Labour Hire Rates in Sydney Explained

When warehouse managers compare labour hire rates in Sydney with the award wage for the same role, the gap can look large. But a charge rate isn’t just a wage plus profit. Most of it is the cost of legally employing a worker — costs you’d carry yourself if you hired them directly.

Here’s what’s inside a typical warehouse labour hire charge rate, and how to compare quotes properly.

1. Worker’s pay

Most warehouse and distribution roles are covered by the Storage Services and Wholesale Award 2020, unless another award or enterprise agreement applies. The award sets minimum rates by classification level, plus:

• Casual loading of 25% for casual employees, in place of paid leave
• Shift penalties for early morning, afternoon and night shifts
• Weekend and public holiday penalties
• Overtime once ordinary hours are exceeded
• Allowances where they apply

Correct classification matters. A forklift driver, a leading hand and a general picker aren’t paid at the same level, and getting it wrong creates underpayment risk for everyone.

2. Super

Superannuation Guarantee is paid on top of ordinary time earnings by the labour hire provider as the legal employer.

3. Payroll tax

In NSW, payroll tax applies to employers whose total wages exceed the tax-free threshold. Labour hire providers generally pay payroll tax on their on-hired workers’ wages.

4. Workers compensation

The labour hire provider holds the workers compensation policy. Premiums are based on industry and claims history, and warehousing costs more to insure than office work.

5. Other costs

• Public liability insurance
• Recruitment and screening — advertising, interviews, reference checks, right-to-work and licence verification
• General induction and safety training
• Payroll, timesheets and invoicing
• Account management and support for urgent requests
• Replacing workers who don’t show or don’t suit your site

6. Margin

What’s left after all of this is the agency’s margin — usually a much smaller slice of the charge rate than people expect.

Want a clear, itemised quote? ASTAR prices every role on the correct award classification. Call 1300 562 562 or request a quote.

Why cheap rates cost more

If a quote looks well below the market, ask how. The usual answers are underpaying workers, misclassifying roles, skipping super or insurance, or sham contracting. Host businesses can face serious legal and reputational exposure when a supplier underpays the people working on their site — and if your site has an enterprise agreement, Same Job, Same Pay rules may also affect what workers must be paid.

Comparing Sydney labour hire rates

• Which award and classification level is the rate based on?
• Does it include casual loading, super, payroll tax and workers compensation?
• What are the rates for overtime, weekends, nights and public holidays?
• How will I see the hours I’m charged for?
• How often will I be invoiced?
• What happens if a worker doesn’t show?

Comparing like with like is the only way to know which quote is genuinely better value. If you’re also weighing up direct employment, see labour hire vs permanent staff.

FAQs

How much does labour hire cost?

It depends on the role, award classification, shift times and how long you need workers. A reputable agency will quote an hourly charge rate by role and shift so you can see exactly what you’ll pay.

Why is it higher than the award?

Because it also covers super, payroll tax, workers compensation, insurance, recruitment, payroll and the agency’s margin.

Do nights and weekends cost more?

Yes. Award penalties for shift work, weekends, public holidays and overtime flow through to the charge rate.

Talk to ASTAR

ASTAR Recruitment has supplied warehouse and logistics workers to Sydney businesses since 2006, including sites in Wetherill Park and across NSW. Our workers are paid weekly every Thursday, and you’re invoiced weekly with electronic timesheets, so you can match every dollar on the invoice to hours actually worked.

Call 1300 562 562 or request a quote for your site.

This article is general information only and isn’t legal, tax or financial advice. Check current award rates with the Fair Work Ombudsman and payroll tax thresholds with Revenue NSW.