ACT takes on Sham Contracting

Canberra Times 05 Mar, 2011

A deal designed to bring industrial peace to Canberra's troubled building sites is due to be signed within a month.

The ACT Government, industry groups and the building union are set to sign an accord aimed at eradicating the use of sham contractors on government projects.

The Construction Forestry Mining and Energy Union, the ACT Government and the Master Builders Association have drafted an agreement that will force all contractors working on territory government construction jobs to be "IR compliant".

Once signed, it is intended that the agreement will be extended to the private development sector and then the union says it has the potential to be extended nationwide.

The ACT building industry is plagued with sham employment contracts, which are helping employers to avoid paying payroll tax, superannuation, leave entitlements and workers' compensation, according to the Australian Building and Construction Commission.

MBA Industrial Relations Manager Michael Baldwin conceded yesterday that bogus contractors or "ABN labour" as they are sometimes called, were a major problem in the industry.

"You might have 15 guys signed up for workers' comp when you start the job, but by the time it's finished there might be 35 workers and those extra 20 might not be on the books," Mr Baldwin said.

"We understand it's an industry-wide problem and we're happy to be helping the CFMEU and the Government in an attempt to fix it."