The Guardian 13 December, 2006
New contractor’s law
The Howard Government is pressing ahead with further changes to industrial relations laws with its latest "independent contractor" bill that gives big business the power to push down contract rates and threaten the take home pay of both contractors and employees alike.
The bill seeks to remove ‘independent" contractors from the provisions of WorkChoices and have them governed by commercial law. Workers hired as "independent contractors" or "subbies" will be even worse off! They will be left without the very basic minimum entitlements that WorkChoices and other legislation offers employees!
It opens the way for employers to use body hire and other schemes to technically change the status of a worker from "employee" to "independent contractor".
Independent contractors are responsible for just about everything — for their own workers’ comp insurance, holiday pay, sick leave provisions, superannuation contributions, and the many other entitlements that have been won over years of trade union struggles.
It is a thinly disguised mechanism for employers to sweep away what remains of Australia’s labour laws and protections.
Speaking at a media conference with technicians working as sub-contractors on the Telstra telephone network, ACTU President Sharan Burrow said the Howard Government will be trampling over more workers’ rights with these new changes to IR laws.
"Already we have seen the Howard Government’s new IR laws make it easier for employers to sack their permanent staff and re-employ them on contracts with lower wages and conditions."
The government now proposes to take this a step further with a new law that will give big business the upper hand in pay negotiations and fails to protect contractors who wish to bargain collectively.
The law fails to help sub-contractors who are being pushed around by big companies.
For example, more than 100 independent contractors working as telephone technicians in regional NSW for Telstra are facing cuts of between 25 percent and 50 percent to their contract pay rates as well as fines for minor defects.
The technicians are employed as sub-contractors for Downer Engineering but carry out the majority of their work on residential and business telephone lines for Telstra.
They say they cannot afford to accept most country work under the new contract rates which mean a cut in the rate of pay for repairing most rural telephone faults in NSW from $105 to $80 — a 24 percent pay cut.
Overall, Telstra’s pay cuts could amount to as much as $25,000 less pay for the sub-contractors over a year.
But under their current terms of employment the subbies have no capacity to negotiate directly with Telstra for decent contract rates and their legal rights to bargain collectively are severely limited.
Unions are also concerned that the proposed new independent contractor law will fail to prevent employers from pushing more workers into sham contracting arrangements.
Recent studies show that up to 40 percent of contractors are actually dependent on the one employer.