What is the difference between a worker who is an employee and one who is not?

An employee is a person employed under a contract of employment. A worker who is not an employee is said to be engaged under a contract sui generis (of its own kind). There are two elements to a contract of employment: mutuality of obligation and control. Mutuality of obligation exists when an employer undertakes to provide a person with work and that person agrees to do that work in return for an agreed salary or wage, and on terms and conditions laid down by the employer. Control exists if the employer determines when, where and how the work is to be done (or the manner in which it is to be done). It follows that temporary workers are not employees if they are free, without penalty, to accept or reject any offer of employment made to them. Although the control element undoubtedly exists when a worker accepts an offer of casual work, the ability to reject such an offer at will, and without penalty, is what distinguishes such a worker from an employee.