Why this matters.
If you work for yourself as a contractor or freelancer in Australia, several laws protect you from one-sided contracts and from being treated as a contractor when you are really an employee. Since 26 August 2024, section 15AA of the Fair Work Act 2009 decides whether someone is an employee by looking at the real substance and practical reality of the whole working relationship, not just the label in the contract. Sham contracting, where a business misrepresents employment as a contracting arrangement, is prohibited by section 357. Under Part 3A-5, independent contractors earning below the contractor high income threshold can ask the Fair Work Commission to deal with unfair contract terms in their services contracts, and the Independent Contractors Act 2006 still applies to those above it. Contractors paid mainly for their labour can also be employees for superannuation guarantee purposes under section 12(3) of the Superannuation Guarantee (Administration) Act 1992.
Separately, the unfair contract terms rules in the Australian Consumer Law (section 23) protect small businesses, including sole traders, that sign standard form contracts. A small business is one with fewer than 100 employees or turnover under $10 million, and since 9 November 2023 businesses that include unfair terms face civil penalties as well as having the terms struck out. Common examples are clauses that let the client change the price or scope on its own, cancel without paying for work done, claim all your intellectual property for nothing, or make you liable for things outside your control. Knowing which protections apply to you helps you push back on terms before you sign, and act quickly if a client treats you unfairly.