25/03/2026
🚨 ATO Alert: Sham Contracting in the Spotlight
The Australian Taxation Office (ATO), together with the Fair Work Ombudsman, is increasing its focus on sham contracting — and it’s something all businesses should be aware of.
👉 What is sham contracting?
It’s when a worker is treated as an independent contractor when they are actually an employee. This can happen intentionally or by mistake.
👉 Why it matters:
Getting worker classification wrong can lead to:
• Significant penalties and fines
• Back payments of super, leave, and entitlements
• Increased scrutiny from regulators
👉 Key reminder for business owners:
Having an ABN or contract in place doesn’t automatically make someone a contractor. What matters is the true nature of the working relationship.
👉 What you should do now:
✔ Review your current contractor arrangements
✔ Ensure contracts reflect the actual working relationship
✔ Seek advice if you’re unsure
The ATO is using data and working closely with other agencies to identify non-compliance, so now is the time to make sure your business is on the right track.
If you’d like help reviewing your setup or understanding your obligations, feel free to reach out.
