This recently happened to Simon* who was left feeling a little confused. The Company told him they would provide him with training (which they said was worth $4000), they would provide him with the clients, hours and days to work and all the tools required. So, is he an employee or a self employed contractor?
The Fair Work Act provides a list of indicators that can help to determine if you are an employee or a contractor. These are:
- Degree of control over how the work is performed
- Hours of work
- Expectation of work
- Tools and Equipment
- Method of Payment
In Simon's case, as the Company would be providing the clients, directing his hours and how his work is performed and providing tools and equipment, this would more than likely be seen by the Fair Work Comission to be an employment relationship.
The ATO also has a very good tool to be able to determine if you are an employee for Tax purposes (which is one of the Fair Work indicators above). You can find this tool here.
As I write this, I received a notification about a case in the UK where two Uber drivers have been found to be employees, and not contractors. Naturally, Uber is playing down the potential ramifications of this decision, but it is an interesting one where Uber drivers in Australia are currently considered contractors, but Taxi drivers are employees. As the "share economy" continues to grow, there are likely to be more of these cases brought before the Fair Work Comission for a ruling. You can read about the British decision here.
What to do if you feel you are an employee and not a contractor?
You should seek advice from an employment lawyer before agreeing to anything, or if you are already working in this scenario, then you can still seek advice and claim for back-pay of Superannuation, long service leave etc.
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*Simon is not his real name