• Employees treated as contractors

    It's against the law for a business to incorrectly treat their employees as contractors. Businesses that do this are:

    • not meeting their tax and super obligations
    • denying workers their employee entitlements
    • illegally reducing their labour costs and gaining an unfair advantage over their competitors.

    Find out about:

    Penalties and charges

    They risk penalties and charges, including:

    • PAYG withholding penalty for failing to deduct tax from worker payments and send it to us
    • super guarantee charge, made up of
      • super guarantee shortfall amounts, made up of the amount of super contributions that should have been paid into a complying fund
      • interest charges
      • an administration fee
       
    • additional super guarantee charge of up to 200%.

    How to report a business

    Businesses that incorrectly treat employees as contractors can often undercut their competitors and obtain an unfair competitive advantage. These businesses illegally lower their labour costs by not meeting all their tax, super and other government obligations for their workers.

    If you know or suspect a business is incorrectly treating an employee as a contractor it is important you let us know.

    You can report a business that is incorrectly treating an employee as a contractor through our Tax Evasion Reporting Centre.

    You don't have to provide your name. However, if you do give your name and a contact number, we can ask you for more information later if necessary.

    Last modified: 06 Jan 2017QC 33198