Contractor rights and protections
Protections at work
Under the Fair Work Act 2009, independent contractors are protected from:
- adverse action – for example, a business can't terminate a contract with a contractor because they made a complaint to a regulator about their workplace rights
- coercion – for example, a business cannot threaten to take action against a contractor to coerce them not to exercise their workplace rights
- abuses of freedom of association – contractors are free to join, or not join, a trade union or employer group.
Unfair contracts
The Independent Contractors Act 2006 allows independent contractors to ask a court to review a contract on the grounds that it's '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:
- to change the terms of the contract (for example, adding or removing terms)
- to 'set aside' (make ineffective) the whole contract, or part of the contract.
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Sham contracting
If a hirer engages you as a contractor but your work conditions are more like 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
- super
- 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.
Help for sham contracting arrangements
If you think you may be in a sham contracting arrangement, you can ask for help from the Fair Work Ombudsman – call 13 13 94.
Work health and safety
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.
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