QLD Labour Hire or Employed by Employer? Jobkeeper

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LauraMae

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21 April 2020
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My friend works in the Finance team of a mid-sized business (lets call it 'milkyway') and they have payroll split into two, paying category 1 (mix of permanent full time and contract employees who are on Awards) on one day and category 2 (all permanent full time, non awards) on another, which is where my friend works in. All payroll and HR is done in-house and all contracts between employees and the business are with 'milkway'.

Category 1 is paid from the company name. i.e. 'milkyway' and the pay slips say same, including milkyway's ABN and milkyways business address.

Category 2 is paid from a name unrelated to the business. Lets call it 'ABC Admin' and the payslips say same, including ABC Admin's ABN and an address relating to the company accountant, but is not the company accountant. Unsure if this address is also shared with 'milkyway' but there is absolutely no reference to 'milkway' on the payslips.

Questions are:
  • Is it legal/correct practice to split payroll in such a way? Makes sense in one way to split the Awards vs non-awards but...
  • Does that make Category 2 essentially a 'labour hire' or employment agent type agreement due to 'milkway' not being mentioned on the payslips? Does that make the contract invalid? ATO -Labour-hire firms and their workers
  • Jobkeeper was applied for for 'milkyway' but not ABC Admin. Again - legal or correct? Friends hours have been cut and Jobkeeper promised but nothing was signed with Category 2 employees. 'milkway' have all been put on Jobkeeper and been told their jobs are secure.
  • Friend opened 2 incorrectly filed invoices which were invoices from ABC Admin to 'milkway' (the business he works for) for the payroll costs for that week clearly labeled with the ABC Admin costs (category 2) which was strange. The costs were also all plus GST. Sounds very fishy?
Just wondering if we can get some advice. He is worried he will get caught up in the payroll side as he's done payroll before and doesn't want to get involved in the mess if the business is doing illegitimate business practices!

Thanks in advance.
 

Rob Legat - SBPL

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16 February 2017
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There's likely a complicated business entity set up at work here - nothing nefarious, it happens. I'd say there's a service company arrangement going on. Think more along the lines of 'secondment' than 'labour hire'. On a broad consideration, I'd say ABC Admin isn't going to qualify for Jobkeeper as its turnover is solely based on Milkway, and hasn't been dropped sufficiently.
 

Rod

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27 May 2014
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I agree with @Rob. On-hire for related entities. There are business reasons for doing so, generally none to the advantages of employees.

Must say I've not looked at how related entities are impacted by JobKeeper rules