Work this Out

This decade and the one preceding it has brought an increasing interest in healthy lifestyles and fitness. Reality television shows like 'The Biggest Loser' seem to have inspired Australians to clean out their fridges and put on their running shoes.

 

This has led to a boom in the health and fitness industry. We have seen an increase in the number of gyms opening their doors, a higher number of holistic fitness programs and more participation in sporting events. More and more people are starting careers within the fitness industry, particularly as personal trainers.

 

As might be common knowledge, most personal trainers (or many of them) run their own businesses. They are not employees of the gym but contractors "engaged by" the gym. Gyms or fitness clubs like Fitness First will encourage their members to purchase personal training services (sometimes in 'packages' at a discounted rate), assign their members to a personal trainer and then "bow out" or wash their hands of the relationship. Often, personal trainers are teenagers just out of school or very young adults on the cusp of their career. In many cases, these trainers do not fully understand the contractor-principal relationship and how it is different from the employee-employer relationship.

 

It is illegal for employers to treat employees as independent contractors or to threaten employees with dismissal unless they sign a contractor's agreement. These arrangements are called sham contracting. Obviously, the legislative landscape has changed since my last entry in this blog. But since 2009, when the Fair Work Act 2009 (Cth) came into operation, the Fair Work Ombudsman has had powers to inspect employer records and take employers to court for penalties and compensation.

 

In recent years, the Fair Work Ombudsman has prosecuted a number of employers, particularly within the hair and beauty, construction and retail/convenience store industries. Prosecutions occur where the relevant employer deliberately seeks an arrangement with an individual worker in circumstances where the worker clearly has no intention or comprehension of acting as a self-employed contractor. The employer does this in an effort to save itself from paying wage and other employee entitlements as well as to remove itself from liabilities associated with the work performed. In most of these cases, the Fair Work Ombudsman seeks compensation for alleged underpayments as well as penalties against the employer.

 

Oddly, while the Fair Work Ombudsman has focussed its attention on industries like construction, the fitness industry seems to have been overlooked entirely. This is in circumstances where the fitness industry is notorious for sham contracting. While contracting is also historically prevalent in the construction industry, many employers used to be sole traders themselves. Furthermore, workers are more likely to understand and comprehend working as their own business than workers in the fitness industry. So why have there been no reports of the Fair Work Ombudsman investigating gyms or fitness centres?

 

One explanation is that no one in the fitness industry is complaining. It is obvious to me that young people are feeling the burden because the rate of personal trainers leaving the industry is very high (while there is very little to demonstrate this in the way of official surveys and statistics, there is a significant body of anecdotal evidence which shows a very clear trend). Yet, despite this, young trainers are either not aware of or have no inclination to exercise their right to complain. Perhaps the majority of would-be fitness instructors or personal trainers are not aware of their rights and those that do consider their efforts better spent in pursuing other avenues or accepting the industry the way it is.

 

I do not believe this is a good thing. Despite that the health and fitness industry continues to thrive, people entering the industry to pursue a career are becoming disillusioned with the single-minded focus on profits as opposed to supporting careers or building the industry from the ground up. Surely, if such a practice continues this way, the industry, as well as the public sentiment for health and fitness, could very well die a sad, empty and premature death. I certainly hope not.