What does sham contract mean?

sham contract

A sham contract is a situation where an employment relationship is falsely presented as an independent contracting arrangement by an employer.

Sham contracting occurs when an employer disguises an employee as an independent contractor. This misrepresentation can be done to avoid responsibilities like providing employee entitlements. It involves situations where a worker is actually an employee based on their work conditions but is labeled as a contractor. This is illegal and can lead to penalties.

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Other glossary terms

classification

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Classification is how a job role is described in an award or agreement, focusing on what the job involves, the responsibilities and qualifications.

pieceworker

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A pieceworker is an employee who earns payment based on the quantity of items they produce or tasks they complete, rather than the hours they work.

allowances

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Extra payments given to employees for certain reasons like doing specific tasks, working in certain places, using special skills, or to cover costs.

pay slip

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A document that ensures that employees receive their correct pay and entitlements and helps employers to keep accurate and complete records.