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‘Worker’ or ‘Contractor’? SIRA’s new online tool to help employers and principal contractors

5 July 2023

If you’re an employer, principal contractor or an individual, including a sole trader, a partnership, incorporated entity like a company or an incorporated trustee, sub-contractor engaging another person to work for you, then you may be considered an employer for the purpose of workers compensation legislation.

For example, calling someone a contractor, subcontractor, independent contractor or if they use their Australian Business Number (ABN) when working for you may mean they’re a contractor for tax purposes, but may be deemed to be a worker under NSW workers compensation legislation.

Under workers compensation legislation, if someone is a ‘worker’ or ‘deemed worker’ then the employer is required to include their wages in the declaration provided to the employer’s workers compensation insurer. If the person performing work is a ‘contractor’, for the purpose of workers compensation premium calculation/law, then the person engaging that person to perform work, doesn’t need to include that contractor’s wages in their declaration.

To help you assess the difference between a worker, a deemed worker and a contractor and ensure you comply with your workers compensation obligations, SIRA has developed the online/interactive ‘Worker or Contractor Tool’. It will take you through a series of questions before giving you guidance about the worker status of the person performing work for you. No personal information is taken during the process.

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