01 Jun Hiring New Staff Strategically
Strategically building your business is an important process, from expanding operations to revisiting your business structure. Part and parcel of this process is the ongoing engagement, retention and management of staff imperative to the growth of your business.
Engaging new staff is not always as straight forward as handing a new employee an employment contract. On-boarding new staff should be done with careful consideration and clarity.
An important element to consider is how you will engage the new staff member, whether it be as an ‘employee’ or ‘contractor’. There are important differences between each of these and both requires careful consideration of your rights, responsibilities and obligations at law.
Despite the title given to the staff member or the terms used in any Contract or Letter of Engagement, reference to a staff member as your employee or contractor is not definitive and does not mean they are an employee or contractor. Irrespective of the ‘words’ used, the staff member might be deemed an employee at law even if you refer to them as a contractor.
The Court has held that there are several ‘indicia’ of the employment relationship, or indicators you need to look out for when determining whether the new staff member is an employee or contractor. These indicators include, but are not limited to, the careful consideration of:
- Identifying who is responsible for the payment of entitlements, taxation or remuneration to the staff member, including superannuation benefits.
- Clarifying who is responsible for equipment, software subscriptions, training or other tools of the trade.
- Understanding how the staff member is to receive payments, whether they have their own company or business entity or if they are required to issue you with invoices for services performed.
- Whether the staff member is permitted to work for other businesses while they are also working for you.
- Appreciating how much control the staff member has over the work they are performing and what is the expectation of the work they are completing.
Setting the foundational requirements of the relationship are important and can avoid disputes, disruption and disappointment between you and your staff member. Obtaining advice from Artstein Legal will assist and protect your business and avoid legal risks, by putting in place clear Employment or Contractor Agreements to meet your specific needs.
Contact our legal team today to find out more.
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