Incorrectly engaging a person as an independent contractor instead of an employee is unlawful and can have significant financial consequences.
In the building and construction industry, there is a common misconception that engaging a person “on an ABN” means that the person is a genuine independent contractor. The question of whether a person is a contractor or employee (at law) is complex, and involves a consideration of numerous elements of the relationship, and how these operate in practice. The question of whether a person has an ABN is not a relevant consideration.
An employment relationship is more likely to exist where the worker:
A contractor relationship is more likely to exist where the worker:
There can be significant consequences for incorrectly engaging a person as a contractor, including financial penalties for breaching the “sham contracting” provisions in the Fair Work Act 2009. There can also be liability arising from:
We can provide assistance to your business to minimise the risk arising from the engagement of independent contractors. This includes helping to identify the true nature of the relationship and preparing a written contract to minimise risks. We can also assist with the defence of claims or investigations where it is alleged that a contractor is or was an employee.
The 2018 and 2019 Rostered Day Off (RDO) Calendars are now available
Whether it be reviewing, developing or negotiating your enterprise agreement we can help.
We offer a free evaluations to members to assist your business to comply with workplace laws.