Rural Funds Management Limited Contractor Engagement and Management Policy - Last updated 8 March 2019

 
Rural Funds Management Limited Contractor Engagement and Management Policy - Last updated 8 March 2019
Rural Funds Management Limited

Contractor Engagement and Management Policy

                                   Last updated 8 March 2019
CONTRACTOR ENGAGEMENT AND MANAGEMENT POLICY

CONTENTS

1.      Introduction ..........................................................................................................3
1.1.    Background ........................................................................................................................... 3
1.2.    Purpose ................................................................................................................................. 3
1.3.    Scope .................................................................................................................................... 3
1.4.    Roles and responsibilities ...................................................................................................... 4
1.5.    Key definitions ....................................................................................................................... 4
2.      RFM Procurement Policy .....................................................................................5
3.      Categories of workers..........................................................................................5
3.1.    Companies, trusts and partnerships are always contractors ................................................ 5
3.2.    Labour hire or on-hire arrangements .................................................................................... 5
3.3.    Hiring individuals ................................................................................................................... 6
4.      What does a contractor relationship look like? ................................................. 6
4.1.    Common law test ................................................................................................................... 6
4.2.    Guidelines to follow to engage an independent contractor ................................................... 8
5.      The Contractor’s obligations...............................................................................8
5.1.    Taxation – Payroll Tax........................................................................................................... 8
5.2.    Taxation – PAYG ................................................................................................................... 9
5.3.    Superannuation ................................................................................................................... 10
5.4.    Workers’ Compensation insurance ..................................................................................... 10
5.5.    Workplace Health and Safety Act 2011 .............................................................................. 10
6.      Management of contractors .............................................................................. 12
7.      Appendix A – Quick Guide ................................................................................ 14
8.      Appendix B – Employment Hero set up............................................................ 17
9.      Appendix C – Authority to Commence Work form........................................... 19
10.     Appendix D – Engagement Authority form ...................................................... 25
11.     Document Information ....................................................................................... 26
11.1.   Primary Contact ................................................................................................................... 26
11.2.   Version Control – Word Doc whilst in Draft (PDF = Final) .................................................. 26
11.3.   Authorisation and Sign-off ................................................................................................... 26
11.4.   Acronyms / Definitions Used Throughout the Document .................................................... 26
11.5.   References (Related Policies / Procedures and Requirements)......................................... 27

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CONTRACTOR ENGAGEMENT AND MANAGEMENT POLICY

1. Introduction

1.1. Background
RFM and its managed entities use contractors for services and for specific activities or
projects. This is usually because certain contractors have particular skills but are not
needed on an ongoing basis.

The most important thing when making a decision to engage a contractor is to do
everything possible to establish that there is a genuine independent contractor relationship
and that the arrangement is not really an employment relationship by another name. There
can be expensive consequences if a contractor relationship is not properly established.
Simply calling an individual a ‘contractor’ on paper, or the fact that they have an Australian
Business Number (ABN) or a registered business name, does not mean that this is
determinative of the relationship. Courts can still look behind a contract to define the true
relationship between the parties. Having a contract in place does not mean that you can
contract out of your obligations under legislation.

There are some important differences between an independent contractor relationship and
an employment relationship. Independent contractors run their own business and are hired
to do a set task or tasks based on certain terms within a contract. Independent contractors
generally use their own processes, tools and methods to complete the work. They can
delegate or subcontract some of the tasks if they need and can work for a number of
different clients at the same time. An independent contractor does not have the
guaranteed minimum terms and conditions of an employee. An independent contractor is
really no different from any business owner. An independent contractor may take the form
of a sole trader, partnership, company or trust and may well have employees or
subcontractors of its own. A subcontractor is an independent contractor that's hired by
another independent contractor to help them complete their contracted work. Historically,
an independent contractor relationship is called a “contract for services”. It is necessary to
be careful when entering into a relationship with a contractor to ensure that they are a
contractor at law rather than an employee, as this can affect things like tax obligations,
insurance obligations, and leave entitlements.

1.2. Purpose
This policy details RFM’s requirements when engaging and managing contractors. It also
provides guidelines to assist staff to determine between contractor and employee
relationships.

1.3. Scope
This policy applies to all RFM employees and its managed and/or owned entities.

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1.4. Roles and responsibilities

  Position                               Role
  National Manager Human Resources       Review, update, approval and implementation
  Company Secretary                      Review against relevant internal policies and approval
  Business Managers,                     Oversee the implementation of this policy within their own
  National Managers                      business unit and ensure the requirements are adhered to

1.5. Key definitions

  Term                      Definition
  ATCW                      Authority to Commence Work
  Contract                  An agreement between two or more competent parties in which an offer
                            is made and accepted, and is supported by consideration
  Contractor                Any registered entity or individual with whom the Company has entered
                            into a Contract
  JSEA
                            Job Safety & Environmental Analysis. A Risk Assessment tool to
                            document hazards and control measures before a work task takes
                            place.
  SOP
                            Safe Operating Procedure. A documented procedure that is
                            implemented to ensure work is carried out in a systematic and
                            considered manner, and that the risk of the activity adversely impacting
                            HSE values is eliminated or minimised.
  The Company, Rural        These terms, either used individually or collectively refer to Rural Funds
  Funds Management          Management Limited and, where required by the context, its managed
  Limited, RFM,             and/or owned entities.
  organisation, business,
  we, us

1.6. Policy review and revision
The policy will be reviewed, revised and approved at least once every two years.

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2. RFM Procurement Policy
In accordance with the RFM Procurement Policy, the following are the requirements to be
satisfied prior to engaging an independent contractor:

•    An independent contractor may be engaged under a contract setting out the terms
     and conditions of the engagement. Contracts must be in place for all engagements
     valued at more than $250,000.

•    A simpler Authority to Commence Work (Appendix C) may be put in place where the
     value of the engagement is between $10,000 and $250,000. This is appropriate for
     both one-off and ongoing arrangements.

•    If the work to be undertaken does not exceed $10,000, a contract or other
     documentation is not required however an Engagement Approval Form (Appendix D)
     should be completed and retained on file.

A risk assessment (using a JSEA form or similar document) must be completed in all
cases, except for low value work (under $10,000) where the inherent risk of the work being
undertaken is not high or extreme.

3. Categories of workers
If apprentices, are engaged by RFM or an RFM entity, they must always be engaged as an
employee.

3.1. Companies, trusts and partnerships are always contractors
An employee must be a person. If a company, trust or partnership has been engaged to do
the work, a contracting relationship exists for tax and superannuation purposes. The
people who actually do the work may be directors, partners or employees of the contractor
but they're not RFM’s employees.

3.2. Labour hire or on-hire arrangements
Workers obtained through a labour hire (or on-hire) firm, where that firm is paid for the
work undertaken in the business, are not employees. The business has a contract with
the labour hire firm and they are responsible for the PAYG withholding, superannuation
and FBT obligations. Labour hire firms can be called different names including recruitment
services and group training organisations and our business may be referred to as the 'host
employer'.
It is important to be aware that there are reforms in force or being considered about
licensing for labour hire providers. For example, in Queensland it is now unlawful to obtain
labour hire from an unlicensed entity. Other States and Territories may also adopt a
similar scheme. Checks must therefore be conducted to ensure that, where required, a
current licence is held by any labour hire provider.

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3.3. Hiring individuals
If an individual has been hired, it is the details within the working agreement or contract
and key legislative provisions that determine if they are a contractor or employee for tax
and superannuation purposes. Refer to clause 5, The Contractor’s Obligations for further
guidance.

4. What does a contractor relationship look like?
An ideal independent contract relationship will display the following features:

•     The contract should be for a given result, a specific task or a series of tasks;
•     The contractor should retain a high level of discretion/flexibility in how the work is
      performed;
•     The contractor will bear responsibility for poor workmanship or injury;
•     Contractors are required to carry their own income protection, professional indemnity
      and public liability insurance;
•     The contractor usually maintains a separate workplace;
•     Contractors provide their own tools and equipment;
•     A contractor is normally contracted for a set period of time or to complete a set task
      or sets their own hours of work;
•     Contractors do not receive leave or other statutory entitlements of an employee;
•     A contractor should be able to delegate their work;
•     Contractors pay their own superannuation/GST/tax;
•     Contractors generally submit their invoice for completed work and are paid at the
      end of a project;
•     A contractor can carry out work for other persons as well as the principal and can
      advertise their services to the world at large;
•     Generally, contractor agreements contain a mechanism for giving notice to remedy a
      breach to the contractor;
•     Contractors can bring proceedings under unfair contract legislation or the common
      law.

4.1. Common law test
The common law test for determining whether a relationship is one of independent
contract or employment is known as the ‘multi-factor’ test. This involves identifying and
weighing up various features of the relationship to see where the balance lies. If the
proposed contractor is not able to meet at least six of the criteria listed below, further
guidance from your Manager must be sought as to their status as a contractor. This table
extracts some common features that courts have considered:

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Feature                 Employee                                      Independent contractor
Measure of              Employer usually has the right to             Contractor works at own initiative to
control exercised       control how, when and where a worker          achieve a stated result. Contractor
by the                  performs their duties. Tasks are              maintains discretion and flexibility as to
principal/employer      usually performed at request of               how work is completed, although
                        employer.                                     contract may specify some terms as to
                                                                      materials used and methods of
                                                                      performance.
Exclusivity             Employee usually works exclusively            Contractor is free to provide services to
                        for employer.                                 multiple clients.
Right to delegate       Employee is personally engaged to             Contractor may delegate all, or some,
                        perform the role and has no inherent          tasks to another person and may
                        right to delegate performance of the          employ other persons to perform the
                        role to another employee, unless              services (although this may be subject
                        authorised by employer.                       to the principal’s consent).
Risk, rectification     Employee bears little or no                   Contractor must rectify poor work at own
of faults               responsibility to rectify poor work.          cost and effort and bears commercial
                        Employer is responsible to others for         risk of loss incurred by principal due to
                        poor work of employee.                        contractor’s poor work.
Tools and               Employee generally performs work              Contractor generally provides their own
equipment               using tools and equipment provided by         tools and equipment. Contractors are
                        employer, at employer’s place of work.        not usually reimbursed for expenses
                        Employee is generally reimbursed for          they incur in providing the services.
                        expenses personally incurred by them
                        in performing work, as long as they
                        are authorised by the employer.
Hours of work           Employee has hours of work set by             Contractor can set their own hours of
                        employer.                                     work, as long as they perform the
                                                                      services.
Leave                   Employee is entitled to annual leave,         Contractor is not entitled to leave, and a
entitlements            long service leave and sick leave, and        written contractor agreement would not
                        this is usually provided for in written       usually provide for these things.
                        contract.
Payment                 Employee is generally paid for their          Contractor is generally paid for providing
                        time, e.g. hourly, weekly, annual             services or completing units of work.
                        salary.                                       Contractor usually issues tax invoices.
Method of               Employees are always personally               If an individual is engaged through a
engagement              engaged.                                      trust, partnership or company, this
                                                                      usually indicates a contractor
                                                                      relationship*.
Part of the             The work of an employee is usually            Contractor carries on their own
business                essential to the business carried on by       business, independently of the employer
                        the employer. Employee is working in          and as distinct from the employer’s
                        the business of the employer.                 business.

* This applies for taxation and superannuation purposes only. Refer to clause 3.3. It is less clear for work
health and safety and workers’ compensation purposes and as many other features as possible should apply
before engaging the individual worker as a contractor.

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4.2. Guidelines to follow to engage an independent contractor
If a decision is made to engage an independent contractor, there are some guidelines
which should be followed:

•      Ensure the contractor delivers the services through a corporate entity;
•      Where possible, ensure the contractor provides their own tools;
•      Where possible, allow the contractor to subcontract and to set their own hours;
•      Where possible, ensure payment is by result rather than by salary or hourly rate;
•      Where appropriate, allow the contractor to contract to other businesses;
•      Pay the contractor only on receipt of an invoice and don’t deduct PAYG tax;
•      Don’t include any form of paid leave arrangement in a contractor agreement;
•      All contractor agreements should be in writing. For those engagements valued at
       less than $10,000, written agreement, even if it is a simple email exchange should
       be in place;
•      Ensure the contractor has adequate income protection and public liability insurance
       and workers’ compensation insurance for any workers engaged by the contractor;
•      It should be clear from the contract that the parties intend a contractor and not an
       employment relationship;
•      The contract tasks should be clearly spelled out;
•      The contract should contain commencement and end dates.

5. The Contractor’s obligations
Independent contractors have taxation, superannuation, workers’ compensation insurance
and workplace health and safety obligations.

5.1.   Taxation – Payroll Tax
In all States and Territories except Western Australia, there are specific contractor
provisions which (subject to certain exemptions and concessions) deem payments to
contractors to be part of ‘taxable wages’ and therefore subject to payroll tax. The
contractor provisions capture all payments to contractors as part of an employer’s taxable
wages regardless of whether the contractor is an individual or is engaged via a company
or trust structure. There are exemptions which apply in certain circumstances, as follows:

1.     the services provided by the contractor are ancillary to the supply of goods under the
       contract by the contractor (e.g. incidental installation services);

2.     the services provided by the contractor are of a kind not ordinarily required by you
       (e.g. an interior decorator hired once a year to select artwork for your reception
       area);
3.     the services provided by the contractor are of a kind ordinarily required by you (from
       any source) for less than 180 days in the financial year;

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4.    the services are provided (by the specific contractor) for a period that does not
      exceed 90 days in the financial year;

5.    the Commissioner is satisfied that the services are performed by a person who
      ordinarily performs services of that kind to the public generally in the relevant
      financial year (reliance on this exemption will require reference to relevant rulings
      and possible input from the Commissioner);

6.    the services are supplied by a contractor in circumstances where the contractor
      engages labour to perform the actual services required under the contract – where
      there must be at least two individuals performing the work;

7.    the services provided are ancillary to the conveyance of goods by means of a vehicle
      provided by the person conveying them;

8.    the services are in relation to the door to door sale of goods solely for domestic
      purposes.

If one of the exemptions above does not apply, the payments made to the independent
contractor will be included in the employer’s ‘taxable wages’ for payroll tax purposes.

Given the nature of our operations, it would usually be the case that points three, four or
six will apply to nearly all independent contractor arrangements.

However, if one of the exemptions above does not apply, an employment
arrangement must be put in place rather than a contractor arrangement.

5.2. Taxation – PAYG
PAYG withholding generally does not need to be withheld from payments to an individual
contractor if the individual is genuinely a contractor.

The relevant test for determining whether an individual is an employee for PAYG
withholding is the common law test discussed at clause 4.1.

PAYG withholding only applies to payments made to individuals in their capacity as
employees – it does not apply to payments made to other entities (provided an
arrangement is not a ‘sham’ designed to merely redirect or re-characterise an employee’s
wages).

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5.3. Superannuation
A number of factors determine who should pay superannuation for an independent
contractor. A key determinant is whether the worker is classified as an independent
contractor for superannuation purposes.

Superannuation contributions will be payable for independent contractors who:

•    are paid wholly or principally for their personal labour and skills;
•    perform the contract work personally; and
•    are paid by reference to the hours worked, rather than for the amount of work
     performed (even if an ABN is quoted).

In these circumstances, the ‘independent contractor’ is treated as if it were an employee
for superannuation purposes and the employer generally has an obligation to pay
superannuation guarantee charge on behalf of the independent contractor.

For our purposes, it is not permitted to engage workers on this basis as
independent contractors. If the three previous bullet points apply, the worker must
be engaged as an employee.

5.4. Workers’ Compensation insurance
Workers’ compensation insurance is a statutory requirement that is prescribed by separate
laws in each state or territory in Australia. Workers’ compensation insurance includes
benefits for job-related injuries, death or diseases sustained by an employee. To the
extent required by the laws of the relevant state or territory, all contractors must maintain
workers’ compensation insurance and supply a certificate of currency as evidence that
they have workers’ compensation insurance in place for themselves and their employees.
Alternatively, if a principal contractor is not covered by its own workers’ compensation
insurance or RFM’s workers’ compensation insurance, they will need to hold income
protection/salary continuance insurance and provide a certificate of currency as evidence
of that insurance.

5.5. Workplace Health and Safety Act 2011
In jurisdictions that apply harmonised work health and safety laws based on the
model Work Health and Safety Act 2011 (Cth)(being the Australian Capital Territory, New
South Wales, Northern Territory, Queensland, South Australia and Tasmania), an
individual contractor or their employees or subcontractors can be a worker and, in that
capacity, will be owed duties by the person conducting a business or undertaking (PCBU).

RFM or its related/managed entities will be a PCBU. Independent contractors will also be a
PCBU.

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In Victoria:

•     work health and safety requirements are governed by the Occupational Health and
      Safety Act 2004 (Vic) (OHS Act). The OHS Act requires RFM as an employer to, so
      far as reasonably practicable, provide and maintain a working environment that is
      safe and without risks to health to employees. The term ‘employees’ is defined so as
      to include independent contractors engaged by RFM and any employees of the
      independent contractor. Where an independent contractor is an employer, it will owe
      the same duty to its ‘employees’;

•     more broadly, the OHS Act requires employers (such as RFM and its contractors) to
      ensure, so far as is reasonably practicable, that persons other than their employees
      are not exposed to risks to their health or safety arising from the conduct of the
      employer’s undertaking.

Where there will be a crossover in duties owed by PCBUs or employers, steps must be
taken to, so far as is reasonably practicable, consult, cooperate and coordinate activities,
so as to properly manage work health and safety.
Where PCBUs engage contractors to perform work, effective contractor procurement and
management is essential to make sure work health and safety duties both to the
contractors as workers, and third parties, are met.

Integrating health and safety requirements into contractor procurement and management
prevents injury and helps fulfil health and safety obligations. PCBUs must ensure, so far as
is reasonably practicable, the health and safety of all workers at work in the business or
undertaking:

•     who are engaged or are caused to be engaged by the PCBU

•     whose activities in carrying out work are influenced or directed by the PCBU.

All workers (employees, contractors and labour hire employees) have a duty under the
harmonised work health and safety laws, and employees also owe duties under the OHS
Act. While at work, a worker must take reasonable care for his or her own health and
safety and take reasonable care that their acts or omissions do not adversely affect the
health and safety of others, and must follow all reasonable instructions, policies and
procedures about work health and safety matters.

The key steps to comply with the statutory work health and safety obligations include:

•     When engaging a contractor to carry out services, there must be a consideration of
      the different hazards and risks to health and safety in each stage of the procurement
      process and either agreement reached or directions issued about how these will be

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      managed, noting that it is not permissible to contract out of work health and safety
      duties;

•     As contractors can fall under the definition of workers under the harmonised work
      health and safety laws or employees under the OHS Act, there is an obligation to
      consult with workers on work health and safety issues to eliminate or minimise risks
      to health and safety.

6. Management of contractors
All contractors must be set up in Employment Hero (EH) and their work periodically
monitored and/or audited for compliance with contractual arrangements, agreed services
and adherence to workplace health and safety policies.

EH set up allows for effective ongoing contractor management, provides documentation of
due diligence undertaken and minimises organisational risk. Upon receipt of the form:
New Independent Contractor – Commencement Request located at Appendix B, a profile
will be set up for the contractor by Human Resources. This form must be completed and
emailed to HR@ruralfunds.com.au. The contractor will receive an email message with a
login to the EH system.

The benefits of a profile in EH include:

•     An automated acknowledgement provided by the contractor confirms their
      understanding and agreement that they are either a principal contractor, sub-
      contractor, employee of a contractor, labour hire agency or labour hire worker.

•     Insurances, licences or other key documentation can be requested via the
      certifications tab. The contractor is requested to provide the documents, review and
      approval is via the relevant manager and expiry dates are automated. Both the
      contractor and the manager receive a reminder when expiry is imminent.

•     Important details such as medical information and emergency contact details are
      retained in the system.

•     Induction and other training materials are delivered via video on the EH platform.
      This allows contractors to complete required training before arriving onsite.

•     Managers have access to a reporting tool to show details of training completed and
      outstanding for each contractor.

•     A contractor’s entitlement to work in Australia can be checked easily. The contractor
      makes a declaration that they are Australian, or alternatively uploads details of their

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    passport and visa to check their eligibility. Once the details are uploaded, the
    eligibility check is automatically processed.

•   A copy of the contractor’s Authority to Commence Work or contract agreement can
    be uploaded to their profile for easy access by both parties.

•   Easy access to relevant documentation requested by regulators in the event of a
    safety incident requiring investigation.

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7. Appendix A – Quick Guide

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STEPS

1.   Refer to clause 2, Procurement Policy to determine the documentation required for
     engagement of the contractor.

2.   Refer to clauses 4.1, Common Law test and 4.2, Guidelines and apply as many of
     the principles as possible.

3.   Refer to clause 5.1, Payroll Tax to ensure one of the exemptions applies. If no
     exemption applies, the worker must be engaged as an employee.

4.   Refer to clause 5.3, Superannuation and ensure the contractor is not

•    paid wholly or principally for their personal labour and skills;
•    performing the contract work personally; and
•    paid for hours worked rather than to achieve a result even if they quote an Australian
     Business Number (ABN).

If any of the previous points apply, the worker must be engaged as an employee.

5.   Key steps for effective management of contractors include:

•    Prequalification - establish the contractor’s scope, specifications, experience,
     qualifications and licensing;
•    Pre-job task and risk assessment – complete a JSEA with the contractor for the work
     proposed;
•    Training and orientation – set up in Employment Hero and consider site specific
     requirements face to face;
•    Job monitoring - ensure a safe system of work is in place, the contractor consults
     with relevant workers, observe and record notes about the contractor’s performance
     periodically; and
•    Post job evaluation – consider the quality of the work undertaken and the
     contractor’s performance.

6.   Complete the New independent contractor - commencement request form at
     Appendix B.

7.   Before the contractor commences work, ensure all required steps in Employment
     Hero have been completed, ensuring copies of licences, public liability, professional
     indemnity and workers’ compensation insurances have been provided.

8.   Provide any relevant site-specific training required.

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9.   Undertake periodic checks/audits of the contractor’s work to ensure compliance with
     contractual arrangements, agreed services and adherence to workplace health and
     safety policies. Comments/notes should be provided in the Management Comments
     tab in Employment Hero to track these periodic checks.

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8. Appendix B – Employment Hero set up

NEW INDEPENDENT CONTRACTOR – COMMENCEMENT
REQUEST
An Employment Hero profile will provide access to:

•     all relevant training materials (except for Standard Operating Procedures (SOPs));
•     retain copies of contracts/ATCW, insurances, licences etc.; and
•     generate automatic reminders for the contractor and relevant RFM manager of
      expiry dates.

Worker name                                   Click or tap here to enter text.
What type of contractor arrangement is            Principal
this?
                                                 Sub-contractor (subcontractor insurances
                                              must be provided)
                                                 Employee of principal or subcontractor
                                                 Worker of principal engaged under a
                                              labour hire provider
                                                 Labour hire agency
                                                 Labour hire employee
                                                 Supplier (high risk or high value only)
Trading name/Business name (if applicable)    Click or tap here to enter text.
Australian business number (ABN)              Click or tap here to enter text.
Name of principal/subcontractor/labour hire
                                              Click or tap here to enter text.
agency (if applicable)
Worker name                                   Click or tap here to enter text.
Email address (This is a mandatory field)     Click or tap here to enter text.
Street address                                Click or tap here to enter text.
Date of birth                                 Click or tap here to enter text.
Phone number                                  Click or tap here to enter text.
Gender                                        Click or tap here to enter text.
Nationality                                   Click or tap here to enter text.
Worksite/property name                        Click or tap here to enter text.
Commencement date                             Click or tap here to enter text.
RFM primary manager                           Click or tap here to enter text.
RFM secondary manager                         Click or tap here to enter text.

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Required licences, insurances and certifications

   Is this engagement covered by a                   Driver licence
contract (include a copy)                            Passport and Visa (if not Australian by birth or
    Is this engagement covered by an             Permanent Resident)

Engagement Form and/or Authority to                  Passport, Australian Citizenship

Commence Work (include a copy)                   Certificate or Australian Birth Certificate (if
                                                 Australian by birth or Permanent Resident)
                                                     Chemcert
    Professional indemnity insurance
                                                     Confined spaces
   Public liability insurance
                                                     Working at heights
   Workers compensation insurance
                                                     Forklift
   Labour hire licence (mandatory in
                                                     First aid
Queensland, South Australia and Victoria)
   Vehicle insurances                                Chainsaw

   Vehicle registration                              Q Fever vaccination

   Other: (insert details)                           Other: (insert details)

Click or tap here to enter text.                 Click or tap here to enter text.

Documentation to be included, if available and/or already provided

         Attach copies of any documentation received from the contractor eg. insurances, JSEA’s,
         SOP’s, licences, certifications etc.

Form completed by: Click or tap here to enter text.

Date: Click or tap here to enter text.

Please refer any questions to Human Resources on (02) 6203 9700 or hr@ruralfunds.com.au

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              9.     Appendix C – Authority to Commence Work form

     ATCW No:                                                                               (RFM or its managed entity to complete)

1.      Notes on the form
          Refer to the Procurement Policy and Section 7 of the Contractor Engagement and Management Policy to determine if a
              formal contract is required for the works.
          Works which do not require a ‘formal contract’ must have an ATCW executed for the works.
          The ATCW must be prepared by the primary contractor and signed jointly by the contractor, their sub-contractors and the
              RFM Responsible Person.
          The ATCW will expire 12 months from commencement, or the expiry date of any required insurances/licences etc.,
              whichever period of time is shorter.
          The ATCW only applies to the nominated job/work and must be re-authorised if/when the scope of work or method of work
              changes.
          The following documents must be attached to this form before work can commence:
         1)     Copies of risk analysis (JSEAs or similar) and procedures for all at risk tasks;
         2)     Copies of the required qualifications/permits &/or licences of persons conducting the work; and
         3)     Certificate of Currency for all insurances required in accordance with the Procurement Policy and the Contractor
                Engagement and Management Policy.

2.      Work being conducted
Include a brief description of the work being conducted, as well as where the work is taking place.

3.      Details of contractors & sub-contractors
Include all contracting and sub-contracting personnel
            Person’s Name and Job Title                      Organisation Name/s                              Phone(s)

Certificates of Currency for public liability, professional indemnity, vehicle and workers’ compensation must be
attached for the principal contractor and any sub-contractors before work can commence:
                                                                                                Principal
                                                                                               contractor             Sub-contractor
                                    Insurance type
                                                                                               certificates         certificates attached
                                                                                                attached
Public liability insurance (Certificate of Currency)                                               Y   / N                Y   / N

Professional indemnity insurance (Certificate of Currency)                                         Y   / N                Y   / N

Registrable vehicles require CTP insurance (Certificate of Currency). Non-
registrable Vehicles require property damage and personal injury insurance                         Y   / N                Y   / N
(Certificate of Currency)

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CONTRACTOR ENGAGEMENT AND MANAGEMENT POLICY

Workers compensation (Certificate of Currency)
If the contractor is self-employed, the contractor status must be verified for legal and
taxation authenticity if workers’ compensation insurance is not available. Where the
                                                                                                Y / N                       Y     / N
contractor status is authentic, workers’ compensation insurance may be waived (within
existing purchasing limits within the Delegations Policy) and/or substituted with salary
continuance insurance.
4.      Work plan
Procedures, JSEAs and/or SOPs/SWMSs for all tasks must be reviewed for compliance with RFM
procedures and attached. If procedures are not available, RFM procedures must be adopted in relation to                       Y   / N
all activities

5.      Controlled activities and/or permits

Task                                                   Y/N        Requirements/compliance (check all)                               Y/N/NA

                                                                  Rider’s risk assessment and/or competency assessment
Motorbikes/Quads/ATV/RTV
                                                                  completed.

Cattle and/or horse handling                                      Competency assessment completed.

                                                                  Lockout, adequate ventilation, atmospheric testing,
Confined space work                                               breathing gear, harness and rescue plan. Permit obtained
                                                                  if required.
                                                                  Management of flammable/combustible materials,
Hot work (welding, gas cutting etc)
                                                                  firefighting equipment, screens, arrestors and observers.

Work at heights > 1.8m                                            WAH training and fall arrest equipment

                                                                  Regulator licence/permits (fauna & flora culls), signage,
Native vegetation/animal removal or
                                                                  neighbour notifications, sampling & testing, firearm or
management
                                                                  poisons licensing
                                                                  Regulator licence/permits, signage, sampling & testing,
Contaminated site/asbestos removal
                                                                  receipts

                                                                  Current firearms licence and approval provided by RFM
Use of firearms
                                                                  authorised person.

Modification of “registered” plant (i.e.
                                                                  Engineering advice to support for modifications
registered with Regulators)

Is the contractor a licensed tradesperson (e.g.
                                                                  Competency/trade qualification, safety glasses
plumber, electrician)

Chainsaws                                                         Competency assessment, safety glasses, chaps, licence

Powered saws, shears, loppers, grinders,                          Safety glasses, gloves

Use of forklifts, cranes, elevated work
                                                                  Competency
platforms and similar lifting equipment

Use of heavy plant, mobile equipment,
                                                                  Licensed
helicopters

Likelihood of passers by getting injured                          Maps, barricades, signage, other communications

                                                                                                                 Page 20 of 27
CONTRACTOR ENGAGEMENT AND MANAGEMENT POLICY

Working alone or in remote locations                                 Communication method in place, food, water

6.        Personal protective equipment (PPE)

Details                   Y/N          Requirements/compliance (check all)                                                          Y/N/NA

                                       In place as identified on JSEA/SOP/SWMS. NB: high vis clothing required in all
PPE                                    operational farming areas and steel capped boots where heavy machinery is
                                       present or work with livestock is undertaken

First aid                              First aid kits available

Fire extinguisher                      Fire extinguishers available in all vehicles

7.        Hazardous and dangerous goods
Task                                              Y/N        Requirements/compliance (check all)                                    Y/N/NA

Bringing onto worksite                                       Supervisors and users of chemicals have a current ChemCert
hazardous/dangerous goods                                    certificate & MSDSs available.

Use and storage of                                           Containers labelled and stored in accordance with MSDS and/or
hazardous/dangerous goods                                    permit. Secondary containment and spill management in place

Bulk transport of hazardous/dangerous
                                                             State Regulator licence obtained
goods

                                                             Waste only to be disposed to licensed landfill or by licensed
Disposal of
                                                             disposal contractor. Empty chemical containers triple rinsed and
hazardous/dangerous/waste materials
                                                             securely stored before disposal
                                                             Potential asbestos containing material identified and contractor
Roof/wall penetrations
                                                             licensed to handle asbestos.

8.        Energy sources
Task                                              Y/N        Requirements/compliance (check all)                                    Y/N/NA
Work with explosives or cartridge
                                                             RFM explosives training/permit
power tools
Maintenance or service to hydraulic
                                                             Competency/trade qualification
equipment
Work on live energy sources                                  Competency in lockout of energy sources

Use of electric power tools, power
                                                             Tested and tagged, used with portable/permanent RCD protection
cords

9.        Construction
Task                                              Y/N        Requirements/compliance (check all)                                    Y/N/NA
Work on a construction site                                  Construction induction ticket/white card?
Scaffolding work                                             Competency/trade qualification
Modification to existing facility or
                                                             RFM modification plans and approvals
equipment
Erection/demolition/relocation of
                                                             RFM building plans and approvals
buildings

                                                                                                                    Page 21 of 27
CONTRACTOR ENGAGEMENT AND MANAGEMENT POLICY

10. Contractor sign-off
Prior to signing this document, the Contractor must ensure all the required information has been supplied. Work can only commence
when this document is complete and a risk assessment/JSEA has been developed for the activity/ies, and training against a
SOP/SWMS for the relevant activity/ies has been undertaken:
By authorising this ATCW, each person:
   Acknowledges all required details have been completed and are true and correct;
   Has read and understood the terms and conditions attached to this ATCW and agrees to be bound by them;
   Agrees to consult, cooperate and coordinate with any personnel onsite in relation to overlapping duties and in relation to the way
    in which each party discharges their respective duties.
   Has had an opportunity to read the relevant HSE standards, policies and procedures and agrees to comply with them;
   Qualifications, licenses and induction completion have been verified for contract employees;
   Work will be carried out in accordance with conditions of this ATCW;
   Commits to completing ATCW audits and inspections during and after work is complete;
   A risk assessment/JSEA has been developed for the activity/ies and training against one or more relevant SOP/SWMS’s has
    occurred.

Name                               Position                                   Signature of contractor                   Date

Note: Work cannot commence until sections 10-12 of this document have been completed by the Authorising Person and a workplace
induction is completed by all contractor and subcontractor workers at the workplace.

11. Assessment (to be completed by RFM or its managed entity)
Agree on audits and inspections and record these in the table below. Tasks which involve high and extreme risks, as indicated by a
JSEA must have a pre-start Inspection and one inspection during the task.
Time                                       Assessment          Audited by                 Signature
                                           Compliance
Eg. Before work commences                                      Property Manager
                                           with ATCW
                                           Workplace
Eg. During the Task                                            Property Manager
                                           Inspection
                                           Workplace
Eg. At completion of work                                      Property Manager
                                           Inspection
12. ATCW approval details (to be completed by RFM or its managed entity)
                  Issue date:
           ATCW valid from:                               ATCW valid to:
                 Workplace:                                   Job location:
                 Supervisor:                                       Phone:

13. Authorisation of work (to be completed by RFM or its managed entity)
By authorising this ATCW, the representative:
   has verified all qualifications and licences; and
   has verified insurance details for the principal contractor and all sub-contractors
    (public liability, professional indemnity, vehicle and workers’ compensation).
Authoriser                         Position                                      Signature of Authorisation             Date

Entity:

                                                                                                              Page 22 of 27
CONTRACTOR ENGAGEMENT AND MANAGEMENT POLICY

1. Definitions
   In these terms and conditions:
   “ATCW” means this Authority to Commence Work;
   “Contractor” means the Contractor or Contractors listed at Item 3;
   “Entity” means the entity managed by Rural Funds Management Ltd and identified above;
   “HSE Standards” means the Health, Safety & Environment standards issued by RFM from time to time;
   “RFM” or “we” or “us” means Rural Funds Management Ltd ACN 077 492 838 in its capacity as manager of the Entity; and
   “Work” means the work specified at Item 2.
2. Payment Terms
   The Contractor must submit invoices to the Entity identified above for the Work at the completion of the Work or such earlier times as agreed in
   writing by the Contractor and RFM. Within 14 days of receiving an invoice, we will pay the Contractor the undisputed amount of the invoice. We will
   notify the Contractor immediately where any amount of the invoice is disputed, and the parties must use reasonable endeavours to resolve that
   dispute prior to commencing arbitration or court proceedings.
   Invoices must be in a form required by RFM, contain details which are sufficient to describe and identify the Work carried out and contain any other
   details required by RFM.
   Any payment made by RFM is on account only and is not evidence of any Works having been carried out in accordance with the requirements of this
   ATCW. Title to any goods forming part of the Works vests in RFM on the earlier of payment for the goods by or delivery of the goods to the place
   where the Work is being performed.
   RFM may set off against and deduct from any monies due to the Contractor any debt, costs, damages, loss or expense due to or claimed by RFM
   from the Contractor arising from or in connection with the Works.
3. Supervision and Personnel
   We may appoint a supervisor who will be authorised to exercise the functions on behalf of RFM under this ATCW and in relation to the Work. The
   Contractor must comply with any reasonable directions given by the supervisor when carrying out the Work. The Contractor will have no claim for
   any additional costs arising from any direction from the supervisor.
   Where any of the Contractor’s personnel have, by any act or omission, breached any laws, policies of RFM or in RFM’s opinion have been unsafe,
   incompetent, offensive or negligent in the performance of the Work, RFM may give the Contractor a direction requiring the removal of such
   personnel from performance of the Work and the Contractor must, if directed by RFM, promptly replace the offending personnel with such other
   personnel acceptable to RFM.
4. Time for Performance
   The Contractor must carry out the Work at the times and dates directed by us, provided however that such direction is reasonable.
5. Warranties
   The Contractor warrants that the Work will be performed with due care and skill by appropriately qualified and trained personnel, in a cost effective
   manner in accordance with the relevant industry principles and all applicable laws. The Contractor warrants that the Work and any goods to be
   supplied as part of the Work are free from any defect; are fit for the purpose for which we intend to use them; comply with any applicable standards;
   and are free of any encumbrances.
   The Contractor warrants that it will maintain, and must ensure its personnel maintain, at its cost, any licences, accreditations, certificates or
   registrations the Contractor or its personnel are required to possess by any law in order to carry out and complete the Work. If requested by RFM,
   the Contractor must immediately provide a copy of any of the licences, accreditations, certificates or registrations.
   The Contractor warrants that it will supply all labour, plant, tools, equipment, appliances, consumable material, spare parts and other property the
   Contractor requires to perform the Work.
6. Defects
    The Contractor must, at its cost, and with as little inconvenience to the occupants or users of the Work as reasonably possible, rectify any defects in
    the Work which are notified to the Contractor within 90 days from the date of the Work being completed. The Contractor is responsible for all work
    and is liable for all costs associated with the rectification of the defect, including where additional work is required to rectify a defect. If the defect is
    not rectified by the Contractor in accordance with this clause, RFM may itself or by others, rectify the defect and the cost of remedying the defect will
    be a debt due and payable to RFM from the Contractor.
7. Insurance
   The Contractor must, before commencing the Work, at its own cost, take out and keep current during the term of Work, public and product liability
   insurance to a sum of not less than $10 million, professional indemnity insurance, vehicle insurance and workers’ compensation insurance as
   applicable.
   The insurance must be in the name of RFM and the Contractor, be taken out with insurers and on terms satisfactory to RFM and not be materially
   modified from the form accepted by RFM or cancelled, without the prior written consent of RFM.
   Evidence of the currency of the insurances must be given in writing to RFM at any time requested by RFM.
8. Work, Health and Safety and Environment
   The Contractor and its personnel must comply with all applicable HSE Standards and other policies which are available on the RFM website,
   including those in relation to work, health and safety and environment requirements and all laws relating to work health and safety and the
   environment, and maintain a workplace free of incidents and injuries, and immediately notify RFM of any incidents (or incidents involving its
   personnel) and cooperate in any investigations relating to workplace incidents. The Contractor must develop and provide to RFM its safe work
   method statements and risk assessments where RFM determines (in its absolute discretion) that such statements and risk assessments are
   required for the Works.
   The Contractor must provide all assistance and access to its offices, workers and records to enable RFM and any government agency to conduct
   audits on the Contractor’s compliance with its obligations under this clause, the policies or any laws. If any non-conformance is detected, the
   Contractor must immediately rectify the non-conformance at its own cost.
   The Contractor indemnifies RFM against any claim, liability or loss suffered or incurred by RFM arising from or in connection with a breach of the
   Contractor’s obligations under this clause 8.
9. Obligation to Prevent Damage and Indemnity
   The Contractor must take all necessary steps to prevent damage to any property and to prevent harm or nuisance to any persons. If any damage is
   caused by the Contractor, the Contractor must, at its own cost, remedy the damage to the satisfaction of RFM. If the Contractor fails to comply with
   those obligations, RFM may perform those obligations itself or through others and all costs and expenses incurred by RFM in performing those
   obligations will be a debt due and payable from the Contractor to RFM.
   The Contractor indemnifies and keeps us indemnified against all claims, costs, expenses, losses and damages incurred in connection with (a) the

                                                                                                                                  Page 23 of 27
CONTRACTOR ENGAGEMENT AND MANAGEMENT POLICY

  performance of the Works (b) any loss of or damage to property, including existing property in or upon which the Works are being carried out; and
  (c) any personal injury or death or loss of or damage to any property; arising as a consequence of the carrying out by the Contractor of the Work, to
  the extent that the Contractor’s actions or omissions caused such loss, damage or claims to arise.
10. Intellectual Property Rights
    The Contractor grants to RFM a royalty free, irrevocable, transferable licence, including a right to sublicence, to use the Contractor’s intellectual
    property rights existing at the date of this ATCW to the extent necessary for RFM to make full use of the Works for all purposes.
    All intellectual property rights which are created by the Contractor or its personnel as a result of performance of the Works will immediately vest in
    RFM upon their creation.
11. Suspension
  RFM may, at any time and for any reason, direct the Contractor in writing to suspend the performance of all or any part of the Works and the
  Contractor must immediately comply. The Contractor will not be entitled to any claim including for any additional cost incurred if the suspension was
  caused or contributed to by the Contractor or its personnel.
  RFM may, at any time, direct the Contractor to resume the performance of the Works and the Contractor must promptly comply with such a direction
  at its cost.
12. Termination
    RFM may immediately, by notice to the Contractor, terminate the ATCW if (a) the Contractor becomes insolvent, or conducts itself in a manner from
    which it may reasonably be deduced that the Contractor is insolvent; or (b) if the Contractor breaches any provision of this ATCW and fails to
    remedy that breach within 10 days of being directed in writing to do so. If RFM exercises its rights under this paragraph, RFM will not be liable to
    make any further payment to the Contractor for the Works.
    RFM may, at any time, terminate the ATCW for any reason in its absolute discretion, by notice in writing of not less than 5 days. If exercises its
    rights under this paragraph, the Contractor will be entitled to be paid for Work completed up to the date of determination and reasonable
    demobilisation costs (if any) but otherwise the Contractor has no other claim as a consequence of the termination including for any loss.
13. Governing Law
  This ATCW is governed by the laws of the Australian Capital Territory and all parties submit to the exclusive jurisdiction of the courts of the
  Australian Capital Territory.
14. Joint & Several Liability
  Where there is two or more Contractors, a reference in these terms and conditions to a Contractor is a reference to each of them jointly and
  severally.
15. Assignment and subcontracting
    The Contractor must not subcontract of the Works or assign or novate the ATCW without the prior written consent of RFM. No consent by RFM
    under this clause will relieve the Contractor of any of its obligations under the ATCW. RFM may assign or novate this ATCW by notice to the
    Contractor. The Contractor must execute any document reasonably required by RFM to affect its rights under this clause.
16. Limitation of Liability of Responsible Entity
  The Contractor acknowledges that RFM enters into this ATCW solely in its capacity as manager of the Entity and it will undertake all covenants,
  terms and conditions on its part to be observed or performed solely in that capacity. No debt, duty, liability or obligation arising under this agreement
  will accrue to, or be enforceable against, RFM in its personal capacity. RFM ceases to have any obligations and liabilities under this agreement if
  RFM ceases for any reason to be the manager of the Entity.
17. Inconsistency
  Where there is any inconsistency between these terms and conditions, and any other terms and conditions adopted by the Contractor, these terms
  and conditions shall prevail.

                                                                                                                            Page 24 of 27
CONTRACTOR ENGAGEMENT AND MANAGEMENT POLICY

           Appendix D – Engagement Authority form
CONTRACTOR/SUPPLIER DETAILS
Company/Contractor Name:                                                             ABN:
Phone:                                         Fax:                      E-mail:
Registered address:

Goods/services to be supplied:

Quoted price:
Will you supply additional personnel?                                         YES/NO
Are additional personnel employees?                                           YES/NO
Are additional personnel sub-contractors?                                     YES/NO
RFM proposed acceptance date (or ASAP)
HEALTH, SAFETY AND ENVIRONMENT
HSE management system and policy provided?                                                             YES/NO/Not Applicable
(If not please ensure signed agreement to comply with RFM policies)
Job Safety and Environmental Analysis/Safe Operating Procedures/ Safe Work Methods Statement           YES/NO/Not Applicable
reviewed?
Agreement to consult, cooperate and coordinate with each other in relation to overlapping duties and   YES/NO/Not Applicable
in relation to the way in which each party discharges their respective duties obtained?
CONTRACT TYPE
Approved contract, letter of engagement or ATCW? Please attach copy.
Has the contractor been added to the management system in Employment Hero                              YES/NO
DUE DILIGENCE
LEGAL
Did you undertake the necessary steps to satisfy yourself that the provider is able to deliver the     YES/NO
services?
Are you satisfied with the integrity of the Company and your contact?                                  YES/NO
If legal review is required, please ATTACH legal sign-off (email / letter)                             YES/NO
INSURANCE
$10m Public/Products Liability insurance (including worker to worker extension):                       YES/NO
Professional Indemnity Insurance:                                                                      YES/NO/Not Applicable
Workers’ Compensation Insurance for all employees. If the contractor is a sole operator, the           YES/NO/Not Applicable
Contractor status must be verified for legal and taxation authenticity if Workers’ Compensation
Insurance is not available. Where the Contractor status is authentic, Workers’ Compensation
Insurance may be waived (within existing purchasing limits within the Delegations Policy) and/or
substituted with Salary Continuance Insurance.
CTP insurance on all registrable vehicles which will be used onsite.                                   YES/NO/Not Applicable
All non-registrable vehicles have insurance for property damage and personal injury.
RISK ASSESSMENT
Have risks associated with contracted work been identified? Please give details of what controls are
in place.
APPROVAL
Requesting Officer

I confirm that due diligence, insurance checks, risk assessment and HSE requirements have been undertaken as above:

Name: _____________________________Signature: _______________________Date: ____________________
Approving Officer

Name: _____________________________Signature: _______________________Date: ____________________
PLEASE ENSURE APPROVAL COMPLIES WITH THE RFM DELEGATIONS POLICY

                                                                                                         Page 25 of 27
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