This article forms part of the series “Contractors – Shifting Sands for Medical and Allied Health Practices”
When considering whether an allied health worker is an employee or a contractor, one factor to consider is in respect of the provision of tools, equipment and other assets required to undertake the work.
An employee generally performs work using tools and equipment supplied by, and at the cost of, their employer at their employer’s place of business. Alternatively, an employee may provide most or all of the necessary equipment and then be reimbursed by the employer.
This latter arrangement will often also apply with respect to additional expenses incurred by the employee (where authorised), and reimbursement of a worker falls within the typical realm of an employer/employee relationship. Contrastingly, a true independent contractor will generally provide their own tools and equipment and not be reimbursed or provided an allowance for expenses incurred in providing the work or services.
While the supply or maintenance of tools and equipment is one factors which might help to show that an individual is in fact an independent contractor, this can be difficult to arrange in a medical or allied health context. This is due to the practical (and financial) limitations of requiring practitioners provide their own equipment which is necessary to their role and is often costly, sizeable, and required to be mounted as a fixture (think radiologists, for example).
Sometimes, arrangement might instead be made for practitioners to pay the practice for use of the practice’s equipment and consumables. But is this appropriate for your situation? While this might be fine if the practitioner is properly characterised as an independent contractor (and could help you to show this is the case), requiring an employee to pay you for use of your equipment is likely unlawful, and exposes you to risk of fines.
It is important that your methods of engaging practitioners, and practical arrangements and contracts with them, appropriately balance and deal with a whole range of issues, including who provides and pays for necessary items such as consumables, stationary and medical equipment. We can assist in reviewing your practices methods of engagement and contracts and assessing your risk exposure.
Consider your current arrangements and review your practice structure. We invite you to contact us with any questions.