11 Sep 099 More on ABNs, employees and contractorsMember 17's comments last week about ABNs, employees and contractors has prompted a number of responses:
MEMBER 18 writes: "There are many employers that make employees obtain ABNs and do not pay super etc. Look at the construction industry, the mining industry. And it is normally no ABN, no work. I have spoken to the ATO and given them names of businesses making employees obtain ABNs, but the ATO cannot do anything. Something should be done."
MEMBER 19 writes: "In my area I would say 7 out of 10 are forced to apply for an ABN as nearly every business is 'trying it on'. We advise our clients of their rights, but they are too afraid to confront the bosses as it means no job, no income. In one case the employer's accountant advised it to put everyone on as contractor. What can we do!. In my most recent confrontation with a client they simply did not believe me when I told them the facts. They had been told to get an ABN, work on contract, and claim everything but the kitchen sink. They went somewhere else when I tried to explain to them the realities of the situation."
MEMBER 20 writes: "I agree with Member 17 that the ATO unfairly places pressure on contractors/employees when they are at the mercy of the employer. It also places pressure on employers who are competing with other businesses that are not doing the right thing. It creates unnecessary problems with complying with ABN, super guarantee, Workcover and payroll tax requirements as well the "employee" missing out on leave entitlements.
It could be all resolved if the ATO took the lead on behalf of the other state organisations to deal with the cause rather than the effect. My suggestion would be to tighten rules to stop employers from being able to somehow disown their 'employees'.
Perhaps on the ABN application there could be a box to select which, if ticked, results in the ATO sending a questionnaire to the principal/'employer', although again this is dealing with the effect and not the cause."
MEMBER 21 writes: "Having an ABN does not automatically make you a contractor or absolve the employer from their SG and other obligations. Also, the ATO does actively enforce the employer's obligation in relation to employees/contractors, at least in relation to one of my clients."