Contractor rights & protections

Under the Fair Work Act 2009, independent contractors are protected from:

• adverse action – for example, a business cannot terminate a contract with an independent contractor because they make a complaint to a regulator about their workplace rights
• coercion –  for example, a business cannot threaten to take action against an independent contractor to coerce them not to exercise their workplace rights
• abuses of freedom of association – independent contractors are free to join, or not join, a trade union or employer group

The Independent Contractors Act 2006 allows independent contractors to ask a court to review a contract on the grounds that it is 'unfair' or 'harsh'. The court may consider:

• the terms of the contract when it was made
• the relative bargaining strengths of the contract parties and, if applicable, anyone acting on their behalf
• whether there was any undue influence or pressure, or any unfair tactics used against, a party to the contract
• whether the contract provides remuneration that is less than that of an employee doing similar work
• any other matters the court thinks is relevant

The court may order:

• the terms of the contract to be changed (for example, they may be added or removed)
• the whole contract, or part of the contract be 'set aside' (that is, have no effect)

Sham contracting

If you have been engaged as a contractor but believe you’re an employee, you may be in a sham contracting arrangement.

A sham contracting arrangement is when an employer attempts to disguise an employment relationship as a contractor relationship. They may do this to avoid certain taxes and their responsibility for employee entitlements like:

• minimum wages
• superannuation
• leave

It’s illegal for an employer to:

• misrepresent an employment relationship as an independent contracting arrangement
• dismiss or threaten to dismiss an employee for the purpose of engaging them as a contractor
• say something false to persuade an employee to become a contractor

All workers in Australia are entitled to a safe and healthy workplace. This means that employers — including self-employed contractors — must comply with the relevant state or territory's workplace health and safety laws.