2017 has been a hugely busy and transformational year for Self-Employed Australia on important fronts.
Since forming in 2000 under the name Independent Contractors Australia, we have focused on one thing—advocacy for the rights of self-employed Australians. In this respect we have had major successes, even though we are entirely a volunteer group.
However, particularly in our dealings with the Australian Taxation Office, we have come to the realization that focusing on public policy alone is not good enough. Our experience has been that, in relation to small business, self-employed people, the ATO ignores policy that doesn’t suit its revenue ambitions. It flouts the law in the belief, based on long experience, that small business people cannot afford to defend themselves. The ATO wins by default, not because of the facts of situations but through bureaucratic intimidation.
This experience with the ATO has been replicated in dealing with large businesses on unfair contract issues. Might wins, not right!
Because of this long experience, we decided back in 2015 to restructure, bringing a range of real services to members, attracting membership and securing independent revenue. The aim was to add to our policy advocacy in a way that would allow us to supply personalised professional help for individual members with ATO or unfair contract issues. Not only would we assist individual members but we would send signals to the ATO and large businesses that at least one organization was sufficiently resourced to hold them to account. Hopefully this would bring about change in both the ATO and large organisations.
It’s been a long, focused journey putting this in place. In 2017 we implemented our restructuring, which is centred around our Protected Membership category. In addition, our policy efforts and successes continued.
Now for the specifics.
2. Protected Membership implemented
- After more than two years of discussion, we secured agreement with a Lloyd’s of London insurer for tax audit protection insurance. The package we have put together is unique in Australia and almost unheard of in other countries. Details here.
- In addition, we committed to assistance provision for people with unfair contract issues. Details here.
The Protected Membership category became available in November 2017.
3. Name change
Whilst still retaining Independent Contractors Australia as our registered name we adopted the business name of Self-Employed Australia to reflect the broader community that we seek to service.
4. Website revamped
To accompany the Protected Membership launch, we revamped the website. Traffic to the site remained steady.
5. Social media
We relaunched our Facebook page with a stronger commitment and plan to do this with LinkedIn in 2018. Also being planned is an app version of our website.
Defending the self-employed
6. ATO unlawful (in our view) targeting of the self-employed
Activity defending people:
- Late 2016-early 2017: we had success with Rod Douglass where the ATO withdrew its tax claim against Rod of $400k. The ATO accepted, after a massive effort, that their claim was false.
- Late 2017: we were successful in the campaign to have reinstated the Australian Business Numbers of 16 (mostly women) work-from-home transcribers. The ATO had cancelled the ABNs in September without justification in our view. The cancellations created immediate financial crises for the people affected.
7. ATO’s wrong policy approaches
While being critical of the ATO, we appreciate that the ATO is engaging in discussions with us on several policy issues. These include its practices of:
- Accusing people of fraud and evasion on grounds that are totally wrong and then demanding money on the basis of its accusations. Rod Douglass’s case was a prime example, but only one of several.
- Applying an interpretation of the ‘results test’ under the Personal Services Income tax laws that is not in accordance with the relevant legislation. Again it demands money on the basis of its incorrect application of the law.
8. Inspector-General of Taxation
We have worked closely with the IGT on a number of cases where the ATO’s treatment of self-employed people is simply wrong. The IGT has conducted very detailed investigations and provided valuable reports.
9. Submission to Parliamentary Inquiry into ATO
We submitted a detailed report to the Parliamentary Inquiry into the oversight of the ATO. The Inquiry occurred because the ATO was complaining that it was subject to too much oversight. We submitted that the ATO needed more oversight. The Inquiry recommended retention of the status quo.
10. Effects test legislation
We were active participants in the campaign for the ‘effects’ test legislation that eventually passed. This requires large businesses under competition law to be more careful where their behaviour may harm competition.
11. Unfair contracts
We can rightly make claim to be the principal advocates for the small business unfair contract laws that came into effect in late 2016. In 2017 we worked on their implementation. We are on the ACCC’s small business advisory group which gives us strong input into the ACCC’s enforcement of the unfair contract laws.
12. Security of Payments
A major issue for small business people is being paid on time by large businesses. We are members of the Australian Building and Construction Commission, Security of Payments Working Group. This enables us to have input about construction industry obligations to pay subbies on time. In addition, we did advocacy work with the Victorian Government in their attempts to have systems put in place for timely payments.
13. Building Construction Code
We promoted and supported the introduction of the Building Code in the construction sector. With the Code in place and enforcement one of the activities of the ABCC, self-employed subbies in commercial construction have improved rights.
14. Black economy
We were involved in the consultation process investigating the black economy and how to address the issue.
15. Vulnerable Workers legislation
We were heavily involved in the campaign to have the Vulnerable Workers Bill passed, which it did in late 20017. This legislation was a response to the exposure of worker exploitation, mainly in the franchise sector. What was odd in this campaign is that we found ourselves fighting against the efforts of ex-Small Business Minister, Bruce Billson, who had become chair and chief lobbyist for franchisors in their attempts to stop the new laws.