Rules of conduct

Supervision

Proper supervision of your employees is vital, particularly where large sums of money and trust accounts are involved. It also helps promote ethical conduct in employees. Poor supervision can cause distress and financial loss for consumers. It can lead to negligence, misleading conduct and fraudulent use of trust money.

The Property, Stock and Business Agents Act requires that all agency businesses be effectively controlled and supervised by a licensed agent. The Act introduces tighter requirements for the supervision and control of employees and clarifies the responsibilities of licensees for employees’ conduct.

Licensees in charge

Each place of business must have a licensee, who is responsible for the proper supervision of the business and employees. A licensee is responsible for the supervision of their own place of business. A licensee who has more than one place of business must employ a licensee to be the person in charge at each other place of business. A corporation that holds a corporation licence must employ licensees to be in charge of each of the corporation’s places of business.

A licensee cannot be in charge of more than one place of business or act for more than one licensee at a place of business. In very limited circumstances, the Secretary for Fair Trading may grant an exemption from the licensee-in-charge requirements.

A licensee cannot be employed to be in charge if they are also the licensee-in-charge of another place of business.

A licensee-in-charge of a place of business must hold a licence in the category relevant to the type of business carried on there. For example, a person in charge of a real estate agency business must hold a real estate agent’s licence.

In limited circumstances, the Secretary may grant an exemption from the requirement that each separate agency office be under the charge of a separate licensee. For more information refer to the Exemptions to licensee-in-charge-rule.

Supervision requirements

A licensee is responsible for the supervision of their business. A licensee employed by another licensee is responsible for the proper supervision of the business carried on there. The licensee who owns the business also remains accountable for the actions of employees. Proper supervision includes:

  • supervision of employees engaged in the business,
  • establishment of procedures designed to ensure that the provisions of the Act and Regulation and other relevant laws are complied with, and
  • monitoring the conduct of the business to ensure that those procedures are followed.

Secretary’s guidelines on supervision

The Act enables the Secretary to issue guidelines for licensees as to what constitutes proper supervision. Failure to comply with the requirements of the guidelines carries a penalty not exceeding 200 penalty units ($22,000) in the case of a corporation or 100 penalty units ($11,000) in any other case.

View the Property, Stock and Business Agents Act Section 32 guidelines (PDF, 16.42 KB) for more information.

Employees

Licensees are prohibited from employing people who are disqualified from holding a licence or certificate of registration or who have had their application for a licence or certificate refused on the basis that are not a ‘fit and proper’ person to work in the industry.

Any agency work done by a certificate of registration holder must be supervised by the licensee in charge. The licensee must hold a licence in the category relevant to the work carried out by the employee. For example, a stock and station salesperson must be supervised by the holder of a stock and station agents licence.

Prev Discipline
Next Pre-purchase inspection reports