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ISGM subbies

ISGM unfair dismissal: when is a subbie really an employee?

A case brought before the Fair Work Commission (FWC) by the CWU has highlighted the issue of sham contracting in the telecommunications industry.

The case concerns a member who until recently worked as an “independent” contractor for ISGM, the sole head contractor to Telstra for field installation and maintenance work. Although theoretically independent, such subbies typically depend on ISGM for daily work flow and are managed directly by that company in coordination with Telstra –just like an employee!

Following a number of performance assessments which ISGM said were not satisfactory, the member was told that he would no longer be getting any work from ISGM.

The member believes this decision, and the way it was made, were “unfair” and the CWU is supporting him in his claims to that effect. The question for the Commission though is whether he was “dismissed” as an employee or simply had his contract terminated – properly or improperly – in his capacity as a small business person.

This is not an academic question: it goes to the heart of the whole practice of sub-contracting and the way it is increasingly used to avoid employer obligations such as superannuation, leave entitlements and health and safety protections and workers’ compensation.

The matter went before the FWC on Friday 5 September for conciliation but was not resolved. It will now go to a formal hearing in October when the question of the member’s employment status will be tested.

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