How to determine if workers are employees or contractors
You can use this decision tool to work out whether a worker is an employee or contractor:
The tool is free and anonymous. You simply answer questions about the working arrangement and the tool will give you a result, including a report that you can keep in your records. Provided you answer each question accurately, you can rely on the result provided by the tool.
Some workers are always employees
If you hire any of the following types of worker you need to treat them as an employee:
- trades assistants.
Companies, trusts and partnerships are always contractors
An employee must be a person. If you've hired a company, trust or partnership to do the work, then the relationship is contracting for tax and super purposes. The people who actually do the work may be directors, partners or employees of the contractor but they're not your employees.
If you've hired an individual, you need to work out if they're a contractor or employee. This depends on the specific circumstances of the working arrangement.
Duration 1:40. A transcript of Employee or contractor? Avoid the myths is also available.
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To correctly work out whether your worker is an employee or contractor for tax and super purposes, you need to look at the whole working arrangement. A worker isn’t automatically a contractor just because they have an ABN or specialist skills or you only need them during busy periods. Our Employee/contractor decision tool makes it easy to get the right answer.