Green v Hummer Limousines Pty Ltd

[2013] FCCA 306

FEDERAL CIRCUIT COURT OF AUSTRALIA

GREEN v HUMMER LIMOUSINES PTY LTD [2013] FCCA 306

Catchwords:
INDUSTRIAL LAW – Fair work – employer and employee relationship – principal and independent contractor relationship – characterisation of the relationship – found Applicant an employee of the Respondent.

Legislation:
Fair Work Act 2009 (Cth)

Cases cited:
Stevens v Brodribb Sawmilling Company Pty Ltd (1986) 160 CLR 161
Hollis v Vabu Pty Ltd [2001] 207 CLR 21

Applicant: HAYDEN GREEN

Respondent: HUMMER LIMOUSINES PTY LTD

File Number: MLG 1028 of 2012

Judgment of: Judge Hartnett

Hearing date: 19 February 2013

Delivered at: Melbourne

Delivered on: 17 May 2013

REPRESENTATION

Counsel for the Applicant: Mr Hone

Solicitors for the Applicant: Hymans Solicitors

Counsel for the Respondent: Mr McKeown

Solicitors for the Respondent: Taylor Splatt & Partners

THE COURT ORDERS THAT:

1. The mediation referred to in Order 4 of the Orders made 5 September 2012 be conducted as soon as practicable after July 2013 by a Registrar of the Court.

2. On or before the 14 August 2013 the Applicant file and serve any affidavits on which he intends to rely.

3. On or before the 28 August 2013 the Respondent file and serve any affidavits on which they intend to rely.

4. Otherwise all extant applications are adjourned for trial on 11 September 2013 at 10.00am.

5. Each party has liberty to apply.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLG 1028 of 2012

HAYDEN GREEN

Applicant

And

HUMMER LIMOUSINES PTY LTD

Respondent

REASONS FOR JUDGMENT

1. These proceedings commenced with the Applicant making claim under the Fair Work Act 2009 (Cth) (‘the Act’) alleging dismissal in contravention of a general protection. A Statement of Claim dated 25 September 2012 was subsequently filed by the Applicant, followed by a Notice of Defence dated 19 October 2012 and filed by the Respondent. These reasons deal with the preliminary issue as to the separate question of whether the relationship between the Applicant and the Respondent was that of employee and employer or that of independent contractor and principal.

The Facts

1. On or about 16 December 2010, the Applicant attended the Respondent’s Port Melbourne premises for an interview with Mr Steve Kantonis, State Manager with the Respondent.  The Respondent company owned Hummer Limousines that they hired out to the public for social occasions, corporate occasions and weddings.  The Applicant, Mr Green made application to Mr Kantonis for a stretch limousine driver position.  He provided to Mr Kantonis his Curriculum Vitae which indicated that the Applicant had the necessary driver’s licence, heavy vehicle driver licence, and full driver’s certificate issued by the Victorian Taxi Directorate to enable him to be employed as a driver of limousines by the Respondent.  The discussions which ensued between Mr Katonis and the Applicant included the following:-

   a)Mr Kantonis advised that he contacted drivers at the beginning of a week and asked their availability to work in that week. Jobs would then be allocated to them by him in the form of a driving schedule which was placed in a pigeon hole with the driver’s name on it for him to collect. The evidence before the Court is that these drivers’ sheet schedules listed the remuneration of the driver by the description ‘drivers wages’. These sheets were not signed by anyone and had no Australian Business Number or logo on any part of them;

   b)a flat rate of pay was paid in respect of the differing Hummer vehicles with this sum being added to in circumstances where increased and defined travelling distances applied. A base rate of $40 per hour or part thereof was paid in respect of driving a Black Hummer and a base rate of $60 for the first hour and $50 per hour or part thereof after the first hour was paid in respect of driving a Pink Hummer. Where a vehicle travelled 35 kilometres or more a further $20 was paid by way of an out of area payment. Where a vehicle travelled 60 kilometres or more a further $40 was paid and where a vehicle travelled 80 kilometres or more a further $60 was paid by way of an out of area payment;

   c)extra money of $20 per hour would also be paid to Mr Green if he was on standby or waiting for his next job after 7.00pm;

   d)if there were outstanding amounts owing by the passenger on the booking, then the driver was required to collect the money from the customer;

   e)a cleaning fee of $10 was to be paid to Mr Green in between jobs for attending to the tasks necessary to have the limousines ready for the next job;

   f)the business expenses of Mr Green were to be paid for by the Respondent;

   g)Mr Green was not at liberty to arrange with another person to perform his driver allocations or any of the other (including cleaning) work performed by him on his behalf;

   h)the equipment involved in the work was the Hummer Limousines and such was provided by the Respondent company; and

   i)there was a dress standard applicable to the drivers of the vehicles which was a suit. There was also a preference, explained by Mr Kantonis, for a driver to wear a shirt with a Hummer Limousine logo and a particular tie.

2. Both Mr Green and Mr Kantonis gave evidence that Mr Kantonis told Mr Green that he would be operating as an independent contractor and that he needed to produce to him an Australian Business Number.  He told Mr Green that any payments of tax and superannuation were the responsibility of Mr Green.

3. Mr Green was also engaged to clean the Respondent’s vehicles and his evidence was that he was one of the head cleaners. Whilst he could commence cleaning at any hour on a Monday morning, he was required to attend on the Mondays to clean the vehicles. He also attended on a Saturday and Sunday morning to clean the vehicles.  He denied in evidence that such cleaning job was voluntary and said that he felt he would lose his job if he declined to perform the job.

4. Mr Green had no saleable assets in any business whilst he was operating as a driver for the Respondent.  His work for the Respondent took up all of his time and he had little chance to be employed elsewhere, and nor was he.  His evidence was that he was one of the main two drivers called upon for work.  He felt unable to decline work; felt the need to comply with the dress standard including preferred clothing; and was obliged to do the work he was directed to do in the limousines made available to him.  Although Mr Kantonis told him he would be employed as a subcontractor driver, no written contract was entered into between the parties and nor did Mr Green ever invoice the Respondent.  Mr Green was paid by way of electronic transfer into a bank account nominated by him with no sums deducted for tax.  He was not provided with pay slips and given no annual leave, sick leave or superannuation payments.  He worked an equivalent of full-time hours or greater hours in many weeks.  For reasons not relevant here Mr Kantonis made the decision to stop giving any work to Mr Green.  Thus, the work relationship was terminated on 7 January 2012.

Consideration

1. The approach to characterisation of the relationship has historically been to apply a control test.  That is now a consideration of what degree of control the Respondent had the right to exercise over Mr Green in the performance of his work regardless of whether that right was exercised.  But control is no longer the only factor. In their joint judgment in Stevens v Brodribb Sawmilling Company Pty Ltd (1986) 160 CLR 16, their Honours Wilson and Dawson JJ said at paragraphs 36-37:-

   “In many, if not most, cases it is still appropriate to apply the control test in the first instance because it remains the surest guide to whether a person is contracting independently or serving as an employee. That is not now a sufficient or even an appropriate test in its traditional form in all cases because in modern conditions a person may exercise personal skills so as to prevent control over the manner of doing his work and yet nevertheless be a servant: Montreal v Montreal Locomotive Works [1947] 1 DLR 161 at p.16]. This has led to the observation that it is the right to control rather than its actual exercise which is the important thing (Zuijs v. Wirth Bros. Pty Ltd [(1955) [1955] HCA 73; 93 CLR 561 at p.571]) but in some circumstances it may even be a mistake to treat as decisive a reservation of control over the manner in which work is performed for another. That was made clear in Queensland Stations Pty. Ltd. V. Federal Commissioner of Taxation [(1945) [1945] HCA 13; 70 CLR 539], a case involving a droving contract in which Dixon J observed at p.552, that the reservation of a right to direct or superintend the performance of the task cannot transform into a contract of service what in essence is an independent contract.

   The other indicia of the nature of the relationship have been variously stated and have been added to from time to time. Those suggesting a contract of service rather than a contract for service include the right to have a particular person do the work, the right to suspend or dismiss the person engaged, the right to the exclusive services of the person engaged and the right to dictate the place of work, hours of work and the like. Those which indicate a contract for services include work involving a profession, trade or distinct calling on the part of the person engaged, the provision by him of his own place of work or his own equipment, the creation by him of goodwill or saleable assets in the course of his work, the payment by his from his remuneration without deduction from income tax. None of these leads to any necessary inference, however, and the actual terms and terminology of the contract will always be of considerable importance.

   Having said that, we should point out that any attempt to list the relevant matters, however incompletely, may mislead because they can be no more than a guide to the existence of a relationship of master and servant. The ultimate question will always be whether a person is acting as the servant of another or on his own behalf and the answer to that question may be indicated in ways which are not always the same and which do not always have the same significance.”

   The factors considered in Stevens v Brodribb Sawmilling Company Pty Ltd (1986) 160 CLR 16 were subsequently endorsed in Hollis v Vabu Pty Ltd [2001] 207 CLR 21.

2. The question of whether an employment relationship exists will always be determined on examination of the factual circumstances of a case. The factors considered in the High Court judgment of Stevens v Brodribb Sawmilling Company Pty Ltd (1986) 160 CLR 16 provide a necessary guide.

3. The assertions made by Mr Kantonis that Mr Green was an independent contractor have little probative value in this matter. The characterisation adopted by the Respondent’s representative does not of itself alter the substantive character of the employment relationship and deem the relationship between the Respondent and Mr Green to be something it is not. Mr Green used the business equipment of the respondent whilst he was working. He performed work at the direction of Mr Kantonis who retained control of the allocation of such and was in a practical sense, unable to obtain other employment as a consequence of the work performed by him for the Respondent. Although there was formally no exclusivity with respect to the services of Mr Green, he was left with little capacity to work elsewhere. He was paid ‘wages’ as described in the drivers schedule sheets albeit no amount was deducted for taxation - one indicia of the nature of the relationship which was used to argue for an independent contractor relationship. Mr Green was not running his own business with independence in the conduct of that business but rather was working, as directed, for the Respondent who provided his equipment, paid his business expenses, a wage and in relation to whom he could not substitute another driver and/or cleaner at his discretion.  His uniform also aligned him with the Respondent company.

4. Looking to the totality of the relationship, a great degree of control rested in Mr Kantonis over Mr Green’s work and to a large extent was exercised. Mr Green was required to attend at a place and time as dictated to him by the driver schedule sheets and take the journey that had been booked in equipment owned by the Respondent.  The uniform identified him as a driver of the Respondent. A consideration of the objective indicia support the proposition of the Applicant that he was engaged as an employee of the Respondent and not an independent contractor.

I certify that the preceding nine (9) paragraphs are a true copy of the reasons for judgment of Judge Hartnett

Date:  17 May 2013