Workplace Law

Running head: WORKPLACE LAW
Workplace Law
Name of the Student
Name of the University
Author Note

1WORKPLACE LAW
Issue 1
The first issue in this situation is whether Bob can be said to be a contractor or he works as
an employee in the club.
Rule
The employment laws and the common law relating to employment, does not govern the
conduct of the contractors. The employment laws are applicable only in case of employees
and not contractors. The main dispute that arises in the implementation of the same is the
determination of a person to be either a contractor or an employee. Both the contractor and
the employees are entrusted by the employer with certain specified work. This makes the
terms employee and contractor to be similar but there lies a considerable amount of
distinction between the same. The differentiation between a contractor and an employee
needs to be drawn with respect to certain factors. These factors, in its initial form, has
evolved in the case of Ready Mixed Concrete Ltd v Minister of Pensions [1968] 2 QB 497,
where a threefold test has been prescribed to identify a contractor distinct from an employee.
This threefold test has undergone a substantial amount of changes and is at present formed
the multifactor test distinguishing an employee from a contractor. This test prescribes certain
factors that are needed to be considered while identifying a contract distinct from an
employee.
 The first factor that distinguishes a contractor from an employee is the control of
the work. The employee generally performs his work under the control of the
employer, whereas the work of the contractor is controlled by the contractor
himself and the employer does not have a right to interfere in the same. However,
in performing the work, the contractor must give regards to the terms of the
contract.

2WORKPLACE LAW
 An employee is required to work for the employer exclusively and he cannot work
for more than one employer. However, the contractor may work for more than one
client and the services rendered by them is not exclusive to one of the client.
Hence, the exclusive factor can be regarded as the second factor of the multi factor
test.
 The delegation power is the third factor of distinction between the employee and
the contractor. The employee does not have the right to delegate his work but the
contractor has such a right to delegate the work and he may hire people for the
same.
 The manner in which the remuneration is paid is another factor that can draw a
distinction between an employee and a contractor. The employees are paid timely
wages whereas the contractor are paid with respect to the units of work.
 The work timing is yet another factor of differentiation. The contractor is
independent in performing their work at any time, but the employee needs to
perform their work in the time as will be prescribed by the employer.
The Australian Business Number (ABN) does not confer upon an employee the status of a
contractor. For gaining the status of a contractor, all the factors of the multi factor test needs
to be complied with.
Application
In the given circumstances, Bob has been employed in and rendering services to the RSL
club. However, after a number of years of rendering services to the club, Bob was ordered by
the employer to obtain an ABN in order to gain the status of a contractor as the club wanted
to operate their work related to the bar with the help of a contractor. The ABN has been
availed for the purpose of issuing invoices. Hence, it does not render Bob to be a contractor