Updated: 13 October 2026
A security company can have a full roster, reliable clients and properly licensed guards, yet still have significant gaps in how it manages its business obligations.
Who checks the subcontractor’s licensing? How are wages funded when clients pay late? Who is responsible for assessing risks at a new site? What happens when a client requests additional guards with only a few hours’ notice?
These are familiar situations for security operators. They are also the types of arrangements attracting greater attention under Victoria’s 2026 labour hire reforms.
The Victorian Labour Hire Authority (LHA) has introduced stronger licensing requirements, additional conditions for high-risk industries and changes affecting labour supply arrangements.
For security businesses, the message is becoming clearer: holding the appropriate licence is important, but so is being able to demonstrate how the business actually meets its obligations.
Why is security considered a high-risk industry?
Security is one of four industries identified by the LHA as presenting heightened risks of worker exploitation and unlawful conduct. The others are commercial cleaning, horticulture, and meat and poultry processing.
The Authority reports that these industries collectively accounted for 63% of labour hire licence cancellations and 79% of application refusals since 2019.
Those figures relate to all four industries combined, not security alone.
The designation does not mean every security provider is doing the wrong thing. It reflects the regulator’s assessment of risk and explains why additional conditions are being introduced.
Security work often involves several parties. A company may employ guards directly, supply them to a host, subcontract work to another licensed provider or operate at premises where the client controls much of the working environment.
These arrangements are not necessarily problematic. The difficulty arises when responsibilities become unclear, records are incomplete or the business assumes another party is handling an obligation that remains its own.
What changed on 1 June 2026?
The first major reforms commenced on 1 June 2026, strengthening the LHA’s assessment of who is suitable to hold a labour hire licence.
The changes include:
- A more rigorous fit and proper person assessment for nominated officers and relevant persons, including those who influence or control a business.
- Broader consideration of previous, current and ongoing compliance with relevant laws.
- Financial viability requirements for licence applications and renewals, including declarations and supporting evidence.
These changes apply across the Victorian labour hire licensing scheme, not only to security.
Financial viability matters in security
Security businesses are particularly exposed to cash-flow pressure because employment costs continue regardless of when clients pay.
Wages, superannuation, insurance and other operating costs must be funded while invoices may remain outstanding for weeks.
A business can win a contract and still lose money delivering it.
When preparing a quote, the question should not simply be whether the charge rate is competitive. It should also be whether that rate supports lawful employment, the actual cost of service delivery and a sustainable business.
The LHA’s increased focus on financial viability reinforces the importance of understanding these costs before accepting work, rather than trying to solve the problem after the roster is operating.
Additional licence conditions for high-risk security providers
Since June 2026, new licences granted to providers in designated high-risk industries have been subject to additional standard conditions.
The LHA has advised that these conditions will progressively extend to existing licence holders from late 2026.
For security businesses, several conditions deserve particular attention.
Subcontracting and independent contractors
Subcontracting is a familiar part of security operations, particularly for events, regional contracts, specialist services and short-notice staffing.
However, the additional licence conditions restrict subcontracting to one tier unless the LHA permits otherwise.
For providers subject to these conditions, the permitted arrangement generally involves supplying workers directly to a host or through one licensed labour hire provider for supply to the host.
Relevant subcontracting information must also be reported to the LHA.
The security-specific conditions additionally prohibit supplying an independent contractor unless that contractor holds the required private security business licence as well as an individual operator licence.
This aligns with changes to Victorian private security legislation introduced separately in 2025.
The important distinction is that holding an individual security licence does not automatically make someone an appropriately licensed independent contractor.
Businesses also need to consider the separate private security requirements for host consent to subcontracting.
For operators using subcontractors regularly, these are matters to address before accepting or allocating work, not after personnel have arrived on site.
Payroll, payments and worker information
The additional conditions also strengthen transparency around how workers are paid and informed of their rights.
They include restrictions on cash payments to workers and subcontractors, reporting requirements for payroll service providers and the provision of an LHA information sheet to workers before they commence work.
Outsourcing payroll does not remove the provider’s responsibility for its employment obligations.
The business still needs appropriate oversight of classifications, wages, superannuation and other entitlements.
Workplace safety and protective equipment
For affected licence holders, the conditions also address the provision of personal protective equipment without charge, including reimbursement where workers purchase required PPE for their work.
These requirements sit alongside existing occupational health and safety obligations.
Existing providers should review the conditions currently attached to their licences and monitor further LHA communications.
What changed on 1 October 2026?
Further reforms commenced on 1 October 2026, clarifying when arrangements involving labour supply fall within Victoria’s labour hire licensing framework.
The revised definition places greater emphasis on the actual character of an arrangement, including whether it is wholly or principally for the supply of labour.
This is relevant where workers are supplied through intermediaries or more complex contracting arrangements.
For security businesses, the practical lesson is not to rely solely on how an agreement is labelled.
A security services agreement, subcontract or other commercial arrangement needs to be considered according to how the work is actually organised and supplied.
Not every security services contract automatically becomes labour hire. However, providers and businesses engaging workers through intermediaries should reassess their arrangements against the amended legislation.
Further construction-related changes are proposed
As at 13 October 2026, further changes were anticipated for 29 October 2026 concerning certain activities on Victorian Government-funded construction projects valued above $50 million.
Under the proposal, specified activities would include site security, alongside traffic management, concreting and crane operating.
These changes were not yet in force at the date of this article.
Security businesses working in this part of the construction sector should monitor the final legislation and LHA guidance rather than assume the proposed requirements have already commenced.
Business Compliance Plans: Explaining how the business operates
One of the most important developments for applicants is the LHA’s greater emphasis on Business Compliance Plans.
Businesses intending to conduct a new labour hire services business must have a Business Compliance Plan explaining how their business will operate and comply with relevant legislation, and be prepared to provide it to the LHA as part of the application process or when requested.
The LHA has also confirmed that providers not previously required to submit a Business Compliance Plan may be asked to provide one later.
This does not create an immediate universal lodgement requirement for every existing provider.
It does, however, make documented compliance arrangements increasingly important.
A Business Plan and a Business Compliance Plan are not the same thing
A conventional Business Plan generally explains what the company intends to do, its services, market, management structure and financial objectives.
A Business Compliance Plan has a different purpose.
It needs to explain how the business will manage its obligations in practice.
The LHA has specifically cautioned that generic, templated or marketing-style plans may not be accepted.
For a security provider, the plan should reflect its actual workforce arrangements, hosts, subcontractors and relevant compliance controls.
Consider a company supplying guards across several client sites.
It should be able to explain how personnel licensing is checked, how employment obligations are managed, how host sites are assessed and who is responsible for responding when something changes.
The answer should not depend entirely on the owner remembering what needs to happen.
A compliance plan provides a framework for documenting those arrangements, allocating responsibilities and identifying the records needed to demonstrate that controls are being followed.
It must still be tailored to the business. A completed document should describe the operation that actually exists, or the arrangements a new business is genuinely preparing to implement.
For security businesses preparing a new labour hire licence application or reviewing their existing compliance arrangements, GuardHERE Consulting offers a security-specific Labour Hire Compliance Plan, available as an editable template or with Editing Assistance.
The resource helps operators bring their workforce arrangements, compliance responsibilities and ongoing controls together in a structured, security-specific document that can be adapted to their individual business.
Occupational health and safety: The client does not take over every responsibility
Security guards frequently work at sites controlled by other organisations.
A host may manage the premises, emergency procedures and aspects of day-to-day supervision. However, the security provider retains its own occupational health and safety obligations.
Under Victoria’s Occupational Health and Safety Act 2004, labour hire providers and host employers have overlapping duties and must consult, cooperate and coordinate where they share responsibilities.
These duties cannot simply be transferred to another party through a contract.
Consider a guard deployed alone to an unfamiliar site.
Before deployment, the parties should understand the nature of the work, relevant hazards, communication arrangements, emergency procedures and appropriate controls.
The provider’s involvement should not end once the first shift is filled. Changes in duties, conditions or reported hazards may require further assessment and consultation.
What should existing security businesses do now?
Established operators do not necessarily need to rebuild their entire compliance framework.
A sensible starting point is to review what is already in place and identify whether it still reflects current operations and licensing requirements.
Consider the following questions:
- Are the business’s current labour hire licence conditions understood and monitored?
- Are subcontracting arrangements appropriately licensed, authorised and documented?
- Can the business demonstrate how it manages payroll and employment obligations?
- Are host responsibilities, site risks and incident reporting arrangements clear?
- Is there a nominated person responsible for monitoring compliance and addressing identified issues?
- Do the company’s Business Plan, agreements, procedures and compliance records describe the same operating model?
For a smaller security company, these arrangements do not need to be unnecessarily complicated.
They do need to be practical, understood and maintained.
A business that can answer these questions and produce supporting evidence is in a better position to respond to a regulatory enquiry than one relying on informal arrangements and documents that have not been reviewed since the original application.
In Summary: Compliance needs to work beyond the licence application
Victoria’s 2026 labour hire reforms are placing greater emphasis on business suitability, financial viability, workforce arrangements and ongoing compliance.
For security operators, the challenge is not simply understanding another set of regulatory requirements. It is making sure those requirements are reflected in how the business is run.
A licence authorises the relevant activities. It does not, by itself, establish the systems needed to manage them.
Compliance should not depend on everything going smoothly. It should still work when a roster changes, a subcontractor is engaged, a client raises an issue or something goes wrong on site.
That is where properly developed and maintained business systems become valuable.
GuardHERE Consulting | Labour Hire Compliance Plan
GuardHERE Consulting supports new and established security businesses with licensing documentation, business planning and practical compliance resources.
Our Labour Hire Compliance Plan is designed specifically for security providers and addresses workforce arrangements, host responsibilities, subcontracting, employment obligations, workplace safety, financial viability and ongoing monitoring.
The resource is available as an editable template or with Editing Assistance for businesses seeking support to tailor the documentation to their circumstances.
This article provides general industry information current to 13 October 2026. Businesses should check the latest LHA guidance, applicable legislation and the specific conditions attached to their licences. The information does not constitute legal advice.