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Wednesday, 23 March 1994
Page: 2110


Senator SHERRY (Parliamentary Secretary to the Minister for Primary Industries and Energy) (6.13 p.m.) —I heartily agree with the comments of Senator Coulter. These provisions will clarify that payments made to contractors wholly or principally for their labour are salaries and wages for superannuation guarantee purposes. An employee is defined as including a contractor who works under a contract which is wholly or principally for the labour of a person. A contract is considered to be wholly or principally for labour if more than half of the value of the contract is for labour. It was clearly intended that payments for labour under such contracts be subject to the superannuation guarantee contributions. However, as such payments are not specifically included in the definition of salary or wages, some employers are of the view that they are not to be taken into account for the purposes of calculating the superannuation guarantee shortfall.

  To remove any doubt that payments made to contractors wholly or principally for their labour are salaries and wages for superannuation guarantee purposes, we have these provisions in this legislation. That is the reason we are moving in this way.