The Commonwealth independent contractors laws provide protection for employees and independent contractors who are subject to a sham contracting arrangement or are pressured to opt-in to the federal laws during the three year transitional period.
Sham contracting arrangements
A sham contracting arrangement occurs where an employer attempts to disguise an employment relationship as an independent contracting arrangement, usually for the purposes of avoiding responsibility for employee entitlements. Under the sham contracting provisions of the Workplace Relations Act 1996 (the Act), an employer cannot:
The Act provides serious penalties for breaches of these provisions. Employees and independent contractors can request assistance from the Workplace Ombudsman on 1300 724 200 or www.wo.gov.au if they feel their rights have been breached.
Prohibited conduct in relation to reform opt-in agreements
The Independent Contractors Act 2006 provides a three year transitional period during which certain state or territory laws may continue to apply to an independent contractor. A reform opt-in agreement is an agreement in writing, signed by the independent contractor and their principal, which states that they no longer want the state or territory laws to govern their contract for services.
Parties to an existing contract for services can choose to sign a reform opt-in agreement.
The Independent Contractors Act 2006 provides protections for parties in making this choice. These protections are that a person must not:
The Act provides serious penalties for breaches of these provisions. Employees and independent contractors can request assistance from the Workplace Ombudsman on 1300 724 200 or www.wo.gov.au if they feel their rights have been breached.