It’s about time we had a serious conversation about some of the nonsense that’s been creeping in to so-called “payroll services” supply contracts.
Consider this common contractual formula:
- Labour Hire Firm has sourced Individual to work as an on-hired physiotherapist for its Client.
- Individual means Jo Physio.
- Client means the Department of Health.
- Payroll Provider must employ Jo Physio.
- Payroll Provider must provide Services of Jo Physio to Client.
- Services means physiotherapy services.
What do you make of it?
Has the Payroll Provider contracted a primary obligation to supply physiotherapy services to the Department of Health? If so, what authority did Labour Hire Provider have to make the bargain? Is it an obligation owed only to Labour Hire Provider, which Labour Hire Provider holds on some sort of trust for the Department?
Has Payroll Provider accepted a sub-contracted obligation from Labour Hire Firm to supply physiotherapy services to the Department of Health? What if Labour Hire Firm never had a contractual obligation to supply physiotherapy services to the department in the first place; but merely an obligation to supply a physiotherapy worker? Was there ever an obligation to supply physiotherapy services that could have been sub-contracted? Does the contract not mean what it appears to say?
What contracts and arrangements would you need to see if you were asked to untangle this mess – say, in order to identify the “true employer“; or to identify whether Jo Physio is an employee or an independent contractor; or to establish who needs a labour hire licence, or an employment agent’s licence; or to untangle indemnity and liability insurance obligations.
Sadly, I see a lot of “half-smart” contracts that create more problems than they solve because they ignore the basics and seem to be thrown together without too much in the way of legal analysis.
That’s why we need to get talking. And that’s what we’re going to do over the next three weeks as we dedicate a series of Tuesday TalkAbout Live sessions to this topic.
Check the details and make sure you don’t miss out.
Let’s talk again soon!