Labour hire and recruitment businesses play a crucial role in Australia’s workforce – supplying skilled workers to industries like construction, warehousing, manufacturing, and more. But with opportunity comes risk. If one of your placed workers is injured, causes damage, or is involved in a workplace incident, your business could be held liable – even if it happened at the client’s site.
That’s where labour hire insurance comes in.
In this article, we’ll break down why labour hire insurance is essential, what it can cover, and how High Risk Cover helps recruitment agencies and staffing firms secure the right protection.
What Is Labour Hire Insurance?
Labour hire insurance is a tailored insurance solution designed to protect businesses that supply workers to other companies. These workers may be placed on short-term or long-term assignments across a variety of industries and job sites.
Because they are legally employed by your business – not the host company – you hold responsibility for their safety, conduct, and in many cases, liability.
Why Standard Business Insurance Isn’t Enough
Labour hire businesses operate under a unique risk profile. Workers are often deployed to environments you don’t control, making it harder to manage workplace hazards directly. In addition, you’re potentially liable for:
- Injuries sustained by your workers while on a client’s site
- Damage to third-party property caused by your workers
- Claims of negligence or unqualified placements
- Legal action related to employment practices or compliance breaches
Standard public liability or workers’ compensation cover may not fully account for these types of risks, especially when they involve off-site or client-controlled conditions.
What Can Labour Hire Insurance Cover?
A tailored labour hire insurance package can include a range of policies to help safeguard your business:
✅ Public Liability Insurance
Covers your business if a third party (e.g. a client or member of the public) is injured or suffers property damage due to the actions of your placed worker.
✅ Workers’ Compensation
Legally required in most states and territories, this cover helps support your employees if they’re injured or fall ill on the job. It’s particularly vital in labour hire, where incidents may occur on unfamiliar worksites.
✅ Professional Indemnity Insurance
If your agency is accused of negligence – for example, placing an unsuitable or unqualified worker who causes a loss – professional indemnity can help cover legal defence and any resulting settlement.
✅ Management Liability
Protects your directors and officers from claims relating to wrongful acts, regulatory breaches, or employment practices disputes.
✅ General Property Cover
For agencies that supply tools, equipment, or uniforms, this cover can protect against loss, theft, or damage of physical assets.
Common Risks in the Labour Hire Industry
- A placed forklift driver causes damage at a warehouse – you may be held liable
- A temporary labourer is injured on a client’s construction site – your business may bear responsibility
- A client claims your vetting process was negligent – triggering potential legal costs
- A breach of workplace health and safety law leads to fines or reputational damage
These risks highlight the need for comprehensive, industry-specific insurance, not just generic business cover.
How High Risk Cover Helps
At High Risk Cover, we specialise in insurance for high-risk industries – including labour hire. We understand the complex relationships between your business, your workers, and your clients.
Our team will work with you to:
- Review your placements and contractual responsibilities
- Identify risk exposures across different industries or job roles
- Source quotes from multiple insurers familiar with labour hire risks
- Build a custom package that fits your business – without paying for cover you don’t need
You’ll also get clear, human advice – no jargon, no guesswork, just practical protection.
Who Should Consider Labour Hire Insurance?
- Labour hire agencies placing temp or contract workers
- Recruitment firms managing high-volume placements
- Companies offering skilled tradespeople or general labour to other businesses
- Agencies working in construction, mining, warehousing, logistics, and similar sectors
If your workers operate under your payroll but at someone else’s site – you need to seriously consider tailored insurance.
Get Covered with Confidence
Labour hire is all about people – and protecting those people (and your business) starts with the right insurance.
Speak to High Risk Cover today for expert advice and a free, no-obligation quote tailored to your business. Whether you’re just starting out or scaling nationally, we’re here to help you protect your operations with clarity and confidence.
📞 1300 477 662
Note: The material offered here is for informational purposes only. It does not constitute legally binding advice and should not be a substitute for a consultation with an insurance expert.
