Contracting Plus Pty Ltd was found guilty of violating workplace laws by paying its workers less than the minimum hourly rate of pay, amounting to $46,000.
The former Brisbane CBD call centre attempted to classify workers as “independent contractors” rather than employees, and therefore avoided mandatory requirements relating to salary and benefits.
At the ruling, Federal Magistrate Michael Burnett said that, “Sham contracting is a serious matter because if workers are incorrectly classified as independent contractors, they can miss out on fundamental entitlements such as minimum pay rates, penalty rates and annual leave.”
Burnett ordered that the fines should go towards reimbursing the employees of Contracting Plus Pty Ltd, a large number of whom were under the age of 21.
“To purposely deny vulnerable and low-skilled workers these important employment entitlements by disguising them as contractors is particularly reprehensible,” he added. “As such, it is important that my agency mark its disapproval of such behaviour and deter others from doing the same.”
Michael Campbell, Fair Work Ombudsman Executive Director, praised the decision, advising that it sent out a very clear warning to other would-be employers looking to evade workplace legislation and their obligations to employees.
The HR Leader reports that the trend of so-called sham contracting appears to have spread into several sectors, with a recent investigation led by the Construction, Forestry, Mining and Energy Union (CFMEU) halting hundreds of illegal contracts at construction sites across Australia. Nationwide audits look set to continue, with well-known multi-nationals such as Bovis Lend Lease and Multiplex construction being questioned by the CFMEU.
Construction workers have teamed up with the union to create the ‘Stop the Sham’ campaign, in an effort to voice their anger against the growing practice of sham-contracting. They are also calling for co-ordinated Federal Government action.
CFMEU Construction National Secretary Dave Noonan said that he blamed authorities for turning a blind eye to the practice, and as well as treating workers unfairly, the organisations responsible were also evading business taxes.
“These companies are taking lucrative Federal Government construction contracts with one hand, and undermining Australia’s tax base with the other,” he said.
To read the full article see: http://www.humanresourcesmagazine.com.au/articles/27/0C06F927.asp
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(Source: HR Leader)
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