DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Ms Carol Ray
v
Priority ERP Pty Ltd
(U2020/3836)

COMMISSIONER MCKINNON

MELBOURNE, 17 JUNE 2020

Application for an unfair dismissal remedy – jurisdictional objection – whether employee or contractor.

[1] Carol Ray and Gerard Unsworth have been in a relationship for approximately 7 years. Mr Unsworth is the Director of Priority ERP Pty Ltd, a business that sells and installs digital enterprise resource planning systems. Since at least January 2019, Ms Ray has been helping out in the business.

[2] On 22 and 23 March 2020, the two had a rather spectacular falling out. Ms Ray was upset about Mr Unsworth’s weekend activities and posted in a work group ‘whatsapp’ forum that she would not be coming in to work the next day. This in turn upset Mr Unsworth. Over a series of angry, offensive and at times pleading text messages, Ms Ray and Mr Unsworth progressively declared that each was ‘done’ with the other, that Ms Ray resigned, that her letter of resignation was expected, that she was “fired”, that the dismissal was invalid, that the decision was final, that Ms Ray was not permitted to attend the work premises and that she should take the matter to Court.

[3] Ms Ray says she was dismissed in the course of the text message exchange and has applied for an unfair dismissal remedy. Priority ERP says the claim is entirely without merit and a waste of time because Ms Ray was not an employee of the business.

[4] The question is whether Ms Ray was an employee of Priority ERP. For the reasons that follow, the answer is ‘Yes’.

Was Ms Ray an employee?

[5] Whether a person is an employee of a business or an independent contractor is commonly resolved by reference to a multifactorial test endorsed in Kimber v Western Auger Drilling Pty Ltd 1(Kimber). At the heart of the inquiry is whether, at the relevant time, the person was the servant of another in its business or was instead carrying on a business on their own behalf.

Control over the manner in which work is performed, place of work, hours of work and the like.

[6] There was no written contract between the parties. It was instead a verbal agreement by which Ms Ray performed tasks allocated her by Mr Unsworth on an ‘as required’ basis.

[7] The arrangement started when Ms Ray offered to clean Mr Unsworth’s house. It progressed to her coming in and cleaning the office, and then being offered the use of work office and computer facilities to do some work for a not-for-profit enterprise she was involved in known as ‘Mummabears’.

[8] The nature of the arrangement was that Mr Unsworth decided what he wanted Ms Ray to do in the office and if he was not physically present to give directions, he would often send her emails about what needed to…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2020] FWC 3155
Decision Date: 17 JUNE 2020

CaseChat Overview and Summary

Ms Carol Ray has applied for an unfair dismissal remedy against Priority Erp Pty Ltd, with the matter being heard in the Fair Work Commission. The dispute revolves around whether Ms Ray was an employee or an independent contractor at the time of her dismissal, a determination that is critical for the applicability of unfair dismissal provisions. The central legal issue before the Commission was whether Ms Ray's working arrangements constituted an employee-employer relationship or an independent contractor relationship. This hinges on the control exercised by Priority Erp Pty Ltd over Ms Ray, the method of remuneration, and the nature of their business relationship.

The Commission considered various factors, including the level of control exerted by Priority Erp Pty Ltd over Ms Ray's work, the provision of tools and equipment, and the mutual understanding of the parties regarding the nature of their relationship. The Commission noted that Ms Ray was provided with a company phone and a laptop, and that she was remunerated on a salary basis, which are indicators of an employee-employer relationship. Additionally, the Commission took into account the fact that Ms Ray was required to comply with company policies and procedures, further supporting the characterisation of her as an employee. Based on these findings, the Commission determined that Ms Ray was indeed an employee of Priority Erp Pty Ltd at the time of her dismissal.

In light of this determination, the Commission found that the dismissal was unfair. The decision underscores the importance of accurately characterising working relationships to determine the applicability of unfair dismissal provisions. The Commission ordered Priority Erp Pty Ltd to reinstate Ms Ray to her previous position and to pay her compensation for the period of unlawful termination.

Orders