At the end of the day, this depends on the contractual relationship you have with your employer. The distinction is important because many important rights – such as the right to claim unfair dismissal or maternity leave – depend on being an employee. Some rights, such as the right to be paid the National Minimum Wage, exists regardless of how you are classified.
Every year court cases hang on the distinction between the two categories and unfortunately there is no clear definition. However, there is a rough rule of thumb:
- If your employer has to provide work for you personally on a regular basis, which you can’t turn down, and says when and where the work is to be done, supplies the tools or other equipment, pays Federal Income taxes on your behalf, and can subject you to a disciplinary procedure if you don’t follow the rules or if your performance is ‘unsatisfactory’, then you are probably an employee, and have what is known as a ‘contract of employment’.
- If you are genuinely running your own business, meaning that you are free to decide when you work, can choose to substitute someone else to do your work instead of you, can carry out work in the manner you best see fit, make your own sickness and holiday arrangements, and pay your own Income tax (usually with a 1099 form), you could be a self-employed person, contracted to provide a service to the employer. Hence your contract is known as a ‘contract for services’.
Many people in the cannabis industry are happy to be self-employed and some occupations, such as journalism, are likely to have a high proportion of self-employed workers. However, some unethical employers deliberately misclassify individuals as self-employed to avoid tax, and other employment obligations.
Working out who is an employee and who is self-employed is often unclear depending on your responsibilities. If you are unsure, you can contact a representative of CWC or contact your union if you are a member.
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