Don’t know if you are a worker or a contractor?

Here are some signs that you may be an employee after all…


Have you sustained an injury only to be told by your boss that you can’t get WorkCover because you are a contractor and not an employee? This happens more often than you think.


This is what happened to our client recently: he was working at a construction site and suffered an injury. He made a WorkCover claim. His boss wrote to WorkCover and said they should not be paying, because our client was an “independent contractor” and not a “worker”.


Does it even matter if you are a worker or an independent contractor?

It does, and it is really important that you make sure that you are not classified as a contractor when in fact, you are a worker (or employee).


Firstly, if you are a worker, then your employer must take out a workers’ compensation policy for you. If you get injured at work, you get weekly compensation, your medical bills are paid and so on. On the other hand, if you are a contractor, then you don’t get any benefits from WorkCover, which can put you in a very difficult position if you suffer injury and can’t work.


Secondly, as a worker or employee, you are entitled to superannuation as well as increased wages for overtime. If you are wrongly classified as a contractor, you might be losing out on an extra 10% payment, representing your super!


You could be a worker even if your contract says that you are a contractor

These days, in some industries, before you can start working for a company, they make you sign a contract which says that you are not an employee. For example, in construction it is commonplace for a labour hire company to sign you up, and their contract will say that you are an independent contractor running your own business.


However, despite what the written document says, you may still be a worker.


In fact, the High Court of Australia recently considered this very situation.


A labour-hire company called Construct signed up a worker (Mr McCourt). The contract stated that Mr McCourt would work at a construction site run by a building company called Hanssen. It was agreed that Mr McCourt would be an independent contractor.


Regardless, the High Court held that Mr Court was an employee of Construct. Why? Because under the written agreement, Construct could tell Mr Court where to work (i.e. which site), when and how many hours per day. The contract also stated that Construct could decide any terms and conditions under which Mr Court would work at the building site.


In other words, Construct decided where, when and how Mr Court would do his work – which is exactly the type of control that an employer has over an employee.


The main principle is this: it doesn’t matter that when you sign a contract, you are labelled a contractor. What matters is that when you look at the contract as a whole, if the substance of it is that it creates an employment relationship, then you will be regarded as an employee.


What are the signs that you are an employee?

Every case is different, but these are some of the things that we examine when we consider if our client might be an employee, rather than a contractor. Keep in mind, this list is not exhaustive. Remember also, sometimes there are factors which suggest that you are a contractor while others suggest you are an employee. Each case is different and we have to weigh up these factors on a case by case basis.


  • Do you supply your own tools? (Generally, other than some basic tools/equipment, such as hard hat and high vis shirt, employees don’t normally supply expensive tools that require a lot of capital investment on their part)


  • Are you paid for a particular outcome or for a certain number of hours per day? (If you are paid to achieve a particular result, that could indicate you are a contractor)


  • Do you wear a company uniform? (If yes, it might suggest you are an employee)


  • Does your vehicle have company logos? (If yes, it might suggest you are an employee)


  • If your work involves driving to customers, do you use your own vehicle or truck? (If you use your own truck, that could suggest you are a contractor)


  • What level of autonomy do you have on how you perform your work? For example, if you complete deliveries, do you decide the order in which you deliver goods? (If you have a lot of autonomy, this might suggest you are a contractor)


  • Are you free to work more than one job at the same time? (If you can work more than one job, this could indicate you are a contractor)


  • What arrangements do you have for paying income tax? For example, you might be doing your work through a company which suggests you might be a contractor.  (If you work through your own company or partnership, this suggests you might be a contractor).


If you think that you are a worker but your boss disagrees…

We may be able to help you. In a compensation claim, we review your situation and if we believe that you are an employee, we will pursue a WorkCover compensation claim for you.


It’s important to understand that just because your boss didn’t take out a WorkCover policy for you, it doesn’t mean you can’t get WorkCover benefits if you are otherwise an employee. In fact, we may be able to enforce the same benefits for you – it will be up to WorkCover to then pursue your boss for unpaid premiums and penalties, but that won’t have any negative effect on you.


Feel free to give us a call on (07) 3063 2268 or email and we will be happy to advise you about your particular circumstances with a FREE consultation.