Important WHS Clarification for Margin-Only Temp Placements
I’m really keen to share a recent one-on-one conversation I had with a SafeWork NSW inspector—because it clears up a common misunderstanding, I know many of my clients are facing.
We've seen this issue come up time and again, particularly in locum placements within hospitals, where the facility pays the worker directly, and the recruitment agency simply takes a margin for facilitating the placement.
Clients often push back, claiming that because they’re the ones paying the locum, the agency doesn’t need to carry out WHS checks or evaluations.
This is incorrect—and not supported by WHS law.
This issue doesn’t just apply to healthcare. It affects any industry using “margin-only” models for temporary placements—where the worker is placed by an agency but paid directly by the host organisation.
Under WHS law, there can be multiple PCBUs (Persons Conducting a Business or Undertaking) responsible for the same worker. A worker is defined as someone a PCBU engages or causes to be engaged—so the payment structure is irrelevant. What matters is who has influence or control over the worker’s day-to-day work.
When I described this locum/hospital margin-only scenario to a SafeWork NSW inspector, she confirmed:
"The recruitment agency is still a PCBU and must undertake WHS checks, even if the host pays the worker directly."
This supports the guidance I’ve consistently given my clients: if you’re placing temporary workers, even in a margin-only model, you still have WHS obligations.
So, if a client tries to sidestep this using legal or payment technicalities, you can push back with confidence. WHS obligations are based on engagement and control, not who’s on the payroll.
If you're facing difficulties with particular clients, feel free to reach out. I’m happy to connect you directly with the inspector—she’s actively interested in these situations and working to better educate host organisations about their shared responsibilities.
Article by Amy Towers, Director – WHS, People & Compliance – helping recruiters navigate compliance with confidence.