Victorian Labour Hire Rules Change From 1 October: What Contractors Need to Know
Victorian Labour Hire Rules Change From 1 October: What Contractors Need to Know
Victorian labour hire laws have changed from 1 October 2026, with the definition of labour hire being broadened to focus more directly on whether an arrangement is genuinely supplying labour.
For earthmoving, civil and construction businesses, the main issue is this:
If your business supplies workers into another business or into a contracting chain, you need to be clear on whether that arrangement now falls within Victoria’s labour hire licensing system.
The changes are particularly relevant where businesses use subcontracting structures, contractor-management arrangements or intermediary companies to supply workers to other businesses. Labour Hire Authority
What Changed on 1 October?
From 1 October, Victoria’s general definition of labour hire has been amended so that greater emphasis is placed on whether an arrangement has the character of labour supply.
The Labour Hire Authority says the change is intended to make it clearer that a licence may be required where labour is being supplied anywhere within a supply chain, including arrangements involving so-called bare intermediaries that do not directly employ the workers themselves but on-supply workers employed by another business. Labour Hire Authority
In practical terms, businesses should look beyond the name of the contract or subcontract and consider what is actually happening.
If the arrangement is primarily about supplying labour to another business, it may fall within the labour hire licensing regime. Labour Hire Authority
Why This Matters to Contractors
This is where things can become less obvious for smaller contractors.
There is a difference between a business being engaged to deliver a defined contracting outcome and a business effectively supplying workers for another company to direct and use.
That distinction can matter when considering whether labour hire licensing obligations apply.
For example, earthmoving businesses regularly enter arrangements involving:
operators supplied with or without plant
labourers working under another contractor’s supervision
subcontracted crews
traffic-management personnel
contract workers placed onto another site
intermediaries sourcing workers for principal contractors.
The exact legal treatment depends on the structure and substance of the arrangement, not simply whether the parties call it subcontracting. The Labour Hire Authority specifically says businesses should review whether they, or entities they source labour from, now require a licence. Labour Hire Authority
Using an Unlicensed Provider Can Also Be a Problem
The licensing obligation does not only fall on businesses supplying labour.
Victorian businesses that engage labour hire workers are also required to use appropriately licensed providers.
That means a contractor engaging another company to supply workers should not simply assume the supplier has dealt with the issue.
The Labour Hire Authority warns that substantial penalties may apply both to businesses that provide labour hire services without the required licence and to businesses that engage unlicensed labour hire providers. Labour Hire Authority
For that reason alone, it is worth checking the licensing position of businesses supplying labour into your projects.
More Construction Changes Are Proposed for 29 October
There is another important development specifically for construction.
Subject to the Victorian Government completing its regulatory consultation and publishing the required regulations, further changes are expected to take effect from 29 October 2026.
Under the proposal, companies providing certain services on Victorian Government-funded construction projects valued above $50 million would be treated as providing labour hire services.
Businesses performing those services in the specified circumstances would need a labour hire licence, while companies engaging them would be required to use licensed providers. Labour Hire Authority
Importantly, as at 1 October 2026, these construction-specific changes are still described by the Labour Hire Authority as proposed and subject to the regulatory process. They should not yet be treated as if they are already in force. Labour Hire Authority
That distinction is worth making very clear in the Hub Report.
What About Owner-Operators and Normal Subcontractors?
This is probably the question most Earthworks Hub members will care about.
The new rules do not automatically mean every subcontractor or owner-operator is suddenly a labour hire provider.
The important question is what the arrangement actually involves.
A genuine contractor completing a defined scope of work under their own business structure may be very different from a company whose main role is supplying individuals to perform labour for somebody else.
However, contractor-management arrangements can themselves fall within labour hire rules where workers are recruited or placed as independent contractors to perform labour for another business. Labour Hire Authority
So contractors should not rely purely on statements such as:
“They’re subcontractors, so it isn’t labour hire.”
The structure needs to be considered properly.
Five Questions Contractors Should Be Asking
If you operate in Victoria and use subcontractors or supply workers to other companies, it is worth reviewing a few basics:
Are we being paid to complete a defined scope of work, or primarily to supply people?
Who controls and directs the workers once they arrive on site?
Are we supplying workers through another intermediary or contracting company?
If we use a labour hire provider, have we confirmed that its licence is current?
Are we working on a Victorian Government-funded project that could be affected by the proposed late-October construction changes?
Those questions will not determine the legal answer by themselves, but they should help identify arrangements that deserve closer review.
Other Labour Hire Changes Already Introduced in 2026
The October changes follow additional reforms that took effect earlier this year.
Since 1 June 2026, labour hire licence holders and applicants have faced stronger requirements around the people controlling labour hire businesses, compliance history and financial viability.
The Labour Hire Authority can consider a broader range of compliance matters when deciding whether to issue, renew or cancel a licence, and businesses must now declare that they are financially viable. Labour Hire Authority
These measures form part of a broader tightening of Victoria’s labour hire licensing system.
What Earthmoving Businesses Should Do Now
For most contractors, the sensible response is not to panic or assume they suddenly need a labour hire licence.
But businesses using complicated subcontracting or labour-supply arrangements should review how those arrangements actually operate.
If you directly supply workers into another business, source workers through intermediary companies or regularly provide crews that operate under another contractor’s direction, this is worth checking sooner rather than later.
Likewise, if you engage labour hire businesses, confirm that the providers you use hold the appropriate Victorian licence.
The Labour Hire Authority recommends businesses seek professional advice where required because the licensing position depends on the specific business model and arrangement. Labour Hire Authority
The Takeaway
The important change from 1 October is not that every subcontractor has suddenly become a labour hire company.
It is that Victoria is placing greater emphasis on the actual substance of labour-supply arrangements, including arrangements further down contracting and subcontracting chains.
For earthmoving and civil businesses, that makes it worth understanding exactly where the line sits between providing a contracting service and supplying labour.
And with further construction-specific changes proposed for later this month, Victorian contractors should keep an eye on the final regulations as they are released.
Source: Victorian Labour Hire Authority, current as at 1 October 2026.
Victorian Labour Hire Rules Change From 1 October: What Contractors Need to Know
Victorian Labour Hire Rules Change From 1 October: What Contractors Need to Know
Victorian Labour Hire Rules Change From 1 October: What Contractors Need to Know
Victorian labour hire laws have changed from 1 October 2026, with the definition of labour hire being broadened to focus more directly on whether an arrangement is genuinely supplying labour.
For earthmoving, civil and construction businesses, the main issue is this:
If your business supplies workers into another business or into a contracting chain, you need to be clear on whether that arrangement now falls within Victoria’s labour hire licensing system.
The changes are particularly relevant where businesses use subcontracting structures, contractor-management arrangements or intermediary companies to supply workers to other businesses. Labour Hire Authority
What Changed on 1 October?
From 1 October, Victoria’s general definition of labour hire has been amended so that greater emphasis is placed on whether an arrangement has the character of labour supply.
The Labour Hire Authority says the change is intended to make it clearer that a licence may be required where labour is being supplied anywhere within a supply chain, including arrangements involving so-called bare intermediaries that do not directly employ the workers themselves but on-supply workers employed by another business. Labour Hire Authority
In practical terms, businesses should look beyond the name of the contract or subcontract and consider what is actually happening.
If the arrangement is primarily about supplying labour to another business, it may fall within the labour hire licensing regime. Labour Hire Authority
Why This Matters to Contractors
This is where things can become less obvious for smaller contractors.
There is a difference between a business being engaged to deliver a defined contracting outcome and a business effectively supplying workers for another company to direct and use.
That distinction can matter when considering whether labour hire licensing obligations apply.
For example, earthmoving businesses regularly enter arrangements involving:
The exact legal treatment depends on the structure and substance of the arrangement, not simply whether the parties call it subcontracting. The Labour Hire Authority specifically says businesses should review whether they, or entities they source labour from, now require a licence. Labour Hire Authority
Using an Unlicensed Provider Can Also Be a Problem
The licensing obligation does not only fall on businesses supplying labour.
Victorian businesses that engage labour hire workers are also required to use appropriately licensed providers.
That means a contractor engaging another company to supply workers should not simply assume the supplier has dealt with the issue.
The Labour Hire Authority warns that substantial penalties may apply both to businesses that provide labour hire services without the required licence and to businesses that engage unlicensed labour hire providers. Labour Hire Authority
Maximum penalties under the legislation exceed:
For that reason alone, it is worth checking the licensing position of businesses supplying labour into your projects.
More Construction Changes Are Proposed for 29 October
There is another important development specifically for construction.
Subject to the Victorian Government completing its regulatory consultation and publishing the required regulations, further changes are expected to take effect from 29 October 2026.
Under the proposal, companies providing certain services on Victorian Government-funded construction projects valued above $50 million would be treated as providing labour hire services.
The proposed activities are:
Businesses performing those services in the specified circumstances would need a labour hire licence, while companies engaging them would be required to use licensed providers. Labour Hire Authority
Importantly, as at 1 October 2026, these construction-specific changes are still described by the Labour Hire Authority as proposed and subject to the regulatory process. They should not yet be treated as if they are already in force. Labour Hire Authority
That distinction is worth making very clear in the Hub Report.
What About Owner-Operators and Normal Subcontractors?
This is probably the question most Earthworks Hub members will care about.
The new rules do not automatically mean every subcontractor or owner-operator is suddenly a labour hire provider.
The important question is what the arrangement actually involves.
A genuine contractor completing a defined scope of work under their own business structure may be very different from a company whose main role is supplying individuals to perform labour for somebody else.
However, contractor-management arrangements can themselves fall within labour hire rules where workers are recruited or placed as independent contractors to perform labour for another business. Labour Hire Authority
So contractors should not rely purely on statements such as:
The structure needs to be considered properly.
Five Questions Contractors Should Be Asking
If you operate in Victoria and use subcontractors or supply workers to other companies, it is worth reviewing a few basics:
Those questions will not determine the legal answer by themselves, but they should help identify arrangements that deserve closer review.
Other Labour Hire Changes Already Introduced in 2026
The October changes follow additional reforms that took effect earlier this year.
Since 1 June 2026, labour hire licence holders and applicants have faced stronger requirements around the people controlling labour hire businesses, compliance history and financial viability.
The Labour Hire Authority can consider a broader range of compliance matters when deciding whether to issue, renew or cancel a licence, and businesses must now declare that they are financially viable. Labour Hire Authority
These measures form part of a broader tightening of Victoria’s labour hire licensing system.
What Earthmoving Businesses Should Do Now
For most contractors, the sensible response is not to panic or assume they suddenly need a labour hire licence.
But businesses using complicated subcontracting or labour-supply arrangements should review how those arrangements actually operate.
If you directly supply workers into another business, source workers through intermediary companies or regularly provide crews that operate under another contractor’s direction, this is worth checking sooner rather than later.
Likewise, if you engage labour hire businesses, confirm that the providers you use hold the appropriate Victorian licence.
The Labour Hire Authority recommends businesses seek professional advice where required because the licensing position depends on the specific business model and arrangement. Labour Hire Authority
The Takeaway
The important change from 1 October is not that every subcontractor has suddenly become a labour hire company.
It is that Victoria is placing greater emphasis on the actual substance of labour-supply arrangements, including arrangements further down contracting and subcontracting chains.
For earthmoving and civil businesses, that makes it worth understanding exactly where the line sits between providing a contracting service and supplying labour.
And with further construction-specific changes proposed for later this month, Victorian contractors should keep an eye on the final regulations as they are released.
Source: Victorian Labour Hire Authority, current as at 1 October 2026.
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