NSW Government: Proposed Labour Hire Licensing Law to Combat Exploitation

• The NSW government plans to introduce labour hire licensing legislation within 100 days of potential re-election.
• This proposed law will require host companies to use only licensed labour hire operators and will include criminal penalties for non-compliance.
• NSW Anti-slavery Commissioner James Cockayne has welcomed the initiative, stating it will protect workers from exploitation and modern slavery.
• The legislation follows years of advocacy from various groups and is supported by a new all-party Parliamentary Friendship Group Against Modern Slavery.
• Modern slavery is estimated to affect 16,000 people in NSW and costs the state $9.6 billion.

A key component of the proposed NSW labour hire operator licensing framework will be the inclusion of criminal penalties for non-compliance.

The New South Wales government has signaled its intent to introduce significant new legislation targeting the labour hire sector. This proposed NSW labour hire licensing law, which the government committed to developing within 100 days of a potential re-election, aims to mandate that all host companies exclusively engage licensed labour hire operators. This move represents a substantial shift for businesses utilizing contract workers across the state.

Dr. James Cockayne, the NSW Anti-slavery Commissioner, has publicly endorsed the government's announcement, commending Premier Minns and Minister Cotsis for their leadership on this critical issue. The Commissioner highlighted that the forthcoming legislation is designed to safeguard workers in NSW from exploitation by "crooks" and "dodgy operators," thereby directly addressing concerns related to modern slavery. He expressed optimism that this initiative would garner broad support across the parliamentary spectrum.

A key component of the proposed NSW labour hire operator licensing framework will be the inclusion of criminal penalties for non-compliance. This means that not only will labour hire operators face stringent licensing requirements, but host companies will also bear significant host company labour hire obligations NSW to ensure they are partnering solely with approved and licensed providers. The introduction of such penalties underscores the seriousness with which the government intends to enforce these new regulations.

This legislative push is a direct response to years of advocacy from a diverse coalition of stakeholders, including unions, workers, survivors of exploitation, faith groups, civil society organizations, and even responsible businesses and industry groups. The overarching goal is to strengthen modern slavery legislation NSW and create a more secure environment for workers, mitigating risks associated with unscrupulous practices within the labour hire industry. Compliance officers and legal advisors will need to pay close attention to the development of this legislation to guide businesses effectively.

Further demonstrating a unified approach to combating exploitation, the establishment of an all-party Parliamentary Friendship Group Against Modern Slavery in New South Wales has also been lauded by Commissioner Cockayne. He praised the formation and leadership of this new group, emphasizing that anti-slavery efforts are a collective responsibility that has historically enjoyed cross-party consensus. This group's formation reinforces the ongoing commitment to this cause.

The Parliamentary Friendship Group includes prominent figures from across the political spectrum. Among its leaders are Dr. Joe McGirr, the independent Member of Parliament for Wagga Wagga and chair of the NSW Parliament’s Modern Slavery Committee, along with Dr. Sarah Kaine MLC representing NSW Labor, and representatives from the NSW Liberals, the Nationals, and the Greens. Other notable members include Courtney Houssos MLC, NSW Minister for Finance and for Domestic Manufacturing and Government Procurement; Gurmesh Singh MP, Deputy Leader of the Opposition and Leader of the Nationals; and Ben Franklin MLC, President of the NSW Legislative Council. These individuals are poised to collaborate with Commissioner Cockayne to address the estimated 16,000 victims of modern slavery in NSW and to mitigate the substantial $9.6 billion financial impact modern slavery imposes on the state's economy. In the coming weeks, Commissioner Cockayne plans to visit regional areas such as Dubbo, Tamworth, Armidale, the Mid-North Coast, and the Central Coast to engage with local stakeholders and distribute resources for healthcare workers on identifying and addressing modern slavery.

Beyond the specific NSW proposed labour hire licensing law, broader efforts are underway at the federal level to strengthen Australia's response to modern slavery. The federal government initiated a public consultation in August, set to conclude on September 25, 2026, to gather input on reforms aimed at enhancing the existing modern slavery framework and legislative measures concerning supply chains. This consultation reflects a national commitment to tackling complex issues within modern supply chains.

Furthermore, in July of the previous year, the federal government announced its intention to introduce a new criminal offence under the Modern Slavery Act. This proposed offence would specifically target high-earning companies that fail to prevent the use of modern slavery within their international supply chains, signaling a stricter approach to corporate accountability. In a related development, the Victorian bar recognized Fiona McLeod in March 2025 with the 10th Pro Bono Trophy for her extensive pro bono advocacy, which includes significant contributions to initiatives combating modern slavery, human trafficking, and advocating for justice for First Nations communities. These national and state-level actions highlight a growing, multi-faceted commitment to eradicating modern slavery.

Lawyers and compliance officers advising businesses in NSW that engage labour hire operators must closely monitor the development of this proposed legislation. It will introduce new licensing requirements for operators and impose obligations on host companies to use only licensed providers, with potential criminal penalties for non-compliance, necessitating a review of current labour hire arrangements and preparation for enhanced due diligence.

Source: Facts reported by a legal industry publication.