Mirik v Victorian WorkCover Authority
[2017] VCC 823
•22 June 2017
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMON LAW DIVISION | Revised Not Restricted Suitable for Publication |
SERIOUS INJURY LIST
Case No. CI-17-00101
| KADIR MIRIK | Plaintiff |
| v | |
| VICTORIAN WORKCOVER AUTHORITY | Defendant |
---
JUDGE: | HER HONOUR JUDGE K L BOURKE | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 8 and 9 June 2017 | |
DATE OF JUDGMENT: | 22 June 2017 | |
CASE MAY BE CITED AS: | Mirik v Victorian WorkCover Authority | |
MEDIUM NEUTRAL CITATION: | [2017] VCC 823 | |
REASONS FOR JUDGMENT
---
Subject: ACCIDENT COMPENSATION
Catchwords: Serious injury – pain and suffering and loss of earning capacity conceded – definition of “worker”
Legislation Cited: Workplace Injury Rehabilitation and Compensation Act 2013; Civil Procedure Act 2010
Cases Cited:Elazac Pty Ltd v Shirreff [2011] VSCA 405
Judgment: Leave granted.
---
APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr J H Mighell QC with Ms C A Kusiak | Zaparas Lawyers |
| For the Defendant | Mr B McKenzie | Hall & Wilcox |
HER HONOUR:
1 By Originating Motion dated 12 January 2017, the plaintiff sought leave to bring proceedings for damages for pain and suffering and loss of earning capacity in relation to a lumbar injury sustained on 4 July 2014 (“the injury”).
2 By letters dated 1 and 5 June 2017, Hall & Wilcox, solicitors for Allan Young Park (“Mr Park”) and Sylvia Bae, advised the plaintiff’s lawyers, Zaparas Lawyers, that serious injury had been conceded and that the only issue in dispute at the hearing on 8 June 2017 would be whether the plaintiff was a “worker” either at common law or a deemed worker under the Act.
3 The plaintiff swore an affidavit relating to this issue on 8 June 2017. He was cross-examined. Mr Park also swore an affidavit on 5 June 2017 and was cross-examined.
4 As the plaintiff relies on an injury sustained on 4 July 2014, any entitlements are governed by s5 of the Workplace Injury Rehabilitation and Compensation Act 2013 (“the WIRCA”).
5 The definition of “worker” is set out in s3 of the Act:
“worker means an individual—
(a) who—
(i) performs work for an employer; or
(ii) agrees with an employer to perform work—
at the employer's direction, instruction or request, whether under a contract of employment (whether express, implied, oral or in writing) or otherwise; or
(b) who is deemed to be a worker under this Act.”
6 The issue for determination is whether or not the plaintiff was a “worker” within the meaning of s3 of the Act.
7 Alternatively, the plaintiff relied upon paragraph (b) in relation to which Schedule 1 to the WIRCA provided:
“9. Contractors
(1) This clause applies if—
(a)an entity (the principal), in the course of, and for the purposes of, a trade or business carried on by the entity, enters into a contractual arrangement with another entity (the contractor) for the provision by the contractor of services (not being transport services within the meaning of clause 8) to the principal for reward in respect of a relevant period; and
(b)the provision of the services by the contractor under the contractual arrangement is not ancillary to the provision of materials or equipment by the contractor to the principal under the contractual arrangement; and
(c)at least 80 per cent of those services are, or are to be, pursuant to the contractual arrangement, provided by the same individual (the individual) being—
(i) the contractor; or
(ii)if the contractor is a partnership, an individual member of the partnership; or
(iii)if the contractor is a body corporate—a member, director, shareholder or employee of the body corporate; or
(iv)if the contractor is the trustee of a trust—a person who may benefit under that trust or is an employee of the trustee; and
(d)the gross income of the contractor that is, or is to be, derived from the provision of the services pursuant to the contractual arrangement is, or is to be, at least 80 per cent of the total gross income of the contractor earned from services of the same class provided by or on behalf of the contractor in the relevant period.
(2) This clause does not apply in respect of a contractual arrangement if the Authority determines that, in providing services to the principal, the contractor is carrying on an independent trade or business.
(3) The Authority may make guidelines as to the circumstances in which it may determine that a contractor, in providing services to a principal, is carrying on an independent trade or business.
(4) The Authority must ensure that guidelines made under subclause (3) are published and are generally available.
(5) If subclause (1) applies—
(a)the individual is deemed to be a worker in respect of the relevant period; and
(b)the principal is deemed to be the employer of the individual in respect of the relevant period; and
(c)the total amount paid or payable by the principal to the contractor under the contractual arrangement, less—
(i)the applicable prescribed percentage (if any); or
(ii)if there is no applicable prescribed percentage, the part of that total amount not attributable to the provision of labour—
is deemed to be remuneration.
(6) In this clause—
principal includes a group, or one or more members of a group, within the meaning of section 431;
relevant period, in relation to services provided under a contractual arrangement referred to in subclause (1), means—
(a)the financial year in which those services are, or are to be, provided; or
(b)if those services are, or are to be, provided in 2 consecutive financial years—
(i)the 12 month period beginning on the date on which those services are first provided pursuant to the contractual `arrangement; or
(ii)the 12 month period ending on the date on which those services cease, or are to cease, to be provided;
services includes results (whether goods or services) of work performed.”
8 If it was not accepted the plaintiff was a “worker” within the meaning of (a) and (b) of the definition, counsel for the plaintiff relied on the Civil Procedure Act.
9 Counsel for the plaintiff submitted that the overwhelming preponderance of the evidence pointed to the arrangement between the plaintiff and Mr Park as being one of employer and employee.[1]
[1]Transcript (“T”) 71
10 In his Claim for Compensation signed on 8 August 2014, which was later accepted, the plaintiff named Allan Park Rendering as the organisation paying his wages when he was injured.
11 Counsel for the defendant submitted however that the plaintiff was an independent contractor and not an employee of Mr Park.[2]
[2]T66
12 The relevant case law was stated by the Court of Appeal in Elazac Pty Ltd v Sherriff:[3]
[3][2011] VSCA 405
“… Whilst earlier authorities often regarded ‘control’ as the determinative factor in deciding whether someone was an employee or an independent contractor, later authorities have recognised that control (or, more particularly, the right to exercise control) is only one of a number of possibly relevant factors (albeit an important one) in determining the issue. Modern authority is to the effect that it is the totality of the relationship between the parties which must be considered. Relevant factors in determining the nature of the relationship between a person who engages another to perform work and the person so engaged include:
(a)the degree of control which the former can exercise over the latter;
(b) whether what is being supplied is the work and skill of a person (contract of service) or the supply of equipment or its performance (contract for services);
(c)whether or not the person engaged can set their own hours of work;
(d) the method of payment (and, in particular, whether payment is determined by hours of service or output or production);
(e) whether or not income tax is deducted and holiday pay or long service leave or superannuation paid;
(f) whether or not the person engaged employs employees and/or conducts his business in partnership;
(g)whether or not there is a power to delegate (send someone else to perform the work); and
(h) whether or not the person engaged considered the relationship as one of independent contractor.”
13 In his affidavit sworn on 8 June 2017, the plaintiff described his work as a subcontractor for CSR Building Products Ltd (“CSR”) erecting Hebel panels. He was one of a number of subcontractors running gangs, erecting these panels.
14 In about 2010 or 2011, the plaintiff registered for an Australian Business Number (“ABN”) so he could work in this role. The business was registered in his name and also in is brother’s name.[4]
[4]Registered from 27 July to 21 July 2014
15 Working as a subcontractor for CSR, the plaintiff was responsible for finding his own workers and formed a gang which carried out the panel work. He provided tools for the workers in his gang and sourced materials for different jobs. He paid them by the hour and they followed his direction about what to do and where to go.
16 Usually, the plaintiff would be emailed a job order, which contained the site address and job details, the start and finish dates, and sometimes the site plan. Once he received the order, he waited for the panels to be delivered on site and then started work. His brother, and about three other workers, worked in his gang for most of the time the plaintiff worked for CSR.
17 When the job was finished, the plaintiff would be paid a lump sum by CSR according to the size of the job, and he would then pay his workers. If there were problems onsite, the plaintiff would usually ring Corey Fisher from CSR.
18 While the plaintiff had general soreness from that time, he had no specific back pain while working as a subcontractor, and that soreness did not warrant a visit to the doctor or time off work.
19 The plaintiff deposed, in about early 2013 or 2014, he was starting to get sick of running his own business. It was a lot of effort to find and keep workers, and he thought it would be easier, and less stressful, to work for someone else.
20 By about early 2014, the plaintiff’s workers had stopped working for him and he spent a month or so doing small maintenance jobs to finish off on his old job sites while he looked for something more permanent.
21 In early 2014, the plaintiff spoke to Mr Fisher about his plans to stop working for himself and told him he wanted some regular hours and pay, and asked if any other subcontractors were looking for gang members. Mr Fisher indicated he would ask around to see if anyone was doing so.
22 The plaintiff was contacted by Mr Park a few weeks later, who sent him a text message indicating he had some work for him. They subsequently spoke over the telephone about the plaintiff’s experience and availability.
23 Mr Park said he would take the plaintiff on as long as he was happy to work at least four days a week, which the plaintiff was happy to do. Mr Park asked if he could work up to five or six days if he became busy, and the plaintiff was also happy with this arrangement.
24 They agreed the plaintiff would be paid an hourly rate of $30, and his work hours were between 7.30am and 4.30pm. Mr Park advised the plaintiff he would get back to him about a starting date.
25 It was the plaintiff’s understanding, after he spoke with Mr Park, that he had hired him as an employee. He was hired to work as part of the gang erecting panels. He was not to provide tools or equipment, and it was clear he was simply to work as a labourer as part of the gang.
26 Mr Park texted the plaintiff, requesting he start work for him on Monday, 30 June 2014.
27 On that date, the plaintiff arrived on site a bit after 7.30am. Mr Park was not present, but Mr Fisher was, and he instructed the plaintiff and another member of the gang to move a number of panels and distribute them around the site.
28 Later that day, Mr Park arrived and told the plaintiff and other workers in the gang to continue installation. Mr Park was in charge of the site. The work was done using the tools that he had provided.
29 At about 12.30pm, they were given a lunch break and they worked until about 3.30pm. Mr Park then told them he was organising for a crane to come on site and not to come back to work until he contacted them.
30 On about 2 July 2014, the plaintiff received a text from Mr Park indicating the crane had arrived on site and he should go back to work on 4 July 2014. The plaintiff did not work anywhere else between 30 June and that date, and had no intention of doing so.
31 On 4 July 2014, the plaintiff arrived on the site and was instructed by Mr Park and another member of the gang to install panels on a garage wall that was obstructed with scaffolding. A short time later, the plaintiff experienced severe lower back pain (“the injury”).
32 Before the plaintiff started working for Mr Park, he had never invoiced or been paid at an hourly rate when erecting the panels. He could only recall one other time when he was paid an hourly rate as a subcontractor, and that was when working for CSR with his brother and they were asked to train a new team for a day.
33 When the plaintiff started working for Mr Park, it was with workers who were part of his gang. It was a new arrangement for him compared to how he had been working as a subcontractor, in that he did not have any employees working for him and did not have to manage them on site, or provide tools for them to use. It was a good change for the plaintiff. He could just turn up at the site at his start time and wait to be told what to do.
34 After the incident injury, the plaintiff rendered an invoice for the hours he worked on 30 June and 4 July.[5] Mr Park paid the invoice.
[5]Invoice dated 30 July 2014
35 After the injury, the plaintiff completed a WorkCover Claim dated 8 August 2014, which was accepted, and he received weekly payments and medical expenses thereafter.
36 On 24 December 2016, the plaintiff’s entitlement to weekly payments was terminated on the basis he had been paid 130 weeks and he had a current work capacity or, alternatively, he had no current work capacity, but it was not likely to continue indefinitely. The plaintiff continues to be in receipt of reasonable and like medical expenses.
37 Mr Park swore an affidavit on 5 June 2017.
38 Mr Park knew the plaintiff, as they both previously contracted with CSR as Hebel installers. The plaintiff was never his employee; he was engaged as a casual contractor.
39 The plaintiff only ever worked with the crew on two days for six hours on 30 June and one hour on 4 July 2014. Prior to that, the plaintiff had contracted directly with CSR.
40 Some time prior to 30 June 2014, Mr Park was told by CSR foreman, Corey Fish, that the plaintiff had taken time off due to a back injury. Mr Fisher told him the plaintiff was now better and wanted to come back to work but had lost his crew, and suggested the plaintiff could work on his crew. Mr Fisher suggested he take on the plaintiff, saying he was very experienced and knew the work.
41 The job they were working on at that time was in Templestowe on a 700-square metre house. The job took about two days. Mr Fisher told Mr Park he had to take the plaintiff on to get the job finished.
42 Mr Park did not intend to keep the plaintiff on long term. Initially it was just a trial, with the agreement being to give him a go for a day or so and see how he went. In any event, the plaintiff told Mr Park he intended to go to do further study to be an estimator and he just wanted to work one or two days a week.
43 It would not be worth Mr Park’s while to take on someone like that long term. It was never his intention to make the plaintiff his employee and he had never had anyone as an employee unless they were an apprentice.
44 It is not disputed that the plaintiff did not work for him between 30 June and 4 July 2014. There was no work at the Templestowe site, as they were waiting for CSR to provide cranes for the steep site.
45 There were other jobs for CSR and if Mr Park had wanted he could have offered the plaintiff work at another site. He did not do so, because it was annoying to have him.
46 The plaintiff turned up whenever he wanted to. The first day he arrived late and left early. The second day he was late and said he had slept in. He was paid for the hours he worked.
47 The plaintiff later submitted the 30 July 2014 invoice for work done on the two days. The invoice was from Mirik Waterproofing and Tiling (ABN 47 308 057 033) and charged $30 an hour plus GST.
48 In support of his submission, counsel for the plaintiff relied on the following as pointing to arrangement of employer/employee:
(i)The plaintiff was paid per hour, $30, for his labour;
(ii)The plaintiff was only supplying his labour rather than for example, equipment;[6]
[6]T52
(iii) The plaintiff could not set his own hours but was, rather, required to work set hours of 7.00am to 3.30pm;[7]
[7]T52
(iv) The work performed by the plaintiff was subject to the direction and control of Mr Park;[8]
[8]T54, L12-26
(v) The plaintiff was not engaging employees or conducting a “business”, but providing labour to installers, such as Mr Park (compared to when he was working as a subcontractor, employing labourers and supplying services installing panels);
(vi) The plaintiff considered the relationship between he and Mr Park as one of employer (Claim Form);[9]
[9]T15, L27
(vii) Even on the best view of Mr Park’s evidence, it was a trial period of work, and if the plaintiff was successful he would have been engaged on a full-time basis, five days a week, generally from at least 7.00am to 3.30pm, as per the arrangement with the other workers, John and Mike;[10]
(viii)The work performed was required to be performed by the plaintiff rather than some other person in his place;[11]
(ix)The plaintiff invoiced Mr Park for the hours worked, and was paid by him for those hours;
(x)There was no evidence the plaintiff was engaged in offering his services (being labour to any other entity) while engaged by Mr Park.
[10]T53, L27-29
[11]T51, L5-14
49 It was submitted it was irrelevant whether Mr Park classified the relationship between himself and his gang, and the plaintiff, in terms of employee or subcontractor. The question was whether or not the plaintiff is a “worker” within the meaning of the Act.
50 In response, counsel for the defendant made the following submissions. In terms of paragraph (a) of Elazac Pty Ltd v Shirreff:[12]
·Mr Park accepted the plaintiff and others were under his control and direction.[13]
·There was an overriding direction and control from Corey Fisher[14]
·This had not changed from when the plaintiff was running his own business, subcontracting for CSR, in that Mr Park and he both previously did the same work for CSR and ran their businesses the same way[15]
·The plaintiff sought to downplay Mr Fisher’s role.[16]
[12][2011] VSCA 405
[13]T50
[14]T47 and T52
[15]T20-22
[16]T22
51 As to paragraph (b):
·Mr Park accepted the plaintiff supplied his labour to him[17]
·However, the plaintiff also supplied a drill and a small ladder.[18]
[17]T50
[18]T52
52 As to paragraph (c), setting of own hours:
·The plaintiff, and others in Mr Park’s gang, were required to attend from 7.00am to 3.30pm[19]
·However, these were the normal hours of the construction site[20] and Mr Park expected the other members of his gang to be there at the same time.
[19]T43
[20]T52
53 As to paragraph (d), method of payment:
·The plaintiff was paid per hour worked as per invoice 30 July 2014.
54 As to paragraph (e), payment:
·It was common ground that Mr Park did not deduct income tax or pay holiday pay, long service leave or superannuation in relation to the plaintiff[21]
·Mr Park confirmed this was the arrangement with others in his gang[22]
·The plaintiff did not deduct income tax for those in his gang when he was operating his business.
[21]T29 and T46
[22]T56
55 As to paragraph (f):
·The business ABN used for the invoice dated 30 July 2014 was a partnership with his brother[23]
·His brother had worked for him in that business.
[23]T29
56 As to paragraph (g), power to delegate:
·The plaintiff denied this[24]
·Mr Park said this was acceptable,[25] particularly as he knew the plaintiff’s brother.[26]
[24]T30
[25]T46
[26]T51
57 As to paragraph (h):
·At most, the plaintiff said it was his “understanding” that he was an employee[27]
·There was never any discussion or documentation to that effect
·There is a conflict in the evidence as to this arrangement
·Mr Park maintains it was a trial for subcontract work only during a busy period,[28] and that the work for CSR fluctuated so that the need for people in his gang fluctuated.[29]
[27]See affidavit, paragraph [9]
[28]T44
[29]T56
58 On balance, it was submitted on Mr Park’s behalf, the plaintiff has failed to satisfy the common law test.
59 Whilst there is clearly a difference in the evidence of the plaintiff and Mr Park as to the terms of their work arrangement, in the end, as counsel for the plaintiff agreed, whatever the precise terms were is not crucial to my determination.[30]
[30]T75
60 As the Court of Appeal stated in Elazac Pty Ltd v Shirreff,[31] I am required to consider the totality of the relationship between the parties – the relevant factors in this regard being set out by the Court in paragraphs (a) to (h) that follow.
[31](Supra) at paragraph [30]
61 Before undertaking that exercise, I do note however that I found Mr Park’s evidence somewhat unclear and hesitant, as I indicated to the parties during cross examination.[32] I had no such concerns with the plaintiff’s evidence and found him to be a reliable witness.
[32]T63
62 I accept that the plaintiff had decided to cease his subcontracting relationship in early 2014 as he was sick of this role and it would be much easier for him to work for someone else.
63 I accept that the plaintiff advised Mr Fisher to this effect and, as a result of that discussion, Mr Fisher contacted Mr Park and advised him the plaintiff was seeking work. The discussion with the plaintiff then followed.
64 In my view, despite whatever the parties thought as to their status – the plaintiff of the view he was an employee and Mr Park considering the plaintiff was a causal contractor – the plaintiff, at the time he was injured, was a “worker” within the meaning of s3(a) of the Act.
65 Unlike the situation where he was subcontracting to CSR, running a business as an installer,[33] when working in Mr Park’s gang, the plaintiff provided no workers nor did he provide any significant tools for use on the site as would previously have been the case when he was subcontracting.[34]
[33]T77
[34]T71
66 I accept that the plaintiff’s work was subject to Mr Park’s direction and control.[35]
[35]T76
67 The plaintiff was paid to work an hourly rate at hours specified by Mr Park. He was paid accordingly for the two days worked after Mr Park received the plaintiff’s invoice dated 30 July 2014.
68 The work for Mr Park was to be done by the plaintiff himself. Mr Park did not accept that if the plaintiff was unavailable, he could send someone to take his place.[36]
[36]T72
69 The plaintiff did not work nor did he intend to work for anyone else after commencing with Mr Park.[37]
[37]T78
70 When joining Mr Park’s gang and starting work on 30 June, the plaintiff was like Michael and John who, in my view, were employees for Mr Park, not independent contractors as he described.[38]
[38]T72
71 The Claim for Compensation was addressed to Mr Park. He accepted the claim, and weekly payments and medical and like expenses were subsequently paid.
72 Taking all the evidence into account, I am satisfied the plaintiff is a “worker” under s3(a) of the Act.
73 As I am satisfied that the plaintiff is an employee at common law and, therefore, not required to consider the submissions relating to the deeming provisions or the arguments pursuant to the Civil Procedure Act 2010.
74 As seriousness has been conceded subject to determination of this issue, I grant leave to the plaintiff to bring proceedings for pain and suffering and loss of earning capacity in relation to the incident on 4 July 2014.
- - -
0