Sham Contract Lawyers
Sham contracting is the term applied to an agreement between an employer and employee to mislead others to believe that the parties do not have an employee-employer relationship.
It is observed to be objectionable conduct, or arrangement because it denies the economic and social benefits bound in an employee-employer relationship. It is often regarded as more beneficial to the employers to enter into these arrangements because sometimes the employee, otherwise known as a contractor or sub-contractor, loses many of the rights conferred by statues such as:
- The Fair Work Act
- The Accident Compensation Act
- The Superannuation Guarantee Act; and
- The Income Tax Assessment Act
Usually, the laws aim to strike a balance of benefit and responsibilities. Persons who seek to force others out of this protective arrangement, or who collude to mutually avoid legal rights and responsibilities, end up paying a high price if they are found to have done so.
McDonald Murholme can provide advice objectively and at short notice to employees who fear they may be caught up in a sham contracting arrangement. At McDonald Murholme we can help employees identify genuine contractual arrangements as distinct from artificial arrangements, or sham contracting.
Employees must recognise that in one industry what will be seen as genuine sub-contracting, may in very similar circumstances in a different industry be regarded as sham contracting. The criteria for assessing a sham contracting arrangement, and the application of the criteria, is sometimes confusing for that reason.
If you are a party concerned that you are not being paid employee benefits but are in fact under the sole control of one employer you would be wise to take advice and have us make an assessment for you.