Contractor Engagement

For the purposes of the University of Adelaide’s Contractor Engagement process, a Contractor is anyone engaged by the University in any activity which involves a labour component.

Traditionally, independent contractors provide services to a business and perform work to further their own business. However, more recent Court decisions and legislation requires robust analysis of all factors to accurately classify a worker.

Additional information on the classification of workers and how this may be done can be found here and here on the ATO website.

Following submission of a Contractor Engagement Assessment form, the University may deem the engagement to be that of a contingent worker.

A contingent worker refers to an independent contractor who is not an employee for most legal purposes, but who falls within the wider definition of employee for certain taxation and superannuation legislation, and therefore for whom employer obligations such as superannuation and payroll tax apply.

Payment for contingent workers is via the Contingent Worker Payment eForm and these payments are facilitated through Payroll (HR). This contrasts with a true independent contractor for whom payment is facilitated through Finance.

According to the Superannuation Guarantee (Administration) Act 1992 there are several clear categories of contractors who fall under the extended employee definition and for whom Superannuation payment is required.

Please note this is not an exhaustive list:

• Sportsperson, artist, or entertainer paid to perform, present, or participate in any music, play, dance, entertainment, sport, display or promotional activity, or similar activity.
• Person paid to provide services to support those who perform, play sport, or promote these activities.
• Person paid to perform services related to the making of a film, tape, disc, television, or radio broadcast.

Engaging a Non-Employee?

Follow these steps:

• Complete the "Contractor Engagement Assessment Form" available online.
• Once submitted, the form goes to Compliance (HR) for review.
• After evaluation, you (the requestor) will receive:
  • An outcome/determination on the relevant classification of the worker and the appropriate payment method to the individual/entity.

As much information about the contractor and the engagement must be obtained by the local area PRIOR to the commencement of the work.

Please follow the steps under the Contractor Engagement Assessment Form to obtain a determination on the compliant engagement of the individual/entity completing the work.

Conflict of Interest - where there is an actual, potential or perceived conflict of interest, a Disclosure of a Conflict of Interest Form must be completed. Refer to the Conflict of Interest Procedure for further information.

No, not if the nature of the engagement (the labour component of the work being performed) is the same as a previous assessment outcome. 

If the contractor/contingent worker hasn’t performed work within a period of 12 months, a new contractor engagement assessment form needs to be submitted.

Once the contractor has been assessed he/she/they will either be deemed:

• a Contractor (with payment via Finance - Accounts Payable/Other Payments) or,
• a Contingent Worker (with payment via the Contingent Worker Payment eForm) or,
• an employee (via an employment contract, contact the HR Service Centre or a HR Advisor for further advice).

Create an HR eform to request a Contingent Worker Payment.

Enter the person’s last name or ABN and click “Search”.

If the person appears, they have been deemed a contingent worker, and you can proceed with requesting a payment.

Please contact the Finance Support Team to confirm if the contractor has been previously assessed and is an active supplier.

• Phone – (08) 8313 3414
• Emal – finprosupport@adelaide.edu.au

If yes, then normal Finance and Procurement processes apply. If not, a Contractor Engagement Assessment Form will need to be completed.

No, engagements for teaching and teaching-related duties are required to be affected by way of employment contract.

Exceptional circumstances will be considered by the Executive Director, Human Resources, if deemed acceptable as a result of the contractor engagement assessment determination.

Current Staff

Current University of Adelaide staff in any capacity, including continuing, fixed term, part time or full time, casual and sessional appointments cannot be engaged as an independent contractor concurrently without approval from the Executive Director, Human Resources. Conversely, a staff appointment should not be offered to a person during the period of a contracting agreement with the University.

Refer to the Recruitment Procedure for further information.

Exceptional circumstances for a concurrent arrangement will be referred to the Executive Director, Human Resources, if deemed acceptable as a result of the contractor engagement assessment determination where both the following requirements are met:

1. The service provided differs from the work currently undertaken through employment; and
2. A specific distinction between work tasks and hours can be clearly identified and captured.

Titleholders

Titleholders supporting the delivery of courses cannot be engaged as contractors.

Former staff

Former staff may be engaged as contractors if both the following requirements are met and deemed acceptable as a result of the contractor engagement assessment determination:

1. There has been a minimum of 3-months break in service; and
2. The labour/service provided differs from the work previously undertaken when employed by the University.

Special care should be taken when considering whether to engage a former staff member who accepted a voluntary redundancy or was retrenched. The University’s Enterprise Agreement specifically outlines re-employment restrictions, unless authorised by the Vice-Chancellor. This should only be considered in circumstances of critical business need because of the significant risks which include:

• Potentially undermining the genuineness of the redundancy;
• Exposing the staff member to having the favourable tax treatment of their redundancy/retrenchment payment overturned by the Australian Tax Office; and
• Creating a sham contract.

Contact your HR Advisor for further advice.

More information can be found on Sham Contracting.

Honorariums are a small, one-time payment made to an individual, who is not a university staff member, as a reward for a special or non-recurring voluntary activity for which a fee is not legally required and where payment is not expected.

Please contact your HR advisor or email contractormgmt@adelaide.edu.au if you have any queries.

This information is applicable to panel or committee members who attend meetings in an advisory capacity only and are not involved in the day to day running of any aspects of the University. The appointment of External Advisory Panel or Committee Members and the details of that appointment should be set out in a letter. The Contractor Engagement Assessment form needs to be competed.

It is preferable for Panel Members to invoice the University of Adelaide either:

• Via their university or employing organisation or,
• Using their own ABN (Note - superannuation guarantee will be payable if they are operating as an individual/sole trader).

If the Panel Member is an individual/sole trader, then superannuation guarantee is applicable, and the Contingent Worker Payment Process should be followed to enable payment via HR Payroll.

If the individual does not have an ABN, then PAYG tax will be deducted at 47%.

Exceptional circumstances may be considered by the Executive Director, Human Resources, if deemed acceptable as a result of the contractor engagement assessment determination.

Please contact the Contractor Compliance Officer in the first instance outlining the reasons as to why you are seeking an exemption for the engagement.

Email: contractormgmt@adelaide.edu.au

A change to services agreed with a contractor may trigger a change to the obligations of the University.

If previously paid through Finance - Accounts Payable/Other Payments, this may need to change as employer obligations can change simply by engagement type.

Contractors will not automatically have access to University systems. If this is required to support the nature of their work then a visitor access account will also need to be requested.

A Consultancy Services Agreement is necessary to assist in determining whether an employee or Contractor Relationship exists between the University and the Individual/Entity.

Recent Court decisions clarify and confirm that, generally, it is ONLY the rights and duties provided under the contract that must be considered in determining whether a person is an employee or an independent contractor. This is not limited however, and a robust analysis needs to be conducted of all the available information.