Managing your obligations – Triangular employment

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The Employment Relations (Triangular Employment) Amendment Act 2019 is now in force and inserts a number of new provisions into the Employment Relations Act 2000.

The main change is that both employees and employers in triangular employment relationships will have the ability to add a ‘controlling third party’ to personal grievance proceedings. The Authority can also join the third party to proceedings of its own volition and can require it to attend mediation in attempts to resolve the issue.

This has important ramifications for organisations that employ or have secondees or labour hire workers, or other types of workers where the organisation controls or directs workers that it doesn’t directly employ.

What does this mean for employers and ‘controlling third parties’?

Both the employer and the ‘controlling third party’ (client) need to be aware that its actions could contribute to a worker’s personal grievance. The Authority will look at whether, and to what extent, the client ‘caused or contributed to the personal grievance’.

Practical guidance

Below are some practical tips to enable businesses to manage their obligations under the Act and mitigate risk:

  • Consider whether there are ways that the business could incorporate protections into commercial terms with clients and be up front about expectations early on;
  • Ensure that policies and practices align between employer and client (and are not inconsistent with employment law);
  • Make sure all communications with workers (whether they come from the employer or the client) are consistent;
  • Both the employer and the client will need to be responsive to any potential or perceived issues workers may face while working for the client. While it will be important for the client to update the employer on any potential issues early, the employer should still be proactive in checking in;
  • Ensure that if any issues do arise, the way the matter will be handled and who it will be handled by is consistent;
  • Any decisions relating to ‘ceasing work’, whether due to a lack of work or disciplinary reasons, need to be communicated to the worker through the employer and not the client.

In summary, communication between all parties is key.

For further information please contact a member of our employment team.


Disclaimer: The content of this article is general in nature and not intended as a substitute for specific professional advice on any matter and should not be relied upon for that purpose.


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