Thread: Well here is a scam.

The main reason they go to "sole trader" is that it relieves them of most of their OHS, Super, overtime penalty rate and notice/retrenchment costs.

Well actually there is only one difference between sole trader and casual labour through hire firms. And it is the real main reason. Penalty rates. Every thing else is the same weather you are sole trader or labour hire. Always gets down to trying to avoid paying people for what they are worth, weather that be through the awards or by merit. There is one distinct disadvantage of a sole trader. You no longer have the safety net of the award system. You have agreed to work for wages and conditions that may be less than those covered by the awards. I say may but in reality I`m sure that any one working as a sole trader will be at some disadvantage. No employer would be going down the path of hiring sole traders for there advantage. At least with the award system you are guaranteed basic wages and conditions.
Cheers Hall

If all your income is derived from personal services then these days there is no benefit to being a sole trader or proprietary limited company. Effectively the ATO sees no difference between you and an employee. All you have is additional costs and if your rate doesn't include them then you're behind.

What many fail to realise is that these companies cannot contract away their legal obligations to their employees. Unless something has changed in the last year or so that I am not aware of there is no real legislation covering employment status and whether or not a person is considered an employee has to be tested under common law. There are several tests that can be applied to determine someone's status. For example, has the employer engaged you to perform a task or can you get someone else to do it?

Essentially, if these tests apply then you are considered an employee, regardless of your contractual position. The employer is then ultimately liable for all the usual conditions such as super, worker's comp etc. They are also liable for your safety, but the new WHS legislation pretty much makes everyone liable anyway.

Cheers,
Jon