Rent-a-chair agreements for freelance hairdressers

Rent-a-chair agreements are a popular option for freelance hair stylists looking to work independently without the cost and commitment of owning a salon. Sometimes referred to as salon licence agreements, they involve renting a chair or workspace inside an established salon while continuing to operate your own business.

When set up properly, this type of arrangement can benefit both parties. Freelancers gain access to professional facilities, an existing salon environment, and the credibility that comes with working from a recognised location while still maintaining control over how their business operates. That said, it’s important to know exactly what you’re agreeing to before signing a contract, particularly when it comes to your legal, financial, and insurance responsibilities.

What is a rent-a-chair agreement?

A rent-a-chair agreement is a commercial arrangement where a freelance hair stylist pays to use a chair or workspace in a salon instead of being employed by the salon owner. It allows you to run your own business from a professional setting without taking on the expenses and obligations that come with managing your own premises.

Under this model, you operate independently within a shared space. You work under your own business name, manage your own clients, and are responsible for your services and insurance. While you may work alongside salon staff, you are not part of the salon’s workforce.

Is a rent-a-chair agreement legal?

Yes, a rent-a-chair agreement is a legal arrangement in Australia so long as it’s set up correctly and reflects how the working relationship operates in practice.

It’s important to note that simply calling an agreement “rent-a-chair” doesn’t automatically make it compliant. Regulators such as the Fair Work Ombudsman and the Australian Taxation Office look at the real working arrangement, not just what’s written in the contract. If the salon controls how the stylist works in a way that resembles employment, the agreement may be challenged.

When structured properly and supported by day-to-day practices that reflect independence, rent-a-chair agreements are a lawful and widely used option in the salon industry.

Renting a chair vs. employment: What’s the difference?

Under a rent-a-chair agreement, you are typically engaged as an independent contractor, not an employee of the salon. This distinction matters, as it affects everything from how you’re paid to who is responsible for tax, superannuation and insurance.

If you haven’t worked under a rent-a-chair agreement before, it’s important to understand the differences between being employed by a salon and working under a rent-a-chair agreement. Understanding these differences is key to deciding which option best suits your career and business goals.

Cost and earning potential

As an employee, you’re typically paid a wage with the salon covering most business expenses such as rent, utilities, and insurance.

Under a rent-a-chair arrangement, you pay the salon a fixed fee or licence amount to use the space. In return, you keep your earnings after expenses. While your costs may be higher, you have greater control over pricing and the potential to increase your income as your client base grows.

Employment law and legal responsibilities

This is one of the most important distinctions. Employees are mainly covered by employment law, including minimum wage requirements, leave entitlements, and superannuation contributions, which are handled by the salon.

When you rent a chair, you typically operate as an independent contractor rather than an employee. This means you’ll need your own ABN and are responsible for managing your tax, superannuation, and business insurance. Getting this classification right matters, as it affects your legal obligations and how regulators assess the working arrangement.

Client loyalty and business ownership

As an employee, clients are generally considered clients of the salon. If you move on, those relationships may stay with the business.

Rent-a-chair arrangements are different. Freelance stylists usually manage their own client lists, branding and bookings, allowing them to build long-term client loyalty that stays with their business.

Ease of operations and day-to-day control

Employment offers stability and simplicity. Rosters, pricing, bookings and salon processes are usually managed for you, which can make day-to-day operations easier.

Renting a chair gives you more control but also more responsibility. You set your own hours, manage appointments, supply your own tools and products and run your business within a shared space. While most salons provide access to essential facilities like basins and dryers, it’s important that your agreement clearly outlines what’s included and what isn’t.

How to set up a rent-a-chair agreement

Whether you’re a freelance stylist or a salon owner, setting up a rent-a-chair agreement properly from the start is essential. A well-structured arrangement helps avoid confusion, protects both parties, and supports compliance with legal and insurance requirements.

Choose the right business model

Before anything is agreed, both parties should be clear on the business model. A rent-a-chair arrangement is not an employment relationship. The stylist should be operating as an independent business, with their own ABN, clients, pricing, and payment processes. The salon provides access to space and facilities, not direction over how the stylist performs their work.

Address health, safety and hygiene responsibilities

Even in a shared salon environment, responsibilities around health, safety and hygiene need to be clearly understood. This includes cleanliness standards, equipment maintenance, chemical handling, and compliance with local health regulations. The agreement should outline who is responsible for what so expectations are clear and risks are reduced.

Clearly define terms and obligations

A strong rent-a-chair agreement clearly sets out the rights and obligations of both parties. This usually includes the rental fee or licence payment, access times, length of the agreement, termination terms, and any house rules that apply to the shared space.

Understand insurance requirements

Insurance is a key consideration in rent-a-chair arrangements. Because freelance stylists operate their own businesses, they’re generally responsible for arranging their own cover. This may include Public Liability and Professional Indemnity insurance, depending on the services they provide.

Some salons may require proof of insurance as part of the agreement. It’s important for both parties to understand what is and isn’t covered under their respective policies, and where responsibility sits if something goes wrong.

Put the agreement in writing

Finally, everything should be documented in a written agreement. Verbal arrangements or informal understandings can lead to confusion and risk down the track. A written rent-a-chair agreement helps ensure everyone is on the same page and provides a clear reference point if questions arise later.

Rent-a-chair arrangements can offer flexibility, autonomy and room to grow your personal brand. But like any business agreement, they come with responsibilities. Taking the time to understand your status, obligations, rights and potential insurance needs will help you enter the arrangement with confidence and set your freelance business up for long-term success.