If you need flying advice ask a pilot. If however, you need legal advice...
There's no separate and distinct legal test to determine if an individual is a contractor or an employee. The relationship is covered by a number of different legislative areas, including superannuation guarantee and OH&S, but primarily we look to the Independent Contractors Act 2006, together with consequential amendments to the Workplace Relations Act.
To quickly dispel a popular urban myth, there's no all encompassing test based on tenure. There's absolutely no reason what so ever why an independent contractor cannot derive 100% of his income for an undefined period from a single source.
Generally speaking, these are the things to consider. Control over work, independence, payment, commercial risk, ability to delegate, ownership of tools and equipment.
There's a number of things which make our friend the Contracted Pilot look and smell like a contractor.
1. There is a written contract in place between The Principal and himself
2. The pilot is responsible for his own tax and super (except even withstanding the contract arrangement, the Principal may still be required to hold super because of an interesting provision of the Superannuation guarantee)
3. The pilot supplies his own uniforms, equipment, charts etc and is not reimbursed
4. The pilot has substantial commercial risk. He's liable for damage to the aircraft. THIS IS AN IMPORTANT CONSIDERATION. Employees are normally indemnified from risk by an Employer.
5. The pilot is independent, in that the contract has no exclusion clause preventing him from working elsewhere
Please note that I can just as easily drum up legal argument that makes him look like an employee. My point is that you should be extremely careful in saying that he's undoubtedly an employee because that most certainly is incorrect.
Also, any allusion to the fact that lawyers are happy to carelessly draw contracts because they don't expect them contested is ridiculous. Whom better than a lawyer to understand the very real risk in this day and age of attracting a law suit for professional negligence? Most lawyers charge by the hour, so why wouldn't one take the time to get it right?
Last edited by Rojer Wilco; 10th Jan 2010 at 11:02.