From 1 July 2013 a new definition of ‘worker’ has been introduced to the Queensland workers’ compensation legislation. This new definition has narrowed the scope, meaning that a lot of independent contractors who previously fell within the definition will no longer do so. From July a ‘worker’ will be determined as:

• a person who works under a contract; and
• in relation to the work, is an employee for the purpose of assessment for PAYG withholding under the Taxation Administration Act 1953 (Cth).

This means that only persons who are employed under contract and fall within the definition of an employee for PAYG withholding tax purposes need to be covered by the workers compensation policy. The previous definition captured a lot of independent contractors as it covered:

an individual:

• who is paid for labour only, or substantially labour only; or
• who does not meet all of the following criteria:

1.            is paid for a specific result;

2.            has to supply all of the plant, equipment or tools of trade to do the work; and

3.            is liable for rectifying defects in the work.

Now that the new definition has been introduced, it is important for businesses to reassess their employee/contractor relationships to ensure their workers’ compensation covers ‘workers’ only.