What Are Your Rights As a Freelancer?

You’ve quit that 9 to 5 grind because you want that freelance, AKA free, life — congrats! But what does that mean for your life admin and more importantly your work rights? Do you have any work rights?

There’s a common misconception that when you decide to become a freelancer you completely leave behind the protections that are offered to other employees, and therefore kind of have to deal with whatever you’re served. This isn’t technically correct. So whether it’s your first time freelancing or you’ve been doing it for a while, here’s a handy summary of some of your key rights.

A footnote before we kick off: A freelancer is a colloquial and commonly used term for what is known under Australian law as an independent contractor. That’s important because…

You might think you’re one, and the business you’re working for might be calling you one, but you could actually be an employee based on the terms and conditions you're required to work. There’s a pretty complex legal test that determines whether someone is in fact a freelancer (independent contractor) which basically looks at what kind of work you’re doing and how regulated it is by the business you’re working for.

The reason it’s important to know whether you are an independent contractor or an employee is because this determines what conditions you need to be provided at work — including whether you get leave entitlements and who pays your tax.

An independent contractor is a person who is self-employed and conducts work for one or many different businesses for fixed periods of time or for particular pieces of work. Generally speaking, you are legally an independent contractor if:

• You have your own ABN and are required to pay your own tax, superannuation and GST.
• Get to have a big say and control over how your work is performed and the hours you work.
• Are allowed flexibility in being able to work for other businesses.

On the other hand, you are likely to be an employee if you have an ongoing relationship with a particular business in exchange for you performing work consistently and getting paid regularly as part of a salary, and not when you submit an invoice.

What’s important to know is that it’s against the law for an employer to mislead a person to think they are an independent contractor when they are actually an employee. It’s called Sham Contracting and you can bring a claim under the Fair Work Act 2009 (Cth) to be paid entitlements as an employee if this occurs. Under the Fair Work Act, an employer also cannot:

• Threaten an employee with dismissal or dismiss an employee only to rehire them as a contractor doing the same work.
• Engage someone as a contractor for the purpose of avoiding paying leave entitlements, superannuation and workers compensation.

Freelancers don’t receive the same entitlements as employees. This means they are generally responsible for their own superannuation and tax and also do not receive paid leave.

If you’re a freelancer, your rights around work and getting paid depends on the terms of your agreement with the business you’re working for. The agreement you make with the business you’re working for around payment rates, deadlines, who gets to own copyright etc together forms a legal document called a contract for services.

If you’re the type of person that normally just goes off emails back and forth around conditions, don’t fret as the emails together can form the terms of the agreement. But it’s good practice to actually try and have a clear single document which maps out the final agreement so there’s no room for misunderstanding.

Therefore once you and the business you’re freelancing for agree on the terms of your engagement, these terms become legally binding and any breach of them by either you or the business could be relied on for a breach of contract claim. This includes if you’re not getting paid or you’re being asked to deliver more than initially agreed for without more money.

If you think your contract of services has been breached, you should get legal advice about whether you can bring a claim for a breach of contract.

There are also protections for independent contractors around unfair contracting. What that means in practical terms is there are laws that prohibit unfair or harsh terms from being included in a contract for services between a principal business and a contractor. There’s no definitive list about what is a harsh or unfair term, but for example, it could include: the rate of pay, whether one part is being pressured to perform more than what’s reasonable, and whether an employee would receive more money for the same work.

If you think your contract of services is unfair or harsh, you should get legal advice around whether it’s a breach of the Independent Contractors Act 2006 (Cth).

Last but not least, as an independent contractor you have the right to a workplace free from discrimination and bullying. For example, a hirer cannot refuse to hire you or change the terms of your contract on the basis of any characteristic considered discriminatory under national, state and territory anti-discrimination legislation. For example, a business can’t not hire you to do freelance work because of your gender or race, or if you’ve made a previous complaint of discrimination.

Similarly you should not be subjected to discrimination or harassment during the course of your contract. If you feel that you have been a victim of discrimination, harassment or workplace bullying, there are a number of steps you can take including raising the issue directly with the principal business or contacting your local state or territory anti-discrimination commission, the Australian Human Rights Commission, or your local state or territory workplace health and safety authority.

Please note: this information is only intended as a guide to the law and should not be used as a substitute for legal advice.

For more legal advice about things you actually care about, check out the rest of the Know Your Rights series.