Key Components of Labour Hire Agreements

Scopes of Services

Labour hire agreements will always identify the scope of services which the labour hired should fulfil. The purpose of setting the scope of services is to explicitly state 

Rates and Payments

The rates and payments for the labour services should also be stated in a labour-hire agreement. Stating the price offered

Insurance, Liability & Indemnification

In response to a company allowing your business to hire their employees, insurance should be discussed between the two parties and integrated within the labour-hire agreement. Labour hire agreements should also state any indemnities and risks that should be shifted between parties. 

Confidentiality & Indemnities Clauses

Labour hire agreements should also identify confidential clauses or any information that should remain private. Furthermore, indemnification clauses should also be included within labour hire agreements to ensure both parties are aware of potential risks and compensation. 

Termination

As a labour-hire agreement deals with temporary employment within a business, it is important to discuss the termination of employment– that is, when it ends, if the termination will cease immediately or if it will be phased out.

Advantages of Using Labour Hire Agreements

Using labour-hire agreements comes with a multitude of advantages. These include:

Flexibility

Labour hire agreements provide flexibility to businesses. These agreements are able to fulfil the necessities that businesses need assistance with and are malleable to the workforce size needed.

Expertise

Employers are able to access a market of employees who specialise in the tasks that are needed for the business. In response, businesses can focus on getting their short-term projects done without the long-term commitment of hiring a full-time employee.

Cost Efficiency

Employers may experience cost savings as insurance, benefits or other overhead costs are not their responsibility. Employers are also likely to spend less on training, especially when hiring labour that is specialised.  

Common Mistakes to Avoid

Not Using A Customisable Template

Using no template or a genetic template can lead to a labour-hire agreement that lacks specificity. Using a customisable labour hire agreement template such as this one is important in ensuring that the contract is legally compliant, specific and communicative.

Not Consulting Legal Counsel

Seeking legal advice is integral when drafting a labour-hire agreement. Consulting with a lawyer when engaging with labour-hire agreements ensures legal compliance and consistency within the contract. 

Unclear Job Descriptions and Responsibilities

Vague or poorly defined job descriptions and responsibilities can lead to misunderstandings and disputes for the duration of the contract. It is important that your labour hire agreement is clear when describing the role and duties the labour must fulfil under the contract. 

Use this Labour Hire Agreement if:

• You have a labour hire agency and wish to hire labour for your business.
• You have a company and wish to hire workers from a labour agency.