Should Casual Employees be On Payroll, or Work as Independent Contractors?

May 17th, 2013

When hiring casual employees that don’t necessarily work consistent shifts week after week or day after day. it is challenging to determine how they should be paid, and what their job classification will be from a legal perspective.

Two popular options are putting these employees on payroll or setting them up as an independent contractor. Having them labelled as an independent contractor, has a number if different pros and cons.

  • ¬†You don’t not need to worry about submitting tax deductions from payroll on behalf of the employee.
  • They are responsible for invoicing the business once the job has been completed.
  • There is no obligation to pay individuals that are not on regular payroll for vacation time, overtime and holidays.
  • the payment process is simplified.

However, you do need to ensure that all people you classify as independent contractors, are in fact self-employed, and that their role with the company is justifiable. Otherwise, the government may be under the impression that you are classifying people. In the trades industries, independent contractors can be anyone that you bring in to focus on certain aspects of the business that they also provide as part of their business services. Any contractor that cannot be classified this way should be put on standard payroll, or the benefits are lost.




Peter Morrissey has been working with employee time and attendance for more than 15 years, Peter has supplied more than 3000 customers around the world with employee time management systems. He has seen the good, the bad and the ugly. Peter bought the JobClock system into Australia in 2008 to fill a void not being covered at the time. As cloud technology has come along the JobClock system not only services construction but many more industries hungry for employee labour costing information.

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