The new impartial contractor laws got here into impact on 1 March 2007 through the Independent Contractors Act 2006.
Together with the current WorkChoices laws, the new contractors' legislation is an additional step towards establishing a single nationwide workplace relations system and has important implications for the usage of unbiased contractor arrangements. The important thing modifications are as follows:
? > Elimination of protections for sure impartial contractors who're deemed employees underneath State laws, and
? > Introduction of a single nationwide scheme for the review of independent contractor arrangements on grounds of ?unfairness? which is able to provide a forum for contractors to challenge the phrases of their engagement, together with termination entitlements
? > Penalties for parties who enter into ?sham? independent contractor preparations ie, participating a person as a contractor when legally they need to be characterised as an employee.
If the contractor arrangements facilitated by the brand new legislation are correctly utilised and applied, there is considerable potential for companies to reap the rewards of this additional deregulation of the labour market.
The acknowledged objective of the Act is to recognise and protect the unique position of independent contractors in the Australian labour market. The Act's principal objects are:
? > To guard the freedom of impartial contractors to enter into services contracts
? > To recognise impartial contracting as a respectable type of work arrangement that's primarily business, and
? > To stop interference with the terms of genuine impartial contracting arrangements.
The Government's policy rationale is that genuine independent contactor arrangements must be ruled by rules of economic and contract regulation, not by industrial and employment legislation. The Act seeks to realize this consequence by overriding various State employment and industrial legal guidelines that currently impression upon independent contractor arrangements by deeming sure unbiased contractors to still be thought of workers at law. The brand new Act overrides these State ?deeming provisions.?
It's crucial nonetheless that you seek legal advice before you implement any contractor agreements as massive potential penalties apply for what the laws considers to be ?sham contracting arrangements.?