New South Wales Consolidated Acts

INDUSTRIAL RELATIONS ACT 1996 - SECT 127

127 Liability of principal contractor for remuneration payable to employees of subcontractor

(1) Application This section applies where:

(a) a person ( "the principal contractor") has entered into a contract for the carrying out of work by another person ( "the subcontractor"), and

(b) employees of that subcontractor are engaged in carrying out the work ( "the relevant employees"), and

(c) the work is carried out in connection with a business undertaking of the principal contractor.

(2) Liability of principal contractor The principal contractor is liable for the payment of any remuneration of the relevant employees that has not been paid for work done in connection with the contract during any period of the contract unless the principal contractor has a written statement given by the subcontractor under this section for that period of the contract.

(3) Content and form of statement The written statement is a statement by the subcontractor that all remuneration payable to relevant employees for work under the contract done during that period has been paid. The regulations may make provision for or with respect to the form of the written statement.

(4) Retention of copies of statements The subcontractor must keep a copy of any written statement under this section for at least 6 years after it was given.

(5) Payments under contract The principal contractor may withhold any payment due to the subcontractor under the contract until the subcontractor gives a written statement under this section for any period up to the date of the statement. Any penalty for late payment under the contract does not apply to any payment withheld under this subsection.

(6) Remuneration For the purposes of this section, remuneration means remuneration or other amounts payable to relevant employees by legislation, or under an industrial instrument, in connection with work done by the employees.

(7) False statement not effective The written statement is not effective to relieve the principal contractor of liability under this section if the principal contractor had, when given the statement, reason to believe it was false.

(8) False statement is offence A person who gives the principal contractor a written statement knowing it to be false is guilty of an offence if:

(a) the person is the subcontractor, or

(b) the person is authorised by the subcontractor to give the statement on behalf of the subcontractor, or

(c) the person holds out or represents that the person is authorised by the subcontractor to give the statement on behalf of the subcontractor.

Maximum penalty: 100 penalty units.

(9) Recovery The provisions of this Act relating to the recovery of amounts payable under industrial instruments apply to the recovery of remuneration payable by a principal contractor under this section.

(10) Exclusion This section does not apply in relation to a contract if the subcontractor is in receivership or in the course of being wound up or, in the case of an individual, is bankrupt and if payments made under the contract are made to the receiver, liquidator or trustee in bankruptcy.

(11) Application To avoid doubt, this section extends to a principal contractor who is the owner or occupier of a building for the carrying out of work in connection with the building so long as the building is owned or occupied by the principal contractor in connection with a business undertaking of the principal contractor.

(12) Nothing in this section limits or excludes any liability with respect to payment of remuneration by a person who is a principal contractor arising under this Act or any other law or any industrial instrument.