Getting your money starts with the right thoughts and attitude You are never too old
‘Careeeer Change!’
Painters - Insurance Issues with Lead-Based Paint Removal
How Accounting Software Can Increase Profits There is never a ‘one size fits all’ formula to apply.
www.aussiepaintersnetwork.com.au
Many great careers start with a Pathway. Whether that be, beginning your Apprenticeship whilst still at school, or by finding an employer ready to take you on from the very start. Become a Painting Apprentice
A painting apprenticeship takes 3 to 4 years to complete dependant on the individual student. They get paid as they learn rather than building up a debt by going to university. An apprentice learns the theory behind painting as well as the practical application of working with others on the job.
Become a Qualified Painter
After completing an apprenticeship, you become a qualified painter. You can continue working for painting companies or building companies on wages for as long as you like. Your wage should increase as you now have your qualification.
Become a Painting Business Owner
After completing your apprenticeship this is where you take the leap of working for yourself and potentially put on staff and your own apprentice. At this point we recommend that you contact Aussie Painters Network as well as other organisations and associations.
Are you running a Painting Business? See how we can assist you in growing your business with apprentices!
CONTRIBUTORS • Anthony Igra
From the Editor
• Hal Pawson
Hey Everyone,
• Helen Kay
Welcome to the 98th Edition of the Aussie Painting Contractor Magazine.
• Jim Baker • Leo Babauta • Monroe Porter • Nat Kassel • Robert Bauman • Sandra Price • Vanessa Petch
EDITOR Nigel Gorman EXECUTIVE EDITOR Caroline Miall GRAPHIC DESIGNER J. Anne Delgado
Finally, all painters throughout the country can get back to work after the final lockdown has been removed from Victoria. Get out and make the most of the work leading to Christmas, there is plenty of work and people looking for a reason to cheer. With from what we hear the economy is in all sorts of array, however from what is happening the painting industry is looking as though it’s in a boom. We have more painting businesses looking for staff than I have ever seen in my nearly 30 years in the industry. If you are looking and considering an apprentice go and submit your information at https://paintingapprenticeships.com.au/, we have a large number of people looking for apprenticeships. I know things are going extremely well for some businesses at the moment, even with businesses making profits, now is still the time to look at the available courses to assist you in running your business to future proof it and turn it into something that you can retire on. Have a look at the courses in the mag!!
Till next month, Happy Painting!! Nigel Gorman
nigel@aussiepaintersnetwork.com.au
07 3555 8010
Contents 06 09
When Your Task List is Overwhelmingly Long
24
Understand the risks associated with your trade.
Tips to Achieve a Successful Sale of your Business
27
‘Careeeer Change!’ You are never too old
30
Conflict in the workplace
34 12
Getting your money starts with the right thoughts and attitude
14
How Accounting Software Can Increase Profits
20
Social housing was one hell of a missed budget opportunity, but there’s time
Painters – Insurance Issues with Lead-Based Paint Removal
Understanding How to Spot Trouble on Your Profit and Loss Statement
37
The budget promises jobs, but does little for workers in the gig economy
40
Has Covid-19 made your QBCC Reporting anightmare?
44
Industry Idiots
45
Important Contacts
Opinions and viewpoints expressed in the Aussie Painting Contractor Magazine do not necessarily represent those of the editor, staff or publisher or any Aussie Painters Network’s staff or related parties. The publisher, Aussie Painters Network and the Aussie Painting Contractor Magazine personnel are not liable for any mistake, misprint or omission. Information contained in the Aussie Painting Contractor Magazine is intended to inform and illustrate and should not be taken as financial, legal or accounting advice. You should seek professional advice before making business related decisions. We are not liable for any losses you may incur directly or indirectly as a result of reading Aussie Painting Contractor Magazine. Reproduction of any material or contents of the magazine without written permission from the publisher is strictly prohibited.
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1800 355 344 / 07 3555 8010 info@aussiepaintersnetwork.com.au aussiepaintingcontractor.com,au
When Your Task List is
Overwhelmingly Long I’ve talked with several people lately who have tasks lists from the floor to the ceiling, and it just overwhelms them. They’re not alone — I can relate, and lots of people have this problem. If we’re fairly organized, our task list has everything we could possibly want to do on it, and it’ll get longer and longer. That’s the good scenario — most people don’t have everything on the list, and the tasks are scattered across different systems and lists, in email inboxes and messaging apps, in browser tabs and pieces of paper, and in their heads. Either way, it eventually gets so overwhelming that many people will give up whatever system they’re doing and start afresh, because the old system wasn’t working. In truth, they just didn’t have a way to deal with the overwhelm. So what can we do? It turns out, several key things.
Get Clear on Priorities Let’s call this Step 0 — if you’re already clear on what matters to you, you’re ahead of the game. But think about this: if you don’t know what matters, how can you focus on anything? Everything will seem urgent and important, and you’ll be scattered in lots of directions.
6 | Aussie Painting Contractor
If you know what is most important, you can focus on that. The rest can wait. It’s like if you’re a doctor in a hospital, and one person needs a life-saving heart operation, and a hundred people have ankle sprains. You’ll focus on the heart operation, and let the ankle sprains wait for a few minutes. Get clear on what matters to you. Make a list. Write out why. It’s worth spending 30 minutes on this. Get clear on what’s important this week. And what you need to focus on today. If you can get clarity on what matters & what to focus on, it will make you so much more effective than jumping around from task to task as if you were putting out a thousand small fires.
Change How You Relate to Your Tasks Think about your list of tasks right now — does it feel stressful? This is a sign that you think of them as burdens, as something stressful, or as a potential way that you’re going to let people down or fail or look stupid. Or maybe all of the above. How I’ve often related to my tasks is something like, “If I don’t do this task, I will be deficient and let people down.” If I have a list of tasks that’s full of these kinds of potential failures … of course it will be stressful! How do you relate to your tasks? Is there an empowered relationship you can create?
5-6 things, though often I give in to the temptation to add more joy opportunities than I actually have time for. :) If I have meetings, those are on the list, and the more meetings I have, the fewer tasks I allow myself to put on the list. What things have to be done today? What things would be a powerful use of your day? Just focus on those. The rest can come later.
Full Focus
Some examples: • I’m fully committed to this task because it’s incredibly important to me, so I’m going to create a sacred space of 30 minutes today to be fully present with it. • This task is an opportunity for me to serve someone I care deeply about, with love. • These tasks are training ground for me to practice presence, devotion, getting comfortable with uncertainty. • These tasks are an adventure! An exploration of new ground, a learning space, a way to grow and discover and create and be curious. • This task list is a huge playground, full of ways for me to play today! • These are some examples from my life, but they don’t have to be your relationship — what empowered way would you like to relate to your tasks? Find that, and practice it daily.
With a short list of high priority tasks, and an empowered relationship to those tasks … the world is yours! The final thing I would say is to focus on one thing at a time. If you can practice this regularly, the overwhelm starts to lessen. The opposite of this is constant switching between tasks. Doing quick emails, working on a task, but 30 seconds into that task you go check your favorite website or messages, etc. Full focus is picking something important to work on, and then clearing everything else away. Make this the only thing in front of you. Notice the urge to go do something else, breathe, then bring focus back to the task. Let it be your whole world. Be grateful to have this task in front of you, this opportunity to serve people you care about, this opportunity to play and be curious, this opportunity to learn and find joy and delight. Now that I’ve shared these ideas of working with an overwhelming task list … would you like to practice?
A Short List I find it helpful to have a long list of tasks, separated by area (work, personal, finances, etc.) and project, if applicable. But this long list can’t be done today. So I create a short list, of just stuff I’m going to do today. I call it “Today’s Joy List”. I try to keep it to
Leo Babauta
a successful ‘simplicity’ blogger and author from California, the creator of top 25 Blog
ZEN HABITS
2020 November Issue | 7
8 | Aussie Painting Contractor
Tips to achieve a
SUCCESSFUL SALE of your Business
You might have already been thinking about selling your painting business anyway, or perhaps this whole crisis has made you realise that you don’t want to continue to run your business after all of this. Whatever the reasons, when it comes time to sell your painting business you want to ensure that you get a good offer and that the sale goes through smoothly. You do not want your business to be one of the many thousands of businesses that do not sell or sell for considerably less than you had hoped. Working with professionals that are experienced in business sales will help but as the Seller you have a huge part to play in the successful sale of your painting business.
GET YOUR BUSINESS READY FOR SALE
The first step in selling your business is to make sure that your business is ready for sale. This is a crucial
step in ensuring the successful sale of your business and should not be overlooked. We regularly come across issues in a business sale that should have been addressed by the Seller before the business went on the market (more commonly when the business is being sold privately without a broker). If you sell your business through a broker, they will analyse the business beforehand and identify any matters that are likely to negatively impact upon the sale price or cause problems down the line. A Buyer will almost certainly carry out a thorough due diligence of a business before they commit to buy it, usually during a due diligence period under contract. You can guarantee that if there is a problem, their advisers will find it. Each issue with the business that is discovered will erode the Buyer’s perception of the value of the business and doubt will start to creep in.
2020 November Issue | 9
As well as looking at the legal aspects you will also need to engage with your accountant to review the financial aspects of the business. Nothing will make a Buyer run for the door more than not having your finances ready.
TIPS TO ACHIEVE A SUCCESSFUL SALE
Here are some tips on what you can do to get your painting business ready for sale: CONDUCT A THOROUGH SELLER’S DUE DILIGENCE Engaging a commercial lawyer to conduct a Seller’s Due Diligence early on in the piece can be useful in flushing out and addressing any issues. The purpose of Seller’s Due Diligence is for the Seller and their advisors to investigate the business, assets and business relationships to make sure all issues, including some that may not have even been thought of, are ironed out before the business goes on market. At the very least you should: 1. Ensure that the business name is registered to the Seller (for example an old business partner may still have it in their personal name or it may simply not be registered). The same goes for any trademarks. 2. Discharge any old PPSR charges (for example from previous supply arrangements) so you don’t need to provide the Buyer with covenants or delay settlement. 3. Ensure that all key contracts are documented – handshake arrangements have no value to a Buyer so it is important to get all key customer and supply agreements in writing. There are other things that can be reviewed in a more in-depth Seller’s Due Diligence, depending on the nature and scale of your painting business, for example: • any current employment contracts; • arrangements in place with suppliers; • client agreements; and • licences and permits required to operate your painting business.
10 | Aussie Painting Contractor
1. Make sure your business is ready for sale: • Do your Seller’s Due Diligence • Identify any issues • Make a plan and address any issues 2. Engage a Broker to help you prepare and find a suitable Buyer 3. Make sure you have a well drafted Contract to protect you 4. Understand and comply with your legal obligations What you need to do .. Let’s Talk! A free consultation with us can help to tackle your legal issues. Typical Legal Disclaimer!… Unfortunately, there is never a ‘one size fits all’ formula to apply. Every situation is unique and it can be tricky to wrap your head around some areas of the law. To ensure you are setting yourself and your business up for success, it is always best to consult a legal professional with expertise in the field. If you require any assistance with [starting a new business] or any other commercial legal issue, please do not hesitate to contact me. P: 0402 318 033 | E: helen.kay@riselegal.com.au
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2020 November Issue | 11
Getting your money starts with the
right thoughts This is perhaps the most important article I have written because it points out what needs to be in place in your own mind before you try to get your money back. Most contractors do not have the right thoughts and attitudes when pursuing bad payers. The mindset is too passive and assumes that the power relationship is such that the contractor has no power and the Non Payer holds all the cards. If that is how you’re thinking you will not be too successful in getting your money. You need to clearly understand and pursue the value of your work, be determined to fight to get it back, and accept the reasonable expense in doing so. Let me explain what I’m talking about by giving you two recent examples of how Contractors Debt Recovery handled two matters:
Example 1 An earthmoving contractor carried out work on an hourly hire basis over 39 days, and invoiced the head contractor $46 000.00 for the work. The head contactor did not pay a cent and insisted that the earthmover chase the property owner for payment
12 | Aussie Painting Contractor
as there had been a “stuff up” saying it was not their project anymore and they had not been paid. The earthmover talked to the owner who provided a copy of the funds transaction showing that the head contractor had been paid in full for his work 3 weeks previously! Then for his efforts he also received a fine from the local council for $3000 for carrying out unauthorised work! How infuriating. Contractors Debt Recovery prepared an adjudication application and give a copy to the head contractor. Within 48 hours $44 000 was transferred to the earthmover’s account. [$2000 held on another job]. Contractors Debt Recovery also challenged the fine in court. We prepared a submission to the council setting out the case why the fine should be withdrawn. A day before the court case was due to be heard, they withdrew the fine. The opening position was a $46 000 debt and a $3000 fine. The closing position was $44 000 in the bank and no fine. Total time for both outcomes; about 10 months.
and attitudes Example 2 A plumber had been called in to a block of strata units to fix water leaking into the ceiling of the ground floor unit. As usually happens the investigations revealed the root cause to be a leaking sewer pipe on level 2. There was extensive damage to the walls and fittings of both units.
The strata held accounts are held in Trust. They are Trust accounts. These accounts cannot be garnished. But given it was a court order the bank set aside the money until expiration of the agency period. So 4 months later the plumbers received a cheque for the whole amount owing plus all costs and interest. Total time for outcome; 6 months.
The plumber carried out the work, including a full bathroom re-fit, with full knowledge of the owners and the strata manager. On completion an invoice for $18 000 was rendered. After much delay the strata paid $10 000 and told plumber to ‘get stuffed’.
Just think about the determination and ‘stick to your guns’ mentality that was required to get these payments. Without the right mindset this would not have been possible. But it was worth it, even on a purely ‘justice-has-been-done-taught-them-a-lesson’ level.
Contractors Debt Recovery took the strata to adjudication and got a determination for the full amount owing. We then registered the judgment in court. The strata refused to pay. We then wrote to the Director General of the Department of Fair Trading arguing that the strata managers were in breach of their own Act as regards the running of the strata scheme. This didn’t work but was done to put pressure on the managers. It also distracted from the fact that we had got a garnishee order from the court to take the money out of the strata’s account.
There are three key things you need to get clear in your own mind when chasing your payments. Keep the FULL VALUE of your work front and centre. Accept that you are STARTING A FIGHT and you will have to be determined to do what it takes to win.
www.contractorsdebtrecovery.com.au 1300 669 075
But there was a hitch.
2020 November Issue | 13
How Accounting Software Can
Increase Profits Most small business owners who use accounting software quickly master the basics. They automate processes like invoicing and payroll, track expenses and view real time financial reports to manage cash flow and make better business decisions.
products and how much each customer spends impact your marketing decisions – not to mention help you fine tune your sales strategies?
But what many business owners don’t take advantage of are key insights that can improve customer care and increase sales. Here are some smart ways you can use your accounting software to help boost your bottom line.
By the same token, when you know which products and services aren’t selling, you’ll be able to make more profitable purchasing decisions. Most accounting software offers inventory tracking to help you decide what to keep on the shelves, which products to sell off at a discount and which items to phase out altogether.
Gain insights that increase sales
Improve customer care and boost profits
If you’re not tapping into your accounting software analytics to better understand your customers, you’re missing a major opportunity to close more sales.
Accounting software can offer peace of mind when you know your financials are accurate and up to date. But another major advantage of an online accounting solution is how much time you’ll save by automating processes like invoicing and payroll – giving you more time to follow up with clients and seek out new prospects.
Most accounting software can highlight your biggest spenders and buying trends. How would knowing who your best customers are, your biggest selling
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We all know how important the personal touch is when it comes to sales. So why not use an accounting software customer data to help remember your customers’ birthdays or thank them when they’ve hit a milestone – spending more than $5,000 on your products, for example? With enhanced customer data at your fingertips, your business will earn a reputation for personalized service. You’ll be able to respond quickly when a customer calls with a question about a product or an order. And you’ll be able to suggest substitutions and offer valuable add-ons based on their buying preferences, so upselling becomes a snap.
How will you use accounting software to grow your small business?
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software as simply a financial management solution and start thinking of it as a comprehensive tool for business growth. You may be surprised at the many ways accounting software can help you better serve your customers or improve your sales strategies when you look at its true potential. Now that you have a handful of ideas for making better use of your accounting software, what will you do differently to enhance customer care, improve your profits and continue to grow your business?
Sandra Price
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2020 November Issue | 17
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Social housing was one hell of a missed budget opportunity, but thereâ&#x20AC;&#x2122;s time Tonight Labor will deliver its alternative budget and promise that if it was in government it would be investing A$500 million in fast-tracking repairs to social housing, and urging state governments to match it dollar for dollar. The federal budget itself, delivered on Tuesday, offered nothing extra for social housing, even though when polled by The Conversation and the Economic Society of Australia more of Australiaâ&#x20AC;&#x2122;s leading economists wanted money spent on social housing than any other stimulus measure. They are right to place it above investment allowances, wage subsidies and tax cuts as a sure-fire way to boost economic activity and employment. Unlike those other measures, it has a track record. The Rudd governmentâ&#x20AC;&#x2122;s social housing initiative, introduced as part of the package that staved off recession during the global financial crisis, delivered 20,000 new units on time and on budget while creating 14,000 well-paying jobs. It was the only Commonwealth public housing or community housing initiative of any size since the Howard government effectively ended routine public home building in 1996.
20 | Aussie Painting Contractor
Conversation Economic Society of Australia survey, September 2020
2020 November Issue | 21
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Pre-tested, pre-prepared On a per capital basis, social housing supply has halved since then. At the same time, private rental housing has moved upmarket, making it even harder for low-income Australians to find a suitable and affordable home. The Community Housing Industry Association put forward a $7.7 billion Social Housing Acceleration and Renovation Program (SHARP) that would have delivered an extra 30,000 homes and renovated thousands more over four years. Calculations by SGS Economics and Planning in June suggested it would have supported between 15,500 and 18,000 full-time equivalent jobs in each of those years. Read more: Australia’s housing system needs a big shake-up: here’s how we can crack this Why, in the face of this analysis, did Treasurer Josh Frydenberg turn the option down? It’s hard to say, but the omission of social housing is consistent with the budget’s lukewarm attitude towards infrastructure investment more broadly. Adding up everything the government is planning to spend on infrastructure over the next four years, the budget comes up with a total of $6.7 billion, which is rather small beer compared with the four-year spending plan before the crisis, which was $4.5 billion.
The strategy, spelled out formally in the budget papers, is to, wherever possible, support markets rather than act directly. It’s thinking that allows the government to distinguish itself from the Rudd response to the global financial crisis in 2008. Read more: Coronavirus lays bare 5 big housing system flaws to be fixed But – unlike direct action, such as through social housing investment – the favoured approach relies heavily on assumptions about how market players (firms and consumers) react to incentives. Those reactions might help bring about the post pandemic snapback the most optimistic forecasts envisage.
There’s time If not, there’s an opportunity to try again, even reluctantly. SHARP is ready and pre-tested. There’ll be an opportunity in the mid-year budget update, due in December (in two months’ time), and next year’s budget (due in seven months). Regardless, resumption of a routine national social home-building program is seriously overdue. Australia’s housing system has become increasingly unbalanced – not just in the past six months, but over the past 20 years and more.
Lukewarm on infrastructure generally
The crisis provides an opportunity to fix it.a
It’s also small when compared to the business tax and other incentives, which amount to $26.7 billion.
--------------------------------------------------------------------
Kick-starting the recovery via social housing or other infrastructure would have been out of kilter with a strategy focused on creating “private sector-led growth”.
Hal Pawson
Professor of Housing Research and Policy, and Associate Director, City Futures Research Centre, UNSW
2020 November Issue | 23
Painters – Insurance Issues with
Lead-Based Paint Removal We all know that painters in Australia don’t use leadbased paints anymore, but it can still be an issue, especially when it comes to insurance. Whilst lead was banned from paint decades ago, there are still tens – if not hundreds – of thousands of houses around Australia which will have this paint present. This article isn’t about the dangers of lead paint or telling you how to deal with it properly. As a professional painter you’ll know much more about that than we do. What this article is about is the insurance implications when dealing with old lead paint.
Public Liability Insurance Most self-employed painters will have public liability insurance. This is the insurance that will cover you for property damage or personal injury resulting from your negligence. If you’re removing lead-based paint and contaminate the property with paint flakes, dust or otherwise, you could be open to a claim from the property owner.
24 | Aussie Painting Contractor
It’s difficult to say what the potential cost of such a claim could be. There are the costs of decontaminating the property, and more seriously, if blood tests showed that the occupants now had unsafe levels of lead in their blood the claim size could be enormous. You might think that for a professional painter to allow such contamination to occur would be negligent, and therefore covered under public liability insurance. But unfortunately, it is not.
Virtually all public liability policies in Australia will have a pollution and contamination exclusion. This means that the standard policy does not cover claims relating to pollution or contamination. So as a painter, even if you have a good quality public liability insurance policy in place, you could be left unable to claim after such an event. That’s quite a scary thought given the potential size of a claim against you.
Getting the Right Cover Whilst a standard public liability policy will not cover lead pollution or contamination, it’s not actually difficult – or expensive – to obtain cover. Many of the insurers we have access to have an option to add a pollution extension to the policy. One of our main insurance providers calls it an “Environment Impairment Liability Extension”. Whilst that sounds like it could be expensive, it’s actually not. Adding this cover to your policy can cost from as little as $60 depending on the size of the policy and your business.
One of the benefits of dealing with a specialist trade insurance broker such as Trade Risk is that we understand the risks associated with your trade, and with painting in particular. Your account manager is your best point of contact, but if you don’t have their name or contact details, simply call our office on 1800 808 800 and we’ll help you out. If you’re not yet a Trade Risk client, call our friendly team or request a quote online. Make sure you specifically mention the lead-based paint issue though, as we don’t include this option in our quotes as standard.
Even if you don’t expect to be removing any leadbased paints, for the sake of around $5 a month, it might be worth having this extension for nothing more than peace of mind.
More Information For more information about this issue, and painters insurance in general, please get in touch with us.
2020 November Issue | 25
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‘Career Change!’ You are never too old A few months back I read a post on the APN Facebook site. Here it is below in case you missed it. --------------------------------------------------------------------
‘Hi everyone. I’m new to this group and glad to be here! Genuinely looking for your advice (!!!please no nasty comments). I’ve always had a passion for painting and done a lot at the places I’ve lived and places I worked and also painted for my friends and relatives. I don’t consider myself as, ‘I know it all’ but I have a solid idea what’s involved in doing the job. I would love to learn more and take it to be next level as I am looking for a career change after being 20 years in one industry. --------------------------------------------------------------------
My questions/options are: I’m looking at getting into a mature age apprenticeship. Very fit and witty 40yo female. Will there be anyone willing to get me on board? Yana.’ It’s not often you come across a person that wants to change career mid-way through their life. I wanted to help her so I made contact. To my surprise she only lived a few suburbs away, so we made a time to meet up. I was so impressed by her passion and eagerness to get into the painting trade, I made a few calls and found that ‘Tas Moulas’ from ‘QPaint’ was willing to take her on.
So this is the story of Yana and how after 20 years of being in the fitness industry, decided she wanted to become a painter. ‘I was 21 when I arrived in Australia from the Ukraine. Being a fully qualified yoga teacher, I was fortunate enough that it didn’t take me long to find employment. Things went along well. I was gaining more experience, more classes, and more students; I was content. Then, after 13 years of working at gymnasiums, I made the big decision to open-up my own studio. A lot of hard work went into the running the business, but it paid off because in 2016, I received an ‘Emerging Business of the Year Award’ by the Logan Chambers of Commerce. The problem in the fitness industry is that it can be very volatile; for instance, if it’s a rainy night, the number of people attending a class drops significantly. The same happens during winter, school holidays, the ‘State of Origin’ nights, and the list goes on. As a teacher and a business owner, I learnt these patterns well. Unfortunately, these kind of ‘ups and downs’ can play against your business. Then, during the recent pandemic, limitations on group gatherings were put into place that resulted in my business shutting down overnight. Now I am a single mother raising a young family on my own, so it was a very worrying time for me. I started to think if there was anything else that I enjoyed doing over the years, (which was not fitness related), that I could do for a living.
2020 November Issue | 27
During the quarantine, my son asked if we could renovate his room and make it ‘really cool’ in his words. Being a single parent it’s almost like being a ‘Jack-of-all-trades’. I have done a bit of painting in the past on commercial venues that I’ve leased. I’ve also painted some domestic projects too. I clearly remember that I absolutely loved working on ‘each-and-every’ one of them as I was creating an atmosphere that I achieved with my own hands. So, repainting my son’s room in a new colour was a relatively easy task for me. This little quarantine project led me to a very vivid ‘aha’ moment! Painting! That was the answer I was looking for. This is what I had really enjoyed doing apart from teaching group fitness. But hundreds of thoughts were racing through my mind. ‘What if I try to take my painting passion to a professional level?’ ‘What if I’m too old to change my career?’ ‘How am I going to manage a full-time job and do the kids school runs?’ ‘Apprenticeship path vs employment?’ All these questions needed answers before I could make any decisions. I didn’t know much about a mature age apprenticeship or other career paths at that point, so I decided to join the ‘Aussie Painters Network Facebook’ group and ask real people to help me wrap my head around this new endeavour. I wrote a very sincere post raising all my concerns and fears that maybe it was too late for me, or that I’m not being realistic in my pursuits etc. Surprisingly, the response I received was overwhelming. I was shy to begin with but the amount of support and encouragement that I received made me absolutely believe that I was on the right track. I don’t like to cut corners when it comes to work ethics or learning processes, so I ended up choosing to go through a mature age apprenticeship opposed to just gaining employment as a painter. Being a perfectionist, I wanted to learn every aspect of the trade thoroughly and in the end, being able to achieve the level of professionalism, similar to what I had in the fitness industry. Losing my yoga business during the Covid 19 Pandemic was devastating but It also helped me to rediscover my new passion and take it to the next level. So today, I am proud to call myself a ‘1st Year Painter Apprentice’ with ‘QPaint’. I’m very excited with the move and the start of a new chapter in my life. With bad, comes good! I would now like to mention a few people that took their time to assist and clarify my concerns. Jim Baker, Nigel Gorman and Gen Frunz, who were absolutely amazing and very kind to me in helping to make the right decision on which painting career path to take.’
Jim Baker
www.mytools4business.com
28 | Aussie Painting Contractor
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CONFLICT in the workplace Do you have conflict in the workplace? Employees not getting along? Workplace conflict can result in increased absenteeism, decreased productivity, formal complaints and staff turnover. You’d be surprised too (or maybe you won’t be!) to learn that the starting point of most conflict is almost always cause by something quite small. Conflict in the workplace is unavoidable. Workplaces are made up of people and people by their very nature have different personalities, values, work styles and personal challenges which can all cause conflict in the workplace. The key to managing conflict is to address it early and in a way that will allow all parties to move forward in a positive manner. Not all conflict is bad. In fact, we wouldn’t want to remove all conflict from the workplace. Positive and constructive conflict indicates a healthy workplace. This means that you have employees who have different views on a topic or on how a problem should be resolved. This type of conflict can allow the status quo to be challenged and new ideas to be formed. It can challenge us to rethink our own perceptions and break through to new and innovative ground. A workplace that allows and encourages healthy conflict conducted in a respectful manner is most likely a high performing workplace.
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But if you’ve opened this blog or found it through Googling “conflict in the workplace” then chances are that you are experiencing the other type of conflict. The disruptive, unproductive and sometimes destructive workplace conflict. This type of conflict can stem from:
PERSONALITY CLASHES All workplaces are made up of different personalities. Some of these will be complementary straight off the bat and others will clash. Personality clashes can be some of the most destructive as people start to pigeon-hole each other and each small infraction is noted and added to the ‘scoreboard’. All is not lost. All personalities can work together, it just takes understanding, acceptance and communication. Our Dealing with Different Personalities at Work blog provides some helpful tips on resolving personality clashes. POOR COMMUNICATION The most common starter of conflict. Lack of communication, different communication styles, misunderstandings and rumours can all lead to misunderstandings between employees. Conflict caused by poor communication often results in passive aggressive behaviour, increases in rumours and gossiping, a loss of productivity and the conflict being driven underground, bubbling away.
DIFFERENT VALUES People are the sum of their upbringing, cultures, values and belief systems which can all impact the values they bring into the workplace. Conflict arises when these values conflict. An older worker may place value in a more traditional workplace where work is conducted in traditional hours, meetings are scheduled and the organisation follows a hierarchical structure. A millennial however may want to embrace a more fluid, flexible and flat organisational structure. These differing values have the potential to create conflict when one feels the other isn’t respecting their values. Managing different generations can be challenging but there are ways to do it successfully. DIFFERENT WORK STYLE / INTERESTS Some people like to work on their own, some in a team, some like background noise and some quiet. Some people like to hit the ground running on a project, other like to take their time and plan it out. Some people will be motivated by ‘being seen’ on a project and others will be motivated by getting the job done. All of these differences can lead to conflict in the workplace. By identifying and understanding people’s work styles and interests then strategies can be implemented that is accepting of all styles and interests. SCARCE RESOURCES When employees don’t feel that they have enough or the same access to information, the manager, or physical resources or even time then conflict can arise. Conflict can also arise if an employee feels that someone else is negatively impacting on their ability to manage these resources, i.e. someone’s failure to submit a report on time impacts on another employee’s ability to submit their data on time. By analysing workflow practices, resources and communicating deliverables, these types of conflicts can be resolved and/or avoided. POOR PERFORMANCE When it is perceived (justified or not) that one or more individuals are not performing or that the workload is not fairly distributed then conflict arises. This is especially common between members of the same team or between an employee and manager. The poor performance or the perception of inequality needs to be addressed quickly. Otherwise, it could result in other employees decreasing their productivity (“Why should I work harder than them? If they can get away with it, so should !?”). Or in the case of it being between an employee and manager then it will breed resentment, insubordination and/or the resignation of the team member.
So how do you handle workplace conflict?
The first and most vital step of fixing workplace conflict is to address it early. Quite often managers will ignore it in the hope that it will resolve itself and go away without any intervention from them. Unfortunately, in most cases the opposite occurs. Left unaddressed the conflict simmers away until one or all of the party’s bubble over and what started as a small issue is now a red-hot smouldering mess that has not only impact the initial parties but also others in the team. By addressing the issues early, its easy to find out what the root cause of the conflict is. Once you know if it is a personality clash, perceived poor performance or conflict arising out of scarcity of resources then steps can be taken to rectify the issues. Addressing conflict can seem daunting so if you need help in knowing what steps to take then give us a call first to talk through your options. Just remember, the worst thing you can do is do nothing. Inaction may mean a formal grievance or your best staff leaving. Addressing conflict, whilst daunting, can provide an opportunity to build a stronger, healthier team by increasing communication and understanding amongst your people. Contact us if you would like more information about how HR Maximised can help you resolve conflict in your workplace. If you have concerns over please reach out to Vanessa on 0418 190 106 or vanessa@hrmaximised.com.au
2020 November Issue | 31
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Understanding How to Spot Trouble on
Your Profit and Loss Statement I realize that for many of you, this article may be very elementary. However, contractors are notorious for not being interested in and really not knowing their numbers. Accounting, particularly profit and loss statements, is much easier to understand than many contractors realize. Accounting is easier than estimating. There is no multiplication and division. Estimating is predicting what you think costs will be. Accounting is simply the adding and subtracting of facts to see what the cost actually was. Unfortunately, many statements are put together in confusing formats and require some digging to figure things out.
sheets show where that money is located or tied up within the system.
The first rule of financial evaluation is to always use accrual statements for financial evaluation. Your accountant may choose to use cash statements for taxes but cash statements are of little value for actual financial reviews. Why? Cash statements do not include accounts receivable (what people owe you) and accounts payable (what you owe others). Therefore, cash statements do not reflect an accurate evaluation of your businessâ&#x20AC;&#x2122;s current financial situation. Another confusing component of profit and loss statements is that while a p & l may look like a checkbook register, it does not measure how much cash you have in the bank. Profit and loss statements show if you are making or losing money and balance
Make sure your P & L reports calculate percentage of sales, not percentages of last period to this period of time. Percentage of sales comparison is the only way to realistically compare actual expenses. A statement that compares each line item regarding how much it has gone up or down as compared with the same statement a year earlier is of little value. The following example shows how misleading this type of comparison can be when comparing line item by line item costs. I have used sales and field labor as an example. In the following example, entitled wrong way, the labor is compared to the previous year. As compared to last year, labor is down 7% which seems like a good thing when in reality it is a disaster.
34 | Aussie Painting Contractor
It is important to conduct a monthly financial meeting each and every month with the bookkeeper and partners. Contracting profits change rapidly plus many businesses are seasonal. By not paying attention to a couple of months of summer financials, suddenly your season is over and you are not profitable. At financial meetings you should also review a balance sheet, an aging report for accounts payable and accounts receivable.
In the next example, we compare numbers as a percentage of sales. This shows the real problem. Now the cost of actually installing a job has increased by 33%. Before a $10,000 job could be installed for $3000, at this new rate a $10,000 job would cost $4000 to install.
If your business uses subs instead of employed field labor, the same logic applies. Common sense tells us that you would not pay a sub for doing nothing. If you use subs and field labor, look at them both and see if the total percentage falls within your norm.
Example of 33% production cost increase
Labor and sub percentages are the best way to tell if your statements are accurate or if there is good or bad financial news. What could have caused a 33% increase? The culprit is usually one of two things: Something is unbilled. Possibly a large job was done last month but not billed until this month or maybe jobs just were not billed on time. You are losing money. You are either the victim of bad job estimates or you are paying employees who are not producing. Possibly employees are being poorly managed or maybe you have been trying to keep people busy during a slow period by dragging out jobs or having field people work in the shop.
There are lots of other things to look at on a profit and loss statement but labor/subs cost to billings is an excellent way to quickly evaluate the accuracy of the statement. Too many contractors simply look at top and bottom line and really donâ&#x20AC;&#x2122;t question whatâ&#x20AC;&#x2122;s between the two.
Monroe Porter
is president of PROOF Management a firm that teaches seminars and runs networking groups for painting contractors.
www.proofman.com
2020 November Issue | 35
The budget promises jobs, but does little for workers in the gig economy Treasurer Josh Frydenberg promised a federal budget focused on “jobs, jobs, jobs”. In one sense he didn’t disappoint. His budget speech mentioned jobs 37 times – an average of about once a minute.
“This budget is all about jobs,” he declared. But it wasn’t about all jobs. While the budget devotes billions to getting unemployed Australians into traditional employment, it does little for those with diminishing opportunities to find work outside the “gig economy”, where they are effectively treated as subcontractors, not as employees with rights secured by the Fair Work Act. The government’s A$37 billion in subsidies for businesses include almost A$4 billion for JobMaker subsidies (paying $200 a week for hiring a new employee aged 16-29, and $100 a week for an employee aged 30-35), and A$1.2 billion for apprenticeships in advanced manufacturing. There’s also A$1 billion for businesses in the defence industry and A$3 billion for infrastructure projects.
It is not just workers in “blue-collar” jobs in hospitality and delivery that increasingly face few opportunities to find a secure, full-time job. Casualised, part-time and freelance “gig” work is also increasingly common in “white-collar” industries such the media, the arts and higher education. Read more: Budget 2020: promising tax breaks, but relying on hope
Rise of the gig economy The term “gig economy” was coined in 2009, at the height of the global financial crisis, as scores of unemployed and underemployed workers picked up various odd jobs to cover their living expenses. Journalist Tina Brown (a former editor of The New Yorker) described workers in the knowledge economy increasingly depending on “a bunch of free-floating projects, consultancies, and part-time bits and pieces” for work.
Brown predicted the gig economy was “the new face of the job market” for knowledge workers.
But largely missing from the government’s considerations are those in sectors hit hardest by the COVID-19 pandemic where jobs are increasingly precarious.
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A decade on, it’s difficult to track the exact scale and shape of the gig economy – partly because terms like “gig work”, “freelance work”, “flexible work” and “digital platform work” are used interchangeably. Australian Bureau of Statistics numbers, for example, are often cited to show the proportion of “employees without paid leave entitlements” hasn’t risen greatly in the past two decades. But this doesn’t capture the insecurity of workers not counted as employees.
One of the gig workers I interviewed was Joseph, who was delivering food around Perth for Uber Eats. As the first restrictions kicked in, his work evaporated almost immediately. He told me that one week he made $78 for 10 hours’ work – about $7.80 an hour, less than half the national minimum wage of $19.84 an hour. After fuel and vehicle costs, he estimated he cleared just $20.
Read more: Self-employment and casual work aren’t
increasing but so many jobs are insecure – what’s going on?
A 2016 report by the Grattan Institute estimated 0.5% of Australians used peer-to-peer work platforms once a month. A 2019 national survey of 14,000 Australians found 13% of respondents had undertaken “digital platform work”, with 7% doing so (or seeking to do so) in the previous 12 months. The five most common platforms used were Airtasker, Uber, Freelancer, Uber Eats and Deliveroo. The most common type of work was food delivery, followed by professional services work, maintenance and then writing or translation work. More than a quarter had done computer-based work only. According to technology researchers writing in the Harvard Business Review: The COVID-19 pandemic could well prove to be a pivotal point in the gigification of knowledge work, and many firms will be attracted by the prospects of the direct and indirect cost savings that the gig economy model seems to offer.
Gig work during the pandemic As as freelance writer and PhD candidate, I can relate. Through my paid work and own experience, I’ve seen how the COVID-19 crisis is affecting both blue and white-collar workers. Earlier this year, when the first wave of the pandemic hit, I was commissioned to write an article about the four major food delivery platforms in Australia (Uber Eats, Menulog, Deliveroo and DoorDash). It was supposed to be a comparison article aimed at potential customers, explaining which platform is best. But speaking to delivery drivers made it clear not a single one of these companies would guarantee their workers a minimum wage.
38 | Aussie Painting Contractor
A delivery rider in Melbourne’s CBD, August 8 2020.
A delivery rider in Melbourne’s CBD, August 8 2020. Erik Anderson/AAP All five delivery workers I interviewed said they had earned less than the national minimum wage at one time or another. Joseph at least qualified for JobSeeker, but others were migrant workers with no right to welfare payments. Read more: Delivery workers are now essential. They deserve the rights of other employees
Being a white-collar gig worker The irony of writing about gig workers like Joseph who grapple with precarious work is that the article I was writing was itself gig work. Over the past few years I’ve worked regularly as a freelance journalist and copywriter for various publications and brands. In a typical week I’d spend Monday in an office writing listicles and advertorials for a website aimed at high school students. On a Tuesday I’d commission and edit articles for a travel website. For the remainder of the week I’d pitch interviews and feature articles to publications.
I commuted to different offices and co-working spaces around Sydney, worked from my windowless bedroom or in nearby cafes. I accepted just about every writing gig I could find, using all my own equipment, setting my own schedule and invoicing as a sole trader. I took occasional cleaning and bar-tending jobs for extra cash.
These academics were naturally the first to lose their jobs, with the universities excluded from the federal government’s JobKeeper scheme.
Though I mostly enjoyed the work, it was challenging to stay on top of five or six different gigs simultaneously. I spent a lot of time chasing up late invoices and it was difficult to financially plan beyond paying my monthly rent.
If the government is “all about jobs”, it’s time to acknowledge the need for substantive reform to Australia’s industrial relations laws, to close the legal loopholes that allow businesses to exploit workers as non-employees.
Closing the loophole
--------------------------------------------------------------------
Now, as a PhD student, I am contemplating how much the gig economy has encroached on academia. It has been estimated that up to 70% of teaching staff in some Australian universities were precariously employed, as casuals or on short-term contracts, before the pandemic.
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Read more: A new definition of ‘worker’ could protect many from exploitation
Nat Kassel
PhD Candidate, Griffith University
Has Covid-19 made your QBCC Reporting a nightmare? More than six months on from the onset of the pandemic, the economy has changed drastically and we’ve moved into recession territory. Some home buyers and developers had to walk away from their plans and contracts. The result is that half-finished projects have been abandoned, sub-contractors short changed and creditors are hundreds of millions of dollars out of pocket. We’ve been lucky so far that construction sites have been allowed to remain open during the pandemic, as they were considered essential business. However, in Queensland construction companies and tradies also had to keep up their compliance reporting regime with the QBCC Minimum Financial Requirements (MFR). With the MFR relying heavily on a particular ratio of net tangible assets vs liabilities, you can imagine the challenges to get that right with so many variables impacting on businesses due to Covid-19.
Asset ratios and maximum revenue impact on QBCC reporting Loss in revenue and a change in net tangible assets impacts directly on QBCC financial reporting. There
40 | Aussie Painting Contractor
are five main facets of the MFR that contractors must continue to fulfill, namely: • Have enough Net Tangible Assets (NTA) (calculation of a contractor’s assets minus their liabilities) to warrant a certain level of Maximum Revenue. • Comply with maximum revenue limitations. This is the amount of revenue a contractor can earn within a year. • Comply with a current ratio obligation. This is calculated by dividing a contractor’s current assets by current liabilities and must be at least 1:1. According to information on the QBCC website: “A current ratio is worked out by comparing a licensees’ current assets to its current liabilities. This helps to determine the businesses financial viability. Current ratio = current assets/ current liabilities. Current ratio must be at least 1:1. For every 1 dollar of current liabilities, you must have at least 1 dollar in current assets. Example: Current ratio = current assets/current liabilities = $52,000 / $30,000 = 1.73:1” • Pay all undisputed debts as and when the debts fall. • Satisfy mandatory annual reporting.
Triggers for MFR reporting Besides annual reporting there are certain triggers when the QBCC requires a licence holder to report on their financial situation. In particular during this time of economic contraction the triggers include, but are not limited to: • where the Maximum Revenue (MR) requires adjustment for categories 1-7. Licensees within SC1 and SC2 will be required to provide the self declaration form; as outlined on Financial reporting requirements for Self-certifying Category 1 and 2; • where the Net Tangible Asset (NTA) position has decreased by more than: o 30% for licensees within categories SC1, SC2 and categories 1-3 o 20% for licensees within categories 4-7 • significant change to the structure of the business (eg change of ownership or executive officers) • restructure of partnership For more details on other reporting triggers VISIT THE QBCC WEBSITE.
Annual Reporting Tips for Self-certifying Category 1 (SC1)
• You will need at least $12,000 in NTA by 31 December 2020. • You will receive written notice of your annual reporting deadline at least 40 business days before the due date. • If you have both an individual contractor and a company contractor licence you’ll need to submit annual financial information for both. • You can lodge your annual reporting online via the myQBCC portal at any time if you wish to do so. • You are required to provide financial information for your most recent reporting year. For most licensees, your most recent reporting year end would be 30 June, in line with the financial year.
Download the QBCC Guide to Annual Financial Reporting here. If you have any doubts about meeting the QBCC Minimum Financial Requirements, call my office on 3399 8844 and we’d be happy to help you with a FREE Business Health Check. You can also visit our website at www.straighttalkat.com.au and complete your details on our Home page to request an appointment.
This category applies if your annual turnover is no more than $200,000.
2020 November Issue | 41
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2020 November Issue | 43
The Industry Idiots
44 | Aussie Painting Contractor
IMPORTANT
Contacts
Aussie Painters Network aussiepaintersnetwork.com.au
Ph. 0430 399 800
National Institute for Painting and Decorating painters.edu.au
Ph. 1300 319 790
Australian Tax Office ato.gov.au
Ph. 13 72 26 / Ph. 13 28 65
Award Rates fairwork.gov.au
Ph. 13 13 94
Fair Work Building & Construction fwbc.gov.au
Ph. 1800 003 338
Mates In Construction matesinconstruction.com.au
Ph. 1300 642 111
Workplace Health and Safety Contacts Comcare WorkSafe ACT Workplace Health and Safety QLD Victorian WorkCover Authority WorkCover NSW SafeWork SA WorkSafe WA NT WorkSafe WorkSafe Tasmania
comcare.gov.au worksafe.act.gov.au worksafe.qld.gov.au vwa.vic.gov.au workcover.nsw.gov.au safework.sa.gov.au commerce.wa.gov.au/WorkSafe/ worksafe.nt.gov.au worksafe.tas.gov.au
1300 366 979 02 6207 3000 1300 362 128 1800 136 089 13 10 50 1300 365 255 1300 307 877 1800 019 115 1300 366 322
actcancer.org cancercouncil.com.au cancercouncilnt.com.au cancerqld.org.au cancersa.org.au cancervic.org.au cancerwa.asn.au
(02) 6257 9999 (02) 9334 1900 (08) 8927 4888 (07) 3634 5100 (08) 8291 4111 (03) 9635 5000 (08) 9212 4333
Cancer Council Australia ACT NSW NT QLD SA VIC WA
2020 November Issue | 45