FWO to prosecute Melbourne IT company over alleged sham contracting, but business owner intends to fight back

The Fair Work Ombudsman will prosecute the operator of two Melbourne IT businesses for allegedly misclassifying employees as independent contractors, and subsequently using false records and underpaying two workers.

But the operator of the businesses says he hasn’t done anything wrong and expects to win the case.

“Let us see what happens. I’m going to fight it and I will win,” Pradeep Gaur told SmartCompany this morning.

Gaur’s two businesses, Konsulteq and Konsulteq Upskilling & Training Services, are being targeted by the Fair Work Ombudsman and will appear in court next month. The FWO alleges that Gaur hired two female employees in 2010-11, but broke sham contracting laws by classifying them as contractors.

As a result, the FWO alleges these two employees were underpaid by as much as $17,000. The Ombudsman claims one employee wasn’t paid any wages during a training program.

In a statement, the FWO alleges Gaur also provided a false document to the body, “purporting to show that one of the employees had been back-paid outstanding entitlements when no payment had been made”.

“Gaur allegedly also breached the adverse action provisions of workplace laws by terminating one of the employees after she continued to complain about her pay,” it says, while also alleging breaches related to employment records and payslips.

Gaur told SmartCompany this morning he’s upset at the Australian court system, saying he is running up thousands of dollars in debt and has made no money from his business.

“After selling my house and car, I started the business. I haven’t made any money,” he said, while maintaining his innocence of any wrongdoing.

“If the court is not racist, they will give it to me. I haven’t received a single penny from the business, and I want to have something done.”

Acting Fair Work Ombudsman Bill Loizides said the seriousness of the alleged breaches demanded a response. The FWO will seek court orders for the employees to be repaid, with the case to appear in the Federal Magistrates Court on February 11.