With so much government work in Canberra, it’s no surprise that contractor payroll services are an integral part of the local recruitment industry.
And while many contractors depend on payroll services to get paid, not all payroll service providers are equal. The industry is largely unregulated, so choosing the wrong company could lead to doing business with backyard service providers or those that have simply attached payroll services to their main business lines.
The best contractor payroll service providers, on the other hand, have a solid business model that can absorb changes in legislation. They know how to navigate employment law in a confusing environment, and can be trusted to manage millions of dollars in payroll funds.
But what else should you look for in a contractor payroll service, and where can you find the best in Canberra? Let’s take a closer look.
What is a contractor?
The problem with the term ‘contractor’ is that definitions vary between companies. In the eyes of the Commonwealth, the Territory and courts of law, however, a contractor:
- Runs their own business and has an ABN
- Takes their own tools of trade to work
- Work the hours they define
- Are unsupervised
- Are paid at the end of the task
- Guarantee their work by fixing any errors for free.
This is a stark contrast to most ‘contractors’ in Canberra, who are paid regularly, do not guarantee their work, do not run their own business and can be hired and fired by their recruitment company.
Technically, these people are employees, and (in most cases) the employer is the company with the contract to supply them to a workplace – typically a recruitment company. Most refer to themselves as contractors because their deep subject knowledge and expertise sets them apart from the permanent employees they work alongside.
What is an employment agency?
An employment agency has a contract to supply workers to another business. This ranges from recruitment companies who know they are employment agents, to companies that might not know they are employment agents (i.e. a professional firm providing advisory services that also supplies advisers to work in ACT government offices).
If the company supplies a worker to another company, then, in addition to its main line of business, it is an employment agent.
What is a contractor payroll service?
A contractor payroll service is a company that provides specialist payroll services for contractors such as salary packaging, novated car leasing and living away from home allowance.
Most employment agents do not provide these specialist payroll services. If a contractor needs them, their employer engages a payroll company as an outsourced payroll service.
A payroll service does not have any contracts to supply contractors to a client.
What to look for in a contractor payroll service
We recommend keeping the following in mind when choosing a contractor payroll service.
- Professionalism. Your contractor payroll service should have an established office and have a Certified Practicing Accountant or Chartered Accountant on permanent staff to correctly manage your salary. A payroll company should be able to articulate the statutory framework it works within, and clearly advise contractors that it is not an employer, and that it does not pay payroll tax or provide workers compensation insurance for the people it pays.
- Financial stability. Managing millions of dollars should not be entrusted to unqualified people, or companies with questionable business structures. For example, the now-defunct Plutus Payroll offered zero fees for all services and became the country’s largest-ever tax fraud.
- Knowledge. A contractor payroll service should know that a contractor is a casual labour hire employee of their employment agent. They should know that terms such as ‘PAYG contractor’ or ‘ABN contractor’ have no place in Australian employment law. They will know you are an employee of your employment agent and that any attempts to not pay you for work you performed is a matter you need to escalate to the Fair Work Ombudsman.
- Workers compensation insurance. No contractor payroll service in Canberra can cover another company’s employees for workers compensation. If your Canberra payroll service does cover you for workers compensation, then it will work until you are injured and then it most likely will be void. Your payroll service should transparently advise you of this.
- Availability. Your contractor payroll service should answer your calls and emails immediately like any other business should. The service should not be something a company adds to is business line because you are likely to receive secondary service.
- Have a known payday. Look for payroll services that have defined pay days so you can maintain control over your personal financial situation.
The top payroll service providers in Canberra according to you
RiotACT’s editorial team has combed through 19 years of on-site comments to compile a list of the most recommended businesses according to you.
To be listed in our Best of Canberra series, each business needs to have consistently received positive feedback on RiotACT and Facebook as well as maintaining a minimum average of 4/5 stars on Google.
PayMe Australia is a locally owned and operated Canberra family business that has been in operation since 2006. Its main office is in Deakin and it has subsidiary offices in Brisbane and Perth. PayMe Australia is part of the PayMe Group which has diversified and owns Canberra’s only novated leasing company, Alliance Leasing, and one of Canberra’s original recruitment company’s, Effective People.
The team boasts the ability to answer all calls within three rings and guarantees your payday or it is fee free. PayMe has a number of qualified accountants, payroll officers and dedicated contractor care staff to support you. It has a focus on compliancy will assist both contractors and their employers understand employment law as it applies to casual labour hire employees.
At PayMe, everyone is important, you have a guaranteed payday, all calls are answered within three rings, and everyone is part of the PayMe family with many contractors having used its services since 2006.
AchieveCorp has helped IT contractors and professional consultants manage contracting income and ATO reporting obligations since 2003. When you choose AchieveCorp, you’ll benefit from seeing your own personal payroll manager supported by an experienced team (including a payroll administrator who looks over your salary payments, and a contract administrator who assists with contract renewals and documentation).
AchieveCorp is committed to paying contractors on time, every time, and can offer a weekly pay option if that’s your preference.
The dedicated team at Bookssorted have helped Australian IT contractors take control of their payroll processes for more than a decade. With a passion for accuracy and outstanding service, Bookssorted promises to get you paid on time.
It claims to be large enough to meet all your payroll needs, but small enough to know your name when you call.
Client Chris shared their experience with Bookssorted in a website testimonial: “A small rate, very professional, competent and quick to respond. The best payroll company I have ever had the pleasure to engage. Four years in and I would recommend Bookssorted to anyone.”
White Pillar in Kingston uses innovative payroll software, devises hybrid payroll systems and helps businesses streamline their practices to save time and money. Its professional, cost-effective payroll services are ideal for businesses of all sizes, including not-for-profit organisations and independent contractors.
Your experience with payroll companies in Canberra
Thanks to our commenters who have provided insightful feedback. If you believe we have got it wrong, please let us know.
Have you had experience with any of the payroll companies listed above? If so, share your feedback in the comments below.