Sham contracting is rife on building sites operated by Lend Lease, the construction union says.
According to a report in The Australian on Thursday, the Construction, Forestry, Mining and Energy Union (CMFEU) says that the practice of hiring workers as contractors when the nature of the relationship is in reality akin to that of an employer and employee is common at on projects run by the company – with workers missing out on superannuation, sick pay and holiday pay as a result.
“They have got in our view a serious track record of lots and lots of sham contracting on their sites and that’s of grave concern to us” CMFEU state secretary Dave Noonan says.
“They don’t have a good record in terms of ensuring that workers on their site receive their legal entitlements”.
According to the report, it is understood that on Lend Lease’s building projects that whilst a core workforce would typically include labourers, some crane crews, hoist operators and amenities people, both formwork constructions and finishing trade workers and their services would be contracted out.
Noonan says that those contractors themselves are engaging in sham subcontracting because Lend Lease is forcing them to do so in terms of the price they demand.
Lend Lease says it continues to work within the framework established by the government and that it remains committed to ensuring full compliance with relevant employment guidelines on the part of contractors.
Lend Lease also says it has received a number of broad complaints regarding allegations of workers being denied proper entitlements as well as some specific allegations, but that no untoward behaviour has been found is subsequent enquiries by the company.
The union’s complaints come at a difficult time for Lend Lease as the company battles to rebuild its reputation after admitting to cheating its clients in New York by overbilling on its projects.
The allegations also come amid increasingly intense debate about ‘sham contracting’ – the use by building firms of engaging workers as contractors in order to avoid obligations associated with superannuation, annual leave and sick leave.
Whilst unions say that the practice is rife on building sites throughout the country, building industry groups disagree. In January, Master Builders Australia hit back at what it said were false statements by the CMFEU about the extent of sham contracting in Australia. Master Builders says the majority of contracting arrangements are legitimate arrangements being entered into freely by participants who choose to operate in this manner to take advantage of the benefits of being a contractor.