Determining the employment status of an individual is crucial for the survival of any organisation that uses the services of contractors, as well as for the survival of legitimate independent contractors. The employment status issue is thus one of the key issues to be addressed in this contribution. In South Africa all the risks and obligations pertaining to the relevant employment taxes are squarely being placed on the shoulders of the employer, or if the contractor is truly independent, on the shoulders of the contractor. A failure to comply with all the complex legislation could result in dire consequences for the persons concerned. Therefore, it is necessary to perform a detailed analysis of all the relevant legislation in order to determine the obligations and potential risks for the employers and or contractors.