Mariana Jansen v Lives Lived Well T/A Headspace Southport/ Upper Coomera
[2021] FWC 6567
•9 DECEMBER 2021
| [2021] FWC 6567 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Mariana Jansen
v
Lives Lived Well T/A Headspace Southport/ Upper Coomera
(U2021/7700)
DEPUTY PRESIDENT LAKE | BRISBANE, 9 DECEMBER 2021 |
Application for an unfair dismissal remedy – jurisdictional objection – whether the Applicant was an employee – where the Applicant was held to be an independent contractor – jurisdictional objection upheld – application dismissed
[1] This decision concerns an application by Mariana Jansen (the Applicant) for an unfair dismissal remedy under s.394 of the Fair Work Act 2009 (the Act). The Applicant contends that on 10 August 2021, she was terminated from her employment with Lives Lived Well T/A Headspace Southport/Upper Coomera (the Respondent) and that the termination was unfair.
[2] The Respondent objects to the application on the basis that the Applicant was an independent contractor, not an employee, and was therefore not eligible to make an application for an unfair dismissal remedy by virtue of s.382 of the Act.
[3] Directions were issued for the filing of material in respect of this jurisdictional issue and a hearing was held before me via Microsoft Teams on 28 October 2021, at which both parties sought to be represented. Granting permission for a party to be represented under s.596 requires the existence of one of the criteria set out in s.596(2), though their mere presence does not immediately invoke the right to representation. Rather, the Commission must use “an evaluative judgement akin to the exercise of discretion” 1 and consider “whether in all of the circumstances the discretion should be exercised in favour of the party seeking permission.”2 In this matter, I am satisfied that the presence of each party’s legal representatives would allow for the legal question of whether the Applicant was an independent contractor and an employee to be dealt with in an efficient but comprehensive manner. Accordingly, both parties were allowed representation.
[4] The Applicant was represented by Hamish Granger from Susan Moriarty and Associates, while Simon Grant of counsel appeared for the Respondent, instructed by Paxton Hall Lawyers.
Was the Applicant an employee of the Respondent?
The legal test
[5] Determining whether a person has been engaged as an employee or a contractor involves issues of both fact and law. 3 A considerable body of case law has developed from applying the general legal principles to specific circumstances.4 Those cases demonstrate that a multifactorial approach is to be adopted. Multiple indicia are to be considered, though none alone are determinative. One must also analyse the totality of the relationship between the parties to determine whether the relationship was one of employee or independent contractor.
[6] The often-cited passage penned by Windeyer J in Marshall v Whittaker’s Building Supply Co 5and then quoted by the High Court of Australia in Hollis v Vabu reads:
“the distinction between an employee and an independent contractor is ‘rooted fundamentally in the difference between a person who serves his employer in his, the employer’s business, and a person who carries on a trade or business of his own’.” 6
[7] In Roy Morgan Research Pty Ltd v Commissioner of Taxation, the Full Court of the Federal Court quoted with approval the following passage from Hall (Inspector of Taxes) v Lorimer:
“The object of the exercise is to paint a picture of the relationship from the accumulation of detail. The overall effect can only be appreciated by standing back from the detailed picture which has been painted, by viewing it from a distance and by making an informed, considered, qualitative appreciation of the whole. It is a matter of the overall effect of the detail, which is not necessarily the same as the sum total of the individual details. Not all details are of equal weight or importance in any given situation. The details may also vary in importance from one situation to another”. 7
[8] The Full Bench of this Commission adopted this passage in Jiang Shen Cai trading as French Accent v Michael Anthony Do Rozario. In that case, the Full Bench helpfully went on to summarise the general approach taken to distinguish between employees and independent contractors as follows:
“(1) In determining whether a worker is an employee or an independent contractor the ultimate question is whether the worker is the servant of another in that other’s business, or whether the worker carries on a trade or business of his or her own behalf 8: that is, whether, viewed as a practical matter, the putative worker could be said to be conducting a business of his or her own9 of which the work in question forms part? This question is concerned with the objective character of the relationship. It is answered by considering the terms of the contract and the totality of the relationship.10
(2) The nature of the work performed and the manner in which it is performed must always be considered. This will always be relevant to the identification of relevant indicia and the relative weight to be assigned to various indicia and may often be relevant to the construction of ambiguous terms in the contract. 11
(3) The terms and terminology of the contract are always important. However, the parties cannot alter the true nature of their relationship by putting a different label on it. 12 In particular, an express term that the worker is an independent contractor cannot take effect according to its terms if it contradicts the effect of the terms of the contract as a whole:13 the parties cannot deem the relationship between themselves to be something it is not.14 Similarly, subsequent conduct of the parties may demonstrate that relationship has a character contrary to the terms of the contract. 15
(4) Consideration should then be given to the various indicia identified in Stevens v Brodribb Sawmilling Co Pty Ltd and the other authorities as are relevant in the particular context. For ease of reference the following is a list of indicia identified in the authorities:
• Whether the putative employer exercises, or has the right to exercise, control over the manner in which work is performed, place or work, hours of work and the like.
Control of this sort is indicative of a relationship of employment. The absence of such control or the right to exercise control is indicative of an independent contract. While control of this sort is a significant factor it is not by itself determinative. In particular, the absence of control over the way in which work is performed is not a strong indicator that a worker is an independent contractor where the work involves a high degree of skill and expertise. 16 On the other hand, where there is a high level of control over the way in which work is performed and the worker is presented to the world at large as a representative of the business then this weighs significantly in favour of the worker being an employee.17
“The question is not whether in practice the work was in fact done subject to a direction and control exercised by an actual supervision or whether an actual supervision was possible but whether ultimate authority over the man in the performance of his work resided in the employer so that he was subject to the latter’s order and directions.” 18 “[B]ut 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, a case involving a droving contract in which Dixon J observed 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.”19
• Whether the worker performs work for others (or has a genuine and practical entitlement to do so).
The right to the exclusive services of the person engaged is characteristic of the employment relationship. On the other hand, working for others (or the genuine and practical entitlement to do so) suggests an independent contract.
• Whether the worker has a separate place of work 20 and or advertises his or her services to the world at large.
• Whether the worker provides and maintains significant tools or equipment. 21
Where the worker’s investment in capital equipment is substantial and a substantial degree of skill or training is required to use or operate that equipment the worker will be an independent contractor in the absence of overwhelming indications to the contrary. 22
• Whether the work can be delegated or subcontracted. 23
If the worker is contractually entitled to delegate the work to others (without reference to the putative employer) then this is a strong indicator that the worker is an independent contractor. 24 This is because a contract of service (as distinct from a contract for services) is personal in nature: it is a contract for the supply of the services of the worker personally.
• Whether the putative employer has the right to suspend or dismiss the person engaged. 25
• Whether the putative employer presents the worker to the world at large as an emanation of the business. 26
Typically, this will arise because the worker is required to wear the livery of the putative employer.
• Whether income tax is deducted from remuneration paid to the worker. 40
• Whether the worker is remunerated by periodic wage or salary or by reference to completion of tasks.
Employees tend to be paid a periodic wage or salary. Independent contractors tend to be paid by reference to completion of tasks. Obviously, in the modern economy this distinction has reduced relevance.
• Whether the worker is provided with paid holidays or sick leave. 27
• Whether the work involves a profession, trade or distinct calling on the part of the person engaged.
Such persons tend to be engaged as independent contractors rather than as employees.
• Whether the worker creates goodwill or saleable assets in the course of his or her work.
• Whether the worker spends a significant portion of his remuneration on business expenses.
It should be borne in mind that no list of indicia is to be regarded as comprehensive or exhaustive and the weight to be given to particular indicia will vary according to the circumstances. Features of the relationship in a particular case which do not appear in this list may nevertheless be relevant to a determination of the ultimate question.
(5) Where a consideration of the indicia (in the context of the nature of the work performed and the terms of the contract) points one way or overwhelmingly one way so as to yield a clear result, the determination should be in accordance with that result. However, a consideration of the indicia is not a mechanical exercise of running through items on a check list to see whether they are present in, or absent from, a given situation. The object of the exercise is to paint a picture of the relationship from the accumulation of detail. The overall effect can only be appreciated by standing back from the detailed picture which has been painted, by viewing it from a distance and by making an informed, considered, qualitative appreciation of the whole. It is a matter of the overall effect of the detail, which is not necessarily the same as the sum total of the individual details. Not all details are of equal weight or importance in any given situation. The details may also vary in importance from one situation to another. The ultimate question remains as stated in (1) above. If, having approached the matter in that way, the relationship remains ambiguous, such that the ultimate question cannot be answered with satisfaction one way or the other, then the parties can remove that ambiguity a term that declares the relationship to have one character or the other. 28
(6) If the result is still uncertain then the determination should be guided by “matters which are expressive of the fundamental concerns underlying the doctrine of vicarious liability” including the “notions” referred to in paragraphs [41] and [42] of Hollis v Vabu.” 29
[9] These authorities all come from a time before the High Court’s decision in WorkPac Pty Ltd v Rossato. 30 The question before the High Court there was not whether a particular employee was an employer or independent contractor, but rather whether Mr Rossato was a casual employee or not. However, the Court’s preference for giving primacy to the terms of the written employment contract when considering the relationship between the parties may still be influential in the present case.
Respondent’s material
Submissions
[10] The Respondent submits that the Applicant was engaged as an independent contractor, not an employee. The Respondent operates two Headspace centres on behalf of the National Youth Mental Health Foundation at Southport and Upper Coomera, providing early intervention mental health services to 12 to 25 year olds. Headspace also assists young people with physical health matters, alcohol and other drug services, as well as work and study support.
[11] The Applicant was engaged as a psychologist and holds the relevant professional qualifications and registrations to provide those services. It is uncontroversial that the Applicant was previously employed by the Respondent from March 2013 as a functional recovery clinician. However, the Applicant resigned from that position in a letter sent on 1 December 2017 (the Resignation Letter) which relevantly provided:
“RE: Resignation from FRT Clinician role within the FRT Team at Headspace Southport/Lives Lived Well
To whom it may concern,
Regretfully, I hereby tender my resignation from my part-time role as Functional Recovery Clinician here at Headspace Southport/Lives Lived Well. My resignation is effective from today December 1st, 2017. … I hereby initiate my two weeks notice.
In addition, I would like to use this letter to convey a big thank you ...
After much contemplation I feel that my time within the FRT Team has come to an end. I feel that I have grown out of my role and I am in need of a new challenges and responsibilities. In the last several months I have not been able to use any of my clinical skills as a psychologist and I really miss conducting assessments, evidence based intervention and crisis management. Although FRT is being redesigned and is going in the one-on-one therapy direction, I feel that this is something that I can quite easily achieve as an independent practitioner as well.
I still look forward to taking on a private practice opportunity at Headspace Southport and would also be more than happy to continue to be on the casual roster with the MATT Team (that is, if Carlie will have me of course), other than that I would like to say a big thank you for nearly three great years.
Kind Regards,
Mariana Jansen”
[12] The Respondent’s evidence was that the Applicant then entered into a service provision contract with the Respondent as a private practitioner psychologist from 1 January 2018 to 30 June 2018 to provide psychological services at Headspace’s Southport Premises. This arrangement was extended on three separate occasions, covering from 1 July 2018 to 30 June 2019, 1 July 2019 to 30 June 2020 and finally, 1 July 2020 to 13 July 2020. The Respondent submits that reason that the latter contract was so short was so it would align with the opening of the Headspace service at Upper Coomera, following which the Applicant would provide services at Upper Coomera only. That occurred. The Applicant entered into a separate and additional service provision contract from 13 July 2019 to 30 June 2021 at the Respondent’s Upper Coomera premises, which was then extended to cover the period from 1 July 2021 to 30 June 2022 (the Final Contract).
[13] The Respondent referred to French Accent v Do Razario (French Accent), 31 noting that in that case, the Full Bench provided that to determine whether the Applicant was conducting her own business, one must consider the terms of the Final Contract, the nature of the work and the various indicia of the relationship. The Respondent acknowledges that alone whether the Applicant was running her own business is not necessarily determinative of their relationship,32 and neither are the terms of the Final Contract or the course of conduct between the parties.
[14] The Respondent asserts that the Final Contract included terms under which:
• the Applicant expressly stated that she was carrying on private practice under her own name and in her own right for the maximum term of 12 months;
• the parties expressly agreed that their relationship is not that of the employer and employee;
• the Respondent granted the Applicant a licence to use its premises at Upper Coomera for the purpose of providing psychology services to clients of the Headspace service;
• the Applicant paid to the Respondent a substantial administration fee in exchange for the following, which were provided by the Respondent:
• the premises licence granted to her;
• support services (e.g. reception, room bookings, appointment books, client billing – including remittance of Medicare benefits to the Applicant upon receipt from Services Australia – and management of client records); and
• general services (e.g. electricity, water, kitchen amenities, cleaning and waste removal, toilets, repairs and maintenance, pest control and security services);
• the Applicant was required to have, and provide services under, her own Medicare Provider Number; and
• the Applicant was required to hold her own professional indemnity and public liability insurances.
[15] The Respondent submits that the terms of the Final Contract should, in this case, be highly influential in determining the relationship between the parties. The Respondent referred to the decision of Dean DP in Alexander v Francis Travel Representation Pty Ltd T/A Travel Industry Club where she agreed with the statement of Watson VP in Cherif Meena Biripi Aboriginal Corporation Medical Centre T/A Werin Aboriginal Medical Centre 33, in which he said:
“Where a strong inference of any independent contractor relationship arises from the way in which the parties have drafted the contract between them, that inference will only be displaced if there are strong factors as to the practical working arrangements that contradict and outweigh that inference.” 34
[16] The Respondent submits that the terms of the Final Contract clearly infer that the Applicant was not an employee and that the practical working arrangements of the parties do not displace that inference so at to cause the Applicant to be characterised as an employee. The nature of the Applicant’s work is to provide professional services. The Respondent asserts that this tends to indicate a contracting relationship. 35 The use of independent contracting arrangements in centres utilising multi-disciplinary allied health professionals is a common model of engagement in the industry as professionals necessarily exercise a high degree of control over the services provided. The Respondent submitted that, in the circumstances, the professional nature of the Applicant’s work is an indicator that she was not an employee. Additionally, the Respondent submitted that based on the multi-factorial test (as summarised by the Full Bench in French Accent), the Applicant was not an employee of the Respondent.
Payment
[17] The Respondent submits that there was no remuneration payable to the Applicant by the Respondent under the Final Contract, without which an employment relationship cannot exist. 36 The Respondent claims that the only amounts payable to the Applicant under the Final Contract are payments by way of reimbursement to the Applicant of either the Medicare Benefits Scheme Payments to which the Applicant is entitled from Services Australia as a result of providing her services (MBS Payments) or the payments to which the Applicant is entitled from Primary Health Network for providing Psychological Services Program (Suicide Prevention) sessions (PHN Payments). The Respondent states that, under the Final Contract, these payments are paid the payments as reimbursements less the administration fee (which the Applicant pays to the Respondent).
[18] The Respondent describes the payment arrangements for the MBS Payments as follows:
• the Applicant was required to apply for and hold a Medicare Provider Number (MPN) in respect of her psychology practice at Headspace. She was required to hold a separate MPN for each locations. The Respondent denied that the Applicant did not provide services under her own MPN. In an email sent on 14 July 2020, the Applicant provided the Respondent details of her MPN for Upper Coomera;
• Medicare has a set billing amount (Bulk Billing Amount) that can be charged for each psychology session, depending upon the practitioner’s discipline. The Applicant could nominate the Respondent as its agent to receive payment of all MBS Payments in respect of her services provided at Headspace;
• due to the nature of the Respondent’s service, the Applicant was required to offer clients the option of sessions for the Bulk Billing Amount only. The Respondent submits this was a necessary and reasonable requirement given the nature of Headspace being aimed at youth, many of whom are in crisis and/or unlikely to have additional funds to meet the costs of accessing its services;
• at the end of each day, the Respondent’s administration staff print off a list of each session completed by the Applicant which shows the Medicare billing code and amount billed for each session. The Applicant then signed her day sheet to indicate her approval of the amounts and to give the Respondent permission to bill Medicare on her behalf;
• the Respondent batches the billings and sends them to Medicare on the Applicant’s behalf;
• Medicare makes payment to the Respondent of the MBS Payments; and
• the Respondent provides the Applicant with a Recipient Created Tax Invoice each fortnight showing the amounts of MBS Payments owing to the Applicant, the period to which those payments relate, the amount deducted as the Administration Fee and details of the individual sessions.
[19] The Respondent described the payment arrangements for PHN Payments as follows:
• the Applicant provides PSP sessions for the Gold Coast Primary Health Network;
• the Respondent’s administration team provides information about the PSP Session to the Finance team who raises an invoice to the Primary Health Network for those sessions;
• the Public Health Network makes payment to the Respondent of the PHN Payments; and
• the Respondent provides the Applicant with a Recipient Created Tax Invoice each month showing:
• the amounts of PHN payments owing to the Applicant;
• the period to which those payments relate;
• the amount of the Administration Fee deducted; and
• details of the PSP Sessions provided.
[20] The Respondent states that the payments made to the Applicant varied depending upon the sessions provided during the relevant billing period. The Respondent further submits that any payment made to the Applicant by the Respondent is for completion of a set task (being the provision of a psychology session) and is not representative of a salary or wages calculated having regard to an hourly rate.
Expenses
[21] Any expenses associated with providing services under the Final Contract were met by the Applicant. For commercial reasons, including the ability to attract allied health practitioners to provide services, the Respondent implemented a scheme whereby certain practitioners would receive a reimbursement of 50% of their estimated annual administration fees for the 2021-22 financial year. The effect of this was what the Applicant’s Administration Fee payable to the Respondent was reduced from 20% to 10%. The Applicant was also required to, at her own expense, maintain her own registration as a psychologist under the Health Practitioner Regulation National Law and registration with Medicare for the purposes of the Health Insurance Act 1973 (Cth).
Control over the way in which work is performed
[22] Due to the clinical and highly regulated nature of the Respondent’s business, the Respondent had placed parameters around the way in which the Applicant could provide her professional services, including that it be conducted:
• with due skill, care and diligence and to a high professional standard;
• in accordance with the Respondent’s policies and procedures (including the Private Practitioner Handbook);
• in accordance with any quality standards specified by the Respondent; and
• with a high standard of professional and clinical ethics applicable to psychologists.
[23] The Respondent advised that these parameters were not only necessary for regulatory and clinical compliance, they were essential to the efficient administration of the Respondent’s business. That said, beyond these parameters, the Respondent claims the Applicant was free to determine the way in which services were provided. The Applicant maintained control and independence of her work as a psychologist including, without limitation, the days and times she provided her services, the services she provides, any periods of unavailability and decisions as to the clinical treatment and/or referrals of clients.
[24] The Respondent referred to the Full Bench in French Accent where it was noted that weight is generally given to the control exercised over the work performed. That decision quoted with approval the following passage from Stevens v Brodribb Sawmilling Co Pty Ltd:
“[B]ut 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, a case involving a droving contract in which Dixon J observed 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.” 37 (emphasis added)
[25] On this basis, the Respondent submits that the setting of parameters within which the services must be provided is not sufficient to warrant a conclusion that the Applicant was the Respondent’s employee.
Risk
[26] The Respondent further argues that the Final Contract provides that the Applicant bore the risks associated with the provision of her services. Consequently, she was required to maintain both professional indemnity and public risk insurances at her own expense for the duration of each contract and for seven years following termination. The Applicant was also required to indemnify the Respondent in respect of claims made against, or loss and damage suffered by, the Respondent arising out of services she provided.
Tools and equipment
[27] There were no substantial tools or equipment provided to the Applicant, due to the nature of her services. To the extent that any tools or equipment were provided, they were provided at the Applicant’s cost (i.e. the Administration Fee) pursuant to the relevant service provision contract.
Hours of work
[28] The Final Contract does not specify the number or pattern of hours required of the Applicant. Whilst it does specify “permitted times”, the Respondent submits these are merely indicate when the service is operational and so goes no further than to set broad parameters within which the Applicant sets her hours. She was free to determine the number of hours, breaks and times, within those parameters. The Respondent notes that the requirement that the Applicant provide a minimum of two sessions per week was simply to ensure efficient use of the Respondent’s resources and client serviceability.
[29] The Respondent submits the Applicant provided her services for a varying number of hours per week but no more than approximately 25 hours. She was free to change her working arrangements as she pleased. The Respondent’s evidence indicated that the allocation of clients to the Applicant was based on her own availability period as notified by her. The Respondent then matched the client’s need with the nominated skills and area of the practitioner – in this case, the Applicant – at a time convenient to both, having regard to the availability indicated by the Applicant. The Respondent submits this arrangement is consistent with the Applicant being an independent contractor.
Leave entitlements
[30] The Respondent states that the Applicant was not entitled to any paid leave entitlements under the Final Contract. In fact, since the Applicant resigned from her employment in December 2017, the Respondent has not provided the Applicant with any periods of paid leave. The Respondent notes that the Applicant admits this as part of her application, and until the filing of the Application of this matter, the Applicant has never complained to the Respondent that she was not provided with paid leave. The Respondent submits that the lack of obligation to provide paid leave entitlements is inconsistent with a finding that the Applicant is an employee.
Period of engagement / expectation of work
[31] The period of engagement under the Final Contract was for a maximum of 12 months. The term was not fixed and was subject to early termination under clause 15. The Respondent notes that all prior service provision contracts had a maximum term. The terms of the arrangements between the Applicant and the Respondent were reassessed annually, with no guarantee that any further contract would be offered following the expiration of each. The Applicant was aware that each contract was subject to negotiation and that the terms would be renegotiated before any further contract was executed. This occurred at least once.
[32] The Respondent submits that the parties’ stated intentions should be given more weight where the agreement has been negotiated. In the Full Federal Court’s recent decision in CFMEU v Personnel Contracting Pty Ltd, Alsop CJ stated:
“In some circumstances it would be perfectly legitimate to give significant weight to [the contract’s] negotiated terms. By way of example only, such circumstances may include where the working man or woman wanted to work as an independent contractor… and made that clear in negotiations.” 38
[33] The Respondent submits that the fact that the Applicant voluntarily resigned from her previous employment with the Respondent with the stated intention of working as a contractor, as well as the fact that she signed various subsequent contracting agreements with the Respondent which are on terms significantly different from an employment contract, indicate that she had clear and definite intentions to create an independent contracting relationship rather than an employment relationship.
Taxation
[34] The Respondent states that the Final Contract is silent with respect to income tax. The only payments made by the Respondent to the Applicant were the PBS Payments and PHN Payments (which were paid by way of reimbursement only). The Respondent further submits that the Final Contract makes it clear that the relationship between the parties was not that of employee and employer, implying that the Applicant was responsible for paying income tax on payments received. At any rate, the Respondent advises they have not withheld or remitted any PAYG tax from or in respect of the Applicant since she resigned in December 2017.
[35] The Respondent claims that the Final Contract makes it clear that the recipient of services under the contract was responsible for the payment of the GST. The Applicant was also required to pay GST on the Administration Fee payable under the Final Contract. The Respondent further asserts that the Applicant has held an ABN since 1 November 2017 and has been registered for GST since 1 February 2018. Her main business location has been listed as “QLD 4215” (i.e. the Southport area) since 1 November 2017. The Respondent submits that this is consistent with the Applicant being an independent contractor and not an employee of the Respondent.
Ownership of intellectual property
[36] The Respondent notes that in the Final Contract the parties agreed that ownership of intellectual property in the client records and practice documentation remains with the Respondent and, to the extent that the Applicant acquires any right, title or interest in them, the Applicant assigns all such right, title and interest to the Respondent. The Respondent submits that this is consistent with the Applicant being an independent contractor.
Ability to accept work from others
[37] The Respondent acknowledges that the Final Contract is silent about whether the Applicant can accept work from others. Ultimately, the Respondent says the Applicant enjoyed the right to do so, regardless of whether she did or not. As the Applicant provided services at Headspace for no more than approximately 25 hours per week, she had a genuine opportunity to work for others, even if she chose not to. Further, the Applicant advertised to the world at large that she was a self-employed psychologist. Her LinkedIn profile, as at 11 October 2021 read:
“Watch this space, new website coming soon. Aim to offer authentic, honest and tailored psychology services to exceptional young people and adults.”
“Initially worked in Functional Recovery Team at Headspace [sic] Southport for 5 yrs. Then self employed as a private practitioner for the last 3 years.”
[38] The Applicant was also able to take periods of absence as desired, provided she gave the Respondent reasonable notice and otherwise cooperated with the Respondent to ensure the safe, effective and efficient conduct and management of the Headspace centre as envisaged in the Final Contract.
Right to refuse work
[39] The Respondent submits that the Applicant was able to refuse to provide her services and was under no obligation to accept any appointments allocated to her. Whilst she was required to notify the Respondent of any “scheduled or unscheduled periods of absence”, this was merely for administration purposes and did not limit the Applicant’s right to refuse work. The Respondent further claims there is nothing in the Final Contract, nor was there any conduct of the parties which suggested that the Applicant was not entitled to refuse work. The Respondent submits that to the contrary, the Applicant was able to, and did in fact, refuse work from time to time.
Delegation
[40] The Respondent concedes that the Applicant was unable to delegate her work. However, the Respondent submits that this is not enough to determine that the Applicant was an employee, particularly given the clinical nature of the services provided by the Applicant meant that it could not be delegated without compromising client safety/outcomes.
Uniform and business cards
[41] The Respondent submits that the Applicant was not required to, nor did she, wear any badge, uniform or other form of Respondent-branded clothing when providing her services. The Respondent further says the Applicant was not provided with any business cards, nor was she advertised as being an employee of the Respondent.
Expenditure on business expenses
[42] The Respondent submits that the Administration Fee of 10% (following the discount applied by the Respondent) of the MBS Payment, together with the professional registration and insurance costs which the Applicant is required to pay, equates to a significant portion of her income earned from providing services at Headspace. The Respondent submits that this further suggests that the Applicant was not the Respondent’s employee.
Training
[43] The Respondent asserts that the requirement for contractors to complete induction training is not uncommon and is not indicative of an employment relationship. On that basis, the in-house training provided to the Applicant does not, of itself, suggest the existence of an employment relationship. Rather, this training simply enabled the Applicant to familiarise herself with, and to maintain, high standards of clinical service provision at Headspace. It was one measure by which the Respondent could ensure that clinical services would be generally provided in a way that did not expose it to additional risk and to ensure the Applicant understood their expectations so that she could meet her duty of care to clients.
Goodwill
[44] The Respondent submits that it is well established that in cases where a medical professional conducts their own business and pays fees to the owner of the medical centre for the use of the premises and for administrative support, both the medical professional and the medical centre have a separate goodwill in the two business being conducted from the same premises. 39
Is the Applicant operating her own business?
[45] The Respondent refutes the suggestion that the Applicant never held a business profile or operated under her own provider number. As noted previously, the Applicant advertised her psychology services under her LinkedIn business profile and has held and operated under two separate MPN whilst providing services at Headspace. The Respondent says that following the Full Federal Court decision in Jamsek v ZG Operations Australia, 40 the test for employment does not necessarily rest on whether the Applicant was operating her own business. In that case, Perram J stated:
“[A]lighting upon the question of whether someone is working in their own business may have a tendency to cause confusion in an area which is already replete with traps for the unwary. This Court has, therefore, affirmed that the question which is to be asked and answered is whether the person is an employee and not whether the person is conducting their own business.” (emphasis added)
[46] Alternatively, the Respondent submits that the fact the Applicant had been advertising herself on LinkedIn as a self-employed psychologist for the past three years, together with the factors outlined above, clearly indicate that the Applicant was operating her own business.
Evidence of Marilyn Hunter
[47] Marilyn Hunter is employed by the Respondent as the Administration Team Leader at Headspace for Southport and Upper Coomera and is responsible for negotiation, preparation and renewal of service provider contracts under which various allied health professionals (Private Practitioners) are engaged to provide services. It is Ms Hunter’s understanding that private practitioner psychologists are engaged as contractors, not employees.
[48] Ms Hunter’s evidence was that the Applicant was first engaged as a private practitioner psychologist at Headspace Southport on 2 February 2018. The Applicant had previously been employed as a salaried staff member working at the Southport Office as a clinician for the Youth Early Psychosis Program before commencing as a private practitioner. Ms Hunter advised that she met with the Applicant prior to her start date as a private practitioner to complete the requisite orientation.
[49] Ms Hunter stated that the Applicant was not required to use Headspace’s calendar and billing software, Pracsoft, as she was not a salaried staff member. Instead, it was Ms Hunter’s role to create the Applicant’s Pracsoft calendar days and times based on the Applicant’s verbal directions about her availability. As the Applicant had previously been a salaried staff member, Ms Hunter explained the difference between being an employee and being a private practitioner to her, including:
• the Medicare billings procedures which were completed daily by administrative staff on the Applicant’s behalf;
• advising the Applicant of the 20% Administration Fee; and
• advising the Applicant of the Medicare payment structure whereby:
• payments are made from Medicare to the Respondent;
• fortnightly Tax Invoices would be created and issued to the Applicant; and
• payments of the amount received from Medicare, less the Administration Fee, would be made to the Applicant on a fortnightly basis.
[50] Ms Hunter advised that she revised with the Applicant the operational sections of the Private Practitioner Handbook. Ms Hunter also issued the Applicant with a “New Practitioner Details Form” so she could provide information on her ABN, contact and next of kin details. This was completed by the Applicant on 5 December 2017. Ms Hunter further provided the Applicant with a copy of her contract on 6 December 2017, which the Applicant signed and returned on 17 December 2017. This was then emailed to the Respondent’s executives for counter signature. A fully executed copy was provided to the Applicant shortly thereafter. Ms Hunter explained that private practitioner contracts are renewed annually, if agreed.
[51] The Applicant was paid by the Respondent’s finance department once funds were received from Medicare for the Applicant’s bulk billed sessions. The Fortnightly Recipient Created Tax Invoices were generated by the finance department and sent to her. Either Ms Hunter, or Macey Prior, Senior Administration Assistant, emailed a copy of the Applicant’s tax invoices to her fortnightly. The Applicant also received monthly payments from the Respondent for sessions completed through the Psychological Services Program.
[52] Ms Hunter further advised that the Applicant was required to and did send her updated copies of her AHPRA registration and insurances each year which she needed to maintain to continue practising as a private practitioner at Headspace.
[53] Ms Hunter advised that the Applicant transferred from Southport to Upper Coomera on 13 July 2020. The Applicant was required to nominate her periods of availability so that the Respondent could book her appointments. The Applicant made changes to her availability on several occasions. For example, in an email sent by the Applicant on 14 July 2021 to Ms Hunter, the Applicant stated she would be unavailable to work between 26 July 2021 to 2 August 2021. Similarly, by email on 18 April 2018, the Applicant informed Ms Hunter and others that she wanted to take on 10 more clients and so wished to open another day. The Applicant specified the days and times she wished to work, including the times and duration of her breaks.
Evidence of Surender Sharma
[54] Surender Sharma is the Head of Finance for the Respondent. His role includes overseeing the arrangements for reimbursing private practitioners with the Respondent’s funds received from Service Australia or Medicare (for the provision of bulk billed medical services) and Gold Coast PHN (for the provision of psychology services in its PSP Session). He described the process of reimbursing private practitioners as follows:
• the administration team sends the set amount for payment to Services Australia/Medicare to be paid for each service provided to clients for each practitioner;
• the administration team gives the finance team information about the services provided;
• the finance team invoices the relevant body for the service;
• Medicare or Gold Coast PHN pay the billed amount to the Respondent; and
• the Respondent deducts the Administration Fee payable by the practitioner from the billed amount and forwards the balance amount to the relevant practitioner fortnightly (for Medicare) or monthly (for Gold Coast PHN).
[55] Mr Sharma provided a list of Bulk Billed Amounts received from Medicare and Gold Coast PHN for the Applicant, the Administration Fees deducted, the GST payable and the balance paid to the Applicant from 12 July 2020 to 22 August 2021. Put briefly, the payment paid by Medicare varied each fortnight, going as low as $137.67 or as high as $2,831.60. Similarly, the payments for each month paid by PHN varied from $228.80 to $4,004.
[56] The finance team collates a list of clients attended by each practitioner every fortnight for Medicare, or month for Gold Coast PHN, reconciles this list with payments received by the Respondent and generates Recipient Created Tax Invoices (RCTI) for each practitioner. A copy of an RCTI is, along with a list of the clients to which the invoice relates, provided to the practitioner every fortnight (or month as the case may be) and payment is made into their nominated bank account. Practitioners are required to check the RCTI and list of clients and advise the finance team of any anomalies.
[57] Apart from these reimbursements, Mr Sharma’s evidence was that to the best of his information, knowledge and belief, the Applicant does not receive, and Mr Sharma has not been required to approve, any wages or salary paid by the Respondent.
Respondent’s closing submissions
[58] The Respondent submits that pursuant to s.591 of the Act, the Commission is not bound by the rules of evidence or procedure. Further, the Commission is entitled to inform itself as it considers appropriate pursuant to s.590 of the Act. While not bound by the rules of evidence, the Respondent notes that the Commission must ensure that any decision must be based on evidence of rational probative force. 41 Any evidence used to inform the mind of the Commission must take into account the requirements of natural justice.42 The Respondent points out that the only evidence led at the jurisdictional hearing was the evidence of the Respondent. The cross examination of the Respondent’s witnesses on behalf of the Applicant was extremely limited and did not extend in any way to putting the case to either witness that the Applicant was an employee of the Respondent at the relevant time or that the contract was in some way a sham contract.43
[59] Further, the Respondent states that despite being invited on a number of occasions by the Commission during the hearing, the Applicant’s legal representative declined to lead evidence from the Applicant or any other witness, and no outlines of evidence were filed on her behalf. Noting s.590 and s.591 of the Act, the Respondent submits that careful consideration of the conduct of the case, the evidence (not) provided and the weight to be given to evidence led, in particular:
• not having put the Applicant’s case to the witnesses for the Respondent, the Applicant cannot now invite the Commission to disbelieve any evidence of the Respondent’s witnesses in relation to factors not put to them; 44
• the only documents in evidence before the Commission were those tendered on the Respondent’s behalf. The Respondent notes that this did not include the Private Practitioner Handbook. The only evidence before the Commission in relation to the Handbook was that given by Ms Hunter, who stated that it was a guide and not a requirement of private practitioners;
• where the Applicant seeks to rely on documents not placed in evidence, either these should be:
• ignored on the basis that despite being offered the opportunity to place them in evidence, they were not; or
• given very little weight against the Respondent because the Respondent’s witnesses were not provided with an opportunity to comment on them;
• conversely, the Respondent was prevented from putting its case to the Applicant and testing her in cross-examination. That is particularly so in relation to:
• the terms of the Applicant’s resignation letter, which clearly indicate her intention to become an independent practitioner, including as a private practitioner with the Respondent’s Southport office;
• the content of the Applicant’s LinkedIn profile, noting it was created after the termination of the Final Contract but clearly states the Applicant considered herself as self-employed for the prior three years;
• the Respondent submits that where the Commission is of the opinion it will inform itself as to facts and matters before it based on documents provided as attachments to documents filed by either party:
• any interpretative ambiguity should be resolved in favour of the Respondent;
• greater weight ought to be given to factors in favour of the Respondent; and
• lesser weight ought be given to factors against the Respondent.
[60] Any attempts to define the arrangements as a new form of “trilateral work arrangement” should be refused. The Respondent’s arrangement with Headspace is to facilitate provision of professional services to youth at a common location, not to provide the actual professional services. However, if the Applicant is a worker, the Respondent submits that for the following reasons the Applicant should be construed as an independent contractor.
[61] The Respondent states that careful consideration of the Final Contract reveals that it is the Respondent that supplied services to the Applicant, in addition to providing a licence to use a room at the Respondent’s facility. The Respondent submits that it is more akin to provision of a serviced office than a services contract. Medicare paid the Applicant for services provided by her to patients. The Respondent argues that the services provided by the Respondent to the Applicant were administrative in nature, looking after bookings and intake for patients, as well as acting as the agent for the Applicant in dealing with Medicare, seeking and receiving payments on behalf of the Applicant. The Final Contract also clearly maintain the independence of the parties and states that no employment relationship is created. 45
[62] The Respondent claims that in return for the provision of the services and access to consultation rooms, the Applicant paid an Administration Fee, which was calculated by reference to a percentage of the payments received on behalf of the Applicant from Medicare. A RCTI was provided by the Respondent, detailing the payments received from Medicare. GST was included in relation to the administration fee and the Applicant held her own ABN and MPN. The Respondent advised they operated a completely separate payroll system in relation to employees. After the Applicant’s resignation in December 2017, the Applicant was no longer paid through the payroll system. Mr Sharma’s evidence was that no PAYG taxation payments were made on her behalf. The taxation arrangements clearly indicate that, if the Commission does consider the Applicant a worker, the arrangement was that of an independent contractor. 46
[63] The Respondent submits that the Applicant was entirely in control of the amount of work undertaken, the number of patients seen and the days she worked. The only requirement placed on the Applicant in relation to her work hours was that they be during the centre’s opening times and for a minimum number of sessions to ensure efficient use of resources. The Applicant was required to pay for her own professional registrations and insurance. This is consistent with an independent contractor relationship. 47
[64] While the Applicant was required to use the Respondent’s computer systems for patient record keeping and billing purposes, the Respondent submits that this was incidental to the operation of the Headspace centre and ensuring the patient could obtain ongoing care. Further, while intellectual property in patient records vested in the Respondent, the Applicant was provided with the right to request a copy of those records for ongoing professional use at any time. Should the Commission inform itself through consideration of the Private Practitioner Handbook, the Respondent submits that the content of the Handbook is not reflective of any control that supports an employee/employer relationship. The content provides a private practitioner with information on service availability and occupational health and safety, guidance on use of the centre’s records and computer systems, access to orientation modules and information regarding the billing process, details of the Headspace program and its links to other services and resources for referral of patients to other disciplines. The Respondent submits that this information is ancillary and focused on allowing the practitioner to efficiently conduct their practice within the Headspace centre.
Applicant’s material
Submissions
[65] The Applicant is a 39-year-old woman who was employed by the Respondent as a psychologist under several employment contracts from March 2013 until 10 August 2021 for a total employment period of approximately 8.5 years. Throughout her lengthy tenure, the Applicant had an unblemished employment history, was never subject to performance management, disciplinary action, or otherwise notified that she was underperforming.
[66] The Applicant says that around December 2017 and January 2018, she began operating under the title of an independent contractor. On 15 July 2021, the Applicant received a letter from the Respondent notifying her of the Respondent’s expectations concerning general engagement with stakeholders. On 10 August 2021, the Applicant was asked to attend a meeting with representatives of the Respondent to discuss the potential termination of her employment for which she had received no prior notice. The Applicant says this meeting resulted in her immediate dismissal and she was escorted out of the building.
[67] In a letter dated 10 August 2021, the Respondent confirmed the Applicant’s termination of employment in writing, effective immediately. The letter stipulated:
“10 August 2021
Dear Ms. Jansen
The purpose of this letter is to notify you that you have not met your obligations as a practitioner with Lives Lived Well as set out in Clause 7.1 of the Service Provision Contract, dated June 24 2021. On that basis, I have determined to terminate the agreement under Clause 15.3 Termination with immediate effect.
In a letter from Emily Hughes on July 15, you were notified of Lives Lived Well’s expectations of your conduct. Expectations concerning professional boundaries were clearly outlined. You were also advised that should you breach these expectations; this could result in the termination of your service agreement with Lives Lived Well.
I have been notified that you have subsequently breached Lives Lived Well expectations by linking with several clients outside regular business hours, unrelated to any therapeutic activity. As a result, your actions in July 2021 are potentially damaging to clients and Lives Lived Well.
Given this, I believe your behaviour to be intentional and not capable of remedy. As such, I do not have confidence that you will uphold your professional and contractual obligations. This letter, therefore, serves to confirm the termination of your contract of service with Lives Lived Well.
Furthermore, I wish to advise you not to have contact with any headspace Upper Coomera clinic clients following this termination. I would also remind you that you remain bound by your obligations as set out in Clause 15.4 upon the termination of this agreement.
Yours sincerely
…
Mitchel Giles
Chief Executive Officer
Lives Lived Well”
[68] The Applicant submits the mere fact that the Respondent labelled the Applicant as an independent contractor is not determinative of the actual legal relationship between the parties. The Respondent cannot alter the true nature of its relationship with the Applicant by simply inserting a different label, as was stated by Gray J in Re Porter. 48 Similarly, as was articulated in Abdalla v Viewdaze,49 an express term that the worker is an independent contractor is not effective if it contradicts the terms of the contract as a whole. In other words, parties cannot deem their relationship to be something it is not. A court must look to the real substance of the relationship.50
[69] The Applicant recalls that in distinguishing between an employee and independent contractor, Bromberg J considered it necessary to identify each role of the parties, their functions and nature of the interactions which constitute their relationship. 51 The Applicant states that the decision in French Accent contains the well-established common law principles in determining whether a worker was an independent contractor or an employee, which the Applicant relied on for the purposes of their submissions.
[70] The Applicant refers to Hollis v Vabu Pty Ltd, where the High Court held that the distinction between an employee and an independent contractor is rooted fundamentally in the difference between a person who serves their employer and their business, and a person who carries on a trade or business of their own. 52 The Applicant states that when the facts and substance of the relationship are considered as a whole – and in light of the indicia outlined in French Accent53– it is apparent that the relationship between the Applicant and Respondent is that of an employee and employer.
Working relationships
[71] The Applicant submits she has only ever worked for the Respondent as a psychologist during the employment period and has never held a business profile, operated under any other company name, provider number, or in any other capacity other than as a representative of the Respondent.
Control
[72] The Applicant submits the Respondent retained a significant degree of control over several key factors of the Applicant’s work such as the manner, location and hours of work.
[73] The Applicant claims her interactions with Respondent were governed by the Handbook, which operates as an instructional manual dictating how the Applicant performed her duties. The Applicant asserts that the ordinary meaning of the word “handbook” as defined by dictionary.com is “a book of instruction or guidance”. A handbook is typically issued to employees as a central document outlining a company’s policies, culture, expectations, and practice methods. It also serves as a useful method of inducting new staff into an organisation and a reference to maintain knowledge of workplace policies and procedures. The Handbook goes beyond a mere guide or policy manual and actively dictates the daily processes and practice methods to be used by the Applicant.
[74] The Applicant referred to the daily clinician processes, including the start and end of the day procedures, weekly task lists and information about how each counselling appointment is to begin. The Applicant claims she was also audited on a yearly basis to ensure she was following the Respondent’s internal and administration policies. The Applicant disagrees with the Respondent’s submissions that the Handbook placed minimal parameters around her otherwise unencumbered practice. The Applicant submits the Handbook is so extensive and instructional that it cannot reasonably be held to constitute obligations regarding due care and professional conduct.
[75] The Applicant claims that the Handbook contained the Respondent’s general policies and procedures which governed her performance, work, and general and professional conduct. The Applicant states that it governed every aspect of her work and left her with very little control or independence in determining how to perform her work and duties as a psychologist.
[76] The Applicant further submits that the Handbook determined the circumstances in which the Applicant was permitted to charge fees, the contents and timeframes regarding client records, data entries for measuring outcomes, opening hours, the letter templates to be used, discharge checklist, closing of client files, how to manage clients at risk of suicide, safety plan templates on how to report child abuse and how to respond to official requests for information.
[77] The Applicant asserts that the requirement in the Handbook to ensure that clients completed the HAPI survey for the purpose of allowing the Respondent to continuously collect client data was mandatory for every appointment. The Applicant says she could not refuse this requirement, despite her client’s objections and obvious discomfort in complying. The inability to decide whether clients should complete these surveys removed the Applicant’s ability to independently apply her professional discretion and make decisions according to her own practices. The Applicant says that if she were truly a private practitioner, she would elect not to require her clients to complete the survey. She says this demonstrates that the Respondent retained full control over her practices and was not consistent with the work of a contractor.
[78] In respect of the obligation to maintain proper case notes, the Applicant acknowledges this is a regulatory requirement. However, she claims that requiring them to submit on a specific software within a specific timeframe related more to internal governance than industry practice. The Applicant asserts that the Handbook contains a step-by-step guide on the process to be followed when writing case notes, meaning the Respondent not only determines when and on what platform case notes are to be submitted, but also their contents and the manner in which they are to be written.
[79] The Applicant submits the Applicant is also required to correspond with stakeholders on the Respondent’s letterheads which demonstrates that she is promoting Headspace and herself as a representative of Headspace, rather than a private practitioner. It is thus difficult to suggest the Applicant practiced under her own name or generated her own goodwill.
[80] The Applicant acknowledges that it is a common model of engagement of using independent contracting arrangements utilising multi-disciplinary allied health professionals. However, the Applicant submitted that most policies and procedures enforced by the Respondent were unrelated to best practice or the regulatory requirements contained in the Health Practitioner Regulation National Law Act 2009 (Qld) (the National Law Act).
Tools and resources
[81] The Applicant claims that the Handbook outlined the platforms and software to be used for data entry and internal booking systems (Pracsoft), electronic medical record-keeping (Mastercare) and data collection policies (Hapi).
[82] The Handbook states that it is expected that within the first month of new “staff” entering the Headspace service that they commence the “Welcome to Headspace Orientation Package”. The Applicant was also expected to complete the orientation. The Handbook also contains an extensive orientation checklist which, the Applicant submits, is consistent with that provided to employees. The Handbook also referred to the practitioners as staff, which, the Applicant submits if given its ordinary meaning, would mean employees.
[83] The Applicant rejects the Respondent’s submissions that the professional services she provided are indicative of a contracting relationship. The Applicant states that she has held either full or provisional registration as a psychologist for the majority of her engagement with the Respondent, including while employed as a functional recovery clinician from March 2013 until 1 December 2017.
[84] The Applicant contends that given the nature of her work, software is equivalent to ‘tools and equipment’, and the fact that the Respondent provided for and determined the use of the software corroborates her claim that she is an employee. The Applicant advised that the Respondent provided in-house training to the Applicant. The purpose of the in-house training was for a company to provide training that involved its own expertise and resources and is highly specific and tailored towards employees learning the operations of that particular business. The Applicant submits that companies typically offer in-house training to employees for development and to improve an employee’s performance across topics specific to the workplace.
[85] Similarly, the Applicant asserts that the fact that the Respondent provided and maintained the premises such as the counselling rooms, lunchrooms, waiting areas and all equipment used, or required to be used, by the Applicant is indicative of an employment relationship. That is particularly so as she was not permitted to use her own computer for telehealth appointments as the Respondent did not have the required licence for remote login.
Delegation of work and payment
[86] The Applicant asserts that regarding clientele, the Respondent utilised a client intake team who determined which practitioner saw each client. The Applicant was further required to see pre-booked clients and sign day-sheets completed on the Applicant’s behalf that were billed accordingly. The Applicant asserts that the intake team would populate the day-sheet to determine the Applicant’s pay for the relevant cycle. She says this process demonstrates her complete lack of control over the work she was to perform. The Applicant states she was paid periodically in accordance with the Respondent’s pay cycle as opposed to providing an invoice after the completion of tasks or work.
Goodwill
[87] The Applicant claims that she did not practice under her own name and the vast majority of referral letters were not addressed to her personally, but to Headspace. The Applicant was not able to advertise her own service in the Headspace centre and did not create her LinkedIn profile until 16 August 2021, after the date of termination. Any complaints or positive feedback received by the Applicant were to be provided via the Respondent’s website and not to the Applicant directly, which she asserts is also indicative of an employee and employer relationship.
[88] The Applicant states that all correspondence was undertaken through the organisation and all letters and emails were sent using the Headspace letterhead. No practitioner was provided with an independent email address to differentiate themselves from Headspace.
[89] The Applicant referred to Hollis v Vabu, where the Court asked itself, “to whose business does any goodwill created by the economic activity ensure?”. 54 The Applicant submitted that it is quite obviously, in this instance, the Respondent’s as the Applicant does not even practice under her own name and therefore does not benefit from any business related to her name, brand or reputation.
Intellectual property
[90] The Applicant states that the all client records and intellectual property in the client records including practice documents and demographic data, are owned by the Respondent and immediately vest in the Respondent upon creation. The Applicant submits that private practitioners are legally required to maintain access to client records for seven years, and as the Respondent owned all client records and intellectual property therein, it cannot be said that the Applicant operated as a private practitioner.
[91] The Applicant states that the Respondent would only hold access and ownership of the Applicant’s client records if she were an employee as the Respondent would then assume the risk. The Applicant submits this is consistent with an employee-employer relationship. In the Applicant’s Termination Letter, the Respondent clearly states that the Applicant is not to have contact with any Headspace clients, showing that the Respondent’s position was that all clients remained under its control.
Client allocation
[92] The Applicant states that the allocation of clients was not entirely based on the Applicant’s availability or skillset. On 27 February 2020 and 23 November 2020, the Applicant was advised by the Primary Access and Intake Team Leader that practitioners would start receiving one or two additional clients per week, despite objections from some of the practitioners including the Applicant that they were at full capacity.
[93] The email from Emily Hughes, Team Leader on 27 February 2020 relevantly stated:
“… Some of you may recall the below email, where the feedback received indicated that private practitioners are happy with the arrangement that if young people allocated to you have been sitting on the waitlist for longer than one month, that it is ok to book them in for an appointment time. Hope has just advised me that there are a few young people meeting this criteria. Therefore, you may see 1 or 2 extra young people booked in to your calendar over the next coming weeks, even if you have stated you are at capacity.
Please be advised that these YP have been allocated to you based on their presentation, your experience and ‘best fit’, scope of practice or appt availability.
If you have any concerns, please come and see me…”
[94] The email from Catherine Scott, Team Leader on 23 November 2020 further stipulated:
“…As you are well aware we are experiencing high levels of referrals increasing demand for service. We have not been able to find any more private practitioners (due to high demand [ineligible] replace some who have moved on or those who have reduced hours due to their own private practice flourishing.
Therefore we are having to implement a waitlist for the majority of you and particularly people requesting late appointments.
This means we will allocate clients to you and they will be placed on a waitlist for 4 weeks before being offered a next available appointment. We can’t have clients on a waitlist for extended periods hence the 4 week period. They will not be assigned to you while on the waitlist only when we book them after the 4 weeks.
If we notice you have empty spots we will book people in from the waitlist if you don’t have any on your cancellation list (see admin if you need to implement a cancellation list).
Now is a good time to go through your case load and close inactive files.
I would like to thank you for all your dedication to headspace. I understand many of you have exceptionally large case loads and this is most likely a bit overwhelming. Hopefully we can work through this crisis and find a happy medium soon…”
[95] The Applicant submits that, in effect, this required the Applicant to leave two sessions open each week due to the intake waitlist. The Applicant argues this is inconsistent with the Applicant being a private and independent practitioner as the Respondent was able to dictate the Applicant’s caseload and assign her additional clients through the intake team despite being at full capacity.
Is the Applicant an employee?
[96] The Applicant submits that given the significant degree of control the Respondent had over the nature and manner of the Applicant’s work (by virtue of the Handbook and the allocation of clients), the Applicant cannot be said to have had any independence in the conduct of her operations and instead served her employer in the furtherance of their business. The Applicant says she does not carry on her own business and spends an insignificant portion of her pay on business expenses, predominately her registration fee and insurances.
[97] The Applicant further submits that she does not have a separate place of work, has only one income and does not advertise her own services to the work at large. According to the Applicant’s Licence and Services Agreement dated 24 June 2021 (referred as the Final Contract by the Respondent), the Applicant had a Probation Period of 12 weeks, a status typically given to new employees for the company or business to determine whether they are a suitable fit for the position. The Applicant asserts that a probation period would not be necessary or suitable for an independent contractor as they are responsible for controlling their own work.
[98] The Applicant advised that the Contract provided for permitted times of work of Monday to Friday, 9:00am to 5:00pm, days and hours that are highly consistent with those of a typical full-time employee. The Applicant proffers that the common law position is that the employer typically controls the hours of work required of employees whereas an independent contractor will retain control over the work is performed. The Applicant asserts that the evidence demonstrates that the Applicant was subject to supervision and control and had little independence in determining the way work was to be performed.
[99] The Applicant submits that the behaviour and course of conduct between the parties is consistent with that of an employee-employer relationship in that the Applicant is working in and for the Respondent’s business as a representative of that business. The Applicant argued that it cannot be said that the Applicant is providing work as a representative of her own business as all correspondence was required to be sent using the Headspace letterhead and in accordance with the Respondent’s templates.
[100] The Applicant claims that the nature of the interactions between the parties were largely governed by the Handbook which dictated how the Applicant was to perform her duties and conduct her appointments. The Applicant submits that the totality of the relationship clearly demonstrates an employee-employer relationship, and that the Respondent has over-emphasised the importance of the label given to the relationship in the Final Contract.
The Applicant’s closing submissions
Goodwill and reputation
[101] The Applicant referred to On Call Interpreters and Translators v Commissioner of Taxation in respect to Bromberg J’s consideration that a common intangible asset of a business is its name, brand, reputation and goodwill. 55 The Applicant is obliged under cl 7.1.5 of the Final Contract to conduct her practice in a manner which maintains and enhances the reputation and goodwill of Headspace, including refraining from any conduct which might cause a loss of confidence in Headspace.
[102] The Applicant questions how she could be considered an independent contractor when the requisite independence is absent. The Applicant is contractually obliged to ensure that her practice not only maintains, but also promotes the goodwill and reputation of Headspace. The Applicant submits that if she was truly an independent contractor, the only business to benefit from any enhancement to its goodwill or reputation would be hers. Further, if the Applicant was an independent contractor, her engagement with the Respondent would be benefiting the goodwill and reputation of an organisation that offers the same services, thereby promoting a ‘rival business’ over her own.
[103] The Applicant submits that in the circumstances it is unreasonable to expect the Applicant to retain clientele for her own alleged business when she is contractually obliged to conduct her practice in a way that enhances the goodwill and reputation of the Respondent. As it was mandatory for the Applicant to promote the goodwill and business of Headspace, the Applicant claims it cannot then be concluded that the Applicant was acting independently. Consequently, the Applicant was at the material time, an employee of the Respondent.
Email signature
[104] The Applicant points to her email signature which contains the Headspace’s logo, telephone and facsimile numbers and website link. The Applicant submits that any reasonable person in receipt of an email from the Applicant would assume that she was an employee of Headspace and would not distinguish her from the organisation. Further, she claims that she was advertising the Respondent’s business (and not her own) in all her communications. The email address itself is attributable to Headspace, which she says indicates to the world at large that she was employed by them. By using their email address, she was further developing their brand and advertising their business rather than her own.
[105] The Applicant submits that an independent contractor would use their own email address that represents their business to distinguish themselves from other organisations within the same industry. Independent contractors, by the very nature of their role, would not be accustomed to using the email address of another organisation. By contrast, it is common (if not mandatory) for employees.
[106] The Applicant has been locked out of her Headspace email address and account. She asserts that it would be unusual for anyone other than the independent contractor to hold the authority to withhold access to their own email address, unless that person were an employee. The Applicant argues that the ability to prohibit her access to the email address is consistent with the powers available to an employer over an employee but not an independent contractor.
Selection of appointments and hours
[107] The Applicant notes that it is the Respondent’s position that the Applicant was able to select the number of appointments she received. However, in an email dated 23 November 2020, the Applicant and others were advised that the practitioners would begin receiving one or two additional clients per week, despite her objections that she was at full capacity. The Applicant argues this demonstrates that she did not retain full control over her appointments. An independent contractor would retain more control over their own workload and would not be allocated additional clients by an ‘external organisation’.
[108] The Applicant refers to the requirement that the Applicant only use the Licenced Area during the Permitted Times, being 9:00am to 5:00pm, Monday to Friday. The Applicant states that in the Termination Letter, the Respondent claims that the Applicant was in breach of her expectations by linking with several clients outside of regular business hours. The Applicant submits that if she were truly an independent contractor, she would not have regular business hours, and as the Respondent suggested, would be free to set her own hours.
Client files
[109] The Applicant states that the Australian Psychological Society (APS) provides a useful overview on clarifying private contracting and employment arrangements for psychologists. 56 They wrote that if a psychologist is employed in a true employee-employer relationship, the management of the files will be the responsibility of the practice. The Applicant contends that in accordance with the APS Code of Ethics,57 psychologists are responsible for ensuring appropriate management of their client files. The Final Contract provides that all client records and intellectual property therein are owned by the Respondent and vest in the Respondent immediately upon creation. In order to obtain access to or copies of client records, the Applicant must request this from the Respondent and it must be for medico-legal purposes.
[110] The Applicant refers to the Termination Letter, noting that the Respondent also barred the Applicant from making any contact with Headspace clients, showing that the Respondent’s position was that all clients remained under their control and not the Applicant’s. This would be typical in an employee-employer relationship. The Applicant submits that if she was an independent contractor, she would assume all risk by owning her own client records and would need to ensure appropriate management as required for private practitioners under the APS Code of Ethics.
Headspace letterhead
[111] The Applicant advised that in this same publication, in response to an FAQ that asked whether using the organisation’s letterhead is unusual for a subcontractor, the APS writes that the more restrictions that are placed on a subcontractor require them to hold themselves as part of a larger organisation, the greater the likelihood that the employee is not involved in a true contractor relationship but is more probably an employee. The Applicant submits that her primary method of communication is on a Headspace email address and much of her practice is governed by the Handbook which determines the systems and process to be performed.
[112] The Applicant advised that she must also communicate with clients and external stakeholders, including general practitioners, on the Headspace letterhead. This has the practical effect of the Applicant holding herself out as part of a larger organisation and increasing the likelihood that she is not involved in a true contractor relationship but is more properly characterised as an employee.
Consideration
[113] I have considered the evidence and submissions provided by each party.
Terms used by the parties
[114] The contracts under which the Applicant was engaged from 1 January 2018 onwards, including the Final Contract that was operational at the time of her termination, described the Applicant as an independent contractor. It is important to note that her original engagement in that capacity came after she had worked as functional recovery clinician for the Respondent for several years. It is uncontroversial that in her former role, the Applicant was an employee. The question is whether she was an employee from 1 January 2018 onwards.
[115] The parties’ true understanding of the nature of their relationship after 1 January 2018 might be gleaned from the correspondence between them. On 1 December 2017, when the Applicant resigned from her position as a functional recovery clinician, she penned a letter announcing her resignation, thanking the Respondent and its staff for her time there, noting that she was in need of new challenges and responsibilities and intended to use her clinical skills as a psychologist which she had not been able to do in her current role. Most significantly, the resignation letter stated, “Although FRT is being redesigned and is going in the one-on-one therapy direction, I feel that this is something that I can quite easily achieve as an independent practitioner as well. I still look forward to taking on a private practice opportunity at Headspace Southport and would also be more than happy to continue to be on the casual roster with the MATT Team.” Read plainly, this letter clearly demonstrates that the Applicant is resigning from her employment but hopes to maintain a working relationship with the Respondent as an independent practitioner engaged in private practice. That is, as an independent contractor.
[116] The parties then entered into a service provision contract which indicated that the Respondent was engaging the Applicant as a private provider of psychologist services at Headspace Southport. The first of these contracts began on 1 January 2018 for a six month period. There were three subsequent contracts between the parties which governed their engagement until 13 July 2020, or would have done so, had the Applicant not been terminated prior. The final contract stipulated that the Applicant’s services would be provided only at the newly opened Upper Coomera location. Each of these contracts stated that the Applicant was acting independently of the Respondent. In fact, the final contract went so far as to provide that she only had a licence to occupy premises which came with a right to provide psychology sessions to Headspace clients.
[117] It is abundantly clear from the written documentation between the parties that the Applicant was not an employee from 1 January 2018. That said, the authorities make it clear that my inquiry cannot stop there. I will turn to each of the other indicia and consider whether they displace the nature of the relationship set out in the documentation.
Other indicia
The Applicant’s profession
[118] It is uncontroversial that the Applicant is a psychologist who held the relevant professional qualifications and registrations to provide the psychologist services for which she was engaged by the Respondent from 1 January 2018. She was responsible for maintaining her own registration under the Health Practitioner Regulation National Law and registration with Medicare for the purposes of the Health Insurance Act 1973 (Cth).
Control
[119] The level of control that the Respondent possessed over the Applicant’s work is difficult to apprehend. In one sense, the Respondent had very little control. Indeed, the clinical nature of the Applicant’s work and the expertise that she had in the area, meant that in terms of the psychological services she provided, the Applicant was completely free to exercise her professional judgement.
[120] I accept that the Applicant was required to conduct her work (as it related to Headspace) from the Respondent’s premises, though the evidence suggests that she still largely retained control over when and for how long she worked each week, subject to the operating hours of the premises and the requirement in the contract that she provide at least two sessions per week to ensure efficient use of the Respondent’s resources and client serviceability. Once the Applicant had specified her availability, the Respondent’s staff would allocate clients to her. I accept that the contract did not prohibit the Applicant from refusing any appointments allocated to her, though she was required to notify the Respondent of any such refusal. This is hardly unusual given that the Respondent’s staff communicated with the clients who would need to be rescheduled if the Applicant was absent. Indeed, that was part of the Respondent’s service that the Applicant paid for by virtue of the Administration Fee.
[121] The one piece of evidence that places some doubt over this understanding is the Respondent’s requirement in more recent times that the Applicant, and other psychologists, allow for two additional sessions per week to combat the growing waitlist. While I accept that this sits at odds with the Respondent’s narrative that the Applicant had complete control over her workload, I am not satisfied that this alone warrants a finding that she was an employee rather than an independent contractor.
[122] In respect of training, it is undisputed that the Applicant was provided with in-house training. While this is often required of employees, it is also not unusual for independent contractors to be required to complete an induction. Accordingly, I do not consider the presence of induction training as being indicative of the relationship between the parties. Similarly, the existence of a Handbook that was provided to all staff and contractors does not, of itself, evince control. The Applicant says it governed her practice because it set out the company’s policies, culture, expectations, and practice methods. However, much like the training that was provided, this document arguably served to set expectations and provide uniformity within the service without strictly mandating how the Applicant went about her work.
[123] One of the matters over which the Applicant says she has no control was the completion of the HAPI survey. She said that had she been truly independent, she would not have completed the survey. While that may be the case, the Applicant gave no evidence to suggest that she had refused to comply and was told she had to. The Applicant also points to the fact that the intellectual property in respect of client records vested in the Respondent as being indicative of an employment relationship. However, the Respondent quite rightly states that the contract between the parties indicates that any intellectual property that the Applicant acquires is assigned to the Respondent. This occurs because of an agreement freely entered into by the Applicant. In any event, the fact that a principal maintains control over the records is not enough to displace the other indications that the Applicant was engaged as an independent contractor.
[124] The software used in respect of data entry and internal booking systems, electronic medical record-keeping and data collection policies – which the Applicant asserts are akin to the tools and equipment of her vocation – were provided by the Respondent. The Applicant asserts this is suggestive of an employment relationship. However, I am not satisfied that is the case. A portion of the Applicant’s earnings was paid to the Respondent as an administration fee. Arguably, the operation of these services and the physical premises is precisely what was encompassed in that fee.
Outside work and delegation
[125] The Applicant says that she did no other work for others. However, as the Respondent submits, that does not equate to her not having a genuine and practical entitlement to do so. The contract between the parties neither prohibits nor allows it. Had the Respondent sought to engage the Applicant’s exclusive service, one would think a prohibition (or at least a requirement of notification) would have been included in the contract. Similarly, the fact that the Applicant only rendered an average of 25 hours’ service per week would suggest that practically, she had the opportunity to perform work for others if she wished to do so.
[126] The Applicant could not delegate or subcontract her work. While in some circumstances this might suggest an employment relationship between the parties, one must also consider the clinical nature of the Applicant’s work. With that in mind, the Applicant’s inability to delegate or subcontract work is not determinative of an employment relationship.
Financial arrangements
[127] The Applicant’s evidence was that she was paid periodically in accordance with the Respondent’s pay cycle as opposed to providing an invoice after the completion of tasks or work. The Respondent disagreed. Their evidence was that the only payments made by the Respondent to the Applicant were the PBS Payments and PHN Payments (which were paid by way of reimbursement only). Additionally, the contract between the parties was silent in respect of income tax and it was never paid by the Respondent. The Respondent advised they have not withheld or remitted any PAYG tax from or in respect of the Applicant since she resigned in December 2017.
[128] The Respondent’s evidence was that the administrative fees, professional registration and insurance costs that the Applicant was entitled to maintain equates a significant portion of what she earned from her employment with the Respondent. Similarly, the Applicant was never paid for holidays or sick leave under the new arrangement. She was paid for services that she provided in accordance with her agreement with the Respondent. These factors clearly point towards the Applicant being an independent contractor.
Goodwill and the Applicant’s presentation to the world
[129] The Applicant submits that any goodwill generated by her services went solely to the Respondent’s business. As such, it was clear she was an employee because otherwise she would be generating goodwill on behalf of a company that was in direct competition to her own, personal business. That presents a simplified view of the goodwill generated by professionals. It is possible that the Applicant’s services at the Respondent’s premises generated goodwill both for the Applicant independently and for the Respondent’s business. There are several authorities which indicate that, particularly with respect to a medical professional conducting services independently of (but within) a medical centre, goodwill in both businesses can be generated. 58
[130] As to the Applicant’s presentation to the world at large, she sent correspondence under the Headspace letterhead, referrals were generally made to Headspace directly (as opposed to the Applicant herself) and she says, any complaints or positive feedback about the Applicant were to be provided to the Respondent and not her. Emails sent from the Applicant included an email signature with Headspace contact details and, she says, this would indicate to any reasonable person who received the email that the Applicant was an employee of Headspace. I accept that may be the case. Similarly, when the Applicant was terminated, she was deprived of access to her emails which would be uncharacteristic of someone operating their own because whose service provision contract was terminated. I accept that those factors might suggest an employer-employee relationship. That is so despite the fact that she was not required to wear a uniform or use business cards that left the impression that she was an emanation of the business.
[131] Interestingly though, the Applicant’s own LinkedIn profile identified her as having been a self-employed psychologist for the past three years, notwithstanding the fact she says this was created after her termination and thus after the events giving rise to this broader dispute commenced.
Conclusion
[132] I have considered each of the indicia set out in the authorities above. While there may be some factors which suggest that the Respondent exercised some degree of control over the Applicant, on balance I am not satisfied that they indicate the Applicant and Respondent were engaged in an employee-employer relationship. Nor do the indicia present in this case operate to displace the written agreement between the parties. In fact, most of the factors – particularly in respect of client care and the financial arrangements between the parties – are indicative of the Applicant being an independent contractor. I am therefore not satisfied that the Applicant was an employee within the meaning of the Act.
[133] The jurisdictional objection is upheld.
[134] Accordingly, I order that the application be dismissed.
DEPUTY PRESIDENT
Printed by authority of the Commonwealth Government Printer
<PR736606>
1 Asciano Services Pty Ltd v Zak Hadfield [2015] FWCFB 2618.
2 Wellparks Holdings Pty Ltd t/as ERGT Australia v Mr Kevin Govender[2021] FWCFB 268 [48].
3 Joshua Kooger v Foodora Australia Pty Ltd[2018] FWC 6836 [64].
4 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16; Hollis v Vabu Pty Ltd (2001) 207 CLR 21; Abdalla v Viewdaze Pty Ltd (2003) 122IR 215; Roy Morgan Research Pty Ltd v Commissioner of Taxation (2010) 184 FCR 448; Jiang Shen Cai trading as French Accent v Michael Anthony Do Rozario[2011] FWAFB 8307.
5 Whittaker’s Building Supply Co (1963) 109 CLR 210, 217.
6 Hollis v Vabu Pty Ltd (2001) 207 CLR 21 [40].
7 Hall (Inspector of Taxes) v Lorimer [1992] 1 WLR 939; endorsed in Roy Morgan Research Pty Ltd v Commissioner of Taxation (2010) 184 FCR 448.
8 Marshall v Whittaker's Building Supply Co (1963) 109 CLR 210, 217 per Windeyer J approved by the majority in Hollis v Vabu (2001) 207 CLR 21 [40]; Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16.
9 Hollis v Vabu (2001) 207 CLR 21 [47] and [58].
10 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16.
11 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16.
12 “The parties cannot create something which has every feature of a rooster, but call it a duck and insist that everyone else recognise it as a duck”: Re Porter (1989) 34 IR 179, 184 per Gray J; Massey v Crown Life Insurance [1978] 2 All ER 576, 579 per Lord Denning approved by the Privy Council in AMP v Chaplin (1978) 18 ALR 385, 389.
13 AMP v Chaplin (1978) 18 ALR 385, 389.
14 Hollis v Vabu (2001) 207 CLR 21 [58].
15 AMP v Chaplin (1978) 18 ALR 385, 394.
16 Zuijs v Wirth Bros. Pty. Ltd (1955) 93 CLR 561, 571.
17 Hollis v Vabu (2001) 207 CLR 21.
18 Humberstone v Northern Timber Mills (1949) 79 CLR 389, 404 per Dixon J.
19 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16, 36.
20 Ibid.
21 Ibid 24.
22 Hollis v Vabu (2001) 207 CLR 21 [47] and [58].
23 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16, 24.
24 Queensland Stations Pty Ltd v Federal Commissioner of Taxation (1945) 70 CLR 539; AMP v Chaplin (1978) 18 ALR 385, 389.
25 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16, 24.
26 Hollis v Vabu (2001) 207 CLR 21 [39].
27 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16, 24.
28 Massey v Crown Life Insurance [1978] 2 All ER 576, 579 per Lord Denning.
29 Jiang Shen Cai trading as French Accent v Michael Anthony Do Rozario[2011] FWAFB 8307 [30].
30 WorkPac Pty Ltd v Rossato [2021] HCA 23.
31 [2011] FWAFB 8307 [30].
32 Jamsek v ZG Operations Australia [2020] FCAFC 119.
33 [2013] FWC 4502.
34 [2016] FWC 7252 [56].
35 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16, 36.
36 Fox v Kangan Batman TAFE Print S0253 (25 October 1999).
37 Jiang Shen Cai t/a French Accent v Do Rozario [2011] FWAFB 8307citingWilson and Dawson JJ in Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16.
38 [2020] FCAFC 122 [36].
39 Symbion Medical Centre Operations Pty Ltd v Alexander [2010] NSWSC 1047 [132]-[135]; Sidameneo (No 456) Pty Ltd v Alexander [2011] NSWCA 418 [66]; and Moffet v Dental Corporation Pty Ltd [2019] FCA 344.
40 [2020] FCAFC 119.
41 Re Pochi & Minister for Immigration and Ethnic Affairs (1979) 26 ALR 247, 256-7; See also Kostas v HIA Insurance Services Pty Ltd t/as Home Owners Warranty (2010) 241 CLR 390 [17].
42 Basic Wage and Standard Hours Inquiry 1952–53 (1953) 77 CAR 477, 506–7.
43 Fair Work Ombudsman v Avert Logistics Pty Ltd [2021] FedCFamC2G 153 [23].
44 Browne v Dunn (1893) 6 R 67 (HL); New South Wales v Hunt (2014) 86 NSWLR 226 [39].
45 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2020] FCAFC 122 [144]-[145].
46 Parker v HG Innovations Pty Ltd [2021] FCA 1051 [74]-[75].
47 Fair Work Ombudsman v Avert Logistics Pty Ltd [2021] FedCFamC2G 153 [52].
48 Re Porter (1989) 34 IR 179, 184.
49 Abdalla Viewdaze Pty Ltd t/a Malta Travel (2003) 122 IR 215.
50 Curtis v Perth and Freemantle Bottle Exchange Co Ltd (1914) 18 CLR 17, 25.
51 On Call Interpreters and Translators Agency Pty Ltd v Federal Commissioner of Taxation (No 3) [2011] FCA 366 [201].
52 Hollis v Vabu [2001] 207 CLR 21 [58].
53 Jiang Shen Cai t/a French Accent v Do Rozario [2011] FWAFB 8307.
54 Hollis v Vabu [2001] 207 CLR 21 [48].
55 On Call Interpreters and Translators Agency Pty Ltd v Commissioner of Taxation (No 3) [2011] FCA 366 [210].
56 Australian Psychological Society, ‘InPysch’ (2012) 34(1)
57 Australian Psychological Society, Code of Ethics (2007).
58 Symbion Medical Centre Operations Pty Ltd v Alexander [2010] NSWSC 1047, [132]-[135]; Sidameneo (No 456) Pty Ltd v Alexander [2011] NSWCA 418, [66]; and Moffet v Dental Corporation Pty Ltd [2019] FCA 344.
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