According to the ATO website: ‘An employee works in your business and is part of your business. A contractor is running their own business.
If a worker is legally an employee, a contract saying the worker is a contractor will not make the worker a contractor at law.
Businesses and workers will sometimes include specific words in a written contract to say that the working arrangement is contracting in the mistaken belief that this will make the worker a contractor at law.
If a worker is legally an employee, a contract specifying the worker is a contractor makes no difference and will not:
– override the employment relationship or change the worker into a contractor
– change the PAYG withholding and super obligations a business is required to meet.’
On Employee Legal Awareness Day consider these 6 factors:
Ability to subcontract/delegate
Basis of payment
Equipment, tools and other assets
Commercial risks
Control over the work
Independence
Now is the time to review your human resources
