The Building and Other Legislation Amendment Bill 2022 (Bill) recently introduced in the Queensland Parliament overturns the proposed repeal (by earlier legislation) of the head contractor licensing exemption in Section 8 of Schedule 1A of the QBCC Act (Head Contractor Exemption). The Head Contractor Exemption allows an unlicensed entity in Queensland to lawfully contract to undertake building work and engage licensed entities to carry out building work of the relevant class. Despite its name, this exemption has surprisingly been applied to unlicensed subcontractors down the contractual chain – see Panel Concepts Pty Ltd v Tomkins Commercial & Industrial Builders Pty Ltd [2021] QDC 322. The implication of the exemption for expanding the scope of work lawfully managed at all levels of the contractual chain is obvious.
The Head Contractor Exemption was due to be repealed entirely on 24 July 2022 but with the introduction of the Bill (if enacted in its current form) will continue with some tinkering and further regulation to be introduced. Firstly, the Bill provides amendment of s32 of the BIF Act with flexibility to apply the retention trust regime to contracts and subcontracts where the Head Contractor Exemption is used. This affords protection of subcontractor retention money that may otherwise not be protected. Secondly, the Bill’s explanatory memorandum flags the introduction of further regulation to exclude from the Head Contractor Exemption unlicensed entities that undertake ‘high risk’ work such as fire protection or mechanical services work. What constitutes high risk work within these and other work categories to exclude the operation of the Head Contractor Exemption will no doubt be the subject of further debate and regulation over the coming months.
Contact us today – Troy Legal offers specialist advice in relation to QBCC licensing and relevant exemptions and exceptions to ensure your project does not run into any unexpected QBCC licensing complications.
