No. The Australian Taxation Office (ATO) guidance, updated 17 December 2024 (figures checked 1 October 2026), lists three payment patterns that may point towards employee status: payment for time worked, a price per item or activity, or commission. Payment for a specified result, generally on completion and often for a fixed fee, may point towards independent contractor status, but no single indicium is determinative; the contract’s legal rights and obligations must be assessed together.
What does the payment method actually tell you?
The basis of payment must be considered when classifying a cleaner, but it is only one part of the contractual relationship.
| Payment basis | Direction indicated by the ATO guidance |
|---|---|
| Payment for time worked | May point towards employee status |
| A price per item or activity | May point towards employee status |
| Commission | May point towards employee status |
| A specified result, paid on completion and often for a fixed fee | May point towards independent contractor status |
An hourly rate therefore corresponds to payment for time worked. A price for each cleaning item or activity corresponds to the per-item or per-activity pattern. A fixed payment for completing an agreed cleaning result corresponds to the result-based pattern.
None of these payment terms guarantees the indicated classification. The ATO expressly says its indicia should not be applied as a checklist and that no single feature determines the outcome.
What else should be checked with the payment terms?
The central distinction is whether the cleaner works in and as part of the business, or provides services to the business while working to further their own business. Other contractual rights and obligations then need to be considered alongside payment.
| Contractual feature | May point towards employee status | May point towards independent contractor status |
|---|---|---|
| Control | The business has a legal right to control how, where and when the work is performed | The cleaner can choose how, where and when to work, subject to reasonable direction |
| Role in the business | The cleaner must act as the business’s representative | The cleaner provides services to further their own business |
| Personal performance or delegation | The cleaner must personally perform the work and cannot delegate or subcontract it | The contract gives a genuine right to delegate or subcontract |
| Tools and equipment | The business supplies all or most tools and assets, or provides an allowance or reimbursement | The cleaner supplies all or most tools and assets without an allowance or reimbursement |
| Commercial risk | The cleaner bears little or no risk, while the business bears the commercial cost of injury or defects | The cleaner bears the commercial risk arising from injury or defects |
| Goodwill | The hiring business benefits from goodwill generated by the cleaner’s work | The cleaner’s own business benefits from that goodwill |
A real delegation right must also be legally capable of being exercised. A clause that is only nominal or cannot operate in practice does not automatically support contractor classification.
Why does the whole contractual relationship matter?
The ATO says the High Court judgments in CFMMEU v Personnel Contracting and ZG Operations v Jamsek confirm that classification depends on the totality of the contractual legal rights and obligations between the parties.
The old multifactorial test is no longer used, but the same types of indicia remain relevant when they help identify those agreed rights and obligations. They are not points to score until one side reaches a predetermined result.
A cleaning business should compare the cleaner’s contractual position with the business’s essential activities. If the cleaner serves as the business’s representative under its control, the relationship may point towards employment. If the cleaner provides services to further their own business, it may point towards contracting.
What if the contract is oral or says “independent contractor”?
A contract may be written, wholly oral, or a mixture of written terms, oral terms and terms implied from conduct. The description used in the contract does not determine the classification: calling a cleaner an “independent contractor” is neither conclusive nor relevant to how the relationship is characterised.
Actual conduct and work practices are not treated as additional contractual terms automatically. According to the ATO, they matter for classification only if they are sufficient to vary the terms agreed between the parties.
What should a cleaning business do before deciding?
- Identify who is contracted. For an individual, examine the working agreement or contract. For tax and superannuation purposes, the ATO treats companies, trusts and partnerships as contractors, and the people working through them are not employees of the hiring business.
- Record the legal rights and obligations, including control, personal service, delegation, equipment, risk and payment.
- Compare those terms with the cleaning business’s essential activities.
- Assess the features together rather than treating payment as a standalone test.
- Check any labour-hire arrangement separately. If the hiring business contracts with and pays a labour-hire firm for the worker’s work, the firm is responsible for the worker’s PAYG withholding, superannuation and fringe benefits tax obligations.
- Seek specific tax or legal advice if the classification remains uncertain. The business is responsible for classifying the worker correctly for tax and superannuation purposes and may face penalties for an incorrect decision.
This is general information, not financial or legal advice. Before making a staffing or insurance decision, check the current ATO guidance and the relevant policy’s Product Disclosure Statement.
Sources
FAQ
Does an hourly rate always make a cleaner an employee?
No. Hourly pay is a remuneration feature that may point towards employment, but it is not determinative. The legal rights and obligations governing control, personal service, delegation, tools, risk and the cleaner’s role in the business must also be considered.
Does payment per room or cleaning item prove employee status?
No. The ATO includes a price per item or activity among the payment patterns that may point towards employee status. It still requires the whole contractual relationship to be assessed.
Does a fixed fee for a completed clean prove contractor status?
No. Payment for a specified result, generally on completion and often for a fixed fee, may point towards independent contractor status. The fixed-fee term alone does not settle the classification.
Does calling a cleaner an independent contractor make them a contractor?
No. The ATO says the label used in the contract does not determine or help determine how the relationship is characterised. The contractual legal rights and obligations do.
Who is responsible for deciding the classification?
The hiring business is responsible for classifying the worker correctly for tax and superannuation purposes. An incorrect decision may lead to penalties, so uncertain arrangements should be checked against current ATO guidance and discussed with a qualified adviser.
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