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Clauses 2.3 – 2.4

Monitor independent third parties

Clause 2.3

The RTO ensures that where services are provided on its behalf by a third party the provision of those services is the subject of a written agreement.

Clause 2.4

The RTO has sufficient strategies and resources to systematically monitor any services delivered on its behalf, and uses these to ensure that the services delivered comply with these Standards at all times.

What this Standard means for your RTO

If you do not use independent third parties, you do not need to take any action relating to these requirements.

Your RTO is responsible for all services delivered under its registration, regardless of where these are  conducted, including in other countries. This responsibility applies to all your obligations as an RTO, including:

  • providing data
  • cooperating with ASQA
  • complying with advertising and marketing standards
  • informing prospective learners
  • dealing with complaints and appeals
  • collecting fees, and
  • recordkeeping.

You must have a written agreement with any third party that delivers services under your RTO’s registration, such as:

  • training and/or assessment of training products within your scope of registration
  • educational and support services, or
  • recruitment of prospective learners.

This does not include hiring trainers and/or assessors as contractors or arrangements for advertising your services. This also does not apply where a person contributes evidence of competency, e.g. in the case of workplace supervisors in traineeship or apprenticeship arrangements.

Activities related to the recruitment of prospective learners may only be undertaken by a third party where these activities are subject to a written agreement. If a party is directly engaging in two-way communication with individual prospective learners about undertaking training and/or assessment at your RTO, they are undertaking activities related to the recruitment of prospective learners

To help each party understand their obligations, your written agreement should explain what is expected from each party in detail. For example, as your RTO is responsible for all marketing of your RTO’s services, details of how marketing undertaken by the third party will be approved by your RTO should be included in the written agreement.

The written agreement must require that any third party delivering services cooperate with ASQA in the provision of information and in the conduct of audits and other monitoring activities.

Some RTOs closely control these arrangements and require third parties to only use resources provided by the RTO or to submit completed assessment material before qualifications or statements of attainment are issued.

Other RTOs operate in a much more flexible way, sometimes to the extent of allowing third parties to issue qualifications on behalf of the RTO. Be aware that the more flexible these arrangements are, the greater the risk to your RTO and the more closely you should monitor these arrangements to ensure the third party has complied with your written agreement.

A particular area of risk that ASQA has identified is where RTOs allow third parties to issue qualifications and statements of attainment on behalf of the RTO. Unless there are significant factors that make this necessary, it is not recommended that third parties be permitted to issue qualifications or statements of attainment on behalf of your RTO.

A guide to compliance

RTOs only need to retain evidence about these clauses if they have arrangements with third parties in place.

Your RTO must retain evidence of current written agreements for all third-party arrangements. While RTOs can choose the form of these agreements, the agreements should clearly describe the obligations of each party.

RTOs must also retain evidence that they have developed and implemented strategies to systematically monitor services provided under third-party agreements, to ensure that these services comply with the Standards. The evidence required to demonstrate compliance will depend on the extent of these arrangements, for example:

  • For an RTO with multiple arrangements, or arrangements for delivery outside Australia, a scheduled monitoring program may be required to make sure the monitoring is systematic and that enough resources are available.
  • For an RTO with a single, tightly controlled arrangement, less formality may be needed.

Evidence could include schedules of reviews conducted and reports on these reviews. Where a review has identified non-compliance, the RTO would need to retain evidence that this has been corrected and that the RTO is now compliant.

If your organisation is seeking registration as an RTO and intending to enter into third party agreements, you must provide evidence:

  • that written agreements have been or will be entered into with each party, and
  • of how third-party arrangements will be monitored to ensure compliance.

Case study: Managing risk when using independent third parties

VWX Training’s scope of registration includes 27 qualifications from various training packages. It has independent third-party arrangements in place with 12 other parties and generates a significant portion of its income from these arrangements.

The RTO developed a standard agreement template and obtained legal advice to ensure the agreement was binding. The template agreement clearly describes the process for recruiting and training learners and which party is responsible for each aspect of the process. 

The agreement also outlines an agreed monitoring schedule. The schedule includes:

  • monthly reporting by the third party, and
  • six-monthly visits to the third party’s site by the RTO Quality Manager.

The Quality Manager reviews marketing on a regular basis, including by conducting a range of Internet searches to identify any marketing by third parties that may breach the agreement or the Standards.

The written agreement had previously provided third parties with access to the RTO’s student management system, including the ability to generate qualifications and statements of attainment. Monitoring of the agreements and the RTO’s assessment validation process, which ensures samples of assessment judgements by all third parties are included, identified that some third parties were issuing qualifications without ensuring that all assessment evidence had been retained in the student management system.

VWX Training saw this as a significant risk and immediately amended its third party agreement and processes to prevent third parties from issuing qualifications or statements of attainment. The RTO developed a new process, which requires third parties to advise administration staff when all assessment is completed. The RTO can now issue all qualifications and statements of attainment directly to the learner (following confirmation that all required assessment evidence has been retained by the third party).