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Contractors and Workers Compensation
Workers compensation is a complicated area and even more so if you work as a contractor, so to help understand how a worker or contractor is defined, we at GC Law have outlined all the information for you in the article below.
Links to Relevant Sections
- Who is considered as a contractor?
- When is a contractor considered a worker?
- When is a contractor entitled to compensation?
- Can a contractor claim unfair dismissal?
- Why should you get a compensation lawyer for your claim?
Who is considered as a Contractor?
Employers will often ask their workers to sign an agreement acknowledging that they are a contractor and not an employee in an effort to avoid the obligation to insure the worker against personal injury under workers’ compensation laws.
These types of agreements usually state that the worker will be responsible for payment of their own income tax, will not be eligible for compulsory employer superannuation payments and require the worker to take out their own private insurance for personal injury.
Each of these characteristics are consistent with a person being a contractor. However, that doesn’t necessarily mean the person is not a “worker” within the meaning of workers’ compensation law and entitled to workers’ compensation benefits if they’re injured at work.
When is a Contractor Considered a Worker?
When is a contractor a “worker” under the Workers’ Compensation and Rehabilitation Act 2003 (WCRA)?
A contractor can be a “worker” under the WCRA regardless of their tax paying status. Even if the contractor works under an ABN and invoices the employer for work performed at an hourly rate, the contractor may still be a “worker”.
A “worker” can also include a contractor who works under a contract of service. If the employer sets the contractor’s hours, gives directions as to hours the work should be performed or the contractor works for a single employer, the contractor could also be a “worker” for the purposes of the WCRA.
Contractors engaged for labour only or substantially labour only may also be “workers”. This means that if the employer provides most of the tools, equipment and materials, the contractor could be a “worker” as defined.
Another relevant factor is whether the contractor is responsible for the cost of rectifying any defects in their work. If this responsibility rests with the employer, the contractor could be a “worker” as well.
These are only some examples of people who may be considered “workers” under the WCRA. Each case still needs to be considered on its own facts.
When is a Contractor Entitled to Compensation?
So, while a person may appear to be a contractor because of an agreement they’ve signed with the employer, they may nevertheless be a “worker” within that meaning under the WCRA and entitled to workers’ compensation if they’re injured at work. It also means that some employers who think they have circumvented the WCRA with these agreements will actually be uninsured…
You may be entitled to worker’s compensation regardless of whether your employer deducts income tax from your wage or not.
You can claim worker’s compensation benefits if you don’t supply your own tools for work or are not responsible for the cost of rectifying defective work.
Even volunteers may be eligible for worker’s compensation in some cases.
Can a Contractor Claim Unfair Dismissal?
When a contractor reaches the conclusion of the fixed work period and it is not renewed, the contractor will not be able to claim unfair dismissal. If a contractor can establish an employment relationship they may be able to bring a claim, however it depends on the case.
Why Should You Get a Compensation Lawyer for your claim?
Making a claim for compensation after suffering an accident at work is a process best conducted by an accredited injury lawyer.
Workers compensation cases often pit the interests of an injured worker against the interests of the company that employed them and for this reason, the workers’ compensation claim process can be adversarial and difficult, and often necessitates the use of a lawyer who is experienced with regard to workers’ compensation claims.
Because we understand the claims process we can often get a higher compensation payout than what an individual could get without a lawyer. We also know the law and can obtain benefits for you that may not be on offer if you lodge the claim yourself.
Remember, if you have a work related injury and you need assistance, contact GC Law immediately.
You can use our Free Case Review process to start your claim; once we have assessed your case, we will contact you with a review and advise on the next steps.