[2017] FWC 1264

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

D'Ambrosio
v
Jakroas Financial Services Pty Ltd T/A ANZ Mobile Lending Belconnen/Gungahlin ACT
(U2016/11000)

DEPUTY PRESIDENT KOVACIC

CANBERRA, 3 MARCH 2017

Application for unfair dismissal remedy – jurisdictional objections – Applicant not an employee – Respondent a small business and dismissal consistent with Small Business Fair Dismissal Code – Applicant found to be an independent contractor – application dismissed

[1] Mr Salvatore D’Ambrosio (the Applicant) lodged an application under s.394 of the Fair Work Act 2009 (the Act) which was received by the Fair Work Commission (the Commission) on 5 September 2016 alleging that the termination of his employment by Jakroas Financial Services Pty Ltd T/A ANZ Mobile Lending Belconnen/Gungahlin ACT (the Respondent) on 15 August 2016 was unfair.

[2] On 9 December 2016 the Respondent filed a Form F4 – Objection to unfair dismissal application which objected to Mr D’Ambrosio’s application on the basis that he was not an employee and, in the alternative that the Respondent was a small business and the dismissal was consistent with the Small Business Fair Dismissal Code (the Code).

[3] The Respondent’s jurisdictional objections were heard on 3 February 2017. Ms Karen Teixeira appeared with permission for the Applicant, while Mr James Macken of Counsel appeared with permission for the Respondent. The Applicant gave evidence on his own behalf and Ms Kylie Peden, the Respondent’s sole director and shareholder, gave evidence for the Respondent.

[4] For the reasons outlined below, I have found that the Applicant was an independent contractor and therefore does not come within the scope of s.382 of the Act which sets out when a person is protected from unfair dismissal. Accordingly, his application is dismissed. An order to that effect will be issued in conjunction with this decision.

Background

[5] The Respondent operates a mobile lending service under a franchise agreement with the ANZ Bank. Under the agreement, the Respondent is paid a commission for originating home loans for the ANZ and is allocated a specific geographic area within which it can operate, in this case Belconnen and Gungahlin in the ACT 1. The Respondent engages mobile lenders as either employees or independent contractors to write loans on behalf of the ANZ Bank.

[6] The Applicant commenced employment with Jakro Financial Services Pty Ltd T/A ANZ Mortgage Solutions Belconnen Gungahlin ACT (a previous corporate iteration of the Respondent) on 15 June 2009 pursuant to an employment agreement 2 which described the Applicant as an employee.

[7] In May 2010 the Applicant commenced employment with the Respondent under the terms of Non-Managerial Employment Agreement (the Employment Agreement) 3. The Employment Agreement stated that the Applicant’s total remuneration would be $60,000 per annum base salary + superannuation and commission (where payable)4. In general terms, the Employment Agreement entitled the parties to terminate the Agreement on the provision of a specified period of notice or, in the Respondent’s case, without notice in the case of serious misconduct5.

[8] On 14 July 2014 the Applicant sent Ms Peden an email requesting that she “… please pay all commission this month and in future to my anz [sic] account” 6. The Respondent contends that thereafter the Applicant was engaged as an independent contractor. The Applicant disputes this.

[9] On 12 October 2015 the Applicant sent the Respondent’s Administration Manager, Ms Rebecca Russell, an email in the following terms:

“My accountant has requested that I commence collecting and remitting GST on my commissions.

Can payments from this month include the GST.” 7

[10] On 12 July 2016 Ms Carmelina Disibio, Regional Manager ANZ Mobile Lending NSW/ACT, sent an email to the Applicant in the following terms:

“Hi Sam

I have no idea why you would be using a gmail account when working?
…

Please refrain from using the gmail account, for work purposes, again.” 8

[11] Ms Disibio’s email was sent after she was copied in on an email from another ANZ Bank employee to the Applicant, with that email sent to the Applicant’s Gmail account 9.

[12] On 14 July 2016 Ms Peden issued a formal warning to the Applicant by email. The email included the following:

“This is a formal warning, on multiple matters. If you do not comply immediately I will have your TPMI cancelled on the spot.

This is not the beginning of a 3 step warning / drawn out process for a small issue – It’s a final warning on THREE serious breaches or within the last day.

I have the right to cancel your TPMI immediately on these issues and if investigations uncover repeated breaches of the same over a longer period of time than I am currently aware of then you may receive this notice retrospectively as I will be directed to terminate you by ANZ I expect … you will not be retained as a mobile lender if that is ANZs wishes as a result of investigations / pending breaches obviously coming my way as a result of your actions AGAIN.
…

It has come to my attention (as part of due diligence carried out due to the other emerging non-compliance issue (GMAIL used to communicate with clients and internal stakeholders) that you are emailing mortgage documentation directly to clients from oversea (using gmail mind you) – asking them to print and “signed” and return – this is out of order. This is a formal warning this practice is to STOP right now. If I see it happen again you will have your TPMI terminated. It is not responsible lending practice or within ANZs guidelines. YOU KNOW THIS IS NOT OK !

When you receive PDFs of mortgage documents from Doc Prep the INSTRUCTIONS ….the very first sentence of the email reads:

Please find attached formal letter/s of offer and security documents to finalise the approval process for your client/s. Please ensure this email is not forwarded to any party outside of ANZ or any non “at ANZ.com” email address.

YOU ARE NOT ALLOWED TO OPEN, READ SAVE THE DOCS AND FORWARD THEM ! DO NOT CONTINUE THIS PRACTICE !

A simple

“Memorandum
Please retain
Please email me if not clear.”

IS NOT RESPONSIBLE LENDING !!!!!!!!!!!
How dare you represent my business in this manner !!!!!!

What appears to be your “standard cut-and-paste email” to clients re docs (ive seen multiple the same today) IS NOT OK !!!!!!!!

…
Regards
Sam D’Ambrosio | ANZ Mobile Lender
Belconnen and Gungahlin Mobile Lending

Rebecca and I will be reviewing ALL FILES that you have managed whilst out of the country since your bankruptcy ended to look at our exposure here – this is NOT the end of it – we need to report it to the bank.
…

In addition, you are to leave in place the auto forward ANZs IT department have put on your ANZ work email account and I will see copies of all emails you receive to your WORK email account as of today.
…

You are NOT to alter this on the server / turn the auto forward off. This is totally in my rights to receive … When you return you are to meet with Rebecca so she can set up a rule to also forward to me all the emails you SEND from your ANZ Mobile Lending email account … This is a mandatory condition of you staying with the business if that’s the decision we come to …

Please confirm to me in writing by close of business tomorrow (Canberra time) that you understand these compliance breaches are serious and that your unauthorised, unlawful out of bank policy practices will cease immediately, and that you understand that your TPI M will be immediately cancelled if it is found that you continue any of these actions from the moment this email is read your end.” 10 (Emphasis as per original)

[13] The Applicant acknowledged receipt of Ms Peden’s email on 15 July 2016 11.

[14] In subsequent developments, on 1 August 2016 Ms Peden met with the Applicant and issued him three written staff formal warnings. The reasons cited in the warnings are set out below.

Warning Notification #1

“Serious misconduct / Non-compliance with workplace policies, rules and procedures.

Failure to perform the duties of the position to the standard required.

Deliberately and repeatedly choosing not to follow ANZ policies / rules around mortgage documentation sign ups, the face-to-face explanation of mortgage terms and conditions, and ANZ mortgage products sold to clients.

Emailing clients (out of policy) the mortgage documents with basic instructions covering only where to sign. Not even explaining the basics causing serious risk of financial loss and reputational harm to both ANZ and Jakroas / Kylie Peden.” 12 (Emphasis as per original)

Warning Notification #2

“Serious misconduct: Non-compliance with workplace policies, rules and procedures.

Deliberately and repeatedly choosing not to follow ANZ policies / rules around client privacy, information security and email use causing serious risk of financial loss and reputational harm to both ANZ and Jakroas / Kylie Peden.
Correspondence with ANZ Mobile Lending clients, ANZ Branch staff / internal stakeholders, and external stakeholders such as solicitors, real estate agents, using a private non-secure – non-ANZ, personal, free G-Mail account from various overseas locations on numerous trips dating at least as far back as August 2015 – August 2016 when management became aware and warned against by email (see attached) as ascertainable by franchisee. Including attaching clients personal information, statutory declarations, mortgage documents, statements of position, personal and private data and account numbers all of which still remain on the non-secure non-ANZ G-Mail free public server.” 13 (Emphasis as per original)

Warning Notification #3

“Serious misconduct / Non-compliance with workplace procedures or standards.

Deliberately and repeatedly choosing not to follow ANZ Mobile Lending Belconnen / Gungahlin procedure put in place by management in July 2015 around overseas leave / leave of absence.

Failure to perform the duties of the position to the standard required.

Jeopardising bank relationships, and causing serious risk of financial loss and reputational harm, relationship damage to both ANZ BANK, ANZ Mobile Lending and Jakroas / Kylie Peden by not actioning time critical and relationship sensitive items or ignoring serious issues arising, delaying responses and/or remedies until return from overseas. For example numerous customer complaints, and in particular the Tomorrow Finance Mortgage Introducer Commission (also done using a g-mail account).” 14 (Emphasis as per original)

[15] On 15 August 2016 Ms Peden met with the Applicant and at that meeting terminated his engagement with immediate effect. The reasons cited in the termination notice were:

“1. NEGLECT OF DUTY
2. BREACH OF BUSINESS POLICIES
3. WILFULLY VIOLATING PRACTICES
4. CAUSING SERIOUS RISK TO THE REPUTATION AND VIABILITY OF JAKROAS FINANCIAL SERVICES PTY LTD AND ANZ BANK/ANZ MOBILE LENDING

Sam D’Ambrosio’s continued serious misconduct / non-compliance with workplace policies, rules and procedures

Sam D’Ambrosio’s continued failure to perform duties of the position to the standard required

Sam D’Ambrosio’s conduct which is damaging the good reputation of ANZ / ANZ Mobile lending, Jakroas Financial Services Pty Ltd and Kylie Peden the Franchisee of ANZ Mobile Lending Belconnen / Gungahlin.” 15 (Emphasis as per original)

Was the Applicant an Employee?

[16] I will deal first with the question of whether or not the Applicant was an employee. In doing so, I will only refer to those aspects of the parties’ respective submissions and evidence going to that question. If I find that the Applicant was an independent contractor, his application will be dismissed on the basis that he is not protected from unfair dismissal 16. If however I find that the Applicant was an employee, I will then need to deal with the Respondent’s second jurisdictional objection, i.e. that the dismissal was consistent with the Code.

The Respondent’s case

[17] The Respondent submitted that there are a number of features of its relationship with the Applicant which were indicative of a contract for services rather than an employment relationship. They include that:

there were no fixed hours of work, with the Applicant permitted to make his own judgement as to when he would work;

there was no requirement that the work be undertaken at the Respondent’s place of business or any other specified place, with the Applicant at liberty to decide the place from which he worked and to vary it from time to time;

the absence of operational integration and coordination, with the Applicant able to decide which types of potential clients he pursued, the types of loan products he suggested to potential clients and the times and places he pursued those opportunities;

while there was a general level of remote control by way of policies and perhaps training in avoiding inappropriate or potentially unlawful conduct for a mortgage broker, there was neither any practical possibility nor a legal right to control the way in which the services were provided by the Applicant;

there was no constraint on the Applicant in pursuing other or wider business opportunities;

the Applicant was paid solely by way of commission, i.e. the Applicant was paid not for his efforts but solely on the basis of his results;

the Applicant invoiced the Respondent for the amounts due to him in respect of particular services, with the entire relationship conducted as business to business;

the Respondent did not deduct any PAYG tax instalments, take out any professional indemnity insurance in respect of the Applicant’s services, make any superannuation contributions for the Applicant, pay any fringe benefits tax in respect of the Applicant and did not provide any form of paid leave entitlements or require the Applicant to apply for leave;

nor did the Applicant express any expectation of receiving any such benefits or having any such obligations met; and

all of these features of the relationship were a consequence of the Applicant’s approach to the Respondent to change both his remuneration arrangements and entitlements from the former basis of employee to the new footing of independent contractor.

[18] Ms Peden in her witness statements 17 disputed a number of aspects of the Applicant’s witness statement and deposed that:

the Applicant became an employee on 15 June 2009, adding that it was necessary for him to do so to undertake the mobile lender training delivered by the ANZ Bank;

the Applicant was made bankrupt in late May 2011, with his bankruptcy ending in or around the middle of 2014;

from July 2014 at the Applicant’s request he was paid by way of commission only;

the Applicant has not been an employee of the Respondent since he began being paid by way of commission in July 2014;

the Applicant could and did work from whatever location he chose, including on occasions international locations such as Vietnam, Thailand and Europe;

the Applicant could work whatever hours he chose, adding that there was no obligation on him to work any set number of hours or any particular hours;

the Applicant’s success or failure in terms of the loans he wrote in a given month was borne entirely by him;

the Applicant could go on holidays whenever he wanted and was not paid annual leave, personal leave, long service leave or any other form of leave;

to the best of her knowledge the Applicant did not wear a uniform of the Respondent or the ANZ Bank, adding that while from time to time the ANZ Bank gave the Respondent T-shirts with the ANZ brand emblazoned upon them there was no obligation for mobile lenders to wear them;

the Applicant drove his own car when providing services and paid for the costs associated with doing so, adding that he did not drive an ANZ branded car;

the Applicant was required to be sub-authorised under the ANZ’s Australian Credit License which required him to go through an approval process conducted by the ANZ Bank not the Respondent;

to maintain that sub-authorisation, the Applicant was required to maintain a minimum number of compulsory professional development points each year and to attend semi-regular online training exercises regarding issues such as privacy, the National Credit Code and responsible lending practices, adding that the Respondent did not otherwise impose any additional requirements on the Applicant;

the Applicant was free to work for other companies or for himself in other capacities;

the Applicant used a mobile phone which was paid for and owned by the Respondent, adding that this was a requirement imposed on the Respondent pursuant to the franchise agreement it has with the ANZ Bank (though in her second witness statement Ms Peden deposed that this was part of the Respondent’s business strategy to ensure that it owned the mobile phone numbers so that if a mobile lender left they would not take clients with them);

the Respondent also provided the Applicant with an iPad which enabled him to use the ANZ Bank’s mobile application called “Homeloan 360” and a laptop computer which was preloaded with the ANZ Bank’s mobile lending software, security protection and relevant calculators;

the Respondent did not have any control over or input into which types of potential clients the Applicant pursued as he was responsible for finding his own clients and generating his own work;

the Respondent did not have any control or input as to the types of loan products the Applicant suggested to potential clients;

the Respondent did not pay premiums for any professional indemnity insurance taken out by the Applicant;

while from time to time the Respondent organised meetings with mobile lenders to discuss a range of issues, attendance at those meetings was not mandatory;

the Applicant was at liberty to do whatever marketing he liked within reason, noting that the ANZ Bank is protective of its brand such that it requires approval if their logo is to be used on any marketing material;

the Applicant paid for his own internet usage when working from home or anywhere else other than the office;

the Respondent did not pay for mobile lenders’ meals or fuel usage but did pay for their airfares and accommodation when they were first engaged by the Respondent so that they could be trained and accredited by the ANZ Bank;

the Applicant invoiced the Respondent through his ABN;

since the Applicant became an independent contractor the Respondent has, among other things, not paid PAYG tax, payroll tax, superannuation contributions or any fringe benefits tax to or for the Applicant;

since October 2015 the Applicant has also collected GST on the commissions paid to him by the Respondent;

in the financial years ending 30 June 2014 and 2015 the Applicant declared in his individual tax returns that he was self-employed; and

it was not true that the Applicant was subject to any of the Respondent’s termination procedures or processes as there were no such procedures or processes in place, adding that the Applicant was the only loan writer that she had had to sever ties with.

[19] In her oral evidence Ms Peden reiterated, inter alia, aspects of her witness statements. In addition, Ms Peden attested that:

the Respondent had five mobile lenders, four of who were engaged as independent contractors and one as an employee 18;

the terms of the independent contracting arrangement with the Applicant were at times expressed on paper but that she did not have a copy of the document because it would have been on the Applicant’s personnel file which had been stolen (allegedly by the Applicant) 19;

it was the ANZ Bank which had brought to her attention that the Applicant had breached client privacy by liaising with clients from Vietnam using a Gmail server to send emails which included customers’ personal details such as dates of birth, addresses and income 20;

the Respondent had terminated the Applicant’s association with it as opposed to his employment because he was not employed by the Respondent, adding that the Respondent had to formalise the termination in part to put in motion a process to cancel the Applicant’s sub-credit license under the ANZ Bank’s license 21;

she was not aware of what other business opportunities the Applicant may have pursued as she had not spoken to him for about two years prior to the termination of his engagement, adding that the Applicant was never restrained from pursuing other business opportunities and that all of the other independent contractors engaged by the Respondent work in other areas as well 22; and

in light of the Gmail issue, the ANZ Bank wanted to re-accredit the Applicant, adding that her view was that the Applicant would not have passed the rigorous checks involved 23.

The Applicant’s case

[20] The Applicant submitted that:

he was engaged as an employee pursuant to a contract of service titled ‘Non-Managerial Employment Agreement’(the Employment Agreement) dated 30 May 2010 24, with the Employment Agreement referring to the Applicant as an employee;

pursuant to that Employment Agreement he was provided with, among other things, a job description, set hours of work, a principal place of work, base salary and remuneration, superannuation, training and accreditation, and the right to terminate employment;

these factors strongly pointed to the inference that he was an employee;

he did not determine where he would undertake work;

it was evident from the Employment Agreement and job description that he was not at complete liberty to decide where he would work, what hours he would work, what work he would perform, the clients he would pursue and the products he suggested;

he was not free to work for others whilst employed by the Respondent nor did he have the right to employ or subcontract any aspect of his work to another person, adding that the restriction to work for others was pursuant to the Employment Agreement;

relying on the decision in Hollis v Vabu 25, the mere fact that he was paid for results rather than efforts did not suggest that he was an independent contractor;

although he submitted invoices to the Respondent through his ABN for the last year and included an amount for GST, this did not sufficiently indicate that the Applicant and Respondent conducted their relationship as business to business;

he was covered under the Respondent’s professional indemnity insurance policy; and

the Respondent provided him with a mobile phone, a laptop computer and an iPad which were paid for by the Respondent,

[21] In support of these submissions, the Applicant relied on several decisions, including the decision in Rabba v PeleGuy Pty Ltd T/A PeleGuy 26 (Rabba).

[22] In his witness statement 27 the Applicant deposed that pursuant to the Employment Agreement he was an employee, reiterating aspects of his written submissions in this regard. Beyond that, the Applicant deposed that:

there was no evidence to suggest that he was operating any other business outside the work he performed for the Respondent, adding that he worked exclusively for the Respondent under a contract of service as opposed a contract for service and that reporting was mandatory;

he was not at liberty to do whatever marketing he wanted to do;

he started submitting invoices to the Respondent because his accountant advised him to do so;

he did not receive annual leave, personal leave or any other form of leave because his job was commission based;

although he travelled to Vietnam a few months each year, this did not hinder his performance nor did he work any less than if he was working in the office;

the Respondent paid for his internet and also paid for his phone and its ongoing contract;

the Respondent would pay his airfares and accommodation whenever he would attend training interstate;

the Respondent failed to pay his superannuation contributions; and

his individual tax returns for 2012 and 2013 were completed in the same way as his tax returns for 2014 and 2015.

[23] Key aspects of the Applicant’s oral evidence were that:

he did not pursue any other business interests as he was fully employed by the Respondent nor did he subcontract any of his work 28; and

following his termination he did not return the iPhone and laptop computer to the Respondent as he had purchased both items, later adding that both were items which he had paid for himself and which he used to earn income 29.

Employee or independent contractor?

[24] In Abdalla v Viewdaze Pty Ltd 30 (Abdalla) a Full Bench of the then Australian Industrial Relations Commission set out in detail the common law approach to the determination of whether a person is an employee or independent contractor and provided a summary of the law.31 I have followed the approach taken by the Full Bench.

1. Was the Applicant conducting a business of his own?

[25] It was not disputed that the Applicant had an ABN. An examination of the Australian Government’s Australian Business Register 32 in respect of the Applicant’s ABN describes the Entity type as “Individual/Sole Trader”, the Entity name as “D’Ambrosio, Salvatore”, the ABN status as “Active from 1 Jul 2014” and in respect of GST as “Registered from 1 Oct 2015”.

[26] Further, the Applicant’s tax returns for the years ending 30 June 2012 to 2014 all specify “Sam D’Ambrosio” as the Business name of main business (the details are illegible in the Applicant’s tax return for the year ending 30 June 2015) 33.

2. The nature of the work performed and the manner in which it is performed

[27] The Respondent submitted that the Applicant was permitted to make his own judgement as to when he would work and to decide the place from which he worked and to vary that place from time to time, the types of loan products he suggested to potential clients and the times and places he pursued those opportunities.

[28] The Applicant submitted that he did not determine where he would undertake work and that it was evident from the Employment Agreement and job description that he was not at complete liberty to decide where he would work, what hours he would work, what work he would perform, the clients he would pursue or the products he suggested.

[29] Attached to the Applicant’s witness statement was a copy of the Job Description referred to in Schedule 2 of the Employment Agreement. The Job Description – Mobile Lender states, inter alia, that:

“It is a sales role, involving business development.
Offering ANZ’s competitive range of mortgage products
…
Mobile Lenders can manage their own appointments / diary around their own family life / personal needs.
Hours worked will depend on client needs, appointments and follow-up / processing of applications.
A workstation will be provided at the homebased offices of Jakroas Financial Services – located in Jerrabomberra – however – the Mobile Lender
may choose to work from their own home also and can with arrangement also work from Belconnen, Gungahlin or Dickson Branches of the ANZ.

…

Ongoing compliance training is a requirement of this role – Adherence to the ANZ Mobile Lending Franchise agreement and Operations Manual is a must, as is compliance with the Privacy Act and all other applicable laws especially with regards to collecting, storing, disclosing or using information of customers. Authorisation under our credit license will be given – and responsible lending guidelines must be adhered to at all times. Compliance with the National Consumer Credit Protection Act 2009 is mandatory. Police background and Credit Checks will be performed by the ANZ Bank prior to appointment of successful applicants. Own car and driver’s licence is essential.” 34

Based on the above, it appears that the Applicant both self-generated and self-managed his work subject to compliance with the regulatory framework established under relevant legislation and ANZ policies. 35 The control which the Applicant exercised over his work is clearly demonstrated by his witness evidence that he travelled to and worked from Vietnam a few months each year. This analysis supports the Respondent’s characterisation of the nature of the Applicant’s work and the way in which it was performed.

[30] Having said that, I note that there was no material before the Commission which indicated that the nature of the work undertaken by the Applicant or the way it was performed differed in any way throughout the duration of his engagement by the Respondent.

3. The terms of the contract

[31] Ms Peden attested that the terms of the independent contracting arrangement with the Applicant were at times expressed on paper. However, the document was unable to be put before the Commission. The Applicant, on the other hand, contended that he continued to be employed under the terms of the Employment Agreement.

[32] The Employment Agreement provides, among other things, for a base salary of $60,000 per annum, superannuation contributions up to $5,400 per annum and commission payable where the average settlement in any one quarter exceeds $2 million at a rate of 80 per cent of the upfront commission on loans over the $2 million target, 4 weeks paid annual leave and 10 days paid personal leave. Bank statements 36 tendered by the Respondent indicate that on 16 June 2014 the Applicant was paid wages of $4,058.58. Those bank statements also indicate that on 15 July 2014 (the day after the Applicant requested that his commission for July 2014 and in future be paid into his ANZ bank account), 18 August 2014, 15 December 2014 and 16 March 2015 the Applicant was paid commission of $2,954.21, $10,243.54, $3,836.74 and $2,025.00 respectively. This, together with the fact that it is not disputed that the Applicant was not provided with paid leave and that the Respondent did not make superannuation contributions on his behalf after he moved to a commission only remuneration basis, does not support the Applicant’s contention that he continued to be employed under the Employment Agreement. Were that to be the case, the Applicant would have received monthly income of no less than $5,000 per month less any applicable tax.

[33] While the material before the Commission does not support a finding that the Employment Agreement continued to operate, in the absence of any documentation I am unable to form a view as to what, if any, contractual arrangement may have replaced the Employment Agreement.

4. The indicia of an employment relationship

4.1 Whether the Respondent exercises, or has the right to exercise control over the manner in which the Applicant’s work is performed, place of work, hours of work and the like

[34] The Respondent submitted that while there was a general level of remote control by way of policies and perhaps training in avoiding inappropriate or potentially unlawful conduct for a mortgage broker, there was neither any practical possibility nor a legal right to control the way in which the services were provided by the Applicant.

[35] The Applicant submitted that he was not at complete liberty to decide where he would work, what hours he would work, what work he would perform, and the clients he would pursue on the products he suggested.

[36] The material before the Commission indicates that the Respondent had little day to day oversight of the Applicant’s work. For instance, the issue of the Applicant using his Gmail account for business purposes only appears to have been accidentally discovered by Ms Disibio, an ANZ employee, after she was copied into an email sent by another ANZ employee to the Applicant as opposed to having been identified by the Respondent through any oversight of the Applicant’s work. Further, the previously discussed Job Description and the fact that the Applicant performed work from Vietnam a few months each year do not support a finding that the Respondent exercised complete control over the Applicant’s work and when and where it was performed. While the Respondent did put in place more rigorous reporting and oversight arrangements in the light of the warnings issued to the Applicant on 14 July and 1 August 2016, those arrangements only operated for a limited period of time prior to the termination of the Applicant’s engagement.

4.2 Whether the Applicant works for others (or has a genuine and practical entitlement to do so)

[37] The Respondent submitted that there was no constraint on the Applicant in pursuing other or wider business opportunities. Further, Ms Peden attested that the Applicant was never restrained from pursuing other business opportunities and that all of the other independent contractors engaged by the Respondent worked in other areas as well. This latter aspect was not disputed by the Applicant.

[38] The Applicant both submitted and deposed that he was not free to work for others whilst employed by the Respondent.

[39] I note that the Employment Agreement included a clause titled “Restraint on the Employee’s Conduct” which in short precludes the Applicant for the duration of that Agreement and six months thereafter from competing with ANZ mortgage products in the Belconnen/Gungahlin plus an area within 5 km of the boundary of that area 37. One would anticipate that some form of obligation not to compete against ANZ mortgage products would have applied irrespective of the nature of the parties’ working arrangement.

[40] There was no material before the Commission which indicated that the Applicant undertook work for others while providing services to the Respondent. I accept, however, that there was no impediment to the Applicant working for others subject to any such work not resulting in the Applicant performing work which was in competition with ANZ mortgage products.

4.3 Does the Applicant have a separate place of work and/or advertise his or her services to the world at large?

[41] The invoices submitted by the Applicant were headed with the Applicant’s name, post office box address, mobile phone number and ABN 38. However, the Applicant’s tax returns for the years ending 30 June 2012 to 2015 each specify a “Business Address of main business”39 which appears to be the Applicant’s residential address at the time. The current details for the Applicant’s ABN cite “NSW 2620” as the “Main business location”40 which is consistent with address cited on the invoices41 he issued to the Respondent.

[42] No evidence was presented that the Applicant advertised his services to the world at large or to anyone else during his engagement with the Respondent.

4.4 Whether the Applicant provides or maintains significant tools or equipment?

[43] Ms Peden deposed that the Respondent paid for the Applicant’s mobile phone but that he paid for his own internet usage when working from anywhere else other than the Respondent’s office.

[44] The Applicant deposed that the Respondent paid for his internet and also paid for his mobile phone and its ongoing contract, though at the hearing he attested that he had purchased an iPhone and laptop computer which he used to earn income.

[45] It was not disputed that the Applicant used his own motor vehicle to attend meetings with clients/potential clients.

[46] Finally, based on the material before the Commission, it would appear that a mobile phone, laptop computer and motor vehicle are key tools or pieces of equipment required to perform the role of Mobile Lender.

4.5 Whether the work can be delegated or subcontracted

[47] While neither party explicitly addressed this indicator in their submissions, the requirement for mobile lenders to be licensed severely constrained the Applicant’s capacity to delegate or subcontract his work to anyone else other than the Respondent’s other licensed mobile lenders. On this latter point, I note that the warning issued to the Applicant by Ms Peden on 14 July 2016 included a reference to an email sent by Ms Russell in July 2015 which stated:

“Can I ask that when you are planning to leave you have contingencies in place for your sign ups / re-works.

There are multiple options;
…

co-ordinating your leave with a colleague/another loan writer … Looking after each other … please let us know WHO if this is your plan” 42

4.6 Did Respondent have the right to suspend or dismiss the person engaged?

[48] As mentioned above, the material before the Commission does not support a finding that the Employment Agreement continued to operate and that, in the absence of any documentation, the Commission is unable to form a view as to what, if any, contractual arrangement which may have replaced it. I am therefore unable to determine whether or not the Respondent had the right to suspend or dismiss the Applicant. It is not disputed however that on 15 August 2016 the Respondent did terminate the Applicant’s engagement.

4.7 Did the Respondent present the Applicant to the world at large as an emanation of the business?

[49] In the warning which Ms Peden issued to the Applicant on 14 July 2016 she stated, among other things, “How dare you represent my business in this manner !!!!!!” 43. Further, the signature block on the Applicant’s emails was:

“Sam D’Ambrosio | ANZ Mobile Lender
Belconnen and Gungahlin Mobile Lending
…
This Mobile Lender operates as ANZ Mortgage Solutions Belconnen/Gungahlin, an independently operated franchaise [sic] of Australia and New Zealand Banking Group (ANZ) …” 44

[50] The above points to the Applicant presenting himself as an emanation of the Respondent’s business. However, there is no material before the Commission indicating that the Respondent presented the Applicant to the world at large as an emanation of its business.

4.8 Was income tax deducted from remuneration paid to the Applicant?

[51] No income tax was deducted by the Respondent.

4.9 Was the Applicant paid a periodic wage or salary or by reference to completion of tasks?

[52] The Applicant was paid commission on a monthly basis, with the amount paid varying from month to month depending on the value of loans he had written.

4.10 Was the Applicant provided with paid holidays or sick leave?

[53] The Applicant was not provided with paid holidays or sick leave.

4.11 Did the work performed by the Applicant involve a profession, trade or distinct calling on the part of the person engaged?

[54] While the Applicant’s work did not involve a profession, trade or distinct calling on the part of the Applicant, it did draw on his experience in the finance sector and required him to be licensed.

4.12 Whether the Applicant created goodwill or saleable assets in the course of his or her work

[55] There is no material before the Commission which pointed to the Applicant creating any goodwill or saleable asset in the course of his work.

4.13 Whether the Applicant spends a significant proportion of his or her remuneration on business expenses

[56] The figures specified in the Applicant’s tax return for the year ending 30 June 2015 indicate that business expenses constituted 22.5 per cent of the Applicant’s business income in that year, with depreciation representing around 60 per cent of the Applicant’s business expenses 45. Business expenses of that magnitude represent a significant proportion of business income.

Summary of the evidence

[57] The features that support the contentions of the Applicant that he was an employee are that he:

did not advertise her services to the world at large;

had a very limited ability to delegate or subcontract his work; and

did not create any goodwill or saleable asset.

[58] The features that support the contentions of the Respondent that the Applicant was an independent contractor are that the:

Employment Agreement appears to have been overtaken by some other arrangement, the details of which were not put before the Commission;

Respondent exercised limited control over the Applicant’s work;

Applicant did, based on his tax returns and ABN details, operate a separate business and have a separate business address;

Applicant submitted invoices to the Respondent;

Applicant was not subject to PAYG taxation;

Applicant was not paid annual leave, sick leave or any other entitlement normally associated with employment;

Applicant had purchased a mobile phone and laptop computer which he used to generate income as well as using his own motor vehicle for work related purposes, with these items being key “tools of trade” for a mobile lender;

Applicant was able to work for others, albeit not in competition with ANZ mortgage products; and

Applicant spent around one quarter of his business income on business expenses.

[59] As previously noted, it is not clear whether the Respondent had a contractual right to suspend or terminate the Applicant, though on 15 August 2015 it did terminate the Applicant’s engagement. Further, there was no material before the Commission that indicated that the Respondent presented the Applicant to the world at large as an emanation of its business.

Consideration of the issues

[60] From paragraphs [58]-[60] above it is evident that there are indicia which support a finding that the Applicant was an employee and that there are indicia which support a finding that he was an independent contractor. However, the majority of indicia point to the Applicant being an independent contractor as opposed to an employee.

[61] As previously noted, the Applicant relied on the decision in Rabba. In that decision, Commissioner Gooley (as she then was) concluded as follows:

“[96] The Applicant was an integral part of the Respondent’s business and in performing his role as a salesperson he was subject to control by the Respondent. The Respondent allocated work to the Applicant and supervised the work. While the Applicant could determine the sales method, what time of day he visited customers as well as the frequency he visited them over and above the minimum number of visits determined by the Respondent, the Applicant was not conducting his own business when he performed work for the Respondent. I therefore find that the Applicant was an employee of the Respondent.” 46

[62] What is clear from the above extract from Rabba is that the circumstances in this case differ in a number of respects from those which existed in Rabba. For instance, in this case the Respondent exercised only limited control over the Applicant’s work.

[63] Further, the Full Bench in Abdalla concluded, inter alia, as follows:

“Conclusion

[49] In this case the various indicia point in both directions such that the case falls close to the ill-defined dividing line between employment and independent contract. In our view, the absence of control emerging from the evidence is a matter to which substantial weight should be attached in the circumstances of the present case. On balance, the various factors to which we have referred tend more strongly to a characterisation of independent contract. The case is by no means clear cut and, accordingly, we must consider whether it can be said that, viewed as a practical matter, Mr Abdalla was or was not running his own business or enterprise with independence in the conduct of his business operations as distinct from operating as a representative of Viewdaze with little or no independence in the conduct of his operations. On the evidence before Drake SDP, we conclude that, viewed as a practical matter, Mr Abdalla was in substance running his own business enterprise with independence in the conduct of his operations. He was entirely free to work as little or as much as he liked. Consistent with a contractual right to act as an ‘‘independent’’ agent, he was not subject to any substantial measure of control by the respondent in relation to his attendance at work or the manner in which he performed his work. The evidence suggests that his work involved bringing his own business to the respondent’s agency (rather than transacting business allocated to him by the respondent) and retaining the vast bulk of the commission generated from that business. The primary purpose of the relationship between the parties seems to have been to provide Mr Abdalla with a convenient vehicle through which to transact the business that he generated through his own sources and contacts with Viewdaze in return taking a small portion of the commissions thereby generated. It follows that, on the evidence before Drake SDP, the proper characterisation of the relationship between the parties is one of independent contract.” (Underlining added)

[64] The circumstances in Abdalla are in many respects similar to those existing in this case. The similarities include the limited control which the Respondent exercised over the Applicant’s work and that the rewards flowing from the Applicant’s efforts primarily accrued to the Applicant, with the Respondent deriving a minimal benefit by way of retention of a small component of the commission payable on loans written by the Applicant.

[65] Having regard to the totality of the relationship in this case, the above analysis of the indicia of an employment relationship and drawing on the decision in Abdalla, supports a finding that the Applicant was an independent contractor.

Conclusion

[66] For all the above reasons, I find that the Applicant was an independent contractor and therefore does not come within the scope of s.382 of the Act which sets out when a person is protected from unfair dismissal. Accordingly, his application is incompetent and will be dismissed. An Order to that effect will be issued in conjunction with this decision.

Appearances:

K. Teixeira for the Applicant

J. Macken of Counsel for the Respondent

Hearing details:

2017.

Canberra:

February 3.

1 Exhibit 1 at paragraphs 7-11

2 Exhibit 5 at Annexure A

3 Ibid at Annexure B

4 Ibid at Items 5-7 of Schedule 1

5 Ibid at clause 18

6 Exhibit 1 at Annexure B

7 Ibid at Annexure C

8 Exhibit 5 at Annexure N

9 Ibid

10 Ibid at Annexure R

11 Ibid at Annexure S

12 Exhibit 1 at Annexure G

13 Ibid

14 Ibid

15 Ibid at Annexure F

16 Refer s.382 of the Act

17 Exhibits 1 and 2

18 Transcript at PN45

19 Ibid at PN147 and PN153

20 Ibid at PN168

21 Ibid at PN246

22 Ibid at PN247

23 Ibid at PN250

24 Exhibit 5 at Annexure B

25 (2001) 207 IR 21

26 [2013] FWC 70

27 Exhibit 5

28 Transcript at PN286-287

29 Ibid at PN325 and PN387-392

30 (2003) 122 IR 215

31 Ibid at [34]

32 Exhibit 5 at Annexure L and Exhibit 1 at Annexure E

34 Exhibit 5 at Annexure F

35 Outline of Submissions of the Applicant at [2.7]

36 Exhibits 3 and 4

37 Exhibit 5 at Annexure B, Clause 20

38 Exhibit 1 at Annexure D

39 Exhibit 5 at Annexure L and Exhibit 1 at Annexure E

40 Exhibit 1 at Annexure D

42 Exhibit 5 at Annexure R

43 Ibid

44 Ibid at Annexure Z

45 Exhibit 1 at Annexure E

46 [2013] FWC 70

Printed by authority of the Commonwealth Government Printer

D'Ambrosio v Jakroas Financial Services Pty Ltd T/A ANZ Mobile Lending Belconnen/Gungahlin Act