Manawatu Employment Law Services
+64 6 3484811

SELF EMPLOYED CONTRACTOR, OR EMPLOYEE?

Although a contract for services with an allegedly self-employed contractor may clothe the relationship with all the characteristics of self employment, simply using one of these contracts will not necessarily avoid the relationship being viewed by the Employment Relations Authority or Employment Court as that of employer and employed. Both the Inland Revenue and any industrial tribunal will be entitled to look behind the agreement at the reality of the contract. Some of the questions they might ask are:

  • Is this the contractor’s only work, or does he work for others too?
  • Does the client/employer control how the work is done?
  • Are the hours fixed by the client/employer or can the contractor choose when he works?
  • Does the contractor use his own equipment?
  • To what extent is the contractor at risk as a self-employed person (i.e. is he liable for any damage, loss)?
  • Is self employment normal for this kind of work?
  • Do customers see the contractor as an integral part of the client/employer’s business rather than a separate entity?

If your contractor challenges his legal status and is found to be an employee, the financial consequences for the client/employer can be costly. For advice on this issue, or any other employment contracts, ring me and have a no-charge chat.  You can be complaint with the law in just a few hours, and have immediate support thereafter.

Posted: Thu 29 Aug 2019

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