Industrial Relations

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Painters Institute
Posts: 12
Joined: Fri Apr 20, 2012 2:21 am

Industrial Relations

Post by Painters Institute » Fri Apr 20, 2012 8:59 am

ABCC and Fair Work Australia Audits Target Commercial Painters

The Australian Building and Construction Commissioner (ABCC) are carrying out workplace audits across Australia with a specific focus on finishing trades, such as painters.

The ABCC regulates industrial relations in the commercial building industry. How does the ABCC select a business for auditing?
While businesses can be selected at random for auditing, the ABCC has also given consideration to other matters such as:

information received from other government agencies like the Department of Immigration and Citizenship and the Fair Work Ombudsman
information gained from prior ABCC site visits from both head contractors and subcontractors who have provided information about those engaged in the finishing trades
information gained from previous investigations
information received via the ABCC 1800 Hotline
examination of recruitment activity in the industry where job advertisements have called for ‘full time’ and ‘permanent’ positions where an ABN is a requirement of engagement
general research including identifying companies through the ABN Lookup website, companies recorded in the ABCC’s internal database, and online searches identifying finishing trades in the commercial building industry.
How will the ABCC contact painters?
Employers and industry representatives that interact with the ABCC during the national audit can expect the following by way of contact:

Advisory letters to industry representative bodies – the ABCC will advise industry representatives that an audit is about to commence. The advice will include details of the nature of the audit.
Notification of audit letter – a business selected for audit by the ABCC will be advised of their selection by letter. The letter will advise the recipient of the nature of the audit and request that they voluntarily complete and return an ‘audit entity’ form. The information included in the returned audit entity form will allow the ABC Inspector to better understand the nature of the business. The letter will advise that ABC Inspectors intend to visit the office of the selected business to examine or collect copies of a range of documents. These documents will be identified in the letter.
Telephone contact – an ABC Inspector will contact the selected business by telephone after the employer has received the notification of audit letter. The Inspector will explain the audit process and arrange a suitable time to visit the business premises (or other agreed premises such as an accountant’s office) to examine or collect the documents requested in the notification of audit letter.
Inspection of documents – at an agreed time and place an ABC Inspector will visit the business to examine or collect the requested documents from the employer.
Interview with principal of business entity – ABC Inspectors may have questions to put to the employer following the examination of documents. If this is the case the ABC Inspector may request that the employer participate in an interview or provide further information to the ABC Inspector.
Interviews with workers – ABC Inspectors may interview workers identified during the audit to assist verify the information provided by the employer. The ABC Inspector will advise the employer of their intention to conduct these interviews but will not necessarily provide details of which workers they intend to interview.
What documents will be requested as part of the audit and how will any possible contraventions be resolved?
ABC Inspectors will request that audit participants produce certain documents and records that relate to the workers they engage(d) over a specified period of time (the audit period). Examples of the types of records or documents that ABC Inspectors may request include:

the names of employees, their status of employment (full-time, part-time, casual or daily hire) and details about the duties they perform
any apprenticeship or traineeship contracts, or relevant industrial instrument(s) that may be in place
time sheets, attendance records, rosters or other documents showing hours worked (including any overtime hours for which the employee is entitled to an overtime rate)
payroll advice records detailing the gross and net wages paid to each employee in each pay period during the audit period
wage rates (or salary) paid as well as any penalties, loadings or allowances, and the nature of such payments
copies of payslips that were provided to employees
where the business engages independent contractors, ABC Inspectors may request a copy of relevant contracts together with invoices and records of payment along with details of the services provided by the independent contractor(s).

Has this happened to you?

Site Admin
Posts: 46
Joined: Tue Feb 07, 2012 12:03 am

Sham Contracting – Scourge of the Industry

Post by daniel.wurm » Wed Sep 02, 2015 4:29 am

Sham contracting is rife in our industry, and so common that many painters don’t realise they are breaking the law.

I want to preface this article by mentioning that up until a few years ago, I was guilty of sham contracting myself, but like most painters, it was because I was ignorant. Because sham contracting is so common in our industry, I didn’t realise it is illegal. I wanted to do the right thing by my employees, but it was often difficult to get good information.

Why is sham contracting so bad?

It’s bad for subbies because it means they are not covered by Workcover insurance, and don’t get superannuation. There are thousands of painters who have no insurance to protect their livelihood should they have an accident. Because of sham contracting, tens of thousands of painters have no superannuation. In case you haven’t heard, in the not too distant future, the government will be expecting all of us to live off our superannuation upon retirement. So if you think you don’t need superannuation, and would rather get paid as a subbie, you could be setting yourself up for a miserable retirement.

Being a ‘subbie’ also means that you cannot access government subsidised training, because in most states, government funded courses are only available for training staff. So if you are an employee make sure you get qualified before you start a business as a contractor.

Sham contracting is also bad for employers. It might seem attractive because it seems to mean less responsibility in the short term. However, there are heavy fines for sham contracting. In addition, government funded training is usually only available for employees. If your employees are ‘subbying’, you could be missing out on valuable training and government incentives.

If you are an employer who uses ‘subbies’, make sure they really are ‘sub-contracting’ to you, otherwise the government will still view you as the employer, and will hold you responsible for their safety, WorkCover insurance and superannuation. To be classed as a ‘sub-contractor’, the worker must have their own business, and there must be some sort of ‘contract’ between you and them, for every job. This means a quote, at a minimum. Just asking them to give you an invoice does not make them a sub-contractor. Neither does them merely having an ABN, having a business name, or working for more than one employer.

So, what should you do if you discover that you are actually operating illegally? Talk to your accountant about how to put on your workers as casual employees. This gives you all the flexibility of a ‘subbie’, but it’s legal, and won’t cost you any more.

If you are an unqualified subbie, talk to your employer about putting you on as a casual employee. You might have a little less money in your hand at the end of the week, but you will have savings in the form of superannuation, and you will have insurance in the case of an accident. You will also be eligible for subsidised training to help you get qualified.

If you are a qualified subbie and don’t want to work as an employee, make sure you run your business properly. Get yourself some self-managed superannuation, and organise public liability and income protection insurance. Sub-contracting means exactly that; contracting your business to another business. If you want to be treated as a business, then act like one. Make sure you have a written contract for each and every job, even if the principle contractor is your mate. Shit happens, even between mates. If you live in WA, SA, NSW or QLD, make sure you get licensed or registered, because being a sub-contractor means the buck stops with you!

Sham contracting is exactly what it sounds like; contracting without a contract. It’s a sham, and it’s illegal. If you are sub-contracting then you need to have everything in writing, and run your business professionally. If that sounds like too much hassle, then maybe sub-contracting is not for you!

Need more info? ... difference

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