Disadvantages Of Outsourcing Australia

Outsourcing
Outsourcing is a term defined as the movement of jobs elsewhere to another company that can perform the same tasks, even though there is the potential of doing the jobs inside the company itself. An example of outsourcing is currently being done at your company, where contractors, usually part of their own contracting company, are performing the duties the old employees used to do. Another example of outsourcing can be moving jobs overseas, such as to developing nations, where cheap labour is readily available and the laws are much less restrictive. In both of these circumstances, the aim of outsourcing is to provide a cheaper alternative for the company, while improving its efficiency. Though there is usually deep public backlash from workers right over Australia, when jobs are being sent overseas.
Effects on Individuals and Their Possible Experiences
There is a wide-range of experiences an individual will take, due to Outsourcing. Outsourcing has an array of benefits and setbacks, though is often use

right across the Developed World. For workers in developing regions of the world and contractors, outsourcing is favourable towards them as it allows them to have a job, that will pay them. Although they won’t receive entitlements that normal employees would, such as annual leave loading, they know that companies will often be regularly scouting for contract-based workers and with this, comes a secure source of income for a period of time, that be used to combat poverty in some regions; feeding families and providing a future of hope. For contractors based in Australia perhaps, this means that they also gain a high level of autonomy from the employer and will be in charge of their own activities. Managers also benefit from this form of employment; whereby their responsibilities are significantly reduced and no longer liable in most workplace incidents.
However, the effects are quite disadvantageous for those who are employees; directly working under the supervision of a manager. Outsourcing means that their jobs will be taken over by someone else and that they will lose their job. They will lose their income and any benefits acquired. They will feel as if a sort of injustice has been blown to them; with very little they are able to do. They will no longer be able to look after their families. They will also realise that the company doesn’t value their workers either. This will flow on with public opinion, with the media heavily criticising its decisions – if jobs are sent elsewhere. Though they can also be disadvantageous in a sense that quality if often lost, a company will lose much control over its activities, amongst others. Though the biggest threat posed by outsourcing is the need to share important data, which is often classified as confidential. Having no central control can severely limit a companies’ capability to control the flow of this information; as it may fall into untrustworthy hands.
Laws and Legislation
Although there is no particular law in relation to outsourcing or anti-outsourcing in New South Wales or right across Australia alone, there are still many legal issues that arise from the growth of outsourcing. Along with the issues, also comes the consequences, risks to companies and the subsequent impact on the local economy. Though this is mainly offshore, and contracting laws constitute a completely different set of legislation. For these type of workers, the two laws that define an independent contractor and what their rights and privileges are the Fair Work Act 2009 (Cwth) and the Independent Contractors Act 2006 (Cwth). Both of these laws work together to assist independent contractors right around Australia. The aspects relating contractors and contracting in these laws are administered by the Fair Work Ombudsman.
These two laws, work in combination to define the difference between an employee and an independent contractor.

Usually, it is determined directly between the two parties of the worker and the employer; though when an incident occurs, it may be harder to find the truth. Usually, independent contractors enjoy a high level of autonomy when conducting their work and usually, work on hours they’ve assigned themselves, have their own tools etc., and since it is likely they have their own contracting business they will hold a unique ABN or Australian Business Number. This special code is used to identify a business to the government, client, customer, and in our case; an employer. This law also defends independent contractors from receiving and abiding by flawed contracts, which the Fair Work Ombudsman refers to as a ‘sham’. They also provide basic rights to each contractor in the workplace; though it is only partial in comparison to the rights of an

employee.
As for responsibilities, independent contractors should always be informed of the law; and know how to properly identify a ‘sham’ contract. They must also know their power in the law. Whilst managers and employers must deal with all employees and contractors truthfully. They should be aware that they cannot offer flawed arrangements, via the contract and they cannot simply turn around and brand their employees as ‘contractors’, in any case, whether it is by threatening them or persuading them. If this is breached and an employee or contract worker feels as if their rights have been violated; they may make a claim with the Fair Work Ombudsman. If the employer is proven guilty, they could be forced to pay up to $54,000 for each offence committed and in some cases will need to pay damages to the employee, while possibly restoring them back to their original position; before their dismissal/incident.
As a result of this, even though that many contractors are heavily used in the manufacturing industry; for example, within Juggernaut Industries. We seriously believe you should rethink the idea of contracting all your workers; you still need some employees to retain the central management of your company.