Allegations outlined in the ABCC’s statement of claim, these may vary over the course of the proceeding.
Background
1. Diploma Construction (WA) Pty Ltd was the head contractor responsible for the construction of a commercial building complex at 36 Adelaide Terrace in Perth, Western Australia.
2. Diploma engaged the first respondent, Inner Strength Steel Fixing Pty Ltd (Inner Strength), to perform building works at the site. Mr Sacha was the sole director employed by Inner Strength and was responsible for recruitment and management of workers.
3. In June 2006 Inner Strength employed a steel fixer under a contact of employment.
4. In June 2008 Mr Sacha told the employee that he would no longer be employed as an employee, but would be engaged by Inner Strength under a contract for services as an independent contractor.
5. From that time the employee was required to render invoices for payment and Inner Strength did not pay the employee’s employment entitlements.
6. In June 2009 Inner Strength engaged another employee under a contract for service, where he would perform work for Inner Strength as an independent contractor. The employee submitted invoices for payment and Inner Strength did not pay the employee’s employment entitlements.
7. Between early 2010 and July 2010 Inner Strength hired another three steel workers under contracts for service as independent contractors.
8. Notwithstanding the representations made by Inner Strength and Mr Sacha, all of the above employees, as a matter of fact and law, were employed under a contract of employment.
Alleged contraventions
9. The ABCC alleges that Inner Strength and Mr Sacha contravened s.900 of the
Workplace Relations Act 1996 by making representations that contract of employment was actually a contract for services as an independent contractor, thereby engaging in sham contracting.
10. The ABCC alleges Inner Strength and Mr Sacha contravened s.901 of the
Workplace Relations Act 1996 by misrepresenting a proposed employment relationship as a proposed independent contracting arrangement, thereby engaging in sham contracting.
11. The ABCC alleges Inner Strength and Mr Sacha contravened s.357 of the Fair Work Act 2009 by misrepresenting employment as an independent contracting arrangement, thereby engaging in sham contracting.
ABCC Civil Litigation Proceedings
12. The ABCC filed a statement of claim in the Federal Court in Perth on 21 July 2011.
13. The ABCC also filed a notice of motion that this matter be heard with ABCC v McDonald and CFMEU [WAD266/2011], and ABCC v CFMEU, McDonald and Buchan, [WAD 106/2009] also related to the Diploma Construction (WA) projects.
14. A directions hearing will be held on 12 August 2011.
Penalties
15. The maximum penalties for a contravention of the Workplace Relations Act 1996 or the Fair Work Act 2009 are $6600 for an individual and $33,000 for an organisation.