RCSA renews its support for Independent Contractors Bill

The Recruitment and Consulting Services Association has renewed its support for the Independent Contractors Bill, and provided some suggested amendments in its submission to the Senate Employment, Workplace Relations and Education Legislation Committee.

ìThe RCSA supports the rights of individuals to make a choice as to the form of engagement they wish to enter into in relation to the provision of personal services,î said Julie Mills, CEO of the RCSA.

ìAs a fundamental principle, so long as the decision of an individual is made without coercion and is made with genuine intent and understanding as to consequence, we believe an individual should be free to provide services by way of a commercial relationship in contrast to one based upon a contract of employment,î she said.

The popularity of independent contracting is evident amongst RCSA Membership who each day are being asked by workers to engage their services as independent contractors as opposed to employees without any solicitation whatsoever.

RCSA Members are happy to facilitate this request; however, they do so with the increased understanding that such commercial relationships must be based upon solid intention and genuine choice.

As at June 2006, 44% of RCSA member corporate entities were providing contracting services to clients, a large proportion of which would be on-hired contractor services. This represents.

In December 2003 in a report released by RMIT University titled On-Hired Workers in Australia: Motivations and Outcomes it was found that, on average, RCSA Members had 54 independent contractors on assignment each day.

Proposed Amendments

ìWhile the RCSA supports the intention behind the Bill, we believe there are some aspects that can be improved via amendments,î said Ms Mills.

The RCSA proposes the following amendments:

Clause 7(2)(c) of the principal bill provides for an unlimited regulation that could provide for the exclusion of State and Territory laws. These exclusions should be specified in the primary legislation.

As a matter of principle, RCSA opposes the preservation of State law governing owner drivers on the basis that there appears to be no sustainable reason why such individuals should not be afforded the rights and protections afforded by the proposed legislation.

RCSA supports the establishment of a federal unfair contracts jurisdiction which encourages resolution of disputes by mediation however RCSA does not believe that comparisons with ësimilar employee remunerationí, as is provided in Clause 15 of the principal bill, is an appropriate consideration of whether a contract is harsh or unfair.

RCSA recommends that the determination of harshness and unfairness in relation to unfair contracts would be best assessed at the commencement of the contractual relationship and not thereafter. The foundation of independent contracting is that it is a commercial relationship and such relationships provide for a degree of risk and reward that is typically not present at the same level within an employment relationship. Therefore, individuals should go in to a commercial relationship with their ëeyes opení to the risks and opportunities presented not only at the commencement of the relationship but throughout the life of the contractual relationship.

RCSA recommends that clause 902 of the supplementary bill be amended so that termination of employment for the ëwhole or dominant purposeí of an individual becoming an independent contractor is not an offence where such termination is to genuinely establish an independent contracting relationship and is therefore not a sham arrangement. Furthermore, the reverse onus of proof should be amended such that the individual claiming the offence is required to establish the breach.

RCSA opposes providing unions with the power to prosecute pursuant to clause 904 of the supplementary bill. RCSA believes that the provision of such prosecutorial power to workplace inspectors and the individuals themselves provides a suitable and accessible mechanism.