Call employees ‘contractors’ at your peril

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A Perth Cleaning company is being prosecuted for allegedly underpaying six foreign cleaners a total of more than $22,000. The company, trading as Housekeeping Pty Ltd, as well as the business’s manager, Catherine Paino-Povey, are facing court, following action by the Fair Work Ombudsman.

It is alleged the employees regularly worked 10 hours a day cleaning houses, but were paid for only 7.6 hours. It is also alleged that the employees were underpaid overtime, had money illegally deducted from their wages, and were underpaid other entitlements (including leave).

The workers were foreign nationals from Taiwan, China, New Zealand and Ireland, and were aged in their 20s and 30s. The alleged breaches were uncovered by Fair Work Inspectors after workers lodged complaints.

Sometimes, employees are misclassified as “contractors” – and there have been a number of campaigns aimed at addressing this practice, says Nichola Constant, Director of People and Culture Strategies.

“Given these campaigns have not uncovered systemic abuse then I would not say that this is common. However, in my experience many of the workers are short term and move on to new work or return home before they are made aware of their entitlements.”

Constant said that businesses that break the law risk fines for breach of legislation, as well as back-payments for leave, and penalty rates. They also risk campaigns by unions and advocacy groups, aimed at damaging their business.

Employers seeking information on how they can support foreign workers and other vulnerable employees can get assistance from the Fair Work Ombudsman, their industry associations, or the Department of Immigration.

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