- The Employer-Employee Relationship
- The Independent Contractor
- Codes of Practice
- Non Employment Income
Part of briefing paper for MCA summit, Australian Musical Futures: Towards 2020, Sydney, 5 September 2008.
Australian musicians, like all other Australians, operate under state and federal award systems that protect their minimum wage entitlements and conditions. There are a number of awards governing the employment of musicians and these are routinely applied in the orchestras and commercial music theatre. Unfortunately in many other areas these are not applied for a number of reasons.
The Employer-Employee Relationship
Awards only apply to people who are engaged as “employees”; however they can apply in many more situations than is generally understood.
Contrary to popular belief, the employment relationship has absolutely nothing to do with the length of time for which a person is engaged. It is possible to be an “employee” for a single gig. The misapprehension appears to arise because of confusion between the employer/contractor distinction and that between a casual and ongoing employee.
The nature of the employment relationship is also not definitively affected by the intentions of the parties. Even if a musician makes an agreement with someone where both parties clearly agree that the relationship will not be that of employer/employee, this fact is insufficient, by itself, to ensure that it will be so.
A requirement that an ABN be provided is also insufficient, by itself, to definitively characterise the nature of the relationship.1
The relationship is only clarified by the application of various industrial law principles by the relevant jurisdiction. The confusion, however, means that many musicians do not believe that they are entitled to award protection and therefore do not pursue it. Many employers are similarly confused and assume that they have no obligations regarding pay and conditions.
The net result is the almost total disappearance of the concept of a “minimum rate” for musicians and a consequent total market distortion caused by the introduction of the possibility of low, or even zero, payment for musical services.
None of this section should be understood as arguing that musicians are always employees, it merely raises the possibility that this may be the case in more cases than is popularly believed.
The Independent Contractor
Musicians who are not engaged as employees have virtually no regulatory protection of wages or conditions. Some state industrial relations legislation, such as that of New South Wales and Queensland, has “unfair contract” provisions but these offer limited use and their application to the situation of musicians has rarely been tested. The “Workchoices” legislation removed the, admittedly weak, “unfair contract” section from the federal act.2 The relatively recent federal “Independent Contractors” legislation also offers no guarantees of minimum wages or conditions.
“Workchoices” changed the constitutional basis of the federal “Workplace Relations Act” from a reliance on the so called “industrial power” of the constitution [section 51 (xxxv)] to a reliance on the “corporations power” [section 51 (xx)]. This could mean that the wages or conditions of independent contractors might be regulated although the previous government did not do this and there is no indication that the current government intends to.
Where a contract is unfair, remedies through the civil legal system are available using, for example, the “unconscionable conduct” section of the Trade Practices Act. This is an expensive path to follow and the typical resource imbalance between the musician and the other contracting party usually means that either the musician is unsuccessful or, daunted by the likely costs, decides not to pursue this path.
Codes of Practice
There are various “codes of practice” relating to the employment of musicians but these are voluntary “opt in” arrangements whose effectiveness largely depends on the strength of customary practice. They have no general enforceability and leave most of the music industry unaffected.
Non Employment Income
This is in a similar category to income as an independent contractor; the only protection is the availability of an essentially ineffective civil remedy. There are guarantees of a sort in the copyright act such as “prescribed royalties” but these come into play only if the parties can not “agree”. Given the relative strengths of the bargaining positions of a musician and, for example, a record company, these provisions generally provide no effective protection.
Deductions relating to expenses incurred in the generation of income are available to Australian musicians on the same basis as to all other Australians. There are also income averaging provisions available to musicians in certain circumstances. There is no special tax scheme for artists similar to that in place elsewhere (Ireland for example).
Terry Noone. Submitted 15 September 2008.