Appointing strata managers and other workers
Strata managers and building managers help with the day-to-day running of a strata scheme. How to appoint and remove strata and building managers.
Key information
- Strata Hub has free tools to help you find and compare strata managers.
- To make a shortlist of candidates, Strata manager finder allows you to search for strata managers who service the area of your scheme and narrow results based on selection criteria.
- Strata managers are usually appointed at annual general meetings (AGMs). Owners corporations can remove strata managers, but there is a process to follow.
- If owners corporations don’t carry out their duties properly, the NSW Civil and Administrative Tribunal (the Tribunal) may appoint a compulsory strata manager.
How to select and hire a new strata manager
When hiring a strata manager to help with the day-to-day running of the scheme, there are steps to take and tools on Strata Hub to find a manager that is a good fit for the scheme.
If an owners corporation has an existing strata management contract that isn’t due to end yet, read the removing a strata manager section first for guidance on how the contract can be ended.
Create a shortlist of potential strata managers
Create a shortlist of three or more strata managers or strata management agencies that service your local area.
To help, NSW Fair Trading has a free online directory called Strata manager finder that lets you search for strata managers servicing the scheme’s local area. The search results also include:
- the licence status of the strata manager or strata management agency to help confirm that they have a current licence
- compliance records (if any), such as disciplinary action taken against the licensee or other compliance information on the Verify NSW public register
- business profile information for a current strata management agency.
- options to filter results based on criteria you select.
To access Strata manager finder (or other Strata Hub tools), simply log in to Strata Hub and go to the left-hand menu, or for new users, you can register for free.
Before finalising your shortlist, consider also the next step – Confirm what tasks you need the strata manager to do.
Confirm what tasks you need the strata manager to do
Before approaching potential candidates, the owners corporation should decide what tasks it wants their strata manager to do.
The strata committee will normally do the work of looking at the tasks to be delegated. Confirming these tasks will:
- help provide value for money
- allow you to finalise your shortlist of candidates – checking if they will match your scheme’s needs.
The owners corporation can delegate some or all of its functions to the strata manager. This can include all or some of the duties of treasurer, secretary and chairperson.
To help you list the range of services your scheme needs the strata manager to provide, use the Strata managing agent engagement planner, available from Strata Hub’s document library.
Examples of tasks a strata manager can do:
- Issuing a notice to follow a by-law
- Providing strata information certificates to interested buyers
- Keeping and updating records
- Arranging records for an owner or person to look at
- Organising and sending meeting notices
- Telling people they have a ‘priority vote’ and when and how they can use it
- Making sure fire safety inspectors can access all parts of the property when doing inspections
- Giving copies of a Tribunal application to all owners
- Giving all residents at least five days’ notice before a pesticide treatment is used.
A strata manager can’t:
- change by-laws
- remove a strata committee member
- hire a building manager
- set levy amounts
- make a decision on a payment plan request
- make a decision on a request to waive interest.
Request proposals from candidates and decide on the best fit
You will have now confirmed:
- which tasks to delegate
- your shortlist of strata management agencies or managing agents.
Use the ‘Strata managing agent engagement planner’ in Strata Hub before you approach candidates for the role of strata manager.
This allows you to:
- customise an information request to send to potential strata managers – including business and service information, quotes, references and disclosures
- easily compare quotes from different strata managers by using our standard response form.
Next, invite the shortlisted candidates to submit a proposal.
The owners corporation should compare at least three proposals to assess value for money and experience with similar strata schemes. In addition to costs, owners corporations (and the strata committee acting on their behalf) should also consider:
- who would be managing the scheme and how experienced they are
- how responsive they are in their communications
- what the fees cover and how easy they are to understand
- conditions in the contract, including what the process and cost are to change the strata manager before their contract ends.
Review the terms of the draft management agreements
Review the draft management agreements of preferred strata management agencies and ask to meet the strata managers who would service the scheme. Pay attention to the contract terms. All of them can be negotiated even if the strata manager says the contract has ‘standard terms’.
Before the next annual general meeting (AGM), the secretary must attach the draft management agreement of the preferred agency to the agenda. This gives owners time to consider the contract terms.
If the fees are expected to be more than $30,000, the secretary must attach two independent draft management agreements.
Check that any new management agreement does not have:
- terms that require the owners corporation to pay for the agent’s professional indemnity liability, including insurance excess
- terms that limit the agent’s liability to a specific amount. This is only allowed if the agreement is covered by a professional standards scheme approved by the Professional Standards Council.
If the agreement contains these terms, ask the strata managing agent to remove them.
Check the contract for any potential unfair contract terms. For example, terms that require the owners corporation to pay an excessive amount in charges for ending an agreement. Learn more about unfair contract terms.
Hold a meeting to appoint the new strata manager
To appoint a strata manager, the owners corporation needs a majority vote at the AGM. If owners cannot wait for an AGM, they can hire a strata manager via an extraordinary general meeting (EGM).
Length of management agreements
If a strata manager is appointed at the very first AGM of the owners corporation, the appointment can only be for 12 months.
After that, strata management agreements can go for up to three years.
A strata manager must give notice of the expiry of their agreement between three to six months before the expiry date.
A strata manager can be appointed after the old agreement ends. This involves a vote at an owners corporation meeting (for example, the AGM).
If a strata manager’s contract ends before the next AGM, the strata committee can extend it up to three months at a time until the AGM happens. A strata manager must give at least one months’ notice before the end of the extension term.
If the strata committee extends the appointment but decides not to extend again, or not to re-appoint the strata manager, they must give the strata manager at least one month's written notice.
In some cases, the strata manager can also extend their agreement for an extra three months. The agent must write to the owners corporation to tell them if they are using this option.
They can only do this if their agreement was for three years and:
- the owners corporation chose not to reappoint the agent and doesn’t want to extend the appointment, but
- they did not give the strata manager three months' written notice that their contract would not be renewed.
Removing a strata manager
Sometimes, an issue can’t be solved directly with the strata manager. The owners corporation may then wish to end their management contract. The owners corporation may handle this or escalate it to the Tribunal.
The owners corporation might choose to remove a strata manager if:
- there is an ongoing issue with contacting the strata manager
- facilities aren’t being maintained
- finances aren’t being managed properly
- the agent hasn’t properly disclosed information about their commissions.
Review the terms of your management contract
The management contract will say when and how you can end your agreement.
A copy of the strata managing agent agreement must be available to the owners corporation at all times.
The owners corporation should look at the contract carefully. Check what the early termination conditions are and how they apply to your case.
If the options to end the agreement seem unreasonable, you should consider whether to apply to the Tribunal.
Add a motion to your next general meeting
If you decide to remove a strata manager, you will need to pass a motion at the next AGM.
You can wait for the next AGM if it is not too far away. Otherwise, call an EGM if you wish to move forward quickly.
The motion will need a majority vote to pass.
Tell your strata manager
If the motion is successful, you must write to the strata manager to tell them.
You will need a handover between the outgoing and new strata manager. If you don’t have a new one, the handover will be to the strata committee.
Ending your management agreement through the Tribunal
The owners corporation may apply to the Tribunal to resolve the dispute. For example, you might do this if there are issues with the terms of the management agreement or where the strata manager acts unlawfully.
For general information about the dispute resolution process, including applying to the Tribunal, visit the disputes page.
Compulsory appointment of a strata manager
If an owners corporation isn’t completing its duties, the Tribunal may appoint a compulsory strata manager.
The Tribunal can appoint a nominated person as a strata manager to carry out:
- all jobs of an owners corporation
- all jobs of the strata committee and/or the chairperson, secretary or treasurer
- only some of those jobs.
The Tribunal can appoint a strata manager if the owners corporation:
- isn’t doing its work properly – for example, not keeping proper financial records
- has not complied with an order – for example, a Tribunal order for the owners corporation to install window locks
- has failed to perform one or more of its duties – for example, not doing repairs and maintenance
- owes a Tribunal judgement debt.
From 1 November 2024, Fair Trading can also apply to the Tribunal for the compulsory appointment of a strata manager in response to severe mismanagement of a strata scheme.
Fair Trading will only consider using this option as a last resort, following an investigation.
Strata lot owners must continue to follow the established processes for dispute resolution. This may include making their own application to the Tribunal for compulsory appointment of a strata managing agent, if they believe the scheme is not functioning properly.
For general information about the dispute resolution process, visit the disputes page.
Hiring a building manager
To hire a building manager, the owners corporation needs a majority vote at the annual general meeting (AGM). If owners cannot wait for an AGM, they can hire a building manager via an extraordinary general meeting (EGM).
Building managers must be appointed in writing. Before being appointed, they must tell you if they:
- are connected with the original owner or developer
- have any financial interest in the strata scheme
- may receive a benefit that affects the fees that they will charge under the building manager agreement.
A benefit includes a referral fee, commission or a direct or indirect benefit.
For example, this would include telling the owners corporation that they expect to receive a referral fee from the cleaning company they will nominate after they are appointed as building manager.
Before you choose a building manager, they will provide their draft agreement. Pay attention to the contract terms, which can be negotiated. This is the case even if the building manager says the contract has ‘standard terms’.
Before the AGM, the secretary must attach the draft agreement to the agenda. This gives owners time to consider the contract terms.
If the fees are expected to be more than $30,000, the secretary must attach two independent draft agreements.
Check the contract for any potential unfair contract terms. For example, terms that require the owners corporation to pay an excessive amount in charges for ending an agreement. Learn more about unfair contract terms.
Building manager duties
Building managers have duties under the strata laws that regulate their conduct. Substantial penalties may apply where a duty is breached.
These duties are to:
Act in the owners corporation’s best interest (unless doing so would be against the law).
Act promptly and with due diligence to –
- bring the owners corporation’s attention to any maintenance, repair or safety issue with the common property that the manager is aware of. This includes both a problem that the building manager becomes aware of (e.g. a lift outage), as well as a problem that the building manager ought to be aware of (e.g. that the regular maintenance of the lift is overdue).
- propose to the owners corporation how a problem should be addressed. For example, recommending a plumber comes to repair a persistent leaking pipe.
Give written notice of benefits and connections when suggesting a contract
- If the building manager will receive a benefit in relation to a contract they are suggesting to the owners corporation, the written notice must include the person who will provide the benefit, and the monetary value of the benefit or the method of calculating the value.
- If the person the contract would be with is connected with the building manager, the written notice must include the nature of the relationship between the building manager and that person.
Disclose any relationships and financial interests
- A building manager must promptly give written notice to the owners corporation if the building manager:
- is connected with a supplier of goods or services for the strata scheme. The notice must include what goods and/or services are provided by the supplier, and the nature of their relationship to the building manager.
- is connected with the original owner of the strata scheme. The notice must include the nature of the relationship between the building manager and the original owner.
- has a direct or indirect financial interest in the strata scheme. The notice must include the nature of the financial interest.
Length of building manager agreements
A building manager agreement can last up to 10 years. After it ends, the building manager may be re-contracted.
Sometimes, a building manager is appointed before an owners corporation starts.
If they were hired before the first AGM, then the building manager agreement ends at the first AGM. The same or a new building manager can be hired, if needed.
Removing a building manager
You might decide to remove the building manager – for example, if they are not performing their job well or if they are not needed for the scheme.
The owners corporation can end a building manager agreement at a general meeting.
Review the terms of your contract
Your reason for removing the building manager will affect how you can end their agreement.
Read the building management agreement. It will say why you can end an agreement early. It will also include the steps to do it.
If the options to end the agreement seem unreasonable, you should consider whether to apply to the Tribunal.
Add a motion at your next general meeting
If you want to remove the building manager, you will need a majority vote at an annual general meeting, or an exceptional general meeting if you can't wait for the AGM.
Tell your building manager
If the motion is passed, you must tell the building manager. Follow the process for this in the management agreement.
Ending your building management agreement through the Tribunal
The owners corporation can apply to the Tribunal to change or end a building manager agreement on certain grounds. This includes where the building manager acts unlawfully in their role. For example, breaching a duty under strata laws.
For general information about the dispute resolution process, including applying to the Tribunal, visit the disputes page.
Hiring other workers
The strata scheme may need to hire other workers or tradespeople. This can help with day-to-day tasks, repairs and maintenance. Examples include gardeners, cleaners, security, a concierge and repair workers.
The owners corporation can also have the strata committee or strata manager hire these workers, if it wishes.
Some strata managers will have preferred people to do the work.
When hiring other workers, you should think about:
- if the work is urgent or needs a licensed tradesperson
- your work health and safety obligations (if the workers are not contractors)
- the insurance you might need, such as personal liability
- including future costs in the annual budget.
Check whether you have planned in the budget to pay for the workers. It's a good idea to get multiple quotes to get an accurate estimate of how much the work will cost. You will need at least two independent quotes for items more than $30,000.
Large schemes have extra financial rules.
For example, they need at least two quotes for items more than $30,000. Also, if an item is more than 10% of the amount estimated at the AGM, the owners corporation must meet and agree to the cost in a majority vote.
Need more help?
Contact Fair Trading
If you have any further questions, you can contact Fair Trading via phone or in-person at a Service NSW centre.