Employee or Subcontractor?

This page is for: 
Employee / workerEmployer

This information is only relevant to employers and employees in the WA state industrial relations system – sole traders, unincorporated partnerships, unincorporated trusts and some incorporated or not for profit organisations. Find out more on the Guide to who is in the WA state system page.

If you operate or are employed by a Pty Ltd business – you can find information on this topic on the Fair Work Ombudsman website.

Employee or subcontractor fact sheet

The Wageline fact sheet about employees and subcontractors provides the same information as on this webpage in pdf format.

View the employee or subcontractor fact sheet in pdf format

A subcontractor is not an employee, but rather a worker running their own independent business. If a person is a subcontractor, employment laws and WA awards do not apply to that person.

If a person is ‘engaged’ as a subcontractor but is legally considered an employee, the person could potentially be owed unpaid leave entitlements, wages (particularly overtime and penalty rates) and superannuation contributions.

Determining whether a worker is a subcontractor or employee can be complex. The table below provides an overview of the main differences between employees and subcontractors. The Employee or Subcontractor Checklist publication has more information and is also designed to assist in understanding the key aspects of each type of working arrangement. 

It is recommended that you seek legal advice if unsure.

The main differences between a subcontractor and employee

Subcontractor Employee
In control over the hours worked and when and how the work is performed The employer is in control of how and when work is performed
Can accept and perform work for other businesses while engaged by an employer The employee is an integral part of the business and will usually be working for that business on a regular and ongoing basis
Provides a rate for a specific job and an invoice for work performed The employer pays the employee in accordance with the relevant WA award, or contract of employment
Supplies their own plant, materials and equipment The employer supplies the employee with materials and equipment
Responsible for their own tax and superannuation arrangements The employer is responsible for tax and superannuation and workers' compensation for the employee
Presents as their own enterprise

The employee represents somebody else's business







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