• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Home
  • Content Disclaimer
  • Contact Us

Self Employed Australia

"Everyone needs an Advocate"

“Everyone needs an Advocate”

  • Current Advocacy
    • Reforming the ATO
    • Fair Contracts
    • Fixing Disputes/Prompt Payment
    • The ‘Gig’ Economy
  • Past Advocacy
    • Submissions
    • Defending ABN Contractors
    • Work Safety
    • Independent Contractors Act
    • Owner-Drivers
    • International Labour Organisation
    • Independent Contractors: How Many?
  • SEA Submissions
    • Submissions
    • Independent Contractors: How Many?
  • NotAboveTheLaw
    • Robodebt
    • Hotel Quarantine 2020
    • Chemical Fire 2019
  • Be Your Own Boss

Search Results for: Morrison unfair contract laws

Annual Report 2021

1. Overview

In our annual report last year we remarked that it is a huge understatement to say that at our 2019 AGM in October no-one could possibly have predicted the events of 2020. Well, again, 2021 has proven to be a continuation of that understatement.

What has perhaps been the greatest and most concerning discovery is that of the thin line between democracy, the rule of law, and the authoritarian overreach of government by democratically elected leaders acting as dictators. Victoria has been the place of most concern. Of course the authoritarian cause has all been in the name of ‘saving lives’. But what has also occurred is that respect for, and adherence to, the rule of law by those who rule over us has been fundamentally trashed.

Whatever the justification for their authoritarian rule, the people most hurt and damaged during 2021 have been, and continue to be, small business people. Think of retailers, tourism operators, restaurateurs, hairdressers, gyms and personal trainers. The list goes on. While governments lavish pay-rises on public servants, the support for small business people is by comparison a pittance, yet they must still pay interest on their loans and a long list of government charges—including rates and land taxes for example.

SEA cannot do anything about these bigger issues but what we can do and have done is maintain our focus on seeking to achieve practical public policy outcomes that will give self-employed, small business people a fair go in these difficult times.

2. Finances

As a volunteer not-for-profit organisation, our finances have always been tight, but as of our October 2021 AGM, the financial position is strong. While many members have understandably had to cut back their support for us, our enlarged membership has meant that support is more widely spread.

3. Membership

SEA membership across all our categories is up significantly. In particular, the campaign membership category has grown.

4. New Website

Our new website was finally completed and was launched on 5 August 2021. Our great thanks to our web manager for the hard and expert work to achieve the outcome.

5. Social Media

For a small association that focuses entirely on public policy our website traffic remains strong.  It fluctuates from month to month depending on our campaign activities. During this year unique viewers in any month ranged from a high of around 14,000 from a base of around 4,000.

The most notable traffic has been related to our campaign to require prosecution of the Victorian government for breaches of work safety laws with respect to the hotel quarantine mess in 2020.

6. Activities of our Executive Director—Ken Phillips

Ken’s activities on behalf of SEA over the last 12 months have included:

  • Writing regularly for Spectator
  • With travel restrictions the face-to-face advocacy work has had to be curtailed. However trips included:

Canberra 22-24 March – meetings with Government ministers, Lib/Nat backbenchers, Greens, ALP shadows and backbenchers, One Nation. Mainly advocating for reform of the ATO.

Sydney & Canberra 26-31 May, meetings with:

  • Chris Merritt – Australian Journalist – Director, Rule of Law Institute.
  • SEA members in Sydney.
  • Inspector-General of Taxation.
  • Director of the Rule of Law Education Centre.

Canberra Senate Estimates on ATO:

  • ALP, One Nation, Minister Tudge adviser, Ben Morton MP, Senator Eric Abetz, Senator Ben Small, Jason Falinski MP, Minister Michaelia Cash adviser.

Some other online meetings have included:

  • Australian Competition and Consumer Commission, 21 May.
  • ATO consultation Employer v Contractors, 21 May.
  • Australian Building and Construction Commission, 24 June.
  • TaxPayer Rights organisation Washington, 23 June.
  • Senate Select Committee on Insecure Work, 27 July.

Policy Issues

SEA’s primary interest is to argue for reform to regulations (and regulators) in terms of how they treat small business, self-employed people. These are always long-term campaigns and the current campaigns are as follows.

7. Commonwealth Integrity Commission

The introduction of a Commonwealth Integrity Commission is a Morrison Government election commitment. A draft discussion Bill is available and SEA has been involved in providing feedback on this. Our main interest is to ensure that the ATO would be subject to the reach of the Commission. Currently if there is a complaint about corruption inside the ATO, the complaint is handled entirely internally within the ATO. This is unacceptable.

8. Unfair Contract ‘beef-up’

SEA campaigned for seven years to achieve the unfair contract laws that are currently in place (started 2016). The current Act probably achieved about 70 per cent of what we sought. After five years of the existing law it is now being ‘beefed up’ and we are very pleased with the new proposals. The new Bill is strong and important.

The Bill’s key features are:

  • Applies to consumers and small business.
  • Expands the definition of small business. To apply to businesses up to 100 full- or part-time employees (excludes casuals) or less than $10m in turnover. Currently only 20 employees.
  • No limit on the value of the contract (currently restricted to contracts of up to $300K).
  • A ‘standard form’ contract is one if the contract has been used before.
  • If minor changes have been made to a contract in negotiations this does not stop the contract being ‘standard form.’
  • Imposes fines for breaches (up to $500K for individuals). There are currently no fines.
  • A person breaches the law if they propose to use or seek to apply an unfair clause.
  • Multiple unfair clauses create multiple breaches.

We are keen to see this Bill passed as soon as feasible.

9. ‘Pay on Time’ Report

Probably the single most important issue for small business, self-employed people is being paid on time. The Morrison Government made an election promise to introduce new regulations to improve payment on time. These have now largely been implemented. There are three key elements as follows:

  1. The federal government requires federal departments to pay their small business suppliers within 20 days—this has been implemented and we congratulate the government on this.
  2. A register has been established for large businesses to report their payment times to small business. This has been established and is going through the implementation phase.
  3. Large businesses that supply services and goods to the federal government have to pay their small business suppliers on time or lose access to government work. This is in the process of being implemented in line with the payment register.

10. ATO reform to require fair treatment of small business people

We have a highly detailed ATO administrative reform program that we are pushing for implementation. The program is based on US laws covering the administration of the US Internal Revenue Service. We launched our agenda on 29 October 2020.

In broad summary, we’re advocating to implement legislation so that:

  • A Taxpayer Bill of Rights guides tax administration.
  • The Bill of Rights is supported by a Taxpayers Rights Code.
  • A Taxpayer Advocate is charged to ensure implementation of the Taxpayer Bill of Rights and

Key reforms under the Taxpayer Bill of Rights to include:

  • The ATO to have the onus of proof of a tax debt.
  • An ATO-assessed tax debt is not a collectable debt at law until all appeals have been exhausted/finalised.
  • A genuine, stipulated independent review process inside the ATO.

We are promoting the reform program across the political spectrum in Canberra. Naturally, the incumbent government is our first focus, but we have also had discussions with the alternative government.

Some of the advocacy activities have included:

  • Working with the Parliamentary Tax and Revenue Committee Report. They have a major report pending.
  • Meetings with the Assistant Treasurer, Attorney-General, Small Business Minister, the appropriate Labor Shadow Minister and Senate independents, the Inspector-General of Taxation, Small Business Ombudsman and others.

There have been several important legal tax cases that we have followed as these go to the heart of how the ATO administers the tax act. These cases include the ‘Gold’ case which the ATO comprehensively lost in the High Court, and other related cases.

The Inspector General of Taxation has produced several important reports. For example, ‘When is the Commissioner of Taxation required to give a taxpayer reasons? Answer is, ‘almost never’ and  ‘Understanding a Taxpayers Rights’ which shows that taxpayers have few, if any, legislated rights

11. Independent Contractor Status

We find again that it’s necessary to work to defend the right of self-employed people to be self-employed.

  • The Victorian government has a policy that would effectively outlaw self-employment. This poses a real and present threat and we are campaigning against this.
  • Uber Eats—a decision in April 2021 by the Fair Work Commission found that Uber Eats uses independent contracting.
  • The NSW parliament is holding an inquiry into the ‘gig’ economy.
  • The Federal Senate is also holding an inquiry into the ‘gig’ economy. SEA Executive Director Ken Phillips gave evidence to the inquiry.

12. Victorian OHS campaign

This is proving to be one of the largest and most intense campaigns that SEA has ever run.

Our objective is to have the Victorian government and named  individuals in the government prosecuted for breaches of work safety laws over the Hotel Quarantine mess in 2020.

Just some of the activities have included:

  • Several waves of social media campaigns including paid social media adverts.
  • Three lots of radio advertising campaigns—April (three weeks), June (three weeks), Sept/Oct (three weeks).
  • Tv advert launched on 26 September on Channel 9 news slot for three weeks.
  • Many TV, radio appearances and news articles.
  • ‘Not unprecedented’ document.
  • ‘Case for the prosecution’ document.
  • Lots more…

Australian unions see flying ‘gig’ pigs landing from the UK

You may have seen reports that the UK’s top court has decided that Uber drivers are not independent contractors. Australian unions are excited by this. The UK decision seems to support the unions’ campaign against the gig economy. And it gives the appearance of international support for Federal Labor’s anti-gig (anti-small business) policy announced earlier this month.

However, sorry to disappoint the small business-haters in the unions and Labor, but the UK’s decision has no relevance to Australia. The Australian unions’ media campaigning and lobbying is political spin. They are hoping to create similar UK laws in Australia.

The facts in Australia are that Uber drivers have been declared to be independent contractors by:

  • Australia’s industrial relations independent umpire, the Fair Work Commission in 2017.
  • The Fair Work Ombudsman in 2019.

And last year (2020) the FWC declared that Uber Eats delivery people are independent contractors. In this 2020 decision the Commission looked at the UK law above and stated that its irrelevant to Australia. Here’s why.

In Australia we have a clear method for determining whether someone is an employee or independent contractor. We use the well-known common law tests which identify whether there is a commercial contract or an employment contract. All independent contractors (self-employed people) earn their income through a commercial contract. This fact is further locked in under Australia’s Independent Contractors Act 2006. It protects the right of people to be their own boss.

The UK is the historical birthplace of common law, which it also uses to distinguish an independent contractor from an employee. But after the UK joined the EU in 1973, the UK became ‘infected’ by concepts of ‘rights’ law. In 1998 the UK created three integrated statutes which say that even if you’re an independent contractor you can still have access to some employment ‘rights’ such as a minimum hourly rate and holidays. This is the ‘little bit pregnant’ idea. The UK statute says that someone working under a commercial contract can be a ‘little bit’ an employee.

This is the statute that has been ruled upon by the UK Supreme Court last Friday in the Uber case. The ruling explains this (see highlighted sections 34–36). The Uber case started in 2016 with a decision by the London Employment Tribunal. The Supreme Court affirms the London Tribunal decision that even though Uber drivers are independent contractors at common law, they can receive some employment ‘benefits’ under the ‘little bit pregnant’ worker rights statutes.

Unions, anti-gig academics and so on are delighted. They hope to see this spread globally.

Certainly this will give extra impetus to the spread of the Californian AB5 self-employment destruction laws across the USA. President Joe Biden backed AB5 in 2020. The Democrats plan to take this nationally under their ProAct law that will likely pass Congress soon.

But here’s the counter-reaction. Free market economies depend on certainty under law. Create uncertainty and economic behaviour becomes distorted.

The UK has made, and is making, a mess of its treatment of self-employed people. Self-employed UK people have been treated as economic trash during the Covid crisis, receiving little if any income support. For 20 years the UK tax office (HMRC) has been trying to stop the self-employed from having business tax rights. It reached a crisis last year under UK budget rulings. The Uber decision now throws massive uncertainty into commercial contract law. The unknown risks of business in the UK rise massively.

Both the Uber decision and the new UK tax laws have no jurisdiction over the contracting party or the independent contractor if either reside outside of the UK. The pressure is on for UK businesses to move as much of their flexible, commercial, contractor dependent business activities out of the UK. We expect to see a surge of this over the next 18 months.

Following the 2008 global financial crisis, the UK re-built its jobs numbers substantially on the back of a surge in self-employment reaching around 4.8 million in 2017. Now, following the Covid and tax mistreatments and the new illogic around self-employment legal status, we can expect this UK jobs and economic growth trend to collapse.

Fortunately, in Australia since around 2006, we’ve developed policies to support and ‘protect’ self-employed people and treat them with respect. This has included the same access as employees to the federal parental leave scheme (2010), JobKeeper and JobSeeker (2020) and the introduction of unfair contract laws (2016) and their planned ‘beefing up this year. Also, this year the full pay-on-time laws for small business should pass.

This is what should occur. We don’t ‘protect’ people by destroying their small business. We don’t ‘protect’ people by stopping larger businesses doing business with small businesses. That’s what’s happened in the UK and California and what’s planned for across the USA.

We ‘protect’ small business people by giving them access to a practical commercial ‘rule of law’ environment, backed by sensible access to social security support where needed. This creates a stronger economy with small business at its core. Let’s hope that the UK small business destruction disease doesn’t spread to Australia.

Memo to Big Business: You owe money. Pay up! It’s that simple

Summary of what’s going on

February 2020

Big businesses have been screwing their small business suppliers for a long time. It’s been a money making ‘sport’. That is, they screw small business people on payment terms as a cheap way of funding their big business empires! In the process they stuff up the heartbeat of the economy—the small business sector. But do big business care? Nah! All that matters to the big business decision-makers is the bonuses they receive as executives!!!

Are we too harsh? We think not! We’re just being realistic about big business behaviour based on the evidence. But, fortunately, it’s now become a big issue.

In this summary we explain what’s been going on lately. We cover:

1. Big business being bad

1.1 CIMIC (construction)
1.2 Telstra
1.3 Rio Tinto

2. Business Council of Australia—Supplier Payment Code—A Joke

3. The Regulators

3.1 Australian Building and Construction Commission
3.2 Australian Consumer and Competition Commission
3.3 Small Business Ombudsman

4. Is Government paying on time?

5. The politicians

5.1 Labor Party
5.2 Morrison Government
5.3 One Nation
5.4 Centre Alliance

6. What’s next? Let’s act

1. Big Business being bad

1.1 CIMIC—Pay late—“Reverse Factoring”
CIMIC is the big construction player. It’s 73 per cent foreign owned (German/Spanish). Current billion dollar government jobs that it’s working on include Melbourne’s Metro Trains and Brisbane’s Cross River Rail projects. In September 2019 CIMIC announced that it would start delaying payments to suppliers by at least two months extending payments to 65 days from date of invoice.

But they are not doing this in New South Wales which had brought in laws requiring payment in 20 days.

For work not conducted in NSW, CIMIC is telling its small business suppliers to go to a finance company, Greensill Capital,  who will lend them the money that CIMIC is now not paying them. This neat trick is called “reverse factoring”.

CIMIC has reportedly achieved an additional $1 billion in cash flow by increasing its payments from 135 to 159 days. Ultimately this $1 billion into CIMIC’s pocket will come out of the pockets of small businesses. Somehow this CIMIC ‘trick’ has avoided the government rules in construction requiring on-time-payments. And get this! CIMIC is funding a big share buy-back.

But more! The most recent report (February 2020) is that CIMIC has just made an after-tax loss of $1.04 billion and the CEO has stepped down. What a mess.

We know what often comes from such messes. Too often large firms collapse and small business suppliers then ‘get it in the neck’, losing big money they can’t afford. Is CIMIC in financial trouble? Who knows! But how many small business suppliers can afford to take the debt risk on CIMIC? The reverse factoring ‘scam’/scheme needs to be squashed.

But CIMIC isn’t the only one and it’s not just the construction sector.

1.2 Telstra
In early January 2020 the news broke that Telstra was up to the same ‘reverse factoring’ trick as CIMIC. It’s effectively pushing payment terms out to 90 days in many cases and has offered introductions to a finance company that would lend the small business suppliers the money that Telstra isn’t paying. Telstra was boasting that this would improve Telstra’s bottom line. After securing some 74 suppliers to the scheme (scam?) Telstra reported that it had ‘opened up’ $500m in ‘free cash’ and ‘liberated’ $3.5 billion in spending.

But by the end of January Telstra had supposedly dumped what it called its ‘supplier payday lending scheme’ following community and supplier outrage! See here and here. But then this news. On 6 February Telstra’s CEO was reported as saying that its ‘supply chain financing’ could be a good thing!

So, what are we to believe? Is it simply that big companies dump this sort of ‘screw-over’ process when the political heat is intense? And then wait and sneak such stuff back in when the political heat backs off?

‘Yes’ is the answer because we’ve seen this before. Look at mining giant Rio Tinto.

1.3 Rio Tinto
In late January 2020 Rio Tinto was exposed as demanding that its 10,000 suppliers take a 2% cut to bills if they wanted to be paid in under 30 days. Rio called this its ‘dynamic discounting scheme’.  The reaction was swift and angry from regulators (ACCC) and politicians. Within days Rio had backed off and dumped its ‘dynamic discounting’ scheme.

The thing is, we’ve seen this Rio Tinto small business ‘screw’ on-off game before.

In April 2016, Rio tried the same trick by extending payment terms to small business suppliers from 45 to 90 days. The political heat from the then Western Australian Premier resulted in Rio in backing down.

2. Business Council of Australia—Supplier Payment Code—A Joke

The Business Council of Australia is the official ‘voice’ and lobbyist for Australia’s biggest businesses. In May 2017 the BCA created its voluntary Supplier Payment Code. According to media reports the Code was created to ‘avoid legislation’ that would have forced large businesses to pay small business suppliers on time.

In June 2017 we attacked the BCA Code on the basis that it had no independent enforcement mechanism. That is, that signatory companies could ignore the Code. We said that the BCA Code ‘is more a public relations play than substance’. And our assessment has now proven accurate.

Over 120 big businesses have signed up to the Code. This is less than half of the BCA’s membership as we understand it. The signatories include Rio Tinto and Telstra. And the behaviour of these two companies alone makes a mockery of the BCA Code.

In December 2019 we attacked the BCA Code in the Australian Financial Review, calling it a ‘public relations game’. We said “If the BCA’s voluntary code was serious, they would have a dispute resolution clause in there so if [companies] don’t pay on time, or there is a dispute over invoicing or whatever it is, there is an independent body to review it, which should be the small business commissioners.”

Funny, a planned meeting for that day between the BCA and SEA was cancelled by the BCA!

3. The Regulators

3.1 Australian Building and Construction Commission
The Australian Building and Construction Commission has a controversial history. Its task is to bring the ‘rule of law’ to the construction industry. The current structure of the ABCC began in 2017. A key focus is on having construction subbies paid on time. If big construction players don’t pay on time, they can be denied federal government contracts. It’s a big commercial ‘stick’.

SEA Executive Director Ken Phillips is a member of the ABCC Security of Payments Working Group. The Group meets quarterly and monitors the ABCC enforcement of on-time payments requirements to construction subcontractors. The ABCC publishes its reports. As a result, SEA has significant knowledge of pay-on-time issues and enforcement in the construction sector.

Ken Phillips’s observation is that the ABCC is making a difference. Large construction firms are reporting if they are late in paying, the ABCC is investigating and payments are being fixed. The fear of losing or being denied federal government construction contracts is focusing the attention of construction firms in paying on time.

BUT. There are loopholes in the law. As explained above, CIMIC, the largest construction business in Australia, is exploiting those loopholes.

Recently the ABCC has been ‘beefing up’ its compliance activities. The head of the ABCC has released a short video explaining its enforcement activity.

It has issued a warning that companies risk being denied government contracts. It cites the example of one construction company which was prevented from tendering for federal government work in May 2019. We haven’t yet seen an explanation as to how CIMIC seems to be getting around the ABCC rules. (see above)

3.2 Australian Consumer and Competition Commission
In October 2019, after prompting from the Labor Party, the Australian Consumer and Competition Commission began an inquiry into ‘reverse factoring’.

The head of the ACCC is quoted as saying, “This whole system looks like it’s a large player in a very dominant position taking advantage of that position to the disadvantage of small players.” See here for the ALP’s media releases.

The inquiry is currently ongoing.

3.3 Small Business Ombudsman
The big news has been the release of a Position Paper by the Small Business Ombudsman on ‘Supply Chain Finance’ (7 February 2020).

The Ombudsman, Kate Carnell, has attacked the BCA’s supplier Payment Code, calling for it to be scrapped. The Ombudsman echoes our view of the BCA Code (see above) as being useless, saying “There is no compliance monitoring and it’s actually unenforceable”.

The Position Paper has called for major reform including:

  • Scrap the BCA Code and replace it with a Commonwealth process that is enforced.
  • All suppliers (big or small) should be paid within 30 days at minimum.
  • Accounting processes should prevent manipulation of cash flow issues. (For example, pretending that an invoice was incorrect to avoid paying.)

The Ombudsman is undertaking further consultation pending final recommendations.

4. Is Government paying on time?

In good news:

  • The NSW government is now (2020) paying small business invoices under $10,000 immediately and other small business invoices within 5 days.
  • The Federal government started paying small business invoices within 5 days using their PCards—a government credit card used by public servants, and
  • Federal agencies have been ordered to pay interest if they exceed the 5-day payment requirement.
  • In Western Australia, the Premier jumped on the state government’s Water Corporation when it was revealed that the Corporation was charging small business suppliers to pay their bills within 28 days. The Premier ordered the Corporation to stop this behaviour.
This is exactly the sort of action we expect to see from governments and we congratulate them on this. Governments at all levels, state and local government included, should be under pressure to do the same.

5. The politicians

5.1 Labor Party
The ALP has been on top of this big time. The Shadow Minister for Small and Family Business, Brendan O’Conner, has attacked Telstra and asked the ACCC to investigate ‘reverse factoring’.

Since October 2019 at least, the Labor Party has been putting real pressure on the Morrison government to act and act fast. See here for the ALP’s media releases. It has slammed big business for delaying payments to small businesses and using ‘reverse factoring’ schemes, calling the process a ‘Rortocracy’.

5.2 Morrison Government
The Morrison government recognized late payments to small business as a major issue that needed fixing in February 2019. The first move was to commit federal departments to pay small businesses within 20 days by July 1 2019 and then moved to payments within 5 days. (See above) and here.

The February 2019 undertaking initiated a consultation process under the government’s Payment Times Reporting Framework. The latest report on the consultation was released in November 2019.

Essentially, the ‘Framework’ involves the government setting up a public reporting system where large businesses will have to report their payments to small business. It’s really a ‘name and shame’ process.

By the end of January 2020, however, following the exposure of CIMIC, Rio Tinto and Telstra’s behaviour (see above), reports surfaced that Small Business Minister Michaelia Cash threatened Telstra with the loss of millions of dollars of contracts for its late payment behaviour. The government’s objective seems to be to have small business suppliers paid within 20 days. More detail is needed, but any legislation looks like being delayed until late 2021.

5.3 One Nation
The Senate is important. One Nation has two key Senators. One Nation’s 2019 election policy called for payment times to be written into law along with penalties for companies that ignore the law. It stated that voluntary codes such as the BCA’s are no longer acceptable.

5.4 Centre Alliance
Centre Alliance also has two key Senators. Senator Rex Patrick blasted CIMIC over their 65-day payment terms saying that CIMIC has undertaken a “material breach of their social licence” (7 February 2020).

He said that Centre Alliance would move to fast-track legislation requiring companies to pay their suppliers within 20 days. He said “They (CIMIC and its subsidiaries) should not be treating subcontractors and mum-and-dad families as banks”.

6. What’s next? Let’s act

The evidence is that big business will only pay small business if they are forced to do so.

Tough laws are needed.
The key is commercial pressure.
If a big business doesn’t pay small businesses on time, all levels of government must refuse to have any commercial dealings with that business. This needs to be backed by legislation.

That has to be the focus of a grass roots small business campaign.

Annual Report 2020

1. Overview

It is a huge understatement to say that at our 2019 AGM in October no-one could possibly have predicted the events of 2020. Not only has Covid-19 produced a global health crisis, it has also triggered arguably the greatest economic crisis since the 1930s’ Great Depression!

But also of heightened concern is the discovery of the thin line between democracy, the rule of law and the authoritarian overreach of government by democratically elected leaders acting as dictators. This has been on display to a scary degree in Victoria. It is, in essence, a huge shock to the collective psyche that, in the name of ‘saving lives’, respect for and adherence to the rule of law by those who rule over us should be so trashed.

2. Departures from the board this year—Our great thanks

We ‘lost’ two very valuable members from our board during the year—both due to health circumstances. Our many thanks to Peter Murphy our retired Chairman who had provided valuable guidance and considerable research ‘grunt’ to our efforts. Also, many thanks to Graham Schorer—a very long-term supporter and valuable board member.
A great loss to SEA.

3. Finances

As a volunteer not-for-profit, our finances have always been tight but as of our October 2020 AGM the financial position is strong.

When the Covid crisis hit in March we immediately cut expenses. Our thanks to our network of service providers who’ve taken these cuts ‘on the chin’ with great understanding. Conversely, we had a number of our long-term supporters having to cut their support dramatically. We well understand this and thank them for the support that they can provide. From around August 2020, however, we’ve had a surge in support from small businesses as well as particularly significant numbers of individuals joining as ‘campaign members’. This has resulted in a solid financial position as of the October AGM. We intend consolidating on this, as in these uncertain times we must be cautious about the future.

4. Membership

SEA membership across all our categories is up significantly on last year by around 60 per cent.

5. New Website

Our existing platform provider Adobe is closing down the platform in 2021. This has forced us to develop a new website on a new platform. Considerable time and money has been allocated to investigating options, planning and progressing. A new website is under construction with an anticipated launch in late 2020/early 2021.

6. Social Media

Our website has traditionally attracted around 3,000 unique visitors a month. This has increased dramatically to around 9,000 as of September 2020. In addition, our Facebook traffic has increased dramatically by around 400 per cent as of October. These traffic increases have been generated by the following campaigns:

  • The provision of easy-to-understand information and analysis on the Jobkeeper and related Covid support packages for the self-employed.
  • Our campaign to alert people to the Victorian government’s plans to make self-employment illegal.
  • Our activity to require prosecution of the Victorian government for breach of work safety laws related to the to the hotel quarantine mess.
  • Our ‘Put Labor Last’ campaign for the Victorian council elections in October.

7. Activities of our Executive Director—Ken Phillips

Ken’s activities on behalf of SEA over the last 12 months have included:

  • Washington DC research trip over 2 weeks in October 2019. Investigating laws covering the operations of the IRS. Ken has produced a 50-page report on recommendations for reforming the ATO.
  • Federal Parliament visits advocating on a variety of issues—
    • 26–27 October 2019
    • 24–26 February 2020
    • 24–26 March 2020
    • Visits stopped due to Covid
  • Meetings with Victorian state MPs, November 2019.
  • Australian Building and Construction Commission. Security of Payments Working Group. 4 meetings during the year.
  • Meeting with Inspector-General of Taxation, 13 December 2019.
  • ACCC, 13 January 2020.
  • Federal ALP consultations.
  • Federal Coalition consultations.
  • WA Small Business Ombudsman consultation on ‘pay on time’ issues.
  • Appearance at hearings of the Federal Parliamentary Tax & Revenue Committee hearing, 26 June 2020.
  • Presentation to the Monash University Tax Law Research Group on ATO reform issues, 23 Sept 2020.

8. Policy issues

Our focus is on achieving positive public policy outcomes for self-employed people. That means pushing for laws that give self-employed, small business people a fair go in their business activities.
Lists of our submissions on issues is here.

Our focus during 2020 is as follows, with most of these campaigns having long lead times to achieve success. Some activities and submissions, etc., are shown below around key policy objectives we are pushing:

Reforming the ATO. See here.

  • Submission to the review of ATO policy on Personal Services Income Tax laws.
  • Submission to, and appearance before, the Tax and Revenue Committee review of the ATO’s 2018-19 report.

Pay on Time. See here.
Being paid on time rates as a top priority for small business people. The Morrison government has implemented 2 parts of their 3-part election promise on this issue.

Unfair Contract laws ‘beef up’. See here.
We strongly support proposals to make the unfair contract laws for small business stronger. We’re calling on the Morrison government to move quickly with these changes.

Protecting the Right to be Self-employed—Common law
There’s a concerted attempt in Victoria to create laws that would make self-employment illegal. The legal ‘trick’ sought is to dump common law and create a different definition.

We’ve seen this done in California in January 2020 and it has decimated the self-employed in that US state. We are campaigning to stop this happening in Australia. See issues around the gig economy here and here.

Work Safety Issues
We’re campaigning to have the Victorian government prosecuted under work safety laws for breaches of the Act over the hotel quarantine mess. Detail and explanation is here.

This is hugely important, not just for self-employed people, but for the entire Victorian and Australian community. Our legal advice is that the evidence is overwhelming that breaches of work safety laws by the Victorian government require prosecution. The courts will decide guilt or otherwise. But if prosecution does not occur, the entire work safety system effectively collapses. There cannot be one rule for the ruled and a different rule for the rulers.

Annual Report 2019

October 2019

This report summaries the activities of Self Employed Australia (Independent Contractors Australia) for presentation to members at the Annual General Meeting to be held on 17 October 2019.  In all, another very busy year.

Prepared by Ken Phillips, Executive Director.

1. Board

Norman Lacy retired as President of ICA after nearly a decade in the position. We held a ‘thank you Norman’ dinner and presented him with our first Lifetime SEA membership. Peter Murphy took over as President in November 2018.

2. Financial

ICA is managed by a Board, all members of which are volunteers. We raise around $100,000 a year. All money is spent on our website, social media, membership services and public policy advocacy work.

3. Social media

Our website averages around 2,500 unique visits a month. Our Facebook page has 1,400 followers and 1,300 likes. Both the website and our Facebook page experienced high levels of activity during the May federal election period. (More detail below.)

4. Members-only newsletters

In 2018 we Initiated a members-only newsletter targeted as a quarterly report to members.

5. Launch of National Bricklayers Australia

In early 2019 we were pleased to form a special membership category for Australia’s bricklayers following approaches from bricklayers themselves. The group is headed by Jason Mills—a bricklayer himself who now sits on our Board. Moving forward, we’re developing support services for bricklayers—particularly in relation to contract management and being paid on time.

6. Transcriber Industry

Transcribers have been particularly targeted by the ATO, with systemic denial of ABNs to self-employed transcribers working through the company Outscribe. We can report that, after a two-year effort, the ATO has finally withdrawn its activity against these people.

7. Assistance to members

In the last 12 months we have provided assistance to about 26 members in addition to the three significant tax cases discussed below. The assistance related to:

  • People behind in tax lodgements. These have been referred to our networked accountants: Your Business Angels.
  • Concerns over contract terms, how to negotiate a contract and how to manage a dispute. Each of the cases were highly specific to people’s unique circumstances.

8. ATO cases

Rod Douglass case

We supported Rod as he took his case to the Federal Court in 2019. The issue at stake is whether, as an IT contractor, Rod passed the ‘results test.’ The legal issue related to an interpretation of what constituted ‘custom and practice’ in the IT sector in which Rod worked. Unfortunately he did not win in the Federal Court.

Peter Fortunatow Case
Peter’s case was heard in the Federal Court with a decision handed down in August 2019. The legal issue is over whether Peter’s LinkedIn activity constitutes ‘advertising’ for the purposes of the Personal Services Income Tax laws. The Federal Court ruled in Peter’s favour—that is, that LinkedIn activity is advertising and Peter’s advertising reached end user clients. We’ve been supporting Peter in his defence efforts against the ATO since 2015.

Linh Nguyen Case
We assisted and supported Linh in his appeal through the new ATO internal ‘independent’ appeals process. The outcome, we believe, was most fair both for Linh and the ATO.

9. ATO—Rules for the Rich

In September 2018 we released our major 24,000-word investigative report into the ATO amnesty for high-wealth individuals who had large sums of money hidden in overseas bank accounts. We believe the amnesty should be subject to an independent investigation. We assess that somewhere between $1.8 and $4.3 billion in unpaid tax has been ‘gifted’ to high-wealth individuals by the ATO through the amnesty. We have called for the ATO internal corruption investigation unit to investigate, along with the Federal Integrity Commission. Both have rejected our approaches.

Our report has been downloaded 1,200 times and has generated 13,000 Facebook reaches.

10. ATO—Reform Agenda

We have a vision for the reform of the ATO and are advocating strongly and persistently for that reform. Our current focus is on advocacy in the Australian Parliament which includes discussions with the government, the opposition and independents.

Our Reform objectives are as follows:

1. Split ATO into two Authorities:
• Collection and auditing body (ATO)
• Objections, appeals & prosecutions under the Attorney-General.

2. Small Business Tax Tribunal

3. ABN registration: Major review
• Unilateral ABN denial/withdrawal to be removed. Appeal before denial.

4. Garnishees and Fraud & Evasion
• Judicial approval required for ATO to take action.

5. R&D grants
• ATO removed. Department of Innovation, Industry and Science only. Cash grant not tax rebate.

6. Compensation for ATO wrongs
• Remove from ATO. Independent assessor.

7. ATO independent probe into Project Do it
• Suggest Federal Police or Law Enforcement Commission to investigate.

8. Suspend expansion of ATO powers
• Halt Black Economy Bills until ATO is reformed.

Small Business Tax Tribunal
We were enormously impressed by the fact that, in March 2019, the Morrison government actually managed to set up the Small Business Tax Tribunal. They did this through a regulatory process. We are now advocating to have the Tribunal locked down through legislation.

11. Block ATO power expansion

The ATO has an extensive agenda to expand its powers. These power extensions, we believe, pose great risk to the rule of law and to core aspects of a properly functioning democracy. We are seeking to stop legislation which extends the ATO’s powers wherever those new powers lack transparency and/or proper independent oversight.

As of September 2019, there are two Bill before the Parliament which we oppose:

a) A Bill that would fundamentally change GST administration and which would enable the ATO to estimate GST liability instead of assessing it, impose GST liabilities on directors and, at the ATO’s whim, withhold GST refunds.
b) A Bill that would enable the ATO to report tax debts to credit rating agencies where the ATO debt assessments could not be guaranteed to be accurate.

12. ATO—Regular Parliamentary advocacy

We are committed to undertake visits to Federal Parliament during every sitting session to promote our ATO reform agenda.

13. ATO—Whistleblower

We put a great deal of effort into promoting crowd-funding support for Richard Boyle, the ATO whistleblower. We’re pleased to say that $140,000 has been raised for Richard’s legal defence. Richard is facing 161 years in jail following his blowing the whistle on ATO breaches of garnishee procedures.

14. International Tax Perspective

To strengthen our ATO reform advocacy we are building an international network and knowledge base of tax administration issues.

World Taxpayers Conference
In May we attended the World Taxpayers Conference held in Sydney. It was a great opportunity learn about tax treatment of small business across the globe.

UK
In early August 2019, SEA Executive Director Ken Phillips spent a week in London networking with tax lawyers, industry groups and others on the tax issues confronting UK small businesses. There are a lot of lessons to be learnt for Australia.

USA
In July 2019, the US Congress passed the Taxpayers First Act. It is ground-breaking law that imposes on the US tax collector (the IRS) procedures to protect small businesses and others from IRS abuse.

In late October 2019, SEA’s Executive Director will spend two weeks in Washington DC on a research project on the Taxpayers First Act. The aim is to bring back a report which can be presented to the Australian Parliament as the basis for similar reform to the ATO.

15. Federal Election May 2019

We conducted a strong information campaign during the Federal election, providing our analysis of the policy positions of the major parties as they would impact upon small business people.

We provided seven information and commentary posts during the campaign on the following topics:

  • Overview of issues
  • The generational debate
  • Unfair contracts
  • Tax calculator
  • Tax policy comparisons
  • ATO reform issues
  • Truckie issues

Our posts generated 86,184 reaches on Facebook, 18,423 engagements and 2,484 comments. Our website interactive tax calculator had 9,262 individual engagements.

16. Advocacy work

Some of the formal submissions made to governments/parliaments have included:

  • Directors Identification Numbers
  • Australian Business Number Treasury review
  • Black economy taskforce
  • Gig economy (Victoria)
  • Finance review of CDDA scheme

We gave evidence to Senate inquiries into

  • Red Tape (2 November 2018)
  • Model Litigant Bill (31 October 2018)

We strongly support the beefing up of the unfair contract laws.

We are members of two government consultative committees:

  • ACCC small business (meets 3 times per year)
  • ABCC Security of Payments (meets 4 times per year)

17. Gig economy campaign

We are working to defend the right of people to work through gig economy platforms:

  • We made a submission to the Victorian government inquiry.
  • The ACTU is out to restrict the gig economy.
  • The ATO is attacking gig economy operations (e.g., transcribers).

Australian unions see flying ‘gig’ pigs landing from the UK

February 24, 2021 by Self-Employed Australia

You may have seen reports that the UK’s top court has decided that Uber drivers are not independent contractors. The UK decision seems to support the unions’ campaign against the gig economy. It gives the appearance of international support for Federal Labor’s anti-gig (anti-small business) policy announced earlier this month.

However, sorry to disappoint the small business-haters in the unions and Labor, but the UK’s decision has no relevance to Australia.

The facts in Australia are that Uber drivers have been declared to be independent contractors by:

  • Australia’s industrial relations independent umpire, the Fair Work Commission in 2017.
  • The Fair Work Ombudsman in 2019.

And last year (2020) the FWC declared that Uber Eats delivery people are independent contractors. In this 2020 decision the Commission looked at the UK law above and stated that its irrelevant to Australia. Here’s why.

In Australia we use the well-known common law tests which identify whether there is a commercial contract or an employment contract. All independent contractors (self-employed people) earn their income through a commercial contract. This is locked in under Australia’s Independent Contractors Act 2006. It protects the right of people to be their own boss.

In 1998 the UK created statutes which say that even if you’re an independent contractor you can still have access to some employment ‘rights’. This is the ‘little bit pregnant’ idea. The UK statute says that someone working under a commercial contract can be a ‘little bit’ an employee. This is the statute that has been ruled upon by the UK Supreme Court last Friday in the Uber case.

The UK has made, and is making, a mess of its treatment of self-employed people. Self-employed UK people have been treated as economic trash during the Covid crisis, receiving little if any income support. For 20 years the UK tax office (HMRC) has been trying to stop the self-employed from having business tax rights. The Uber decision now throws massive uncertainty into commercial contract law.

Fortunately, in Australia since around 2006, we’ve developed policies to support and ‘protect’ self-employed people. This has included the same access as employees to the federal parental leave scheme (2010), JobKeeper and JobSeeker (2020) and the introduction of unfair contract laws (2016) and their planned ‘beefing up this year. Also, this year the full pay-on-time laws for small business should pass.

We ‘protect’ small business people by giving them access to a practical commercial ‘rule of law’ environment, backed by sensible access to social security support where needed. This creates a stronger economy with small business at its core. Let’s hope that the UK small business destruction disease doesn’t spread to Australia.


For a longer version of this article which includes a link to the UK Supreme Court ruling, click here.

Filed Under: Defending the gig economy, Self-employment, The nature of work

  • « Go to Previous Page
  • Page 1
  • Page 2

Primary Sidebar

defendingCampaign Info here

Not Above the Law Campaign

We explain the case for prosecution—Hotel Quarantine 2020

Not-above-the-LawNot-above-the-Law

Not-above-the-LawNot-above-the-Law

Not-above-the-Law


Reforming the ATO

ABC confronts ATO” (3′ 42″)
More info here

petaia-abc

Authorised SEA Content

The use of Self-Employed Australia’s logo or its website materials requires our prior written consent. Self-Employed Australia does not issue printed material. All authorised content is published on our website or on our officially linked social media pages. Any material found outside these sources is unauthorised and constitutes a breach of copyright. If you wish to report any suspect material, please contact us.

Copyright © 2026 · News Pro on Genesis Framework · WordPress · Log in