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Clauses 2.3, 2.4 and 8.3—Recording, monitoring and reporting third‑party arrangements

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.

Clause 8.3

The RTO notifies the Regulator:

a) of any written agreement entered into under clause 2.3 for the delivery of services on its behalf within 30 calendar days of that agreement being entered into or prior to the obligations under the agreement taking effect, whichever occurs first, and
b) within 30 calendar days of the agreement coming to an end.

What clauses 2.3, 2.4 and 8.3 mean for your RTO

RTOs are responsible for:

  • monitoring independent third parties (clauses 2.3 and 2.4)
  • reporting on any third-party arrangements entered into or concluding (clause 8.3).

If you do not use other organisations to provide any RTO-related services, 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 students
  • dealing with complaints and appeals
  • collecting fees
  • record-keeping.

Third-party arrangements must be documented and transparent to assist you in managing the quality of services and in effectively identifying and managing the risks.

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

  • training and/or assessment
  • providing educational and support services
  • recruiting prospective students.

The requirement for a written agreement does not apply when:

  • you hire trainers and/or assessors as contractors
  • you make arrangements for advertising your services
  • a workplace supervisor contributes to evidence collection or training.

Guidance for VET Student Loans-approved providers

VET Student Loans-approved providers are prohibited from using any third party in recruiting students or providing information about VET Student Loans.

What kind of third-party arrangements could RTOs have?

An RTO might be involved in third-party arrangements with:
  • other RTOs
  • non-registered training providers
  • recruitment agents or brokers
  • employment/job services agencies.

Third-party arrangements with other RTOs

An RTO may engage another RTO in order to provide specific training and assessment to its students on its behalf. (This type of arrangement was sometimes previously referred to as a ‘partnership’ or ‘auspicing’ arrangement.) For example, the RTO, ABC Training, delivers SIS30313 Certificate III in Fitness, which requires the delivery of HLTAID003 Provide First Aid as a core unit. ABC Training decides to engage a third-party RTO ‘Uptown Training’ to deliver HLTAID003 Provide First Aid to its SIS30313 learners.

Although Uptown Training undertakes the training and assessment, it is ABC Training that would record the outcome for the unit and issue the record of results and testamur accordingly.

Third-party arrangements with non-registered training providers

An RTO may engage another organisation that is not an RTO in order to provide specific training and assessment to its learners on its behalf.

For example, an RTO, ‘DEF Training’, delivers CHC30212 Certificate III in Aged Care. DEF Training decides to engage the ‘Autumn of our Lives Aged Care Facility’ to deliver learning and assessment which has been contextualised to the workplace.

Third-party arrangements with student recruitment agents or brokers

An RTO may engage an individual or party to recruit students on behalf of the RTO.

For example, a third-party organisation, ‘Skills Today’, advertises SIT40313 Certificate IV in Hospitality on its website on behalf of ‘ABC Training’. As part of its third-party arrangement, Skills Today collects student enrolment information on behalf of ABC Training. Skills Today subsequently provides the student enrolments to ABC Training. This is considered a third-partyarrangement, whether or not a commission is paid to Skills Today.

Employment service provider

An RTO might provide training for clients of an employment service provider (an organisation that helps find jobs for individuals seeking employment). In order to source employment for its clients and provide skilled workers to employers, an employment service provider may source training from one or more RTOs in order to upskill their clients.

For example, an employment service provider, ‘Top Skills Employment’, has an agreement in place with an RTO, ‘ABC Training’, which specifies that Top Skills Employment may utilise ABC Training for training and assessment to be provided to its clients. ABC Training may or may not provide a fee to Top Skills Employment in exchange for the enrolment of Top Skills’ clients into a training product delivered by ABC Training.

Government-appointed intermediaries (in certain cases only)

  • A government-appointed intermediary refers clients to various programs, including to training provided by RTOs.
  • Government-appointed intermediaries do not recruit students on behalf of specific RTOs, but rather, fulfil their obligations in relation to their clients, on behalf of government departments. These intermediaries do not receive funding from a government departments, RTOs or prospective students in exchange for referrals.
  • For example, a government-appointed intermediary—CUE Training Centre—has an arrangement in place with a government department to provide programs to unemployed youth, which may include a training component. CUE Training Centre refers its clients to one or more government-contracted RTOs in order to provide training to its clients.
  • Examples of government appointed intermediaries include Australian Apprenticeship Centres; the Disability Services Commission; departments of correctional services; some employment service providers; and Migrant Resource Centres.
  • However, in some cases, these government-appointed intermediaries may be providing other services or referring other prospective students on behalf of the RTO. These cases are considered third-party arrangements and are therefore subject to the relevant Standards.

Case study—Third-party arrangements with an employment agency

The ABP Workfind employment agency has been appointed by a government agency to identify if their clients are in the target group for a funded training program place. ABP Workfind refers its clients to one of several RTOs under this arrangement. ABP Workfind does not receive a fee for this referral and is not considered to be a third party as it is operating on behalf of the state government.

However, ABP Workfind also has an agreement in place with a specific RTO—Quality Training—which specifies that ABP Workfind will utilise Quality Training for training and assessment to be provided to its clients. Quality Training may or may not pay ABP Workfind a fee in exchange for the enrolment of clients into a training product delivered by Quality Training. This arrangement would be considered a third-party arrangement.

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

To help each party understand its 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 by providing information at any time it is requested and during 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.

ASQA’s regulatory experience has identified that it is a particular area of concern where RTOs allow third parties to issue qualifications and statements of attainment on their behalf. 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 relating to 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 you can determine the format these agreements, any agreements should clearly describe the obligations of each party.

Your RTO must also retain evidence that you 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:

  • If your RTO has 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.
  • If your RTO has a single, tightly controlled arrangement, less formality may be needed.

Evidence could include schedules of reviews conducted and reports on these reviews. If a review identifies non-compliance, your RTO needs to retain evidence that this has been corrected and that the RTO is now compliant.

Your RTO must notify ASQA whenever it starts or ends a third-party agreement. Third-party arrangements may increase risk to the quality of your services; as such, any third-party arrangements will be considered as part of your provider risk profile.

You must notify ASQA of third-party arrangements using the online form on the ASQA website.

ASQA’s fact sheet on third-party arrangements includes additional guidance on meeting your obligations in relation to any such arrangements.

You should be aware that ASQA may interview third parties to verify how your arrangements are being implemented and monitored in practice and how practices align with your written agreements.

Tips on developing a written agreement

Your RTO can determine the format and content of your written agreement; however, the lists below include some basic guidance on what you might choose to include.

A written agreement with a third party providing training and assessment services on your behalf might include:

  • the name of your RTO and the third party
  • the start and end date of the agreement
  • details of the RTO’s operations, including all delivery locations in Australia or elsewhere
  • clauses detailing your RTO’s obligations under the agreement—for example, which party will:
    • issue qualifications and statements of attainment
    • provide pre-enrolment information
    • collect student fees and enrolment information.
  • clauses detailing the obligations of the third party—for example, which party will provide the training and assessment materials, resources and facilities
  • the mechanisms through which your RTO will systematically monitor the third party—for example, if the third-party is developing marketing initiatives and providing the training and assessment materials, resources and facilities:
    • how you will review these prior to use for all delivery sites
    • how you will ensure that trainers and assessors provided by the third-party meet the requirements of the Standards.
  • record-keeping procedures for student enrolment information and completed student assessments
  • clauses relating to which party will validate completed student assessments
  • any of your RTO’s obligations, or the third-party’s obligations, relating to VET Student Loans, government-funded subsidies or other financial support
  • clauses requiring the third party to cooperate with ASQA and to provide accurate responses to requests about delivery of services.

A written agreement with a third party providing recruitment services on your behalf might include:

  • the name of your RTO and the third party
  • the start and end date of the agreement
  • clauses detailing your RTO’s obligations under the agreement—for example, you might stipulate that your RTO will:
    • review all marketing initiatives
    • provide current and accurate pre-enrolment information
    • ensure that all information provided to a student meets the requirements specified in clauses 4.1, 5.1, 5.2, 5.3, and 5.4 of the Standards
    • arrange translation of all materials in languages other than English.
  • clauses detailing the obligations of the third party—for example, you might stipulate that the third party will:
    • provide your RTO with all marketing material before publishing
    • provide student enrolment information and student fees to the RTO
    • train their staff to assist with training package and enrolment enquiries.
  • any of your RTO’s obligations, or the third party’s obligations, relating to VET Student Loans, government-funded subsidies or other financial support
  • detail of arrangements for commission or fees to be retained by the third party
  • the mechanisms through which your RTO will systematically monitor the third party
  • clauses requiring the third party to cooperate with ASQA and to provide accurate responses to requests about provision of services.

Guidance for applicants for initial registration

If you are intending to use any third-party arrangements, you must have written agreements in place.

You must be able to show how you intend to monitor such arrangements.