The distinction is important for the tax and benefit implications and for the availability of employment standards protections. Getting it wrong is problematic.

For example, if a worker is found to be an employee rather than a contractor, your non-profit may be liable for unpaid overtime.

A worker is someone who performs services and is paid for those services.  A worker can be categorized as an employee or a contractor. There are also "contract workers", which are a type of employee.

The difference can be confusing, particularly because each can have contracts describing the work they do and how much they will be paid.