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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.
A true independent contractor has no protection under the provisions of the Labour Relations Act and section 83A does not apply to persons who earns in excess of the amount determined by the Minister. It is for this reason that many employers will prefer to employ someone as an independent contractor.
By contrast, as a general rule, employers are not liable for the acts of independent contractors, however there are several exceptions to the general rule. The reality today is that corporations face many liability issues when dealing with independent contractors and suppliers.
The general rule regarding independent contractors states that a person who hires an independent contractor cannot be held vicariously liable for the wrongdoing of the independent contractor.
And in fact, under the law, employers cannot be held liable for the acts of their independent contractors. However, just because an employer asserts that a negligent worker is an independent contractor does not shut down the question of employer liability.
A sales agent is an independent contractor. They earn a percentage of what they sell or a commission based on sales. It is in the best interest of the sales agent to get the highest amount possible because the sales agent's pay is directly related to how much they sell for the client.
FEHA typically protects independent contractors as well as employees.
The contract should state who pays which expenses. The contractor is usually responsible for all expenses including mileage, vehicle maintenance, and other business travel costs; work supplies and tools; licenses, fees, and permits; phone and internet expenses; and payments to employees or subcontractors.
Doing Work as an Independent Contractor: How to Protect Yourself and Price Your ServicesProtect your social security number.Have a clearly defined scope of work and contract in place with clients.Get general/professional liability insurance.Consider incorporating or creating a limited liability company (LLC).More items...?