WITH the Australian Building & Construction Commission’s round table discussions as part of its inquiry into sham contracting coming to an end, the industry regulator should be wary of recommending extra compliance burdens be placed on already heavily regulated businesses unless there is evidence it is warranted.

AMMA’s submission to the ABCC’s inquiry − Sham arrangements and the use of labour hire in the building and construction industry − highlights the need for hard facts rather than anecdotal evidence to be provided as to the extent of the sham contracting problem so that it can target its compliance efforts if and where they are needed most.

AMMA Chief Executive, Steve Knott, said the thrust of the ABCC’s inquiry should not be to intervene in mutually beneficial and consensual relationships involving people earning six-figure sums, but to protect lower-paid and vulnerable workers who have no specialised skills and consequently very little bargaining power.

“AMMA maintains that industry parties should be free to enter into the contracting arrangements they see fit as long as they are well-informed and not coerced or exploited,” Mr Knott said.

AMMA’s submission to the inquiry makes these and other recommendations including:

  • A targeted education campaign should be the first course of action undertaken by the ABCC as a result of the inquiry, and this should precede any further regulatory or legislative changes; and
  • If the inquiry does recommend regulatory or legislative changes, these should be restricted in application to arrangements involving individuals earning less than $113,800 a year. This aligns with the unfair dismissal high-income threshold under the Fair Work Act and acknowledges the fact that high-income earners are not vulnerable to exploitation as are lower-skilled, lower-paid workers.

“If parties are entering into independent contracting arrangements in an informed way, and one of those parties is offering their services in excess of a six-figure dollar amount each year, they should be free to enter into the contracting arrangements of their choice.

‘It is only where manipulation, coercion or exploitation arises that the ABCC should exercise additional compliance powers to intervene in the arrangements,” Mr Knott said.

Click here to view a copy of AMMA’s full submission to the ABCC.