Some companies still aren't getting the message, with two call centre service providers set to face court after the Fair Work Ombudsman accused them of breaking "sham contracting" guidelines.
The organisations in question are being accused of breaching a number of workplace laws, by employing 10,000 call centre workers and door-to-door sales people as contractors, resulting in "massive underpayments".
The Ombudsman defines sham contracting as an employer disguising or misrepresenting an employment relationship as an independent contracting arrangement, thereby avoiding employee entitlements such as minimum pay rates and leave entitlements.
Speaking at the Australian Industry Group's workplace conference earlier this week, Fair Work Ombudsman Nicholas Wilson, stressed that while hiring independent contractors is not illegal, if an organisation sets out to evade their workplace relations responsibilities, by using commercial processes to find a business partner who will undercut established minimum wage rates, then that may be considered unlawful.
"The pretence that commercial negotiations can procure below award wages or that the cover of an ABN can avoid an employment arrangement are merely that – pretences. And they are pretences that can have significant consequences," he added.
In March, the Ombudsman warned that it would be cracking down on sham contracting in the health and beauty, cleaning, and call centre industries.
That same month, a Brisbane call centre company and its director were fined $214,500 for sham contracting and underpayments while the Construction, Forestry, Mining and Energy Union also threatened industrial action against developers and builders that engage staff as ''sham contractors'', which is believed to account for up to 168,000 workers (See Blog Post: Employers shirk Employee Obligations).
Read the full story: http://www.smartcompany.com.au/industrial-relations/20110503-fair-work-ombudsman-claims-two-companies-labelled-10-000-workers-as-sham-contractors.html
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