When it comes to hiring staff for your business, it’s important to be aware of the different employment types and how it can impact your relationship with those in your workforce. This way, you can be on top of any legal obligations you owe your employees as their employer. 

A question we often get asked by business owners is “What is the difference between an employee and a worker?”.   

It’s a good question! Even though the two terms are sometimes used interchangeably, there’s a distinct difference between an employee and a worker. As such, the obligations you have to an employee and a worker are very different .

As an employer, it is your job to set our clear expectations regarding your staff’s employment, so understanding the different types of employment is the first step in avoiding misunderstandings later down the track. 

What Is The Difference Between A Worker And Employee In The UK?

An employee is someone who is hired to work a particular job, often for a set amount of days and hours. For example, 9am-5pm, Monday to Friday.  A worker, on the other hand, has a more casual, less structured relationship with their workplace. 

We’ve highlighted some of the key differences between an employee and a worker in the table below. 

Works a regular scheduleHas an irregular work schedule
Is expected to work Can turn down work 
Has set days that they workWorks when they are called in/needed
Is paid a set wage/salary Is paid for the time they work 
Employer has a certain amount of control over their work Their work is not meticulously overseen by the employer 
Their role is integral to the greater workplaceTheir role is not always required or essential 
Has as Employment Contract deeming them an employee of the workplaceHas an agreement relating to their personal work, but is not specified as an employee

It’s important to keep in mind that all of the above may not necessarily apply when it comes to determining whether a person is an employee or worker. These are simply common traits of the two types of work arrangements. 

As an employer, it’s crucial to have strong Employment Contracts with all your staff in order to determine what their hiring conditions are. When you have a clear contract in place, both parties can be aware of their respective rights and responsibilities towards one another, allowing less chances for misunderstandings and disputes. 

Our expert lawyers can chat you through your options when it comes to documenting your work arrangements – contact us for a consultation today. 

Worker Rights Vs Employee Rights

Workers and employees both have rights. However, as their working conditions are different, the rights they can expect to receive also differ. Usually, an employee will have more rights than a worker. However, workers still have certain rights under the law. 

Let’s take a look at some of the rights both employees and workers can expect to have.

Employees are entitled to:

  • Leave entitlements and recurring pay
  • Redundancy payments
  • Superannuation 
  • Liability protections 
  • Tax deductions

Workers are entitled to:

  • Minimum wage
  • The right to be free from harassment or discrimination 
  • A safe working environment 
  • Protection from  unlawful conduct 

What Other Types Of Employment Should I Consider? 

Along with employees and workers, there are other types of employment that are different from the two we’ve been discussing in this article. 

Contract workers and contingency workers are a significant part of the UK workforce. Chances are you’ll be coming across them in your career, so it’s wise to understand these key differences. This way,  you can be prepared to handle employment relations with all kinds of hires.  

What Are The Differences Between Contract Workers And Employees? 

A contract worker or a contractor is someone that is hired externally from the company. A contractor is generally a self-employed person who is hired for a specific period of time or until they have completed a certain task. 

A startup needs a redesign of their web page. In order to get this done, they hire a professional web designer on a 6 month contract. During this time, the designer’s job is to customise the webpage to the startup’s liking, after which their contract with them ends and both parties go their separate ways. 

This kind of arrangement would fall under contract work, and the designer is the contractor. 

An employee, on the other hand, is hired internally and they are a member of the organisation they work for. As such, they are entitled to things like annual leave and minimum wage. 

It’s easy to get confused between an employee and a contractor as they can often appear the same from the outset. However, distinguishing between the two is important  as employers do not owe the same rights and duties towards contractors as they do employees. 

Therefore, establishing that you intend for a certain worker to be a contractor is essential – we recommend getting a professionally drafted Contractor Agreement in place to achieve this. 

Are A Contingent Worker And An Employee The Same?   

Much like a contractor, contingent workers are not internal employees of the company. They are hired to work in the company temporarily and are not considered to be part of the company. In fact, contractors can be considered a type of contingent worker. 

Another example of a contingent worker is a consultant. A company might decide to hire a business consultant to help give them growth advice. The consultant might stay in the company for 8 weeks to help the company and then part ways to work with a different company. 

This type of work is often referred to as the ‘gig economy’, where instead of being hired full time at one workplace, individuals take on a number of temporary projects. 

As An Employer, What Else Should I Look For? 

Employees, contractors and contingent workers are all valuable members of the workforce. As an employer, knowing the difference between employment types will determine how you interact with certain employees. 

This is one of the many obligations employers have when it comes to their staff.

Another one of your primary responsibilities as an employer is to provide a safe working environment for your employees and anyone else that enters your place of work. 

Having strong and well-defined workplace policies can help greatly in developing an environment that is a safe and positive space for all those that interact with it, whether this be virtually or in person.   

For example, your workplace policies can include inclusivity awareness, anti-discrimination and harassment as well as methods on how to manage certain machinery, especially if you’re using equipment that could pose a threat to others. 

Workplace policies are specific to the individual workplace, which is why it’s good to have the help of a legal expert when drafting a Custom Workplace Policy that fits the needs of your business. 

Many employers also like to provide their employees with an additional Staff Handbook. These are another custom document that all members of staff can have (regardless of whether they are internal or external) that can help them remember the process and policies that are in place for keeping an encouraging work environment. 

Key Takeaways 

As an employer, you’ll be setting the tone of the relationship with any current your future employees. Understanding the different types of employment is not only beneficial, but also necessary,  when fulfilling your employer obligations. To summarise what we’ve discussed:  

  • Employees are internal members of a workplace that are hired under a contract and their working conditions meet certain requirements 
  • A worker, on the other hand, isn’t as strictly bound as an employee and their relationship with the workplace can be described as more casual 
  • Contract workers are people that have been hired temporarily to complete a certain task 
  • The same applies with contingent workers, where contractors are also a type of contingent worker
  • Employers owe different rights and duties to employees depending on the type of employment they have, so it’s important to define the type of employment an individual will have right from the beginning
  • Another key legal obligation employers have to all members of their staff is to create a safe working environment. Workplace policies and staff handbooks can be utilised effectively here 

If you would like a consultation on your options moving forward, you can reach us at 08081347754 or [email protected] for a free, no-obligations chat.

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