McCann and Secretary, Department of Jobs and Small Business

The applicant sought review of a decision by the Department of Employment (now Department of Jobs and Small Business) that he was ineligible for an advance under the Fair Entitlements Guarantee Act 2012 (Cth) (FEG Act). The original decision, affirmed on internal review, was that the applicant was a contractor, not an employee, of Leromar Holdings Pty Ltd. The applicant had applied for FEG assistance following the liquidation of Leromar Holdings.

The primary legal issue before the court was whether the applicant was an employee of Leromar Holdings for the purposes of the FEG Act, which requires an applicant to be a former employee to be eligible for an advance. This involved determining the true nature of the relationship between the applicant and the company, considering various factors indicative of an employment relationship versus an independent contractor arrangement. A secondary consideration was whether the applicant could be considered a de facto director, which might also affect his eligibility.

The court affirmed the decision of the Department, finding that the applicant had not established he was an employee. The court noted the absence of documentary evidence supporting an employment relationship, such as a contract, payslips, or PAYG summaries. Instead, payments to the applicant were characterised as consultancy fees, and he was not listed in the company's employee records. Furthermore, the applicant's own tax returns did not initially declare income from Leromar Holdings as employment income, with amendments made only after the company's liquidation. The director's evidence consistently indicated she did not regard the applicant as an employee, and the applicant's significant control over business operations, including expenditure, suggested a relationship beyond that of a typical employee. The court also considered the applicant's concurrent role as a director and shareholder of Dakota Investments Pty Ltd, which engaged in property development and sometimes contracted with Leromar Holdings, further complicating the nature of his engagement.