Independent contractors run their own business, hiring out their services to other businesses and organisations. Unlike most employees, independent contractors negotiate their own fees and working arrangements, and can work for a variety of clients at one time.
How do I know if I am an independent contractor?
You will need to determine whether you are classified as an independent contractor before entering a contract. Your status will affect your rights and obligations with your employer or the business you contract with.
What are my entitlements?
Independent contractors and hirers should be aware of their entitlements and obligations regarding superannuation, leave and redundancy, OH&S, and workers compensation insurance.
What are my taxation obligations?
There are special tax rules for independent contractors to ensure that you do not use business structures to avoid your income tax obligations.
How is my intellectual property affected?
IP created by an independent contractor is by law considered the property of the independent contractor, unless otherwise stated in the contract.
Independent contractors & the common law
The Independent Contractors Act 2006 relies on the common law meaning of independent contractor. The common law is a set of legal principles, which have been developed through decisions in the courts.
Unfair contracts and sham contracts
Under the Independent Contractors Act 2006, an unfair contract is one where a person performs work on terms that are ‘unfair’ or ‘harsh’.
If you have a dispute with your hirer, there are a number of options available to help you resolve it and preserve your business relationship.
Tools & resources
- Independent Contractors: contracts made simple (PDF, 2.37MB) – Updated June 2012.
Helps independent contractors save time and money by explaining how to minimise business risks and negotiate good contracts.
- Independent Contractors: the essential handbook (PDF, 1.55MB)
Updated June 2012. Tells independent contractors and their hirers all they need to know about independent contracting. Includes tax, super, insurance, workers compensation, negotiating contracts and much more.
- Independent Contractors: preventing and managing disputes (PDF, 2.33MB)
Helps independent contractors and their hirers in preventing and managing disputes. It gives practical guidance, tools and useful contacts to assist in dealing with business disputes.
- The Contractor decision tool
Gives an insight into whether someone is likely to be an independent contractor or an employee under common law. It takes just a few minutes to complete.