skills are in emerging or growth areas not yet available within the VPS, it is not efficient to resource from within the VPS, or in areas where there is high demand for talent and certain specialist skills.
Parameters and tools to guide decision making in relation to external engagements, supported by quality workforce capability planning and development, will help to reduce inappropriate use of professional services and labour hire.
Recognising that professional services and labour hire can play a legitimate role in the VPS and will continue to be needed to ensure delivery of government priorities, these Guidelines and the Administrative Guidelines on Engaging Professional Services in the Victorian Public Service offer a framework for the valid use of external engagements.
For detailed information about the policies that govern procurement in the Victorian Government more broadly, contact the Victorian Government Purchasing Board, or visit the Victorian Government Purchasing Board website, .
How the Guidelines work
The Administrative Guidelines on Engaging Labour Hire in the Victorian Public Service (the Guidelines) are circulated to public service bodies and entities under section 36A of the Public Administration Act 2004 (Vic) (the Act).
The purpose of these Guidelines is to provide decision making principles and practical guidance that supports public service bodies and entities to determine when the use of labour hire is appropriate. These principles need to be included into organisations’ decision-making processes.
Scope of the Guidelines
Labour hire refers to personnel provided by a staffing services provider such as a labour hire firm for a fee. These personnel are employees of the supplier and not the public service body or entity where they are assigned to work1.
These Guidelines apply to the scope of labour hire services captured by the service categories of the Victorian Government Purchasing Board (VGPB) Staffing Services State Purchase Contract. The categories can be found in the .
In these Guidelines, labour hire does not refer to persons hired to undertake or supply professional services under a contract of work made directly with a public service body or entity. These engagements are covered under professional services and are addressed in the Administrative Guidelines on Engaging Professional Services in the Victorian Public Service.
Who the Guidelines apply to
These Guidelines apply to all government public service bodies and entities as defined in the Act, that are mandated to comply with VGPB policies.
The Guidelines do not apply to:
- special bodies as defined by section 6 of the Act
- exempt bodies as defined by section 4 of the Act
- to any government body established under the Inquires Act 2014 (Vic)
Principle One: Valid engagement circumstances
The use of labour hire in the VPS should be limited to the following circumstances:
A. Internal and/or external recruitment action has not been successful or is unlikely to be successful
To meet this condition, at least one of the following circumstances must be demonstrated:
- approaches to sourcing a suitable candidate through internal and/or external recruitment processes have been unsuccessful including advertising on the Jobs and Skills Exchange
- due to limited supply and/or high demand for a technical or specialist skill, recruitment action is highly unlikely to succeed or succeed in a reasonable timeframe
B. An existing VPS employee is on short-term leave or secondment
To meet this condition, at least one of the following circumstances must be demonstrated:
- approaches to sourcing a suitable candidate through internal and/or external recruitment processes have been unsuccessful, including advertising on the Jobs and Skills Exchange
- the leave or vacancy has occurred without sufficient notice to undertake internal and/or external sourcing processes
- the vacancy is likely to conclude before it can be recruited
C. Recruitment is underway to fill a vacancy, and temporary backfill is required
To meet this condition, the following circumstances must be demonstrated:
- the temporary vacancy would compromise the ability of the work unit to meet critical business needs or the temporary vacancy is likely to conclude before it can be filled
- approaches to sourcing a suitable candidate internally have been unsuccessful
- the leave or vacancy has occurred without sufficient notice to undertake internal sourcing processes
If a proposal to engage labour hire does not meet principle one, labour hire is not appropriate and alternate sourcing arrangements should be made.
Principle Two: Engagement conditions
Where a proposed engagement satisfies principle one, the following conditions apply:
- all engagements must be approved by the Secretary or equivalent. This authority may be delegated by the Secretary to the responsible Deputy Secretary or equivalent for engagements of less than 12 months.
- engagements cannot continue for longer than 12 months unless approved by the Secretary or equivalent and:
- the role is deemed critical to the business and the workload cannot be redistributed
- VPS fixed term or ongoing recruitment was unsuccessful
- wages paid to labour hire workers must not be below the designated or equivalent VPS level of the position being filled2
- written approval must be granted before a contract to provide labour hire personnel can be entered, and before any labour hire personnel commences work
How to apply these principles
All requests to engage labour hire require approval from the Secretary or equivalent Head of a public service body. This authority may be delegated to the responsible Deputy Secretary or equivalent if the total length of engagement, including any contract extension, is for less than 12 months.Figure 1: Decision matrix – engaging labour hire
Scenario 1 – Specialist computer programmer
Division A requires a specialist computer programmer to develop a software package. The job is anticipated to take four to five months to complete. The need for this work is once-off and does not present a skills or capability gap in the Division or Department that needs to be filled long-term.
Division A undertakes an internal recruitment process through the Jobs and Skills Exchange, followed by an external recruitment process. No internal applications were received, and external applicants were not suitable. Due to an unsuccessful recruitment process, Division A seeks approval to engage a programmer through a specialist IT labour hire provider.
The request outlines all the above considerations for the Deputy Secretary, as the authority has been delegated to the Deputy Secretary for roles less than 12 months. The Deputy Secretary approves the engagement.
Division A prepares an assignment workplan. The workplan includes a handover and contingency checklist for when the engagement finishes, or in the event the labour hire worker leaves the engagement unexpectedly. This is to ensure that corporate knowledge and relevant learnings are retained and transferred appropriately to Division A.
Scenario 2 – A staff member in Division B applies to take four months of long service leave close to a busy holiday season for the Division
Division B assesses that the vacancy needs to be filled over the period to meet urgent or critical business needs. The staff member sought approval three months in advance of the leave so there is sufficient time to advertise the position on the Jobs and Skills Exchange to find an appropriate candidate.
Scenario 3 – An existing employee on leave or secondment for less than six months
A staff member in Division C needs to take urgent leave due to a family emergency and leaves with less than a week’s notice.
It is not certain when the staff member will return but is likely to be two to eight weeks’ time.
Because the vacancy has occurred at short notice, and due to the uncertainty around the timing of the staff member’s return, Division C does not consider advertising on the Jobs and Skills Exchange to be a suitable option.
Division C assesses that its options are to either seek approval to engage a labour hire worker to fill the vacancy; or provide a staff member already in Division C with a development opportunity to act in the position.
Division C chooses to provide an internal staff member with the acting opportunity, recognising that this option has the most advantages for the Division and its staff. By providing the acting opportunity, Division C can maintain business continuity, provide a development opportunity for existing staff, and promote secure employment practices.
Scenario 4 – Backfill while recruitment is underway
A staff member in Division D provides six weeks’ notice of their intention to take up a 12-month secondment with another Department. Division D advertises the position as a 12-month secondment and identifies a suitable candidate.
The candidate cannot commence for 12 weeks. Division D assesses the criticality and urgency of the departing staff member’s work and identifies that continuity of work is critical to meeting deadlines.
Because Division D requires continuity to meet critical business needs, it would be appropriate for Division D to seek approval to engage a labour hire worker to fill the six-week gap between the staff member’s departure, and the new incumbent’s commencement.
Additional information and resources on the Staffing Services State Purchase Contract
Overview of the Staffing Services State Purchase Contract
Public sector bodies mandated to source through the Staffing Services State Purchase Contract
List of suppliers on the current Staffing Services State Purchase Contract Panel (including contact details)
User Guide for the Staffing Services State Purchase Contract
Victorian Government Financial Management and Financial Reporting Directions
Financial reporting directions and guidance for public sector entities
Standing Directions 2018 under the Financial Management Act 1994
1. The public service body or entity and the supplier are jointly responsible for the occupational health and safety of labour hire personnel. The appointed branch supervisor is required to provide a reasonable level of supervision and care that is commensurate with the role and the working environment.
2. This does not include any other entitlements that employees have under relevant Enterprise Bargaining Agreements. If a change in the rate comes into effect after a contract has commenced, the wage that was in effect and agreed to at the time the contract was signed will apply. Where an engagement is proposed to be renewed or extended, any change in the rate that has come into effect must be incorporated into the new or amended contract but must not be retrospectively applied to any previous contract.
Authorisation and amendments
Authorised by the Secretary, Department of Premier and Cabinet Victoria, under section 36A(1) of the Public Administration Act 2004 (Vic).
Chris Eccles AO
Secretary, Department of Premier and Cabinet
Under section 36A(3) of the Public Administration Act 2004 (Vic), if a public service body or a public entity to which guidelines have been issued operates, or intends to operate, in a manner that is inconsistent with those guidelines, the relevant public service body Head or public entity Head must provide written reasons for doing so to the Secretary, Department of Premier and Cabinet.
Issued by the Department of Premier and Cabinet Victoria (DPC) in October 2019.
These Guidelines are subject to periodic amendments. DPC will provide notification when an update has taken place.
Reviewed 02 October 2019