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This Fact Sheet provides information about the legal tests which determine whether a worker is actually an employee or a contractor, and the implications of working as an independent contractor.
If you are an independent contractor, you are not an employee but are working for yourself. Generally, independent contractors are running their own business, and the emphasis is on getting a particular job finished, rather than working a particular number of hours.
However, in some circumstances, workers may regard themselves as employees, but the person they are working for considers them to be independent contractors. This may be because the person they work for has decided it is cheaper or that it limits their legal obligations.
A worker engaged as an independent contractor may later be legally recognised as an employee (and vice versa) in certain circumstances. It is important to understand this, because many laws which protect employees’ rights do not apply to people classified as independent contractors.
Whether a worker is an employee or an independent contractor depends on a range of factors taken together, regardless of whether they are called an independent contractor (for example, in the wording of a contract). For example, you are more likely to be seen to be an independent contractor if your contract indicates that:
Not one of these factors is enough, by itself, to make somebody an independent contractor. All the factors are considered. If you are unsure as to whether you are really working as an independent contractor, contact JobWatch, your union, or a lawyer for further assistance.
For more information about implications for independent contractors, download the Fact Sheet.