Your thoughts on cash-in-hand job?

Azn310 on 30/08/2014 - 08:30
Last edited 30/08/2014 - 16:57

To start of, I know cash-in-hand jobs are not legitimate, but is it illegal? If it is, why aren't the government do something serious about it?

It seems to be a win-win for employers and employees in most case, and a lost for government AND possibly taxpayers.

What do you think? What if that person that serves you at your local cafe or local grocer are being paid cash-in-hand? What about the future of Australia? Is tax going to get higher and higher, and more people will resort to cash-in-hand jobs? Or is life going to sort itself out and everything will be ok?

I'm not saying wrong or right here, I'm just curious hows the Australian system working in the grand view of things. I'm fresh on the market, got a job, looked at the tax percentages and realize why people prefer to stick to cash-in-hand jobs

Financial

Comments

  • spersephone on 30/08/2014 - 08:52
    +19

    Cash in hand is illegal. The employer is not paying for the things they should, such as tax, super and holiday pay (if appropriate). Usually the people who accept this are also getting well underpaid.

    It's wrong on many levels and is illegal. You just need to be caught. There are strong consequences.

    • djkelly69 on 31/08/2014 - 07:48
      +21

      Getting paid in cash in hand itself is not illegal (obviously). It is the lack of paying mandatory taxes and benefits that almost always comes along with it that is the issue.

      • spersephone on 31/08/2014 - 07:57
        +3

        The paying of cash-in-hand to circumvent paying the proper taxes and associated costs is in itself illegal by the employer.

        You can be paid cash, but you should also be accumulating whatever you have the right to, such as superannuation and withheld tax.

        • RockyRaccoon on 01/09/2014 - 07:21
          +13

          as spersephone says

          Cash in hand is TOTALLY OK.

          NOT declaring it is the ILLEGAL part. (like "cash under the table")

          Declarations are required by the receiver (if its for work etc), as income
          Declarations are required by the employer and at that time they are also required to make payments to super, etc

          Saving money is great as a bargain hunter, if you dont like the current system rather than rorting it then look at who might change it and maybe vote for them.

          While we may not agree with the way our taxes are used by different political entities, many services like the education you received are paid for from Taxes.

          But if you feel comfortable taking and not paying your share, that's your choice, but dont kid yourself that it's a Win Win for everyone. And it is ILLEGAL

    • jto00 on 01/09/2014 - 08:48

      how exactly is it illegal? How do you think contracting works?

      If the person is not considered an employee they are paid the gross amount and when they lodged their tax returns they include the personal services income and the tax is calculated on that.

      • Parentheses on 01/09/2014 - 22:42
        +2

        There are laws about what you can contract and what you can't. The contractee needs to have an ABN, for starters.

        • tohara on 02/09/2014 - 14:30

          you don't need an ABN to receive PSI income

  • X35rgfF45 on 30/08/2014 - 09:08
    +3

    It is noooot a win for employees.

    Its a win for employers, until they get caught.

    • Scrooge McDuck on 31/08/2014 - 14:41
      +13

      I don't think anyone would want to be caught giving a cash-in hand-job.

      • rodericb on 01/09/2014 - 00:13
        +2

        Oh yeah - the coins would feel rough and notes would be just blah. Different strokes for different folks I guess!

        • NosDan on 01/09/2014 - 00:18

          Oh yeah - the coins would feel rough and notes would be just blah. Different strokes for different folks I guess!

          dont knock it until you try it ;)

    • pitufon on 01/09/2014 - 08:31
      +2

      it's a win for employees as a second job.

    • Eivad on 01/09/2014 - 08:38
      +1

      It does not have to be a win for employers. On one hand they get out of paying super and giving you any holiday leave. On the other, it means the employer have most likely not declared the wages or salaries expense at all. This means come tax time, their profit before tax ends up being much higher which results in them ultimately paying more tax to the government.

      • zeomega on 01/09/2014 - 10:16
        +7

        You really think an employer who is paying cash-in-hand is declaring real numbers? LoL.

      • centrelink on 02/09/2014 - 09:48

        Every rich person I know are dodgy and corrupt. They will always find some loop hole to make themselves go bigger. Its the people who try to stay within the system and be fair who always seems to lose out in the end.

  • YouLIKEyouLICK on 30/08/2014 - 09:26
    +3

    People who get cash in hand payment are always so under payed, if everyone did it, we will have no roads, Medicare, fat politicians and schools.

    • [Deactivated] on 30/08/2014 - 12:37
      +3

      That honestly sounds like the new budget…minus the road part, they get lots of monies in the new budget.

      Its completely illegal, doesn't help employees and only benefits employers as said by others.

    • chipstss on 01/09/2014 - 07:33
      +1

      And no NBN, w-wait a minute…

  • DrStinge on 30/08/2014 - 10:01
    +42

    One thing that urks me is people getting cash in hand jobs and also claiming centerlink. For those of us that legitimately pay our taxes and contribute positively to the well being of the country I say "screw you".

    • [Deactivated] on 30/08/2014 - 10:50
      +16

      Man, my best friend in high school was an only child with a single mum (who was born overseas and had quite poor English, but could get by as her understanding was better than her own verbal/writing skills).

      They were both on Centrelink, and both working cash in hand jobs. The mother had TWO cash in hand jobs as a kitchen-hand and cook in Rose Bay, Sydney (posho area lol). Her daughter, my friend, was a waitress.

      I was naive at the time, not really understanding the issues that go along with schemes like this and how widespread it was. I also felt pity and thought they deserved the extra money, being just the two of them in a foreign country,

      Now I look back on it, they were rolling in money. Always wearing new fancy clothes, nice home with antique furniture. No car though - but everything else was nicer than what I had in my family of three (all working legitimate jobs, no government benefits ever).

      • Baghern on 31/08/2014 - 19:29
        +2

        I understand that predicament, the things is you need to remember is how much/hard work they've done, what they've suffered to get to where they are.

        Their problem is not adjusting to their safer/comfortable lifestyle.

        Despite what statistics say, cost of living is going down, has been going down for the lower class ever since GST.

        The black market, for the lower class especially has been proven to benefit the economy as a whole, it helps bring up the lower class, allows merit to rise.

        The 18k tax free amount was long time coming, really it should be around $30k now.

        The black market that damages the economy are those that is pure greed ie millionaire tradies

        • ozhunter on 31/08/2014 - 19:42
          +1

          The 18k tax free amount was long time coming

          Hasn't it been like that for a long time? Just before it was 6k tax free but then there was low income tax offset which I think made the first 18k tax free.

        • DrStinge on 31/08/2014 - 20:45

          I think you missed the point; sure they worked hard - they should do that on their own merit - not subsidising that with the wages of other hard workers.

        • Baghern on 31/08/2014 - 21:29
          +1

          @DrStinge:

          Not disputing that, just pointing out the economics of it.

          By there not being official channels for people to progress at different levels(not possible), people cheat…

          Its why the blackmarket is generally tolerated, kinda like piracy. The problem is where it gets out of control… ala Greece.

          The above example of the cash and hand mother, is an example of where the person does not know when to transition to proper channels.

          What if the tax rate was a flat tax rate… not the progressive tax rate we have now? There would be a lot more cheating. The progressive tax rate give us proper signals of transition.

        • Baghern on 31/08/2014 - 21:37

          @ozhunter:

          no it hasn't

          15% to 18000, is $2700 the tax offset wasn't that high

          Before that it was 17% and 20%

          https://www.ato.gov.au/rates/individual-income-tax-for-prior…

          Before the 6k it was 5xxx…for a long long time

          It meant the poor paid very low/no tax back in ye olde days

        • Daabido on 31/08/2014 - 22:17

          @ozhunter: The offsets I think made it about around $10-11k tax free. That's just from the far reaches of my memory though so could be wrong.

        • ozhunter on 31/08/2014 - 22:31

          @Baghern:

          If you made 30k ending June 2012 you would have to pay $2100 in tax($3600-$1500 from the low income tax offset).

          If you made 30k ending June 2014 you would have to pay $2242 in tax.

          @Daabido:

          $1500 was the maximum you could get from the low income tax offset so back then the first 16k was basically tax free.

        • DrStinge on 31/08/2014 - 22:44
          -3

          @Baghern:

          I've always felt they should increase GST (ie to 20%) then lower income tax. Catches the cheaters and reaps in more from tourists.

        • RockyRaccoon on 01/09/2014 - 07:32
          -1

          @ozhunter:

          taking a short time frame you can always show the effects of bracket creep. Until we get the tax scales adjusted with inflation annually this can always be argued.

          Take a longer time frame like 10 years ago, you will see that the tax take was higher then.

          Also you need to take into account inflation of 5% during the figures you quoted, so the 2100 in 2012 is adjusted to 2200 and then salary increases over the same time etc.

          NET effect is pretty much the same.

          Your comments about the offset are pretty spot on. The worlds greatest treasurer played a shell game, the real impact of the game was that instead of getting the rebate at the end of the year as a tax refund, the money wasnt taken out during the year.

          Now that may assist people more by giving them more weekly, but over the year the total tax after refunds was about the same.

        • Tgb on 01/09/2014 - 08:20
          +1

          @Baghern:

          The LITO created an effective tax-free threshold of $16,000 for low income earners. Then it was cut to $445 for the tax year 2012-2013 and $300 for subsequent years.

          So the previous government only gave a $2k extra tax free for low income earners…. Genius play by them however as lots of young people, students etc naively thought they were saving a lot more then they actually were because of the trickery of upping the threshold but effectively removing the offset

        • zeomega on 01/09/2014 - 10:19

          @DrStinge:
          And then online shopping will boom. Local money going overseas… tourism slightly hit due to higher costs…etc.

          Not as simple as that mate.

        • DrStinge on 01/09/2014 - 14:05
          +1

          @zeomega:

          Online shopping + Money going overseas is already an issue.

      • Kevan2 on 01/09/2014 - 10:47
        +1

        This a really sad situation. As told to me from a foreign student, Canadian, he was working for a notable themed pub, when the tax and fair work department raided them. Result, fine and back wages.

        The pub then paid the correct amount of wage with the provisio that the employees pay back the difference when they finished work at Christmas.

        He left the job.

        Not aware of the later out come.

        Here in the country, fruit picking contractors, Tolley boy contractors, get the contract with farmers and majour grocery chain (listen to ABC story for details sorry not sure which radio national department . The country hour was fruit pickers s Sory t). The contractors paid wages as low as $5 hour. If the fair work is in the area the contractors close down overnight and start up somewhere else.

        Who are to blame for this going on ? The people who employ contractors, we if we know, tax dept, fair work, banks, I don't know! Maybe we all should care more.

        • NosDan on 01/09/2014 - 12:55
          +1

          Who are to blame for this going on ? The people who employ contractors, we if we know, tax dept, fair work, banks, I don't know! Maybe we all should care more.

          sadly the reason they use these sort of contractors etc is exactly so they can do something dodgy/illegal (have underpaid workers in this case) but then claim its not there fault and escape any and all penalties.

          Maybe we all should care more.

          sadly it is partly (mostly?) our fault as well for these sweat shops etc. we demand cheaper and cheaper items and be damned where they come from. "we" dont care if 1000 people die in factory collapses in india, those people are valueless to "us", "we" only care that the crap we buy is suitably cheap for our tastes.
          http://en.wikipedia.org/wiki/2013_Savar_building_collapse

          if we, as a population of humans, decided that we are going to insist on only dealing with ethical companies then the companies would be forced to supply our demands, but we dont and wont so the problem just keeps getting worse

    • Azn310 on 30/08/2014 - 17:01
      +3

      Its true.. The whole centrelink thing is getting out of hand. Most of the money go to the wrong people..

  • anna10 on 30/08/2014 - 10:22
    +5

    Also, you will not have any insurance cover should there be an accident, and it does happen.

    Obviously, there are a number of people who get away with it. Often, they already have a business set up w' an ABN, and a bit of cash for a job is not the main part of their income - tradies come to mind. Then, there's mates rates and reciprocal arrangements (that's more like a community thing); and bitcoin, and probably a few other ways.

  • modsec802 on 30/08/2014 - 11:14
    +5

    Did anyone else read this post as blah blah hand job blah blah blah?

    • whooah1979 on 30/08/2014 - 11:42

      cash is the best way to pay and the best way to get paid. many small businesses do it in one way or another. mnc can't so they profit shift, tax shelter, etc.

    • [Deactivated] on 30/08/2014 - 11:52
      +1

      Yes, juicedpixels, and save for one transposed hyphen, Scotty's baby would suddenly be blacklisted. OzB as NSFW.
      Although maybe not a NSF(any-kind-of)Work website…

      • [Deactivated] on 30/08/2014 - 11:55
        +3

        What a difference a little dash makes lol

        • [Deactivated] on 30/08/2014 - 12:08

          As someone who does like a hyphen, and a dash (I'm-a-bandit-for-'em - both) (sometimes) (not exactly shy of parentheses, either), I know, turnip, I know…

        • GaryQ on 31/08/2014 - 10:19

          @Tas:

          Not to mention an Oxford comma

        • [Deactivated] on 31/08/2014 - 13:01
          +1

          @GaryQ:
          Indeed, more often than not, and always with intent.

          . *
          !

        • GaryQ on 01/09/2014 - 17:23

          @Tas:

          I curse overlooking to chance to make that

          Not to mention, an Oxford comma

          Bah!

    • MelbBargainChaser77 on 01/09/2014 - 21:42

      hahahaha YES I did!!

  • Unorthodox on 30/08/2014 - 11:33

    Think that in most cases, the employer benefits from that. Employees would usually be underpaid, have little to no bargaining power, etc

    • whooah1979 on 30/08/2014 - 12:07
      +2

      the employees benefit just as much from their agreement with their employers. some reasons employees want cash:
      receiver of a government benefit
      here on a student or visitor visa
      reduce child support payments
      reduce child maintenance
      reduce spouse maintenance
      reduce tax liability

      • Azn310 on 30/08/2014 - 16:55

        Yes, if employees can make as much as $14-15 an hour cash. Thats almost the same as an average salary job, with more flexibility, possibly more hours and less stress. Just gotta work hard..

        • whooah1979 on 31/08/2014 - 09:28
          +1

          $15 p/h is pocket change. i had a plumber install a 3m line for my fridge drink dispenser. $180 for 20min work and no invoice. not a bad way of making a buck.

        • Azn310 on 31/08/2014 - 12:33
          +1

          @whooah1979: what.. Isnt that a rip off?.. I would try to do it myself before calling tradies, they do charge too much

          Also if you agree to pay them without invoice, isnt that similar to paying them cash-in-hand?

        • whooah1979 on 31/08/2014 - 12:53

          @Azn310:

          i didn't know how they would connect the line. i'm sure there were plenty of clips on youtube showing how to do a similar job.

          not getting an invoice wasn't a big deal as it wouldn't make a difference to my tax liability.

  • [Deactivated] on 30/08/2014 - 12:45

    "where are the handjobs" said jv

  • isthisreally_me on 30/08/2014 - 13:43
    +7

    Big question is what if you are injured at work, cash in hand means no insurance coverage & no benefits from your employer. You will also have little rights and wont be able to bargain with employer as he will have the upper hand. Cash in hand is fine until something goes wrong.

  • Davo1111 on 30/08/2014 - 13:46
    +3

    undermines the entire purpose of award/minimum wages, and the legal benefits/protection both sides have.

  • drexxx on 30/08/2014 - 20:00
    -5

    haha my friend.

    you need to educate yourself further on how this "all works".

    it's fine that you dont know now! not everyone was born with knowledge! So good on you for making this post and trying to find out the answers! I just really hope you seek to understand the system more because what you have said is completely retarded (said in the nicest way possible haha)

    • What do you think gets done with tax money?
    • Do you know how a government works?
    • If we all adopted your cash only system how would a country work?

    Just same basic questions you should try to find the answers too and things will be come clearer :)

    • Tafe on 31/08/2014 - 22:56
      +4

      Ease up on the mushies.

  • davidmwilliams on 31/08/2014 - 08:32
    +6

    It is not legal, and the Government does take it seriously. However, just because the Government is not aware of, and stamping out, every single cash in hand job this does not mean it is accepted, permitted, or reasonable.

    People doing cash in hand jobs are being short-sighted. They are not getting superannuation, worker's compensation protection, sick leave, holiday leave, long service leave, or other things.

    They think they are being clever because they are not paying income tax on this money, and because as others have mentioned they can deceptively claim welfare benefits at the same time but in the long run they are just robbing themselves and others.

    • scrimshaw on 31/08/2014 - 18:19
      +2

      People doing cash in hand jobs are being short-sighted. They are not getting superannuation, worker's compensation protection, sick leave, holiday leave, long service leave, or other things.

      They don't see these things as priorities until they have a stable job and a good income. My neighbour for instance, is a 45 year old guy on permanent visa with little in terms of education, speaks broken english and would be willing to take a job even it it means being exploited and not having work compensation, insurance or super. They wouldn't be able to land a job otherwise.

      And it's very tempting for a business, to hire someone like him because he's someone who won't dob them in to the ombudsman, has zero bargaining power and is willing to be underpaid.

  • VFM on 31/08/2014 - 09:22
    +2

    It is illegal but I doubt ( just pulled from thin air, no studies referred or research done by me), the normal cash-in-hand jobs have any significant effect on tax revenues as most recipients are below the 37k pa brackets.

    And the employer does pay more corporate tax since the payments to the employee are not expensed. If it came out of the employer's personal pocket, then it was already "taxed" at most likely a higher rate.

    The situation of paying employees cash-in-hand benefits the employer only where some streams of revenue are also cash-in-hand. And that is a different, more serious and probably the source issue.

    Disclaimer: I do not have any basic knowledge.

    • Azn310 on 31/08/2014 - 12:29

      I dont think employers report their real revenues, thats why in many cases, they sell without invoices for cheaper, and consumers like cheaper stuff, e.g. Ozbargain community :D

    • cannedhams on 31/08/2014 - 21:03
      +2

      Most of Australia's economy is dominated by large firms who cannot evade taxes since it would require a conspiracy of too many people (eg Coles, Woolies). People who work for government can't cheat, most professional service providers can't cheat either. You're left with the independent retail and services sector (eg hairdressers) and some dodgy handyman/tradie types.

      Treasury estimates the black cash economy is about 5% of GDP, it may be more, but from their point of view it makes more sense to go after high-earners using elaborate tax minimisation schemes.

      A black cash economy can be a huge problem for government once it becomes embedded in a country's culture. Greece's main problem is that everyone, literally, avoids paying tax. Aldi and other chains have tried to penetrate the market but can't compete with the independents that basically operate completely using black cash. Even most Greek politicians dont declare income from properties, everyone is in on the rort.

      • RockyRaccoon on 01/09/2014 - 07:40
        +1

        Most of Australia's economy is dominated by large firms who cannot evade taxes

        Given that the ATO has taken a number of cases to court, they do. Although the debate in the courts is about evasion and avoidance.

        If the company has an overseas entity in a low taxing country the money can be shifted there.

        If you earn billions then paying lawyers and accountants to work ways around taxes is a small investment.

        While we could probably do the same, initial costs make this strategy uneconomical

        • Azn310 on 01/09/2014 - 11:37
          +1

          Agreed. Accountants are like magicians, they will ask the companies how much tax they want to pay and work accordingly.. And yes multinational companies are the worst if not dealt with, Coca Cola has been in Vietnam for over 2 decades and not paying a single cent of tax, they transfered profit to a tax haven somewhere

  • Boshait on 31/08/2014 - 13:24

    Great idea. Even better is bitcoin in wallet.

  • R3XNebular on 31/08/2014 - 14:00

    Hand jobs are illegal if you pay in cash. It is legal if it is free.

  • MonocleMoose on 31/08/2014 - 14:30
    +4

    Cash in hand in itself not illegal - it is the lack of reporting of income that is illegal.

    A lot of the responses to this question show a very strange notion of paying tax, and that people should avoid paying tax. Think of paying tax as being a member of a golf club. You are all lucky to be here in Australia and that you get to pay tax for police, roads, schools, hospitals, fire brigades, child care, waste services, infrastructure building, the list goes on and on and on.

    Anyone seeking to actively avoid paying tax should be seen as scum who don't want to be part of society. We have the privilege of living in a country with one of the highest standards of living in the world. Tax avoiders should never been seen as 'smart' or brag about it - even if a company has a duty to it's shareholders to make a profit. If you can't pay tax, don't run a business. The end.

    Nearly all the other responses in this thread are tremendously disappointing.

    • whooah1979 on 31/08/2014 - 14:40
      +1

      tax avoidance wasn't illegal the last time i checked (30sec ago). many people get confused when it comes to legal tax definitions.

      edit
      the feds and states waste tens if not hundreds of millions in tax money in every budget. the less tax they get the less they can waste. it's our right and duty as citizens of any country to avoid paying as much tax as possible.

      • MonocleMoose on 31/08/2014 - 16:47
        +1

        "it's our right and duty as citizens of any country to avoid paying as much tax as possible."

        Sigh. What a self centred world you live in.

        • whooah1979 on 31/08/2014 - 18:15
          +2

          i live in the same world as you. i work hard for i want and what i have. i see no reason to donate more tax than i have to, to a bunch of public servants that have knack of wasting it on failed projects.

          edit
          if you're the kind if person that likes to donate more tax then by all means do so. just put an extra 0 on your tax return. do tell us about how selfless you're after you're done that. i'll give you a pos.

      • cannedhams on 31/08/2014 - 21:29
        +6

        just to clarify - tax avoidance is legal, tax evasion is illegal.

        • RockyRaccoon on 01/09/2014 - 07:45
          +4

          Actually Tax avoidance is covered, under anti avoidance provisions

          I think you may be better off saying tax minimisation

  • [Deactivated] on 31/08/2014 - 14:49
    -1

    Who cares? Not everyone gets minimum wage anyway. Most of the family businesses aren't working for minimum wage.

    What about those on commission only jobs? There is a choice and that is what matters.

    If someone wants to do slave work for $5 an hour, then let them be. We already have systems whereby you have to work for an organisation as a volunteer for 3 years before you get put on full time work. This has been long documented and yet charities still pull this trick. You choose whether you want to be exploited or not. It's a choice.

    • spersephone on 31/08/2014 - 14:51
      +1

      The more people allow themselves to be ripped off by this sort of stuff, the more it goes on. Our economy is not so good at the moment, we need to protect our workers. By giving them adequate wages, they are more likely to spend money which goes back into the economy.

      Everyone ripping everyone else off doesn't really help the economy at all.

      • [Deactivated] on 31/08/2014 - 15:00
        +5

        No one is ripping anyone off. They can't afford it. If everyone could afford to pay an extra then we wouldn't have the problem, but people like ozbargainers don't.

        I've often wondered about how can a restaurant pay their freaking rent? If you look at all the underlying costs it appears that even if the 3 people working are paid $8 an hour. That's $24 an hour. Suppose you get 20 customers during the peak hour and each time you earn $3-4 a dish. This is about $56 an hour during the peak lunch break.

        Just sit down and count next time you are at lunch. However, most of the time the restaurant is probably empty, and rent is $500 a week or more. Bigger restaurants pay over $2000 a week in rent and have tens more employees. It's hard to see how a small business could even be evading tax, other than payroll tax. This is because they don't even turn a profit most of the time. Any profit they make is probably at below minimum wage and on a commission style basis.

        By protecting your workers, you are stopping them from getting a job. The minimum wage is the core reason why there are so many unemployed young people. The minimum wage only protects those who have skills, and was an idea crafted by the labour unions to protect themselves against cheap unskilled labour.

        • oringal on 31/08/2014 - 23:35
          +1

          yep this is true, for small businesses like ones run by families (i.e. businesses with no franchises or no other sort or person investing in it (like posh restaurants)) they barely make much profit even with the low wages. And also these workers are willing to work for these wages, retail jobs are a competitive market out there, its either I get this pay now or risk trying to find a job who pays award wages.

        • michaelTito on 02/09/2014 - 20:30

          believe me, small businesses earn more than you think! i know people who have small business that earn up to 200k a year in profit (dodgy tax though)

    • [Deactivated] on 31/08/2014 - 15:05
      +4

      You choose whether you want to be exploited or not. It's a choice.

      No. Not everyone has that "choice". Many (or most) people who end up working in underpaid or cash-in-hand jobs either lack work skills or language skills, which invariably leaves them little option but to take whatever work they can get. All of those people don't necessarily have the time or resources to increase their skills - what if they have family/children to support etc? They'd need money quickly, even if it's a small amount compared to if they took time out to study further and then get a legitimately paid job with award pay.

      Same applies to overseas countries. Do you think workers in underdeveloped countries choose to be exploited? Or do you think it's the only practical available option for them to survive? We may be on the total opposite end of the spectrum in terms of our country's development, but the same issue applies here to a lesser degree among certain groups of people. Plenty of people here are desperate and are forced to be exploited just to survive.

      • [Deactivated] on 31/08/2014 - 15:07

        That's a choice, some people don't work and beg instead.

        So, do you think that they are being exploited? No, they don't even work.

        Under your theory, everyone who works is being exploited as everyone is being underpaid. There will always be someone being paid more than another person for the same work.

        There are always alternatives to work. You just need to use your head. If all someone thinks they have is a low paying job, that is better than nothing, but eventually if they think enough, they will find something better. Either way, less than minimum wage is better than being unemployed for some, whilst others would think begging is better. Different points of view.

        • [Deactivated] on 31/08/2014 - 15:13
          +2

          I don't consider it exploitation simply if the person is being underpaid. I see it as exploitation if the person isn't being paid on the books, and therefore has no official rights as an employee.

          Being underpaid is just a byproduct to being paid off the books, is it not? Since the employees can get away with it.

        • [Deactivated] on 31/08/2014 - 15:16

          They aren't being underpaid according to free market principles. They wouldn't have that job otherwise. How many places can really afford to pay minimum wage? Even when I visit a restaurant, I wonder how the heck can it be so cheap.

          When robotics start to improve, most people will be unemployed. Then what? Will you try to compete with the robot? You won't be able to compete. When you start to think about the future and what minimum wage actually means. You will realise it's a load of crap created by labour unions to protect themselves in the "today's society", but when the robots come, the minimum wage will be the reason why you are out of a job.

          The minimum wage would perform the exact opposite function as it does today, as the robots are more highly skilled and efficient.

          This is why the minimum wage keeps out unskilled/low-skilled workers.

        • [Deactivated] on 31/08/2014 - 15:51

          @josephchi: I see what you're saying and it does have logical merit, for sure. But it seems like a hell of a slippery slope to change the views or laws surrounding minimum wage etc. You do raise a good point though. I'll have to go off and ponder it further. Tricky issue…

        • [Deactivated] on 31/08/2014 - 16:12
          +2

          @josephchi:
          In reference to your reference to robots, as and when they 'start to improve', if this video, very cogent as it is, turns out to be indeed accurate, the breadth of impact + the very real potential of SOON, should maybe lead us all down the path of a keen compassion for the particular circumstance of other people - like many of your current friends, maybe, josephchi.
          They might then - one day - individually, or as a society, return the favour to you, given your own circumstance as it could well be, down the track.

        • NosDan on 31/08/2014 - 18:08

          @Tas: you talk of "soon" yet cant see that its already happened? its simply a slow progression yet people seem to be waiting for this big amazing obvious point to smash them in the face.

          boiling frog comes to mind

        • [Deactivated] on 31/08/2014 - 18:53
          +1

          @nosdan: That's actually why I put 'start to improve' in inverted-commas, as opposed to block-quoting it.

          I do think that - at least in some areas of world, and certainly in some areas of employment (particularly in manufacturing and transport), that we really are on the cusp of a whole 'other level' of automation, with concomitant 'other level' social upheaval.

          On many fundamental levels, governments will struggle (and fail) to respond quickly enough to that which lies just beyond current horizons.

        • Azn310 on 01/09/2014 - 12:06

          @Tas: thanks Jas, that video is very eye opening indeed.

  • fredzfrog on 31/08/2014 - 18:13

    I can see the advantage of paying someone in cash.
    If its a short, one time job, I don't see too much of a problem. if its a long term ongoing arrangement, then there's a need to do things properly.
    I can see the same result with the beerconemy too.

    Not that i'd ever knowingly engage in such a practice, always above board here Mr tax man sir!

    :P

  • Baysew on 31/08/2014 - 18:55
    +2

    You can earn up to $18200 of income tax free.

    Wages are tax deductible for an employer.

    ATO has a data base of every individual and company in Australia going back years.

    ATO has wide ranging powers and penalties can be quite severe.

    SMH

    No sympathy for tax dodgers.

    Greece Is Bankrupt

  • This Guy on 31/08/2014 - 20:27

    Cash in hand sucks for the employee. It's not always short sighted. It's often the only work a person can get without lying about their situation.

    Many cash in hand jobs are 'unskilled' and pay half or less of the going rate. They don't tell you that you're off the books until after you've started.

    Demanding to be paid right can get your shifts cut. Yes you can keep a logbook and go to court to get what you are owed, but if a google search shows you sued your old boss, it makes it harder to get more work.

    Some employers are struggling. Other employers don't mind stealing from employees and taxpayers. I've heard of employers who pay adult's $10/hr and tell staff to get Centrelink for the rest.

    The economy is rubbish. My industry has been firing for the last two years. At my 'pay the rent' job, around five of my customers are made redundant every week.

    I'm lucky. I'm paid right. But it took 12 months job hunting to get this entry level job with no career prospects.

  • Weezle on 31/08/2014 - 21:24
    +2

    Cash in hand is legal AS LONG AS the employer declares to the ATO these payments, and IF a tax return has to be submitted (i.e. by employees who earn over $18200), then they also have to declare it is as income.

    • spersephone on 31/08/2014 - 21:32
      +4

      Being paid cash is legal. Being paid "cash-in-hand" is not. That is the term used for getting paid cash "under the table" so to speak. It is not so much whether you are paid with cash that is the issue, but whether you are being paid cash to be off the books, and not get your entitlements, as well as not declaring the taxation requirements.

  • Cluster on 31/08/2014 - 21:48
    +2

    I knew someone who did household type chores for cash. He didn't declare the income, but the person paying DID declare the outgoing expense on his taxes. The 'employee' got caught and had to pay a small fine. Just because it's cash doesn't mean it's anonymous, and that someone hasn't created a paper trail you may not be aware of.

  • zeckem on 31/08/2014 - 22:51
    +1

    I know someone (possibly myself) who did a cash in-hand job for almost two years, I guess to answer the question of why they are not cracking down on it, is that, this would rarely happen for a good paying job in business or a corporate job. It's generally the small business jobs who do this sort of thing. So to the government, it's not a major deal that will affect the country.

    • [Deactivated] on 31/08/2014 - 23:26

      So to the government, it's not a major deal that will affect the country.

      I don't think you understand how it all works, dude. I'm too tired to go into it right now, so hopefully someone can respond to your post and try to explain things better to you.

      But basically, yes, it does affect the country in a very significant way.

      • Boshait on 01/09/2014 - 10:52

        But basically, yes, it does affect the country in a very significant way.

        It improves it by allowing economic activity that the dead hand of government regulation would otherwise forbid.

        My 80-something mother is one of those exploitative employers. Since my father died she hasn't been able to mow the lawns, so she pays a man who lives nearby $40 or $50 to do them every fortnight. Cash in hand. No super, no tax.

        Should the government come and get her?

        • [Deactivated] on 01/09/2014 - 11:15

          so she pays a man who lives nearby $40 or $50 to do them every fortnight.

          How is that the same as running a business, making income/profit and paying employees off the books?

        • Boshait on 01/09/2014 - 11:49

          @waterlogged turnip: She's exchanging money for labor. Isn't that what employers do?

        • Baghern on 01/09/2014 - 17:09

          @waterlogged turnip:

          Those two aren't the same.

          Your proposition is where the dilemma is, when does it become a burden on society how do we stop it cost effectively.

          Education and cultural ethics is the key here.

          Greece went overboard and are paying the price for it.

        • NosDan on 01/09/2014 - 17:18

          @Baghern: imo the problem is simple and a self fulfilling one. why cant the restaurant make money like they could 10 or 20 years ago and thus pay people properly? because they dont have as many customers and the customers they do have are unwilling to pay a reasonable profit margin. why is this? because the "average" person dosnt have the disposable income they used to. so by paying your workers even less you are infact making the issue even worse for yourself (the restaurant owner)

    • Weezle on 01/09/2014 - 01:06
      +1

      It's something like 80% of the Australian economy (business wise) is made up of small-businesses.

      So yes it is a major deal to the government…

  • pyro love bird on 01/09/2014 - 02:27

    Well I guess it doesn't make a difference if they're a casual employee and don't make enough to get taxed anyway (they get it back at the end of the financial year anyway) right?

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