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Evaluation of Direct Hire Relationship

Risk Assessment Analysis - Engaging Direct Hire Independent Contractors
The most important criterion to be considered in a risk assessment of direct hire arrangements is the relationship between parties.

If the host employer-contractor relationship is deemed to be a contract for employment under common law rather than a contract for service, the host employer's liabilities could involve:


  • Penalties for not deducting appropriate tax
  • Retrospective requirement to PAYE tax liability for employee
  • Contractor exposure to an employment relationship
  • Penalties for failure to meet Superannuation Guarantee liability
  • Retrospective requirement to meet superannuation liability for employee
  • Penalties for failure to meet pay-roll tax liability
  • Retrospective requirement to meet pay-roll tax liability.

Workers' Compensation

  • Penalties for not making payment to relevant authority
  • Retrospective payment for premiums
  • Exposure to a claim not supported by the Workers' Compensation Insurance Authority.

Employee Entitlements not Previously Paid to Independent Contractors

  • Annual Leave
  • Public
  • Holidays
  • Sick Leave
  • Long Service Leave
  • Redundancy
  • Leave Loading
  • Maternity Leave
  • Paternity Leave.

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