The Australian Institute of Employment Rights (AIER) this week presented a submission to the Senate Employment, Workplace Relations and Education Legislation Committee urging them to review the proposed Independent Contractors Bill legislation in the belief that the legislation would adversely affect the rights of Australian employees established under federal and state law, and have a negative impact on employees’ living standards, health and well-being.
The following is an extract from the submission:
The Independent Contractors Bill 2006 is founded on the premise that the growth in independent contracting in Australia has arisen from workers making a free choice to become self-employed. It thus seeks to remove the ‘regulatory excess’ which may impact upon independent contractors. The Workplace Relations Legislation Amendment (Independent Contractors) Bill 2006, however, acknowledges that some employees have been coerced into independent contracting arrangements, and offers some protection from this coercion. This is commendable. But it is not sufficient to counter the growth in dependent contracting or disguised employment.
Further, the Independent Contractors Bill removes legislative safeguards introduced by state governments to protect vulnerable groups of workers through deeming provisions. Combined, these Bills fail to respond to the individual and social costs associated with independent contracting when that contracting is in reality disguised employment.
This submission argues that the Bills are a retrograde step in several respects. They fail to recognise and distinguish dependent contracting from independent contracting. In so doing, they will enable the continuation and expansion of dependent contracting and disguised employment. Research has consistently identified negative outcomes associated with these practices. These include:
- Absence of minimum employment entitlements designed to protect workers’ economic, social and health wellbeing, including a satisfactory work/life balance
- Excessive working hours without commensurate remuneration
- Higher risk of occupational injury to contractors
- Higher risk of occupational injury to those working alongside contractors
- Shifting the cost of injuries away from workers’ compensation systems onto injured workers and their families, and onto the general health system
- Absence of investment in skills and training
This submission focuses on the following components of the Bills:
(1) Definition of independent contractor
(2) Definition and process for determining unfair contracts
(3) Steps to prevent sham contracting arrangements
(4) Over-riding of state deeming provisions.