Olga Hunt: The recent ATO allegations and how they relate to recruitment and Workplace Relations

Recently, there have been a number of reports regarding recent criminal charges relating to an alleged white-collar criminal syndicate involving a Senior ATO official.

The charges involve allegations that a Contractor Management Service (CMS) by the name of Plutus Payroll funneled funds illegally, ‘skimming’ small amounts of monthly PAYG Tax payments to second tier firms which were run by straw directors.

Tellingly, allegations have emerged that consultants at recruiting firms were offered ‘kickbacks’ of up to $900 to refer contractors onto Plutus. The end result has meant that thousands of contractors have found themselves out of pocket with unpaid wages and superannuation.

The recruitment firm would match the contractor with an employer (generally within government departments or IT firms) and then refer the contractor to Plutus as the payroll provider.

The particulars of the allegations can be found at Business Insider Australia link by clicking here. Another more detailed chronology of the allegations has been produced by the Australian Financial Review which can be read by clicking here.

It should be stressed that the matter remains before the courts and any content contained in media reports is, at this stage, unproven. However, in light of the recent information, the Bayside Group has provided regarding both Accessorial Liability and Independent Contracting, it is a salient reminder to be proactive and vigilant when sourcing labour from external sources.

We will continue to monitor any developments in the matter and distribute further information if, and when, further information comes to light and, as always, we are happy to discuss this and other Workplace Relations matters at any time. Contact the Bayside Group Workplace Relations Team to get in touch.