The central question you must ask: Is this person working as part of your business (employee) or are they working as part of their own business (contractor)?
Determining the classification of your workers is critical. There are consequences for a business and the individual (in more ways than one) who do not understand the difference between the two (e.g. penalties under the Fair Work Act for sham contracting).
This is important now more than ever. With the rise of the gig economy, the line between contractor and employee is shifting as businesses change their practices in taking on larger contractor workforce’s. There have been several cases recently where worker classification has been called into question, involving high profile companies such as Uber. It is a crucial business risk.
Drawn from case law and building on the Fair Work Ombudsman guidelines, this simple yet effective checklist can assist you in determining whether an individual is working as an employee or as an independent contractor, regardless of what the contract may say.
