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Contractual/Employment Relationships
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A - 28.2 Contractual/Employment Relationships
The ATO has issued a Taxation Ruling (TR1999/13) which makes the following distinctions between the above forms of contractual relationships:
"The relationship between an employer and an employee is a contractual one. It is often referred to as a contract of service (or in the past, as a master/servant relationship). Such a relationship is typically contrasted with the independent contractor/principal relationship that, at law, is referred to as a contract for services. An independent contractor typically contracts to achieve a result whereas an employee contracts to provide his or her labour (typically to enable the employer to achieve a result)…"
"A user of labour or service requirer may contract with a labour hire firm for the provision of labour of a specified kind. The labour hire firm does not contract to perform the work; it merely contracts to provide labour to work under the direction of the user.
The labour hire firm then ascertains the availability of suitable workers on its books. Contacted workers may accept or reject the work offer. On acceptance, a contract is formed between the labour hire firm and each worker."
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