Contractors, independent contractors and subcontractors

As an employer, it is important to determine whether the worker you hired is considered an employee or contractor.

Employees and contractors have different entitlements with regards to receiving various paid leave and superannuation guarantee.

Contractors fall into 3 main categories with subtle differences.

A contractor describes a person, business or organisation that contracts with another entity for work at an agreed price.

Independent contractors run their own business and are hired to do tasks based on their contract. They generally use their own processes, tools and methods to complete tasks.

A subcontractor is an independent contractor that has been hired by another independent contractor to help complete their contracted work.

A worker may be a contractor, however in certain circumstances, Government agencies such as the Fair Work Ombudsman and the Tax Office may classify them as an employee.

For more information, click here.