Transport Businesses who engage sub-contractors to perform work for them need to be aware of the basics of their engagement, including but not limited to:
- Is the sub-contractor a corporate entity or a sole trader with an ABN – if a sole trader you will need to apply one of the many ’Contractor or Employee’ tests that are available for you to determine whether the Australian Tax Office and the Fair Work Commission, in particular, will class them as an employee.
- If classed as an employee using one of the tests, you MUST obtain advice as to your liability for the sub-contractors superannuation Guarantee contributions at 9.5% of payments made to them; and in addition payments for Workers Compensation purposes must be disclosed on the Principal’s wages declaration.
Does the sub-contractor have appropriate and current insurance cover including:
1. Motor vehicle insurance;
2. Non owned trailer – full comprehensive insurance;
3. Public and Products liability insurance;
4. Marine transit insurance;
5. Workers Compensation insurance.
If you have or intend to engage sub-contractors, it is important to that you review your contractual arrangements to avoid future conflicts where sub-contractors may be able to take action against you under a range of federal and state legislation.
Source: NatRoad News, September 2014.