Harrison Pye v Soccer X Pty Ltd
[2023] FWC 2288
•8 SEPTEMBER 2023
| [2023] FWC 2288 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.365—General protections
Harrison Pye
v
Soccer X Pty Ltd
(C2023/3594)
| DEPUTY PRESIDENT DOBSON | BRISBANE, 8 SEPTEMBER 2023 |
Application to deal with contraventions involving dismissal – jurisdictional objection by Respondents –– independent contractor – no written contract in place – jurisdictional objection upheld – application dismissed.
Background
Mr Harrison Pye (the Applicant) lodged an application pursuant to s.365 of the Fair Work Act 2009 (the Act) to deal with a general protections dispute in relation to the alleged termination of his employment. The Application named Samuel (Ryan Michael) Smith as the Respondent and was filed in the Commission on 20 June 2023. On 11 August 2023, Commissioner Durham issued an order pursuant to s.586(a) of the Act, amending the Respondent to SOCCER X PTY LTD.
Directions were issued for the filing of material on 14 August 2023 and 23 August 2023, the matter was listed for hearing on 5 September 2023. The Application was initially allocated to Commissioner Durham and on 24 August 2023, the matter was allocated to me. Commissioner Durham’s directions were not disturbed by the reallocation of the file and this was communicated to the parties.
The decision of the Full Court of the Federal Court of Australia in Coles Supply Chain Pty Ltd v Milford[1] requires the Commission to determine a dispute about the fact of a dismissal under section 365 of the Act, before the Commission can exercise powers conferred by section 368.[2] It is thus necessary to determine the jurisdictional objection in order for the Applicant’s application to proceed further.
The Applicant was engaged by the Respondent to perform the duties of a soccer coach in schools commencing on 24 April 2023. The Respondent raised a jurisdictional objection that the Applicant was engaged as an independent contractor and not as an employee[3] and therefore he could not have been dismissed within the meaning of s.365 of the Act where no employment relationship existed.
Legislation
Section 365 of the FW Act provides:
“365 Application for the FWC to deal with a dismissal dispute
If:
(a) a person has been dismissed; and
(b) the person, or an industrial association that is entitled to represent the industrial interests of the person, alleges that the person was dismissed in contravention of this Part;
the person, or the industrial association, may apply to the FWC for the FWC to deal with the dispute.”
Section 365 requires a dismissal to have occurred as a jurisdictional fact. A mere allegation that a person has been dismissed will not establish this as fact. “Dismissal” for these purposes (and other purposes of the Act) is defined in section 386(1), which provides:
“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.
Section 357(1) of the Act states:
“A person (the employer) that employs, or proposes to employ, an individual must not represent to the individual that the contract of employment under which the individual is, or would be, employed by the employer is a contract for services under which the individual performs, or would perform, work as an independent contractor.”
Section 358 of the Act states;
“An employer must not dismiss, or threaten to dismiss, an individual who:
(a)is an employee of the employer; and
(b)performs particular work for the employer;
in order to engage the individual as an independent contractor to perform the same, or substantially the same, work under a contract for services.”
Applicant’s Submissions
The Applicant did not file a witness statement in the matter. The Applicant’s material was provided in his Form F8 Application and across several emails.[4] Given the Applicant was self-represented, I permitted the Applicant to swear in this evidence at the hearing as his evidence in chief. This material did not contain any witness statements from any third party.
The Applicant contends that the Respondent dismissed the Applicant on 31 May 2023. The Applicant asserts that he submitted his application to the Commission within the prescribed timeframe per section 366(1) of the Act.
In respect of the matters to be determined by the Commission, the Applicant submits in his application that:
“Sam Smith engaged me as an ‘independent contractor’ although I am certain that I represented that of an employee during my entire time of engagement. All the responsibilities I had an (sic) undertook resemble that of an employer-employee relationship as defined by this FairWork page:
I note that when following this link a note can be found on that page which says:
“IMPORTANT: Pages dealing with whether a worker is an independent contractor or employee are currently under review in light of the High Court decisions in Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1 and ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2. Please refer to these cases for the current approach to be taken in determining whether a worker is an independent contractor or employee.”
The Applicant provided in his submissions a document titled “Sports for Better Minds: Coaches Conduct.”[6] It was uncontested by the parties that this document outlines the expectations of the relationship, which sets out the following requirements:
a. Expectations that each session would be accompanied by a 15 minute set up and a 15 minute set down;
b. Deduction from wages for lost or damaged equipment;
c. Session structures; Pay rates based on completion of a session;
d. Probationary pay rates increasing after 3 months;
e. Different rates for working as a Lead Coach, Assistant Coach or working in Holiday Clinics;
f. Where the agreed conditions were not met, provisions for taking disciplinary action verbal warning, written warning and dismissal; and
g. A required notice period when “leaving” the Respondent of 2 weeks.[7]
The Applicant provided a copy of the invoice template he used to invoice the Respondent for his services.[8]
Respondent’s Submissions
The Respondent did not file a witness statement in the matter from itself (although it did file witness statements from other witnesses as to the merits of the matter which were not relevant to the matters to be decided in these proceedings). The Respondent gave evidence in a range of emails.[9] Given the Respondent was self-represented, I permitted the Respondent to swear in this evidence at the hearing as his evidence in chief, to the extent that material was from him and not from other witnesses.
The Respondent contends that the Applicant was not dismissed by the Respondent because he was a subcontractor and that the Respondent brought the relationship with the Applicant to an end due to the Applicant ceasing a coaching session 20 minutes early and leaving children unsupervised. The Respondent submits this created a serious risk to the safety of these children as children whose parents were not there early to pick them up, were left unsupervised. Respondent asserts that as the Applicant was a contractor, there was no employment relationship therefore the Applicant could not be dismissed.
The Respondent submitted a copy of an email sent to the Applicant on 28 April 2023 that confirms that the Applicant was required to register as a coach on the Respondents website with an ABN before payments could be made.[10]
The Respondent submitted that the Applicant was hired as a contract Coach and that he would complete coaching sessions for the Respondent when required. The Respondent submitted to the Commission:
“…
We can confirm Harrison was brought on board as a contractor to Soccer X. Upon submitting his application we called Harrison to discuss the job.
He informed us:
5. He was looking for casual coaching hours to work alongside his current other part time position.
6. He would supply his ABN to us and coach 1 session per week for us.
Some other relevant details:
7. Harrison coached for us for a total of 5 sessions over a 5 week period from April 2023 to May 2023.
8. Harrison informed us he had various income streams which added up to make a living for himself (this was again re iterated to us in the phone call recorded 25 Aug 2023).
9. Sports X request any coaches who work less then (sic) 4 sessions per week fill out a statement of supplier form, Harrison instead preferred to provide his ABN as he was receiving other income from other similar jobs.
10. The coaches roster sent out clearly stated the session was 3-4pm at Windaroo State School each week. A picture of this is attached.”[11]
The Respondent submitted that it provided the Applicant with a number of available sessions at various schools at various times over various times of the week and it was the Applicants decision as to which of these opportunities he chose to avail himself of.[12] This was uncontested by the Applicant.
At the hearing, despite the directions on foot, a Director of the Respondent Mr Justin McKay appeared and sought to provide verbal witness evidence on the spot without prior notice. I declined to allow Mr McKay to give witness evidence in this context given the procedural fairness that would be denied to the Applicant. The Respondent had adequate opportunity to comply with the directions and at no time sought an extension to file new evidence. The Respondent then requested an adjournment on the spot in order to provide further evidence. Again, the Respondent had ample opportunity to comply with the directions of the Commission to provide evidence and it would deny the Applicant procedural fairness to allow a last-minute witness without notice. I declined to grant an adjournment for these reasons.
Out of Time
It is uncontested that the Applicant and the Respondent’s relationship ended on 31 May 2023. It is also uncontested that the Applicant filed his application on 20 June 2023.
The application was required to be lodged on or before 21 June 2023. The application was not lodged out of time.
Is the Applicant an Employee or an Independent Contractor?
The Applicant has brought an application pursuant to Section 365 of the Act. Section 365 only entitles a person to bring an application if that person has been “dismissed” (see Section 365(a)).
Section 386 of the Act states that a person has been dismissed if:
“(a) The person’s employment with his or her employer has been terminated at 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.”
Accordingly, a person can only be dismissed for the purposes of Section 386 if there is an employment relationship.
In the contest of whether the Applicant was an employee or a contractor, recent authorities can assist with the determination. The High Court recently revised the applicable legal principles to determine whether a person is an employee or an independent contractor in Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (‘Personnel Contracting’)[13] and ZG Operations Australia Pty Ltd v Jamsek (‘Jamsek’)[14] A useful analysis was applied in the Commission decision of Waring v Hage Retail Group Pty Ltd (‘Hage’):[15]
“[52] In two judgements delivered on 9 February 2022 the High Court of Australia pronounced on the law that applies in determining whether, absent a specific statutory rule, a person is an employee or contractor. In doing so, the Court reviewed past decisions of the Court (and other courts) and set out afresh relevant legal principles.
[53] In important respects the law as expressed by the High Court in Jamsek and Personnel Contracting has modified, if not replaced, former approaches. In particular, the past approach of the Commission (itself based on past court authority) as outlined in the leading full bench case of French Accent is, with some limited caveats, no longer good law.
[54] The High Court, via the combination of judgements in both Jamsek and Personnel Contracting, has largely rejected an approach whereby the relationship between parties across its life span is examined (including how the relationship operates in practice). The Court has stated that contractual terms and not performance, where those terms can be ascertained and where the contract is not a sham, will determine the true nature of the relationship. However, the Court has observed that the manner in which the relationship is worked in practice may be relevant for certain limited purposes, such as to find contractual terms where they cannot otherwise be ascertained or to determine the nature of any variation to agreed terms.
[55] Indicia (such as those identified in earlier cases in the Court) may be relevant but only insofar as the terms of the contract give voice to them. One approach, to be used as a guide, is to look at whether, under the contract, the worker is engaged to work in the business of another, though this may not necessarily be useful in all cases. The extent of a contractual right to control, as evident from the terms of the contract itself, remains a major signifier of an employment relationship. That an arrangement was brought about by the superior bargaining power of one party has no bearing on the meaning and effect of the contract.
[56] Amongst the caveats expressed by the Court, is that a mere label acting as a subterfuge to the true nature of the contractual relationship will not determine the status of the parties. In this respect at least, the law remains unchanged by these recent decisions.” (footnotes omitted).
The Hearing
There being contested facts involved, the Commission is obliged by s.397 of the Act to hold a hearing.
After taking into account the views of the Applicant and the Respondent and whether a hearing would be the most effective and efficient way to resolve the matter, the matter was listed for a determinative conference pursuant to s.399 of the FW Act.
Both parties were self-represented at the hearing on 5 September 2023.
Witnesses
The following witnesses gave evidence on behalf of the Applicant:
· The Applicant Mr Harrison Pye
The following witnesses gave evidence on behalf of the Respondent:
· Mr Sam Smith of the Respondent
It was uncontested in the hearing by the parties that there was neither a written employment contract nor a written independent contract in place. However, both parties agreed that there was a verbal understanding as a result of a meeting between Mr Smith of the Respondent and the Applicant on 24 April 2023, that the relationship would be of a contractor nature, that the Applicant would supply an ABN and would be responsible for payment of taxation and superannuation and the Applicant would provide invoices for payment.
Under cross-examination the Applicant submitted that he understood the role of a Contractor as he had registered for an ABN to perform work for Uber Eats which he understood to be of a similar nature to the type of work he was to perform for the Respondent. It was uncontested between the parties that the Applicant was paid a set fee for each coaching session he performed and that the fee was set by the Respondent. That fee increased with experience or in the event that the Applicant performed Assistant Coach or Holiday Clinic sessions.[16]
The Applicant gave evidence that he did not question the nature of his employment until after the relationship came to an end and he sought legal advice from a community legal centre. The Applicant claimed that it was the community legal centre’s advice that gave him cause to believe that the nature of the engagement was as an employee not a contractor.
Whilst a clear written agreement was absent, I find that there was some shared understanding between the parties that the relationship was one of a contractor rather than employee nature. In saying that, some of the material filed by the parties demonstrated confusing language that was inconsistent with that understanding, such as the referral to payment of wages and to the taking of disciplinary action, both in the Expectations Document[17]. On that basis, given the High Court’s caution expressed in Hage “that a mere label acting as a subterfuge to the true nature of the contractual relationship will not determine the status of the parties”,[18] I consider it important that the manner in which the relationship was performed must also be examined.[19]
In considering the various indicia identified in EFEX Group Pty Ltd v Bennett[20] and Stevens v Brodribb Sawmilling Co Pty Ltd[21] , and other authorities, the Commission addressed the list of indicia in the following manner.
Whether the putative employer exercises, or has the right to exercise, control over the manner in which work is performed, place of work, hours of work and the like.[22]
The Applicant submitted, that he performed work under the direction and control of the Respondent including the hours required for each job, how work was to be done and the location of the job. The Applicant gave evidence at hearing that he dictated his availability to the Respondent and the Respondent had no say in what days he worked. The Applicant gave evidence that this was due to the Applicant’s other work commitments. The Applicant gave evidence that was uncontested that the Respondent attended 3 out of the 6 sessions he performed and gave direct demands and instructions as to how he should conduct those sessions. On the converse, the Applicant was able to conduct the other 3 sessions on his own accord having regard for the Expectations Document. There was uncontested evidence that the Respondent gave the Applicant free range to choose which sessions at which schools the Applicant could take.[23]Further, the uncontested evidence before the Commission was that the Applicant had unilaterally decided to end a session on 30 May 2023, 20 minutes early.[24] This is further indicative of the Applicant having control over his hours of work.
What the Arrangements were in respect to Invoicing and Other Entitlements[25]
The Applicant gave evidence that at the beginning of his relationship with the Respondent, the Respondent advised him that he was required to submit invoices after completing sessions and that the Respondent provided him with a template he could use. The Applicant submitted an invoice for the sessions he conducted and this was paid by the Respondent.[26] It was uncontested at hearing that entitlements or other obligations such as income tax, superannuation, pay slips or accrued leave were provided by the Respondent, sought or questioned by the Applicant.
Whether the worker performs work for others.
The Applicant gave evidence that he held another part time job with commitments that meant his role with the Respondent was a “side gig” and his availability for work with the Respondent was limited at the Applicant’s discretion.
The Respondent submitted that the Applicant was free to work for others and that he regularly performed work for others limiting his availability for work with the Respondent.
Mr Smith gave evidence that some of its coaches were engaged as independent contractors and others as employees. Mr Smith prefaced this evidence by saying that he did not make these decisions as they were made by the Director of the Respondent and he thought perhaps the decision was made on the basis of how many hours or sessions a Coach undertook. I consider Mr Smith’s evidence in respect of how Coaches became either a contractor or an employee to be hearsay as he said he had no direct knowledge of this and therefore I place no weight on this evidence.
Did the worker provides and maintains significant tools or equipment in relation to work for the Respondent[27]
It was uncontested at hearing that the Applicant did not provide his own tools or equipment. The Respondent provided a kit of sports equipment that was used by the children in the coaching sessions. There was no evidence before the Commission that there was any equipment that the Applicant was required to provide to perform his role as Coach.
Whether the work can be delegated or subcontracted
The Applicant gave evidence that he was unable to delegate the work to others however if he was unavailable, the Respondent would find someone else to perform the work. The Respondent did not contest this.
Whether income tax is deducted from remuneration paid to the worker
It was uncontested by the parties that no income tax was deducted from the Applicant’s remuneration and that the Applicant did not have expectation that it would be nor did the Applicant raise any concerns about this with the Respondent.
Whether the worker was provided with paid holidays or sick leave
It was uncontested by the parties that the Applicant was neither provided paid holidays nor sick leave and it was further uncontested that the Applicant had never requested nor expected paid holidays or sick leave.
Whether the work involves a profession, trade or distinct calling on the part of the person engaged
The Applicant was engaged by the Respondent as a sports coach. The Applicant gave evidence that other part time work the Applicant performed was with children however there was no evidence before the Commission of any specific qualifications that were required to perform the role of Coach and therefore, I find that the work performed was not of a distinct calling, profession or trade.
Whether the Applicant was held out as part of the Soccer X organisation[28]
It was uncontested that the Respondent provided uniforms for the Applicant to wear, that were branded with the Respondents business name. Further the Respondent gave evidence that the Applicant’s conduct with the Respondents clients, was reflective on the reputation of the Respondents business rather than on the Applicant.
Whether the Applicant had the ability to generate goodwill or other value in saleable assets[29]
It was uncontested that the Applicant performed the work on behalf of the Respondent and was only paid for his time. There was clearly no ability to generate goodwill for a saleable asset.
Consideration and Conclusion Independent Contractor or Employee
I have considered the High Court authorities in Jamsek and Personnel Contracting and the Commission’s previous consideration of those authorities in Hage particularly at paragraphs [54] and [55]. I have also considered the Federal Court decision in Efex. I note that in this present matter, there was no written agreement between the parties that the engagement was as an employee nor as an independent contractor although there was a shared understanding the engagement was as an independent contractor notwithstanding the confusing language in the Expectations Document.
I have considered the relevant practical relationship between the parties in light of the relatively short period of time that it occurred between the parties being approximately 5 weeks.
Accordingly, having regards to the indicia of the relationship, including the Expectations Document, the verbal understanding by the parties at the commencement of the relationship and the greater conduct of the parties being consistent with that agreement up until the relationship came to an end, it is my view that my assessment of all of these factors weighs in favour of finding that the Applicant was an independent contractor. Further that the parties understood this from the beginning of the engagement and conducted themselves predominantly in this manner until after the relationship came to an end.
CONCLUSION
For the above reasons it is considered that the Applicant was engaged as an independent contractor and was not an employee of the Respondent. On that basis there is no utility for me to consider whether the relationship came to an end at the initiative of the Respondent.
Mr Pye was not dismissed for the purposes of s.365 and accordingly the matter is dismissed.
I Order accordingly.
DEPUTY PRESIDENT
Hearing: Brisbane, 5 September 2023
[1] [2020] FCAFC 152.
[2] See Yi Zhang v Medlab Clinical Ltd [2021] FWCFB 2453 [1].
[3] Digital Court Book (DCB) p48.
[4] DCB pp3-47.
[5] Applicants Form F8, Answer to Question 33, p8.
[6] DCB pp14-15 (Expectations Document).
[7] Ibid.
[8] DCB p18.
[9] DCB pp48-62.
[10] DCB p30.
[11] DCB p48.
[12] DCB pp41-42.
[13] Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1.
[14] ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2.
[15] Waring v Hage Retail Group Pty Ltd[2022] FWC 540.
[16] Expectations Document.
[17] Ibid.
[18] Waring v Hage Retail Group Pty Ltd[2022] FWC 540. [56].
[19] Ibid.
[20] [2023] FCA 508 (Efex).
[21] 160 CLR 16.
[22] Efex [103]-[117].
[23] DCB pp41-42.
[24] DCB pp46-47.
[25] Efex [27].
[26] DCB p18.
[27] Efex [124].
[28] Efex [118].
[29] Efex [125].
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