Sham Contract Warning

Federal court proceedings against a Queensland-based transport company has unveiled a sham contract warning for small businesses from The Fairwork Ombudsman. The transport company had disguised employees and misclassified four of their delivery drivers to underpay and avoid payments of various entitlements.

The four misclassified delivery drivers had underpayments totaling $63,803 between 2016 and 2018. Three of the four workers were underpaid hourly overtime rates and public holiday rates, and not paid for any annual or personal leave. Underpayment of loading and unloading duties and cents-per-kilometre were also found to have been missed. The four misclassified drivers were not listed as employees, and listed as contractors, when in fact they were technically employees of the business.

Sandra Parker from Fairwork Ombudsman has said, “If employers misclassify employees as independent contractors and pay flat rates that undercut entitlements, they face serious consequences such as court action, hefty back-payment bills and penalties”.

FWO has stated indicating sham contracting will be one of its focus points for 2020 and warns businesses to keep in mind that under the Fair Work Act companies don’t get to decide the nature of an employment relationship.


More Posts

How Are You Managing Your Farm's HR

How Are You Managing Your HR?

The recent election of the Labor government is likely to lead to significant employment and industrial relations changes. With the new government, I anticipate several

Industrial Manslaughter Imprisonment

Industrial Manslaughter Imprisonment

Businesses should now be aware of Western Australia’s new Work, Health, and Safety (WHS) legislation and the implications concerning workplace deaths and industrial manslaughter.  If

Contact us for help

Contact Us

Start your HR or Safety assessment for your business

Treat yourself

Let Us Take Care Of You

Copyright © ProcessWorx 2022

marisa ross team photo

Marisa Ross

HR Advisor

Marisa is an experienced and motivated HR professional with a strong HR generalist and business operations background with a focus on employee relations, performance management, leadership training & development, workers compensation & injury management, and employee retention. Marisa holds a Bachelor of Human Resource Management and a Bachelor of Behavioural Science with a minor in Counselling. Having worked in a variety of industries from SMEs to large blue-chip organisations, Marisa is passionate about enriching employee experience, employee retention, and building leadership capability in people management.

Aimee Grigson

Aimee Grigson

WHS Advisor

Aimee has a strong understanding of Workplace Health and Safety Legislation and standards and has extensive HSEQ experience in a number of industries. Aimee has a great ability to engage across all levels of organisation, including field teams, leadership and external stakeholders. Aimee ensures Health and Safety Management Systems are compliant to legislation, effectively implemented and understood by all. Aimee has a Certificate IV in Work Health and Safety and qualifications in auditing and incident investigations. Aimee is passionate about coaching and developing small businesses towards a positive safety culture.