Self Employed Australia

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“Everyone needs an Advocate”

Rule of law

The truth needs to be told about the ATO.  Drop the charges against Richard Boyle

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richard-boyle-protestEarly this week the trial for ATO whistleblower Richard Boyle was to start in the Adelaide District Court. However, Richard and his entire legal team came down with Covid and the trial could not proceed.

But the trial cancellation didn’t stop us joining a rally of citizens calling for Richard’s case to be dropped. In the photo are SEA members Annette and Tina making our views known. The Australian Financial Review gave Richard’s case good exposure on Monday.

Background

On 9 April 2018 an ABC Four Corners exposé was aired that exposed malpractice and small business abuse by the Australian Taxation Office. Ex-ATO debt collection officer Richard Boyle featured in the program, detailing malpractice in the ATO’s debt collection division. Essentially the ATO was raiding people’s bank accounts in defiance of its required rules.

Richard had lodged an internal report to the ATO detailing the malpractice which was ignored. Richard then followed lawful whistleblower procedures in going public. However, the ATO still went after him, initially with charges that would put Richard in jail for 161 years.

Richard’s report on ATO malpractice was subsequently proven to be accurate by both the Inspector-General of Taxation and the Small Business Ombudsman. A Senate Committee criticised the ATO.

Why the charges should be dropped

We have detailed why the charges against Richard should be dropped. See our full reasons here.

In summary, our reasons include:

  • Richard’s whistleblowing was the moral thing to do. This impacts upon the appropriateness of the prosecution.
  • The charges against Richard are the product of a witch-hunt.
  • The length and expense of a trial is a waste of public resources.
  • There is a need to maintain public confidence in the administration of justice.

In undertaking Richard’s prosecution, the Commonwealth risks creating the impression of conducting a cover-up of evidence of maladministration by the ATO. If not a cover-up, then at least a diversion from the truth. This seriously diminishes the confidence of the public in the tax administration system. Further, it seriously diminishes trust in the justice system itself, by delivering the potential impression that the justice system is likewise involved in covering up maladministration by the ATO.

‘They’ plan to screw over 2.1 million Australians

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dark-menaceLet’s be clear. There’s a cabal of unions, labour academics and self-interested businesses that are gunning to destroy the right of Australians to be self-employed.

Their strategy is brilliant in its simplicity. They plan to push through new Federal legislation that will throw into chaos the law that defines who is self-employed and who is an employee. This will directly harm the capacity of Australia’s 2.1 million people who are self-employed—people who, by definition, are their own boss.

That’s right. The Australian Bureau of Statistics identifies 2.1 million of us comprising:

  • 1,391,900 self-employed (own boss) who don’t have employees and
  • 805,800 self-employed (own boss) who have employees.

The ‘cabal’ is mostly targeting the 1,391,900 self-employed who don’t have employees. Think hairdressers, owner-drivers, care workers, gardeners, personal trainers, and the massive numbers of IT, accounting (and more) consultants to identify just some. What the ‘cabal’ is calling for is legislation that will strip away your right to be your own boss. They want forced employment.  Such law will also have an impact on the other 805,800 self-employed.

The cabal wants legislation that invents ‘employee-like’ arrangements.

Understand what this would do. It would destroy the integrity of the commercial contract. It would give smart-arse lawyers the ability to carve out and deconstruct the very legal basis of commercial activity upon which our society is based and which defines who is self-employed. It’s a sneak guerrilla attack. But once in place it will have devastating effects.

Legislating to invent employee-like arrangements is to take social or psychological concepts and to fashion law on those concepts. It’s incredibly dangerous for our society. It’s something the High Court seemingly commented against in a ground-breaking judgment in February this year.

The High Court said (See par 44):

The employment relationship with which the common law is concerned must be a legal relationship. It is not a social or psychological concept like friendship.

That is, the employment contract, and its opposite, the self-employed contract are legal concepts. This comment by the High Court was within the context of the most important judgement on the definition of self-employment in 50+ years.

After more than 50 years of legal confusion the High Court said (See par 58):

It is the task of the courts to promote certainty with respect to a relationship [employee/self-employed] of such fundamental importance.…

and

The parties’ legitimate freedom to agree upon the rights and duties which constitute their relationship should not be misunderstood.

The fact is that people have a right to determine their contractual (self-employment) relationship themselves. Employee-like legislation would strip away that right. It would create massive uncertainty in defiance of the certainty the High Court says should exist.

Unfortunately, Labor’s federal ‘Secure Jobs Plan is to create ‘employee-like forms of work’ legislation.

Stop prosecution/ persecution of ATO whistle-blower Richard Boyle

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richard-boyleIn a truly important development, Labor’s new Attorney-General, Mark Dreyfus MP, has ordered the dropping of charges against whistle-blower lawyer Bernard Collaery. Collaery had supported an ex-spy who exposed a 2004 Australian spying operation in East Timor.

We ask Mr Dreyfus to now seriously consider the dropping of charges against ATO whistle-blower Richard Boyle.

Richard was charged in 2019 with offences that would have put him in jail for 161 years. This occurred after Richard exposed serious misbehaviour inside the ATO in their debt actions against small business people. Richard went public with this in 2018 on the Four Corners exposé of the ATO’s bad behaviour.

Richard’s reporting of ATO misbehaviour has proven accurate in the following years. Further, a Senate inquiry heard that because the ATO ignored Richard’s internal reporting, this led to investigations from the Inspector-General of Taxation, the media and so on.  Even an ATO-funded survey found that the ATO acted unfairly.

Australian whistle-blower laws are supposed to protect public servants who follow set procedures, principally issuing public interest disclosure documents. The legislation on this supposedly facilitates “… disclosure and investigation of wrongdoing and maladministration in the Commonwealth public sector…” What a joke this law is.

Richard followed public interest disclosure processes but that didn’t give him any protection. The ATO went after Richard anyway.

In our view Richard Boyle is an Australian hero. He exposed the truth about  the bad behaviour of the ATO.  In our view, the ATO is not just in the business of prosecuting Richard but rather of persecuting him. Why? In our view it’s because Richard is being used as an example to all other ATO officers. The message is clear. Don’t tell the truth. Don’t expose when the ATO does the wrong thing.

In the United States, whistle-blower protection laws are robust and have a long history dating back to the Civil War. The US recognizes that government must be transparent and accountable if government is to serve the people properly. Protecting people who declare the truth is an essential part of open, transparent and good government.

We congratulate the new Albanese government and AG Mark Dreyfus for dropping the charges against Bernard Collaery. Previous Coalition governments have shown no interest in protecting whistle-blowers but have been active in their persecution. The Albanese government seems to be using a firm broom to sweep up a major mess on this one.

Mark Dreyfus has let it be known that he is reviewing other whistle-blower cases, but has not confirmed if Richard Boyle is one of them. We ask that Dreyfus do for Ricard Boyle what he has done for Bernard Collaery and drop the charges.

We consider this an important step toward better government and a better ATO.

2021: A Victorian Health Department Space Odyssey – Where is Hal?

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space-odysseyTry this piece of strangeness. We now have ‘proof’ that the Victorian Department of Health makes decisions and does things without any apparent human involvement.

The Department, we assume, must operate like Hal in the great, classic sci-fi movie 2001: A Space Odyssey. Hal was the super computer that ran the spaceship without human involvement. Somewhere in the Health Department ‘Hal’ must exist.

The ‘proof’ of Hal is contained in a 4 October 2021 memo to executives in the Health Department. On 29 September 2021 the Victorian WorkSafe Authority announced it was prosecuting the Department of Health over the 2020 Hotel quarantine disaster which resulted in over 800 deaths. The 4 October memo states:

“WorkSafe have advised that no individuals from the department are, or will be, charged.”

Here’s what this means. WorkSafe has found sufficient evidence of breaches of work safety laws to start a criminal prosecution of Health. We updated you on this last week. In other words, the Department did or failed to do things that has resulted in criminal charges being laid. BUT. According to WorkSafe’s advice to Health, no humans committed any of the criminal things. The Department acted criminally but no human acted criminally. Go figure!

But see. We told you so. It’s Hal! And now like the children’s book ‘Where’s Wally?” we have to ask ‘Where’s Hal?’

Here are just some of the questions that must be asked:

  • How did WorkSafe conduct a criminal investigation without interviewing any humans?
  • Or did WorkSafe interview and question humans?
  • If WorkSafe did interview humans, did any of those humans explain how the Department does things without humans making decisions or doing those things?
  • Can humans in the Health Department explain how the Department operates without humans making decisions or doing things?
  • Did WorkSafe meet or see Hal?

Of course, these questions are all nonsense and just as nonsensical as WorkSafe only prosecuting Health but not individuals.

In truth a government department is just a bunch of humans making decisions and doing things. A ‘department’ does not and cannot act criminally. Only humans act criminally. There is no Hal in the Health Department. Only humans.

But WorkSafe is acting on a fantasy, a Space Odyssey.

This is not just an isolated Victorian issue. It cuts to the heart of whether government in Australia operates impartially so that no-one is above the law, including government itself. It’s no joke. It’s serious!

Here’s the Health memo obtained through FOI.

Note the 104-page Charge Sheet but with all important information blanked out!

Prosecution of Victorian Health over 2020 Hotel Quarantine Disaster—Update

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It’s been a little while since we updated you on the legal process of prosecuting the Victorian government over the 2020 Victorian Hotel Quarantine disaster that resulted in over 800 deaths. What’s at stake is whether governments hold themselves accountable to the same standards to which they hold the rest of us.

It’s quite clear that our Not Above the Law Campaign forced Victorian WorkSafe to prosecute the Department of Health. We have to ask the question: how genuine is that prosecution? We’re chasing this and here’s an update:

  • The prosecution of Health was announced on 29 September 2021 and involved the laying of 58 charges. Since then there has been NO, that’s ZERO, further information.
  • We decided to check things out. We went to the Melbourne Magistrates’ Court and were told that there was an online directions hearing on 26 May.  Members of the public could attend and we were told we’d receive an email link. The link arrived. We dutifully attended only to discover that we’d been sent the wrong link. Goodness—what an unfortunate mistake by someone!!!

SO

  • We tried to hunt down the case number. What an effort that was, given that the case name has not been made public from what we could discover. Victory! We discovered the name. It’s Victorian WorkSafe Authority v The Crown in the Right of the State of Victoria (Department of Health). Case number M12097325. If you want to follow the case, check the Magistrates’ Court website, choose the “Criminal List” button in the top left corner and put the case number in the appropriate box. Members of the public have a right to attend, but it seems you’ll need to ring the Magistrates Court to receive a link (assuming you’re sent the correct link) or else attend the hearing in person.
  • Next step is that we’ve applied to the Court for the release of all court documents. We’re after the charge sheet, summons, prosecution summary and so on. Lawyers tell us that in criminal cases (OHS charges are criminal) such documents are ordinarily public documents. But the release will be decided at the next hearing date, Friday 17 June at 10 am (a Committal Mention). It will be interesting to see if WorkSafe and Health both apply to keep the documents hidden from the public.

Justice is something that must be done and must be seen to be done! But, goodness, with the Health prosecution there seems to be a lot happening to keep it ‘unseen’. We’re chasing this up and will update you after the 17 June.

Morrison’s dead flat small business pitch

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election-2022-pitchLast week Morrison made his pitch for the small business vote. It fell dead flat. That’s strange really.

It’s almost an Australian political truism that political parties cannot win government in Australia without a sizable chunk of the small business vote. So, for Morrison, who’s supposed to be ‘Scotty from marketing,’ his seeming blindness to this alleged truism is odd.

Morrison’s pitch was that by lowering overhead costs and energy bills he’d create a vast number of new small businesses. This pitch is not specific and applies generally to any business (or family) in the economy. There’s no ‘joining of the dots’ between the pitch and the lives of the self-employed, small and family businesses.

Again, it’s strange that Morrison has totally missed his small business target. The Coalition in fact has a substantial history of not only spouting the small business mantra, but of having substance to support the mantra as well. Take some examples.

John Howard created the Independent Contractors Act to protect the status of the self-employed. Tony Abbott committed to the introduction of a Federal Small and Family Business Ombudsman and put the wheels in motion for unfair contract laws for small business.  The Abbott-era commitments were finalised and delivered under the Turnbull coalition government.

Self-employed, small business people profile strongly on the measure of informed and swinging voters. They are extensive seekers of information. This again is why Morrison’s dead flat small business pitch seems so strange at this election.

At the 2019 election Morrison promised to introduce security of payment laws for small business. He’s done this. And it’s good. It’s strange that he’s not pitching it.

He also promised to ‘beef up’ unfair contract protections for small business people. The Bill was ready to go. But strangely this major pro-small business Bill was deserted immediately before the election was called. Did the ‘big end of town’ get to Morrison to pull the Bill?

Then there is the elephant in the room. The Australian Taxation Office has been crucifying small business. The ATO has destroyed small businesses in the research and development space—claiming dodgy use of grants—but the ATO subsequently admitted that it was wrong.

The ATO has been attacking small and family business trusts, forcing trust beneficiaries to pay tax when (even the ATO admits) the beneficiaries have not received any income. The ATO has also sought to change trust distribution rules retrospectively, thereby creating tax debts in the past where, under then-existing ATO rules, no tax debt existed.

In the 2021 Budget the Morrison government declared in Parliament that “We are backing small business in over the ATO. No longer will the ATO be able to garnishee and takeaway (alleged tax debt) while the dispute is in train”. But this promise turned out to be false. The implemented policy only enables small business people to ‘apply’ to have a disputed debt ‘paused’ until appeals have been heard.

Morrison’s pitch to create large numbers of small businesses falls dead flat if those new (and existing) small businesses find themselves under unfair attack from the ATO without the protections afforded by a rule of law regime.

To win and retain the small business vote the Coalition has historically made a policy of substance that it then delivers when in government.  This time Morrison is not selling what he’s done and not promising anything new for small business.

It’s almost as if Morrison has abandoned the small business vote. How odd!

Closing the construction watchdog will harm self-employed tradies

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Unfair contract laws

In March we praised the Morrison government for moving to ‘beef up’ the unfair contract laws for small business people. Albanese’s Labor also supports this, which is great. Unfortunately, the Bill did not pass through Parliament before the election was called.

Integrity Commission – ATO

Labor has made a big noise about Morrison failing to establish a Federal Integrity (anti-corruption) Commission. Here’s our assessment of the issues and politics of this. Morrison has a model, but Labor wants one based on the NSW Commission. The NSW Commission is, however, accused of being a kangaroo court that the High Court found breached the law. The Morrison model would, for the first time, make the ATO accountable to an external body. That’s a policy we strongly support.

Industrial relations

Last week Morrison announced he would move on some industrial relations reform. Labor attacked and Morrison quickly reversed his stance. Here’s our assessment of the politics around this issue. Essentially, we say that the ‘big end of town’ wants changes to suit themselves. But we reckon that the ‘big end of towners’ are incompetent in managing their workplace relations.

Construction Industry Watchdog

If there’s one Labor commitment that stands out, it’s that an Albanese Labor government will close down the Australian Building and Construction Commission (ABCC).  We see this as highly negative for self-employed people in the construction sector. We strongly oppose this Labor policy.

Here’s our longer assessment, but in summary:

  • The ABCC has brought some discipline to the mafia-like behaviour of construction unions. Over the last two years the ABCC has had the courts impose fines totalling some $5.7 million for illegal (thuggish) behaviour.
  • What’s extremely important is that the ABCC operates a Security of Payments system in the construction sector. It’s a vital service. All construction firms within the ABCC’s jurisdiction are required to pay their subcontractors within payment terms. If they are late, they must report this to the ABCC. Subcontractors can lodge complaints with the ABCC over late payment.
    If contractors do not pay on time, they risk sanctions that ultimately include being banned from all Commonwealth-funded work. Over around the last 5 years the ABCC has recovered some $10.7 million in outstanding payments owed to subcontractors. Some major contractors have been disciplined.
    An external review of the ABCC reports a “reduction in the number of delayed payments” and “greater efforts being made to pay subcontractors on time.” This is critically important.

There’s no doubt that should Anthony Albanese’s Labor win the election, one of its highest priorities will be the elimination of the ABCC. The outcome would be renewed, unrestrained thuggery on construction sites. Further, small business tradie subcontractors would again carry the risk of not being paid. A bad outcome for all except for the thugs.

(Disclosure: Ken Phillips is a member of the ABCC Security of Payments Working Group along with representatives from the ACTU and Building Industry Associations.)

We’ll produce more election assessments on issues for self-employed people over the coming weeks.

Confronting bullies in our own (Australian) backyard – Unfair Contracts

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bullyIn a world full of bullies, the ‘little’ person must have the power to stand up against aggressors. If bullies rule, our democracies, the rule of law, justice and fairness are simply empty, meaningless terms thrown around like useless confetti.

In Australia we are lucky to have a government and a parliament that are finally moving hard to stop big business bullies in their dealings with consumers and small business people.

There is a Bill before Parliament at the moment, ready to be passed, that gives real teeth to unfair contract laws. What might seem like technical change to obscure law known only to a few people is, in fact, a huge step for fairness in how the Australian economy works. Everyone is affected, even if few understand how.

Simply put, when this Bill becomes law:

  • It will be illegal for big business to have unfair contract terms in their standard form contracts with consumers and small business people.
  • Fines will apply to anyone who tries to push an unfair contract on to consumers/small business. (Up to $500,000 for individuals and $10,000,000 for corporations.)

The implications of this are massive. Businesses that want to screw over consumers and/or small businesses with unfair contracts will be forced to dump those contracts. (Think phone, internet, car and other equipment leasing, land sales and on and on.) This is a huge economic reform that will make for a fairer and stronger Australian economy. More people will be able to do business and buy things with real protections against unfair contracts.

For us, this journey started in 2009. At Self-Employed Australia we believe we played a pivotal role in making this happen—along with many others that we need to thank. The sequence of events was as follows:

A full timeline and details of the events is here.

There are many people to thank, reflecting the very best of the Australian parliamentary process and the public service:

  • The Abbot government committed to the laws for small business.
  • The ALP, Greens and Senate independents ensured that the laws had reasonable meaning.
  • SEA played a pivotal advocacy role to this point (2016) against opposition and dirty play by ‘big end of town’ types.
  • Rod Sims and the ACCC were champions in highlighting the weaknesses in enforcement and pushing for ‘beefing up’.
  • The Morrison government has worked through to ensure that the ‘beefed up’ laws are now before parliament.
  • The ALP, Greens and independents all seem clearly supportive of the new laws.

For the ‘big end of town’ lawyers who say that these laws break contract integrity, we reply as follows: The Unfair Contract laws embed or codify the ‘structural’ principles of commercial contract in statute. They ensure that standard form contracts have a measure of power balance such that they engender contract trust—that is, the contracts have integrity.

We do, however, have one major concern. Australian governments, state and federal, routinely break the unfair contract laws. They reckon they are exempt. And most often they are. We need all Australian governments to amend laws to hold government agencies accountable to the same contract laws they expect of the rest of the community.

There’s more work to be done.

ABC’s Dr Norman Swan says badly degraded Victorian Health capacity to blame

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norman-swanThe ABC’s Dr Norman Swan explains why Victoria did so badly with Covid in 2020. Watch his comments here (47sec): https://www.youtube.com/watch?v=x3h8mS-6VUM

Dr Swan says Victoria has

“… 88 different health services which don’t look after the population unlike most other states (the Victorian government)… long ago degraded … the public health capacity, and in 2009 they ran the white flag up … Dan Andrews was the Health Minister.”

This analysis by Dr Swan reinforces why we must proceed to push for the prosecution of the government and responsible individuals (Premier, etc.) over the 801 Hotel Quarantine deaths in 2020. If WorkSafe fails to do its job by prosecuting individuals, the degraded Victorian health system will continue to put people at risk. It’s unsafe.

Running parallel to Dr Swan’s comments is an analysis by a public administration academic who case studied the 2020 Hotel Quarantine program. His report Hiding in plain sight: Vulnerability, public administration, and the case of Covid-19 hotel quarantine sets out a table that shows all the actions and inactions of the government that led to the 801 deaths disaster. The paper says:

“The Covid-19 HQ Inquiry found that a series of actions and inactions surrounding decisions by politicians, practitioners, and policymakers with responsibilities for public administration portfolio areas gave rise to accidents which brought failures and subsequently a crisis into existence.”

“… the leadership and functional expertise at group as well as individual levels was unable to take meaningful action to ensure that the program was fit for purpose.”

However, the paper focuses exclusively on the notion that the disaster should be treated as a learning experience for public health administration. Some people might believe that no individuals need to be held to account to enable ‘learnings’ and change. Such a position would be plain wrong—even dangerous and unsafe in our view.

We see this attitude too often in public administration. The people who make the decisions (politicians and bureaucrats) are rarely held personally accountable for their decisions. The ‘blame’ is isolated and attached to the ‘system.’ But this is not the standard applied to business or the community. Small business people, in particular, are held personally accountable for every action they take. We say the public sector must be held to the same community standard.

This is why we say that Victorian WorkSafe is making things dangerously unsafe in only prosecuting the Department of Health and not the individuals who were the decision makers in the Hotel Quarantine disaster. Community standards of individual responsibility must be applied. No one is above the law.

More developments and news soon.

Tax bureaucrats try to sneak one through

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robertWho runs Australia? Is it the politically accountable politicians elected through the democratic process? Or is it the unidentified, unelected, bureaucrats who hide behind closed doors?

A situation happening now indicates that at least some Commonwealth bureaucrats think they run the country and democracy can go jump!

In the April budget last year, the Morrison government announced that the Tax Office would no longer be able to collect a small business tax debt while in dispute and under appeal. That’s a damn good policy move for tax fairness.

robertThe Small Business Minister stated in Parliament:

“We are backing small business in over the ATO. No longer will the ATO be able to garnishee and takeaway while the dispute is in train …”

A recording of the Ministers statement in Parliament can be viewed here  (23 sec)

A key job of the Commonwealth Treasury department is to draft legislation that puts government policy into effect. Last week, nine months after this very clear policy statement, Treasury released draft legislation that does the opposite of what the government promised. (See here and here.)

The draft legislation would not automatically stop the ATO collecting on a disputed debt. It would force a taxpayer to apply to the Administrative Appeals Tribunal (a very expensive process) for a pause. And a taxpayer would have to prove that their application did not “restrict …administration of tax law…” In our view this is a sneaky bureaucratic way of killing off the Morrison government’s attempt at small business tax fairness.

Yesterday we lodged a submission condemning the draft law and calling for it to be put in the trash bin. Here’s our submission (3 pages).

Robert Gottliebsen in The Australian took the same view with the headline ‘Tax bureaucrats try to sneak one through.’

Why ‘sneaky’? The draft legislation was released for ‘consultation’ on 12 January, smack bang when most people are on holidays, and during the height of the Djokovic mess and while the government was/is handling supply chain and other Covid ‘crisis’ issues. And Treasury has given only seven days for responses. The draft legislation is short and tax bureaucrats have had nine months where they could have done something. Looks sneaky? Probably is sneaky!

We’ve said in our submission:

The job of Treasury is to faithfully draft legislation that accurately reflects the government’s policy intent … we submit that this draft legislation undermines the government’s policy intent and the process of democracy in Australia.

We’ve made it clear what the legislation should look like.

Normally we admire the professional integrity of the Australian public service and their respect for the democratic process. This situation is a dark smudge on that professional integrity.