Emerald Chamber of Commerce Inc

Craig Joy goes after ATO - Wednesday 11 February 2015

This story comes with the courtesy of Angus Peacock and the “Shiftminer”.

A WORKPLACE consultant in Mackay is challenging the Australian Tax Office (ATO) and the Fair Work Ombudsman over decisions he says are costing businesses hundreds of thousands of dollars.

Craig Joy told Shift Miner that one engineering firm in Mackay has already been hit with a $400,000 bill for back payments, tax, super and other entitlements and he believes other businesses are in the firing line.

At the heart of the dispute is how businesses employ staff - on a permanent or contract basis.

While the ATO’s problem with bosses forcing permanent employees to become contractors is well-documented, this issue is to do with a contractor relationship developing when neither party objects.

According to Craig Joy, the rules governing this are confusing and government agencies handling the area have different positions on it.

He says the Department of Employment, which oversees the Independent Contractors Act, has come around to his view that the Act is not about dictating staff should be contractors or employees if both parties have freely entered into the agreement.

However, Mr Joy said the ATO and Fair Work Ombudsman see it differently.

“The ATO and Ombudsman are both of the view that the intent of the Act is to tell people whether or not they are allowed to be contractors or whether they should be employees,” he told Shift Miner.

“The upshot of it is that you have people entering into contracts and years later the tax office can come along and say you shouldn’t be a contractor you should be an employee and they are then prosecuting the business.

“They are saying you should have been holding tax for this person and you haven't been, and you should have been paying super for this person and you haven't been, and this has been going on since 2006.

“One government department isn’t talking to the other, and the people in charge of the Act are saying this isn’t what it should be and the tax office is saying it definitely is and we are going to overturn it.

“One Mackay business just got slogged $400,000 for that and it happens all the time.”

So far Mr Joy says he has not heard back from either the Fair Work Ombudsman or the ATO, and he is now taking his complaint to the Federal Employment Minister Senator Eric Abetz.

Editors Comment: I often wonder if Craig Joy ever got a response Senator Eric Abetz. 

This story has been brought to you by the Emerald Chamber of Commerce Inc.