The Knockoff- Issue# 4

The Australian Taxation Office (ATO) and Fair Work Ombudsman (FWO) launched a joint crackdown on sham contracting in March — and building and construction is one of their two priority sectors. This isn't a press release. Investigations are already underway.

Here's how much data they have on you: in 2024–25, the ATO received more than 7,000 tip-offs from the building and construction industry alone. Around 20% alleged sham contracting. The ATO's Taxable Payments Annual Reporting (TPAR) system gives them visibility over nearly 185,000 businesses making payments to 1.4 million contractors — totalling over $507 billion. They cross-reference that with your ABN records, your tax return, and your Single Touch Payroll data. If it doesn't add up, they can see it.

Sham contracting is when you call someone a contractor when they're actually an employee — to get out of paying super, leave entitlements, and workers' comp. Simply handing someone an ABN and a daily rate doesn't make them a contractor. What matters is how the arrangement actually works in practice — do they work exclusively for you, use your tools, follow your direction? That's employment. The penalties go up to $99,000 per contravention for small businesses and up to three times the underpayment amount for larger ones. If you're unsure whether your arrangements are legitimate, the time to check is before they knock on your door. [FWO, 13 March 2026 / ATO, March 2026]

The Fair Work Ombudsman has commenced legal action against a northern Melbourne painting and restorations company and its director for an alleged breach affecting an adult apprentice. It's the latest in a string of construction-sector enforcement actions — the FWO has made clear that apprentice exploitation is a primary focus for 2026. If you employ apprentices, your Award obligations aren't optional and they aren't negotiable.

Check your hourly rates, overtime, annual leave accrual, and training cost reimbursement against the relevant Award now. The FWO's pay calculator is at fairwork.gov.au. [Fair Work Ombudsman, June 2026]

WT Partnership released their Australian Construction Market Conditions Report on 17 June. The headline: costs are expected to remain elevated for the next three years — and that's the baseline scenario before you factor in any ongoing Middle East conflict impacts. Labour costs are the main driver. Materials have stabilised somewhat, but are still historically high. Housing approvals in March dropped 10.5% — private sector multi-res was down 26%. There's no soft landing on costs coming.

If you're quoting fixed-price work extending into 2027 or beyond, make sure your escalation allowances reflect the actual market — not the market from two years ago. [WT Partnership, 17 June 2026]

Since 26 August 2025, the Right to Disconnect has applied to every business in Australia — including small operators under 15 employees. If you employ anyone, this law covers you. Employees can refuse to monitor, read, or respond to contact from their employer outside their working hours — unless that refusal is unreasonable.

What does "unreasonable" mean on a construction site? The law doesn't give you a clean list, but here's how it works in practice. A site foreman who needs to know about a weather delay at 7am start — reasonable to expect a response the night before. An apprentice painter being texted at 9pm about tomorrow's colour schedule — not reasonable. An emergency involving safety or genuine site crisis — probably reasonable. A boss who just wants to confirm something that could wait until morning — not reasonable. Seniority, pay, and the nature of the role all factor in.

The law doesn't ban you from sending messages after hours — it bans you from requiring a response, or penalising someone for not providing one. If a dispute can't be resolved internally, either party can take it to the Fair Work Commission. Now is a good time to review your contracts and make sure your after-hours expectations are clearly documented — not because the FWC is knocking on doors yet, but because clear expectations protect both sides. [Fair Work Ombudsman]

Gareth the sparky had just finished wiring a new hallway light circuit — good clean job, everything tested, homeowner standing by for the moment of truth. He flicked the switch. The hallway remained completely dark. The automatic garage door, however, ground to life and trundled open with great purpose. Gareth, to his credit, reacted immediately and flicked the switch back down. The garage door responded by slamming shut with authority, at which point it became apparent that a neighbourhood cat had wandered in during the brief moment of opportunity. The roller mechanism launched the cat out the bottom of the door like a very undignified projectile. The cat was unharmed and left at pace. The homeowner was speechless. Gareth confirmed there had been a wiring mix-up somewhere between the switchboard and the ceiling.

The hallway light now works correctly. The cat has not returned. Gareth's assessment of the situation — "I've wired worse" — is doing a lot of heavy lifting.