In a recent court case (Trustee for Virdis Family Trust t/a Rickard Heating Pty Ltd v FC of T, Administrative Appeals Tribunal of Australia, 05 January 2022 2022 ATC 10-612) a plumbing business was ordered to backpay super for a subcontractor they had employed for a 5 or 6 year period. It is quite common in construction for businesses to employ or engage subcontractors to work for them rather then formerly employ them as employees; as we tell our clients in many cases this is not technically legal and leaves you open to being ordered to back pay super. This case confirms this.
It is important to understand that in cases like this not only will you need to back pay super you will have to pay fees, interest and shortfall penalties, these additional charges are substantial.
“But I agreed with my subbie he will pay his own super” This is exactly what happened in this case! It does not matter, the law is the law and in this case Rickard Heating had to pay the Subbie his super as well as having paid a rate all these years that supposedly included super.
You can read the full case here 2022 ATC 10-612 if you want to discuss your Subbies and what your Super Liability is then please get in contact.