HomeHome SearchSearch MenuMenu Our productsOur products

Warning! Make sure you know the difference between employees and contractors...

by , 12 October 2016
Warning! Make sure you know the difference between employees and contractors...If you don't know the difference, you could be giving an employee benefits when he doesn't qualify. Or even worse, you could treat someone like they aren't your employee and land up with a costly labour case on your hands! Not to mention the legal fees you'll have to fork out to deal with your mistake.

But first...

What is an employee?
 
The law assumes a worker is legally your 'employee' if any one or more of the following circumstances are present (Section 200A of the LRA):
  • You control the way the person works.
  • You control the person's hours of work.
  • If a person works for an organisation, the person forms part of that organisation.
  • If he works for an average of at least 40 hours per month in three months.
  • If he's economically dependent on you.
  • You provide him with the tools to do the job.
  • The person only works for or supplies services to you.
This assumption is only for employees who earn less than the earnings threshold which is currently R205 433.30. If a person earns more than this, you can't presume he's an employee. 
 
The definition of an employee is broad. It covers just about everyone who works, but excludes independent contractors. So in all, labour laws protect almost all workers. 

Keep reading below to find out why you need to know the difference...
***
Be warned! The Labour Relations Amendment Act changes the way you treat fixed-term and temporary employees!
 
If you use fixed–term contracts in your workplace, you need to make sure they're in line with the new Labour Relations Amendment Act which came into effect on 1 April 2015. 
 
If you don't know how to implement and manage fixed-term and temporary contracts you could land up with an unfair labour practice case on your hands!

Find out more here...

***

Why you need to know the difference between employees and independent contractors

Because most labour laws only protect employees. They don't protect independent contractors.  As the employer, you have to prove the person is an independent contractor, and isn't an employee. You can do that by using the table below to make sure…
 
Five types of employees you could confuse with independent contractors
Be careful though, there are some workers you could confuse with 'independent contractors' and not give them any rights.

These include:
1. Occasional employees who work less than 24 hours in any month;
2. Temporary or fixed-term employees;
3. Part-time employees;
4. Probationary employees; and
5. Agency assignees.

Click here to find out how you need to treat fixed-term and temporary employees and how the labour laws affect you...
 



Related articles




Related articles



Related Products



Comments
0 comments


Recommended for You 

  Quick Tax Solutions for Busy Taxpayers – 35 tax answers at a glance



Here are all the most interesting, thought-provoking and common tax questions
asked by our subscribers over the last tax year – everything from A to Z!

To download Quick Tax Solutions for Busy Taxpayers – 35 tax answers at a glance click here now >>>
  Employees always sick? How to stop it today



Make sure you develop a leave policy to regulate sick leave in your company.

BONUS! You'll find an example of the leave policy and procedure in this report.

To download Employees always sick? How to stop it today click here now >>>
  Absenteeism: Little known ways to reduce absenteeism



This FREE e-report will tell you how you can reduce absenteeism in your workplace while avoiding the CCMA and without infringing your employees' labour rights.

To download Absenteeism: Little known ways to reduce absenteeism click here now >>>
  7 Health & safety strategies to save you thousands



Don't let a health and safety incident cost you one more cent. Implement these seven
strategies in your company today.

To download 7 Health & safety strategies to save you thousands click here now >>>