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Becoming an independent contractor is one of the many ways to be classified as self-employed. By definition, an independent contractor provides work or services on a contractual basis, whereas, self-employment is simply the act of earning money without operating within an employee-employer relationship.
The main pieces of employment legislation, chief among which are the Labour Relations Act 66 of 1995 (LRA) the Basic Conditions of Employment Act 75 of 1997 (BCEA) and the Employment Equity Act 55 of 1998 (EEA), apply to employees and not independent contractors.
Some general protections provided under the Fair Work Act 2009 extend to independent contractors and their principals. Independent contractors and principals are afforded limited workplace rights, and the right to engage in certain industrial activities.
Simply put, being an independent contractor is one way to be self-employed. Being self-employed means that you earn money but don't work as an employee for someone else.
The other contract (Independent contractor) is a Contract for Service, and is usually a contract where the contractor undertakes to perform a specific service or task, and upon completion of the agreed service or task, or upon production of the result agreed upon, the contractor will be paid.
Freelancers are independent contractors who should receive 1099 from the company using their services and are subject to paying their own taxes, including self-employment tax.
A 1099 employee is a US self-employed worker that reports their income to the IRS on a 1099 tax form. Freelancers, gig workers, and independent contractors are all considered 1099 employees.
Often Independent Contractors are completely unaware that they are not Employees as defined in South African labour legislation and therefore unprotected by labour legislation.
The Labour Relations Act applies to all employers, workers, trade unions and employers' organisations.
Employees in South Africa are entitled to certain minimum employment benefits, while independent contractors are not. Subject to some exclusions, all employees are entitled to a number of statutory minimum entitlements and basic conditions of employment.