representing building managment, cleaning and security staff

WHO IS REALLY A SUBCONTRACTOR?

Workplace Relations Update from Workplace Advisory Group

WHO IS REALLY A SUBCONTRACTOR?

For those who follow my blog or who are clients of Workplace Advisory Group, you will know that the question of what really constitutes a bona fide sub contract relationship looms large in Australian workplaces.

For months now we have seen a sustained assault in the courts against so-called subcontractor relationships. Probably the highest profile case has been one that the Fair Work Ombudsman took against Foodora. Foodora had tried to classify its meal delivery riders as subcontractors but the case was dropped after Foodora folded its corporate tent and left Australia. The TWU also got into the act and backed an Unfair Dismissal case against Foodora which the union won. That will probably turn out to be a pyrrhic victory in a monetary sense given Foodora’s departure but the finding of an employment relationship might be crucial. Uber, Deliveroo and others will be watching closely.

What is clear is this: for low paid, unskilled work the courts in Australia will look very hard at relationships alleged to be subcontracts. Whether it’s cleaning, hospitality or parcel delivery, it will be difficult to convince a court that a subcontract exists. The real test is whether the worker is genuinely running his or her own business. In a lot of cases, they simply aren’t.

For businesses who think that slinging a worker an ABN and a mobile phone turns that worker into a subcontractor: think again.

Written by Mark Diamond, Workplace Advisory Group: December 2018