Annette Calvert v Australian National Circus Pty Ltd

[2024] FWC 1325

[2024] FWC 1325

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.394—Unfair dismissal

Annette Calvert
v

Australian National Circus Pty Ltd

(U2024/1006)

COMMISSIONER MCKINNON SYDNEY, 23 MAY 2024

Application for an unfair dismissal remedy – whether dismissed – whether employee

1. Ms Annette Calvert worked for Australian National Circus Pty Ltd trading as Circus Rio (ANC) from 28 August 2023 until 29 January 2024.

1. On 30 January 2024, Ms Calvert applied in time for an unfair dismissal remedy under section 394 of the Fair Work Act 2009 (Cth) (the Act). ANC objects to the application on the basis that Ms Calvert was an independent contractor and not an employee, and accordingly she could not have been “dismissed” for the purposes of the Act.[1]

1. The question is whether Ms Calvert was an employee of ANC.

1. For the reasons below, I find that Ms Calvert was an employee of ANC. The jurisdictional objection will be dismissed.

Legal framework

1. Section 386 of the Act sets out the circumstances in which a person is taken to have been “dismissed” for the purposes of section 394. Relevantly, it provides as follows:

“386 Meaning of dismissed

(1)   A person has been dismissed if:

(a)   the person’s employment with his or her employer has been terminated on the employer’s initiative; or

(b)   the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.”

1. The text of section 386 makes plain that a person is only “dismissed” if their employment comes to an end in one of the circumstances described in (a) or (b) above. In each case, the circumstances depend on the existence of an employment relationship at law.

1. The relevant legal principles for present purposes are those set out by the High Court of Australia in Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd[2] (Personnel Contracting). These principles, together with those enunciated in the High Court’s contemporaneous decision in ZG Operations Australia Pty Ltd v Jamsek[3] were helpfully summarised by the Federal Court of Australia in JMC Pty Limited v Commissioner of Taxation[4]. Shortly stated:

1. First, where the rights and duties of the parties are comprehensively committed to a written contract, the legal rights and obligations established by the contract are decisive of the character of the relationship provided that the validity of the contract has not been challenged as a sham, or that the terms of the contract have not been varied, waived or are subject to an estoppel. The task is to construe and characterise the contract made between the parties at the time it was entered into.

2. Second, in order to ascertain the relevant legal rights and obligations, the contract of employment must be construed in accordance with the established principles of contractual interpretation. In that respect, regard may be had to the circumstances surrounding the making of the contract, as well as to events and circumstances external to the contract which are objective, known to the parties at the time of contracting and which assist in identifying the purpose or object of the contract. The nature of the specific job that the putative employee applied for and the nature and extent of any tools or equipment they have to supply for that job may also be relevant. It is, however, generally not legitimate to use in aid of the construction of a contract anything which the parties said or did after it was made.

3. Third, and flowing from the first two principles, the characterisation of the relationship between the parties is not affected by circumstances, facts or occurrences arising between the parties that have no bearing on their legal rights. A “wide-ranging review of the entire history of the parties’ dealings” is neither necessary nor appropriate. For a “matter to bear upon the ultimate characterisation of a relationship, it must be concerned with the rights and duties established by the parties’ contract, and not simply an aspect of how the parties’ relationship has come to play out in practice but bearing no necessary connection to the contractual obligations of the parties”. The fact that the parties’ subsequent conduct may not have precisely aligned with their contractual rights and obligations, or the fact that a particular contractual right may have never been exercised or utilised, will generally be irrelevant when it comes to characterising the relationship. That is unless the manner in which the parties conducted themselves after entering into the contract was such as to establish that the contract was a sham, or that the contract had been varied, or that certain rights under the contract were subject to an estoppel.

4. Fourth, the contractual provisions that may be relevant in determining the nature of the relationship include, but are not limited to, those that deal with the mode of remuneration, the provision and maintenance of equipment, the obligation to work, the hours of work, the provision for holidays, the deduction of income tax, the delegation of work and the right to exercise direction and control.

5. Fifth, the characterisation of the relationship as one of service or employment involving an employer and employee, as opposed to a relationship involving an independent contractor providing services to a principal, often hinges on two considerations, although neither are determinative and both involve questions of degree. The considerations are:

1. the extent to which the putative employer has the right to control how, where and when the putative employee performs the work, and
2. the extent to which the putative employee can be seen to work in his or her own business, as distinct from the business of the putative employer – the so-called “own business/employer’s business” dichotomy.

6. Sixth, a “label” which the parties may have chosen to describe their relationship is not determinative of the nature of the relationship and will rarely assist the court in characterising the relationship by reference to the contractual rights and duties of the parties. The parties’ “legitimate freedom to agree upon the rights and duties which constitute their relationship” does not “extend to attaching a ‘label’ to describe their relationship which is inconsistent with the rights and duties otherwise set forth” – to permit otherwise would elevate the freedom to “a power to alter the operation of statute law to suit … the interests of the party with the greater bargaining power”. The characterisation of a relationship as being either one of employer and employee, or one involving the engagement of an independent contractor, is ultimately an evaluative judgment that takes into account the totality of the parties’ contractual rights and obligations. The exercise may not necessarily be straightforward because, in some cases at least, the parties’ contractual rights and obligations may point in different directions. The evaluative exercise also should not be approached on the basis that there is some checklist against which ticks and crosses may be placed so as to produce the right answer. Some degree of uncertainty is unavoidable, particularly in the case of many modern-day work or service contracts.

1. In Secretary, Attorney General’s Department v O’Dwyer[5], the Federal Court considered the principles established in Personnel Contracting to apply equally to circumstances where there is no wholly written contract between the parties but where there is instead an oral contract or one that is partly written and partly oral.

Consideration

1. In Ms Calvert’s case, there is no written contract between the parties. The evidence as to arrangements of a contractual nature governing Ms Calvert’s work for ANC is this:

1.   Ms Calvert applied and was engaged for a job advertised on Facebook saying, in words to the effect: “Labourers needed, $25 cash per hour”. The job was advertised by Mr Matthew De Graaf trading as MR Home Services & Maintenance (MR Home Services), in consultation with ANC. Mr De Graaf is the “Tent Boss” for the circus. He runs the tent and logistics side of the business in consultation with Mr Yuri Abrosimov, Director of ANC.

2.   Ms Calvert commenced work in the tent crew from 28 July 2023 and was paid the sum of $750 per week into her bank account by MR Home Services. No tax was deducted from the weekly payments to Ms Calvert by MR Home Services, and no superannuation was paid by MR Home Services for the benefit of Ms Calvert.

3.   Ms Calvert brought her own black shirt(s), gloves and steel capped boots to the job as she already had them. It is agreed that gloves, boots and other personal protective equipment could also be provided by the circus on request. Gloves and hard hats were provided for tent ‘put up’ and ‘put down’. 

4.   On and from 20 October 2023:

a.   Ms Calvert was no longer required to do the tent “pull down”. She was still required to do the “put up” and was given the additional tasks of driving vehicles from one location to another and working in the canteen.

b.   She wore a work shirt bearing the Circus Rio logo for work in the canteen.

c.   Her weekly remuneration increased to $850 plus a discretionary “canteen bonus” and reimbursement of expenses on production of receipts. Again, no tax was deducted and no superannuation was paid.

d.   Ms Calvert did not lose pay for days that she was unable to work due to illness.

e.   Ms Calvert had the use of an ANC caravan to live in at no cost.

f.    Ms Calvert was paid directly by ANC. It was a condition of payment that she provide ANC with a tax invoice bearing her own Australian Business Number (ABN).

5.   On 29 January 2024, Mr Abrosimov terminated the arrangement with Ms Calvert on behalf of ANC.

1. ANC submits that Ms Calvert was working in her own independent business because she agreed not to be an employee; was responsible for payment of her own tax and superannuation and provided invoices for her work under an ABN. Ms Calvert denies the assertion that there were conversations leading to a verbal agreement between Ms Calvert and ANC that she would work under “non-employment” conditions. Ms Calvert submits that she had no choice but to invoice ANC for her work because that was the only way that she would get paid. I accept her evidence and prefer it to the evidence of Mr Abrosimov where there is a conflict in relation to discussions between the parties about the nature of the relationship between them.

1. It is difficult to arrive at any conclusion other than that the relationship between Ms Calvert and ANC was one of employment.  She was a labourer, working in the Circus’ tent crew. Her job description and daily tasks were set by ANC and MR Home Services. These evolved over time to include driving and canteen work. Ms Calvert had no control over her work activities independently of ANC and/or MR Home Services.

1. Ms Calvert’s work was governed by an oral contract of employment. It may be that initially, the contract was between Ms Calvert and MR Home Services from 28 July 2023 to 19 October 2023 and that there was then a transfer of her employment from MR Home Services to ANC on 20 October 2023. Alternatively, the contract may always have been with ANC. The precise relationship between ANC and MR Home Services; whether there was a transfer of employment involving Ms Calvert, and whether this occurred in the context of a transfer of business (either because there was a transfer of assets, or ANC and MR Home Services were associated entities or otherwise) are not matters about which the parties have yet had the opportunity to be heard. What is clear is that at the time of her dismissal, Ms Calvert was employed by ANC. She was not conducting her own business and was clearly serving in the business of ANC.

Disposition

1. Ms Calvert was employed by ANC at the time she was dismissed. The jurisdictional objection is dismissed. The matter will now be listed for further hearing in relation to whether Ms Calvert has completed the minimum employment period as an employee of ANC.

1. Directions will issue separately.

COMMISSIONER

Appearances:

A Calvert on her own behalf.
Y Abrosimov for the Respondent.

Hearing details:

2024.
Sydney (by video):
April 4.

[1] Fair Work Act 2009 (Cth), s.394 and s.386 (meaning of “dismissed”).

[2] [2022] HCA 1.

[3] [2022] HCA 2.

[4] [2022] FCA 750 per Wigney J.

[5] [2022] FCA 1183; see also Meltser v Toppa Sports Pty Ltd [2023] FWC 3224.

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