Ms Louise Kimber v Western Auger Drilling Pty Ltd

[2015] FWC 38

[2015] FWC 38 [Note: An appeal pursuant to s.604 (C2015/632) was lodged against this decision - refer to Full Bench decision dated 13 July 2015 [[2015] FWCFB 3704] for result of appeal.]

FAIR WORK COMMISSION

DECISION

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

Ms Louise Kimber
v
Western Auger Drilling Pty Ltd
(U2014/5107)

COMMISSIONER SPENCER BRISBANE, 4 MARCH 2015

Application for relief from unfair dismissal - jurisdictional objections - minimum employment period, contingent on date of transition from independent contractor to employee - no dismissal - alleged assault ends employment

[1] This decision relates to an application filed by Ms Louise Kimber (the Applicant) pursuant to s.394 of the Fair Work Act 2009 (Cth) (the Act) for an unfair dismissal remedy (the substantive proceedings). The Respondent is Western Auger Drilling Pty Ltd. The matter was allocated for arbitration to the Commission as presently constituted.

[2] In summary, this jurisdictional decision relates to the determination of the length of the employment relationship and the date of dismissal. The Applicant submits she commenced as an independent contractor but that the employment relationship started earlier than the Respondent suggests. Further, the Applicant argued that the Respondent dismissed her when the employer allegedly assaulted her and demanded she immediately leave the employer’s property (where the Applicant had been living) and to take her horses with her. In contrast, the Respondent argued the employment relationship ended approximately 4 weeks later after an investigation into the Applicant’s allegations of sexual harassment had been completed and the Applicant had failed to make contact with respect to a return to work.

[3] The matter had been the subject of preliminary conferences by consent. A security for costs application was filed by the Respondent. Directions were issued for the filing of materials in relation to the security for costs application. A decision in this matter was previously released by the Commission as currently constituted [PR554686].

[4] The Respondent raised jurisdictional objections in relation to the substantive application. The Respondent objected to the application, on the basis of s.382(a) of the Act, that the Applicant had not served the minimum employment period under s.383 and that there was no dismissal at the employer’s initiative under s.386(1)(a). The Respondent submitted that the Applicant commenced employment on 2 January 2014, and prior to this, the Applicant was an independent contractor, rather than an employee and therefore did not meet the minimum employment period of six months. The Applicant submitted that she commenced her role as an employee from at least 11 July 2013. The parties also disputed whether the Applicant was dismissed pursuant s.386(1)(a) and on what date the employment relationship ended. This decision will deal only with the jurisdictional objections.

[5] The Directions required the parties to confirm whether they consented to the jurisdictional objections being decided on the papers. Neither party objected to the objections being determined on the papers or sought that the Commission convene a hearing in the relation to the objections. The recent Full Bench decision in Lewis v Altus Traffic Pty Ltd  1 dealt with procedural fairness where a matter involved contested facts.

[6] Section 397 of the Act states:

“397 Matters involving contested facts

The FWC must conduct a conference or hold a hearing in relation to a matter arising under this Part if, and to the extent that, the matter involves facts the existence of which is in dispute.”

[7] Accordingly, after consideration of the written submissions and the above Full Bench decision, a conference by telephone (given the geographical location of the parties) was proposed and agreed to by the parties. The conference was recorded and the parties agreed any additional information offered by the Applicant and the Respondent could be taken as evidence. Predominantly, the material provided further confirmation of matters before the Commission.

[8] Both parties were granted permission (pursuant to s.596) for legal representation. The submissions were prepared by their representatives. At the telephone conference, the Applicant was represented by Mr Jeff Johnson and Ms Kara Burgess of Johnsons Solicitors and Attorneys, and the Respondent was represented by Mr David Riwoe of Aden Lawyers.

[9] Whilst all of the materials and evidence may not have been referred to in this decision, all of such have been taken into account.

Legislation

[10] The relevant statutory provisions are set out, as to whether the Applicant is an employee who has completed a period of employment of at least the minimum employment period and whether there was a dismissal at the initiative of the employer.

[11] Section 382 of the Act provides as follows:

382 When a person is protected from unfair dismissal

A person is protected from unfair dismissal at a time if, at that time:

(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and

(b) one or more of the following apply:

(i) a modern award covers the person;

(ii) an enterprise agreement applies to the person in relation to the employment;

(iii) the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.”

[12] The minimum employment period is defined in the Act as follows:

383 Meaning of minimum employment period

The minimum employment period is:

(a) if the employer is not a small business employer—6 months ending at the earlier of the following times:

(i) the time when the person is given notice of the dismissal;

(ii) immediately before the dismissal; or

(b) if the employer is a small business employer—one year ending at that time.

[13] Section 386 provides as follows:

386 Meaning of dismissed

(1) A person has been dismissed if:

(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or

(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.

(2) However, a person has not been dismissed if:

(a) the person was employed under a contract of employment for a specified period of time, for a specified task, or for the duration of a specified season, and the employment has terminated at the end of the period, on completion of the task, or at the end of the season; or

(b) the person was an employee:

(i) to whom a training arrangement applied; and

(ii) whose employment was for a specified period of time or was, for any reason, limited to the duration of the training arrangement;

and the employment has terminated at the end of the training arrangement; or

(c) the person was demoted in employment but:

(i) the demotion does not involve a significant reduction in his or her remuneration or duties; and

(ii) he or she remains employed with the employer that effected the demotion.

(3) Subsection (2) does not apply to a person employed under a contract of a kind referred to in paragraph (2)(a) if a substantial purpose of the employment of the person under a contract of that kind is, or was at the time of the person’s employment, to avoid the employer’s obligations under this Part.

Summary of submissions and relevant case authority

[14] It is not in dispute that the Respondent is not a small business employer. To be protected from unfair dismissal under s.382 of the Act, the Applicant must have completed the minimum period of employment 2, that is, the Applicant must have been working, as an employee, for six months at the time when she was given notice of the dismissal or immediately before the dismissal. It is not disputed by the parties that the Applicant satisfied s.382(b), that is, the Applicant’s annual rate of earnings was less than the high income threshold. The Respondent has also raised an objection that the Applicant was not dismissed pursuant to s.386 of the Act. The jurisdictional objection relating to the length of the employment relationship will be dealt with first.

Was the Applicant working as an employee for the six months prior to the dismissal/Is the Applicant protected from unfair dismissal?

[15] It was agreed that the Applicant commenced working for the Respondent as an independent contractor in March 2013, undertaking workplace health and safety duties. The Applicant transitioned from an independent contractor to an employee, however, the Applicant submitted this occurred from at least 11 July 2013, while the Respondent submitted that the Applicant commenced as an employee from 2 January 2014.

[16] The Respondent submitted that the Applicant ceased employment on 11 March 2014 (after the completion by the employer of the sexual harassment investigation), while the Applicant submitted that she was dismissed on 14 February 2014 (following an alleged assault by the employer). In the current circumstances, the issue of the date of commencement as an employee is particularly important in determining the minimum employment period. If the Applicant commenced as an employee on 11 July 2013, she would be protected from unfair dismissal, having completed the minimum period of employment of six months, regardless of the exact date of the end of her employment. If the Applicant commenced as an employee from 2 January 2014, she would not have completed the minimum employment period by either employment end date. The relevant question is, when did the Applicant commence as an employee?

[17] This involves a characterisation of the employment relationship. Both parties referred to case authority on classification as an employee versus an independent contractor. The material provided by both parties has been reviewed in light of the case authorities to assess the nature of the relationship between the parties.

[18] One of the leading cases in relation to the contractor/employee test is ACE Insurance Limited v Trifunovski and others 3(ACE Insurance), a decision of the Full Court of the Federal Court of Australia. This unanimous decision of the Court reviewed the case authorities; the approach in that decision is adopted, in relation to the material before the Commission in this case.

[19] It is apparent, from the case law, that the question of whether a person was an employee or an independent contractor requires an assessment of a variety of factors. 4 The case authorities set out how the question is to be considered, relevant to the indicia. What is clear, from the authorities, is that no one single criterion will necessarily be determinative and that each matter will turn upon the particular circumstances of the case, with the decision maker weighing all the relevant factors.5 Various factors have been found to be relevant as the case authorities have developed, but it is acknowledged that the relevant factors considered in the cases, to date, are not exhaustive or exclusive. The list of criteria is not closed, nor is their application to the facts at hand entirely prescriptive.

[20] A review of when the Applicant became an employee was undertaken based on each of the indicia, to conclude the nature of the overall working relationship. As stated, no single criterion is determinative of the outcome; all of the indicia and other relevant factors must be weighed in informing the overall view or ‘picture’ of the working relationship 6. The relationship must be considered against the range of indicia including: control, the right to work for others, place of work, arrangements as to tools and equipment and expenses, right as to delegation of subcontracting, right to suspend or dismiss, emanation of the business, taxation and related payment arrangements, leave arrangements, development of goodwill or assets, and other factors. The evidence and submissions of the parties on the elements have been taken into account.

[21] The approach set out in Jiang Shen Cai T/A French Accent v Michael Anthony Do Rozario 7 (French Accent) requires the consideration of the indicia, not as a mechanical exercise, but as an appreciation of the whole of the relationship. In that case, the Full Bench stated as follows8:

“The general law approach to distinguishing between employees and independent contractors may be summarised 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 9: that is, whether, viewed as a practical matter, the putative worker could be said to be conducting a business of his or her own10 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 relationship11.

(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.

(3) The terms and terminology of the contract are always important 12. However, the parties cannot alter the true nature of their relationship by putting a different label on it13. 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 whole14: the parties cannot deem the relationship between themselves to be something it is not15. Similarly, subsequent conduct of the parties may demonstrate that relationship has a character contrary to the terms of the contract16.

(4) Consideration should then be given to the various indicia identified in Stevens v Brodribb Sawmilling Co Pty Ltd 17 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. 18

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 19. While control of this sort is a significant factor it is not by itself determinative20. 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 expertise21. 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 employee22.

“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.” 23 “[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.”24

● 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 25 and or advertises his or her services to the world at large.

● Whether the worker provides and maintains significant tools or equipment. 26

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 27.

● Whether the work can be delegated or subcontracted. 28

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 29. 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. 30

● Whether the putative employer presents the worker to the world at large as an emanation of the business. 31

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. 32

● Whether the worker is remunerated by periodic wage or salary or by reference to completion of tasks. 33

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. 34

● Whether the work involves a profession, trade or distinct calling on the part of the person engaged. 35

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. 36

● Whether the worker spends a significant portion of his remuneration on business expenses. 37

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 38.

(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.”

[22] In examining the nature of the relationship, it is noted that the characterisation of the relationship, by those parties to it, may simply be a product of ‘convenience’ or how one party views it. However, the label put on the contract is of less influence than the rights and obligations created by the contract 39.

[23] A series of cases were referred to by both parties, whilst not all have been cited, all have been considered.

Contract

[24] The following extract from Ace Insurance refers to the contentions relevant to a contract of employment:

“Contracts of employment (contracts of service traditionally so-called) are contracts for personal service. Benefits and obligations of contracts of individual service of this kind are not unilaterally assignable by either party... The requirement for personal service has the effect that a contract which truly permits discharge in another fashion or by another person, is not a contract of employment. Thus, contracts with corporations, contracts with partnerships, contracts permitting unlimited delegation and contracts which do not actually compel the performance of work but pay only on results, are each prima facie not contracts of the necessary quality...” 40

[25] The initial point of examination would normally be to look at the contract that existed between the parties, to assist in the examination of whether the relationship of the parties was that of an employee and employer. Whilst the contract is a matter to take into account, it is not determinative. This is well settled on the relevant case authorities, in relation to the question of whether a person is an employee. 41

[26] The Applicant submitted that she signed and returned to the Respondent, an employment agreement and Pre-Employment Medical Assessment Form on 30 May 2013, at the Respondent’s request. This employment agreement was for casual employment, but the Applicant stated she did not receive a copy signed by the Respondent. A copy signed solely by the Applicant was provided in the Applicant’s evidence. The hourly rate of pay was specified in the agreement as “tba”.

[27] While the Applicant submitted that she was requested to sign the agreement, the Applicant also provided in evidence the email from Ms Jodie Giles (manager of the Respondent) to the Applicant, attaching the Employment Agreements (full time and casual). This email does not request that the agreement be signed and returned. It refers to a bonus (unspecified) that needs to be paid when a public holiday is worked. On the material this was a draft agreement provided for consideration. No employment agreement of confirmed terms was provided in evidence.

[28] The Applicant was engaged to undertake duties to review, and assist the Employer to meet, workplace health and safety obligations. On the evidence; discussions were held in late May to early June 2013 regarding the possibility of the Applicant working full-time hours. The Applicant submitted that she commenced working hours that resembled full-time hours as an employee on 11 July 2013, and had re-located to live and work on the Respondent’s premises. Prior to this, the Applicant provided the workplace health and safety services remotely. From 11 July 2013, the Applicant continued to provide and be reimbursed for her work via invoices she prepared and provided to the Respondent.

[29] On the evidence, the Applicant provided invoices for payment from 14 March 2013 to 23 December 2013. The invoices contain an ABN number.

[30] The Applicant submitted that she was informed that she would be put “on the books” (as an employee) when Ms Giles of the Respondent had the time. The Respondent refuted this proposition but confirmed the specific engagement as an employee occurred, after further discussions, on 2 January 2014. The Respondent submitted that it agreed to employ the Applicant as an employee on or about 23 December 2013 and that the Applicant signed a tax declaration form at this time. This engagement coincides with the end of the provision of invoices by the Applicant. The invoices provided by the Applicant up to this time provide entries for payment not commensurate with a full-time employee.

Personal Services

[31] The case authorities have considered that contracts of service, being contracts of employment, are contracts for personal service. That is, the benefits and obligations of the contract cannot be unilaterally assigned by either party. 42

[32] In this regard, the Courts will look at whether the contract in question “truly permits discharge in another fashion or by another person”. 43 In this regard Buchanan J in ACE Insurance held, in distinguishing independent contractors and employees:

“contracts with corporations, contracts with partnerships, contracts permitting unlimited delegation and contracts which do not actually compel the performance of work but pay only on results, are each prima facie not contracts of the necessary quality...” 44

[33] It was submitted, on behalf of the Applicant, that she had no authority to subcontract work to third parties. In her evidence, the Applicant stated that she did not run any business of her own, however, neither party addressed whether it was contemplated that the Applicant subcontract the work to another party. It was submitted that the Applicant worked five days per week in the Respondent’s office from 11 July 2013 (after moving to the area of the Respondent’s business). Prior to this the Applicant had worked remotely and at ad hoc hours around another job. Nothing provided supports that the Applicant was subcontracting her work from 11 July 2013. However, the Respondent submitted that that the only direction to the Applicant was to review their workplace health and safety function to ensure compliance. The Applicant undertook this task at her discretion and invoiced the Respondent accordingly.

Control test

[34] Further to the above, a necessary factor to be taken into account is the degree of control the ‘putative’ employer has over the ‘putative’ employee.

[35] In the matter of Humberstone v Northern Timber Mills 45 it was held:

“The question is not whether in practice the work was in fact done subject to a direction and contract 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.”

[36] The Applicant submitted that she had no control over the manner in which her work was performed, the place of the work or the hours of work, from 11 July 2013.

[37] The Applicant stated in her evidence that she was instructed to arrive at 7:00am and finish at 3:00pm. The Applicant also stated that she was required to seek permission for time off. It was submitted on behalf of the Applicant that she was supervised by and took direction from the Respondent.

[38] In contrast, the Respondent submitted that the Applicant had complete control over the role performed for the Respondent, and the hours she worked. Ms Jodie Giles, manager of the Respondent, stated in her evidence that the Applicant had complete control over how the role of WHSO (Workplace Health and Safety Officer) was to be performed. She stated as follows:

“WAD was only concerned with the end result (having systems and documents in place to cover off our legislative and common law obligations). Louise was not given any directions and she performed the role autonomously.” 46

[39] However, the Applicant stated in her evidence as follows:

“...in reality nothing changed between the 11 July 2013 [and] when I was put on the books. I did the same work. I wore the same uniforms. I answered to the same people. I used the same equipment and attended at the same office...” 47

[40] The distinction is that the Applicant acknowledged the manner of remuneration by invoices (in which she set the billing amounts) in relation to the agreement to produce the required workplace health and safety work as she considered the Respondent required. This method of remuneration then changed from the initial agreement. The later acceptance, of an employee role, does not reverse the initial agreed contract arrangement.

[41] The nature of the Applicant’s role as WHSO involved a degree of autonomy over the work performed by the Applicant. There is no evidence to suggest that the work being performed changed from 11 July 2013; the difference in where and when the work was performed simply arose out of the Applicant’s physical relocation to the Respondent’s premises, where it was a matter of convenience for her and her livestock to become resident. There was continuing autonomy by the Applicant in the performance of her work, in the creation of systems and documents for the Respondent.

Taxation, insurance and superannuation arrangements

[42] In assessing the nature of the relationship and whether the arrangements entered into between the parties genuinely characterised the relationship as an employee or contractor; the following extracts of ACE Insurance are relevant 48:

“In the present case, the contracts executed by the parties stated that the agents were not employees, but were independent contractors. The judgment under appeal held to the contrary. There may be many good reasons why it might suit an individual worker to be treated as an agent or a contractor rather than as an employee. Those reasons may include a freedom to incorporate or act in partnership (with one’s spouse for example); different taxation obligations; more freedom about when, and how, work is done; the ability to work for others at the same time etc. However, it is increasingly necessary that parties conduct themselves (in their relations with regulatory agencies, and not just each other) in accordance with a correct appreciation of the nature of their relationship, not just as it may suit them (or one of them). The parties may agree the terms of their contract, but any statement by them about the character of their relationship, or of their contract, has consistently been held not to be decisive of the true legal character of either.

In the case of an employee, an employer is bound to deduct and remit income tax, make superannuation contributions on behalf of the employee and pay payroll tax. These all involve the discharge of obligations to regulatory agencies and, in some cases, failure to do so may attract criminal sanctions. On the other side, where a contractor is carrying on business independently of employment, that contractor will need to take responsibility for insurance, income tax arrangements, and the lodging of appropriate tax returns. Those arrangements will depend on whether the “contractor” is a sole trader, is in partnership, is engaged to provide services through a corporate entity and so on. The method chosen by the contractor will generate procedures for the acquittal of any tax liability which will need to be observed. Under whichever arrangement is appropriate, tax deductions for business and operating expenses may be claimed. The company engaging the contractor will usually have no involvement in these matters and may not even know about them.”

[43] With respect to superannuation payments, the Applicant submitted that she was paid an amount for superannuation on 26 June 2014 which, it was submitted, equated to approximately 9.71 months of superannuation payments at 9% based upon a salary of $88,000.00 per annum. The Applicant attached as evidence a statement from her superannuation fund, which indicates a payment of $6,414.09 was made into the fund on 26 June 2014 by Western Augur Drilling. This payment alone is not conclusive of the Respondent acknowledging an employment entitlement to superannuation prior to 2 January 2014. Whilst the amount, it was submitted, equated to that length of period, it does not represent periodic payments made for such period. There was no evidence of what superannuation rate the parties agreed to from 2 January 2014. In addition, the amount was paid after the employment had ended (on either date) during a time in which the Respondent maintained that the Applicant’s employment commenced in January 2014. Payment of superannuation at a later stage when the parties were engaged in conciliation and examining methods to resolve the claim does not, in the circumstances of this matter, justify an employment relationship.

[44] For the period prior to January 2014, the Respondent submitted that the Applicant provided invoices for work undertaken in line with the agreed arrangement, which was commensurate with a contractor. The invoices included an amount for GST and the Applicant was required to have her own insurance policies.

ABN/Remuneration/Commissions

[45] In relation to the provision of an ABN, paragraph [34] in ACE Insurance states as follows:

“Often, perhaps even usually these days, a contractor will need an Australian Business Number and to be registered under the GST legislation. The contractor will be entitled to demand a 10% additional payment on account of GST, which must be remitted to the taxation authorities pursuant to regular returns. The contractor will have the right to claim, as a deduction, input tax credits (GST credits). Although the engaging company would be required to furnish some of the material necessary to make the returns, it would not be involved in all aspects. Ultimately, compliance with the taxation legislation, in this and other respects, would be a matter for the contractor.” 49

[46] In the current matter, the evidence was that the Applicant, after having been engaged as a contractor by the Respondent in March 2013, provided her ABN and was paid as a contractor, via her invoices containing an ABN, until 23 December 2013. The Applicant submitted that the delay in formalising the relationship as one of employee/employer, in their business records, was of benefit to the Respondent. This submission was not persuasively made out on a consideration of the invoices. The evidence indicates a different agreement being reached between the parties at the later stage.

[47] The Applicant’s invoices were provided, as evidence, by Ms Giles (for the Respondent) and indicate that, from 11 March 2013 until 10 July 2013, the Applicant invoiced at a rate of $40.00 per hour. From 11 July 2013, the Applicant invoiced at a rate of $338.46 per day, and did not usually specify the hours worked on the invoice. In December 2013, the Applicant and Ms Giles of the Respondent had discussions about the structuring of the Applicant’s salary package as an employee. The Applicant signed a tax declaration form on 23 December 2013, indicating an agreement that the Applicant move to full-time employment.

[48] From 11 July 2013, the Applicant moved to the area (of the Respondent’s business and residence) and the invoices reflected the day rate. This is not determinative of a change to an employment relationship. Contractors may be engaged on a daily rate. The invoices contained variations on charges for work; rather than simply continuous payment at a constant level as per an employee.

[49] The change in the remuneration structure and the cessation of the use of the ABN and invoices indicates that the Applicant’s engagement with the Respondent changed from contractor to employee in January 2014.

Paid holidays/sick leave

[50] The Respondent submitted that the Applicant was responsible for her own leave and was not paid for any annual leave or personal leave 50. However, the Applicant stated that she was required to request permission for time off, and was required to make up for the time taken off outside of her normal work day51.

[51] The Applicant also stated that she was entitled to time off in lieu for the overtime she worked, which was recorded on weekly timesheets 52. These were not provided in evidence.

[52] The Applicant clarified in the telephone conference that she was not paid for public holidays or annual leave, that is, the Applicant was not paid for days she did not work (without having to make the hours up at another time). The invoices reflected this.

[53] The Applicant stated that the invoice dated 9 October 2013 (for 4 days of work only) reflected that the Applicant was not paid for the Labour Day public holiday. The last of the Applicant’s invoices is dated 23 December 2013, which is the last day worked on the invoice. This invoice only recorded 4 days, only 3 of which were invoiced at a daily rate. The 22nd of December 2013 is invoiced for 6.5 hours at an hourly rate ($40.00 per hour). The Applicant stated that work ceased for Christmas on 23 December 2013. Between this time and the commencement of her employment on 2 January 2014, the Applicant stated she was not paid for the Christmas public holidays, New Years day or any of the other days she did not work. These invoices highlight the deviation from remuneration commensurate with full-time employment, given that public holidays were not paid for and only days worked (or part thereof) were invoiced. The invoices provided prior to the engagement as an employee reflect invoicing in accordance with work as a contractor with no payment for time not worked, including public holidays.

[54] The invoices do not reflect that the Applicant was paid a day rate in lieu of a salary. Whilst the Applicant submitted that the day rate was calculated to reflect a salary arrangement, broken down into a daily rate, the invoices reflect part-days and part weeks. The treatment of the Applicant’s leave or time that she did not work and non-payment of public holidays does not indicate that the Applicant was working or being remunerated as an employee from 11 July 2013.

Uniform/Emanation of the business

[55] The Applicant stated that in late July or early August she was provided with uniforms bearing the name of the Respondent and her shortened name. Photographs of vests and a jacket and jumper were provided in evidence by the Applicant and the Applicant stated she was required to wear the uniforms. No evidence was brought, as to a policy that required a uniform to be worn.

[56] Ms Giles stated that while the Applicant was provided with a uniform in late July/early August 2013, it was required by the principal contractor that any employee or contractor of the Respondent had to wear the Respondent’s insignia when attending the principal contractor’s site for the purpose of identification on site. Ms Giles stated that other contractors were also supplied with uniforms for this purpose and for visibility, although they were not employees 53.

[57] The Applicant stated in response to Ms Giles’ evidence that the subcontractors were required to pay for their uniforms and that the Applicant was not. The Applicant also stated that the correct reason for contractors being required to wear uniforms was so that the Respondent would not appear to be engaging contractors 54. The indicium of the uniform is not conclusive of an employee relationship.

Provision of tools and transport

[58] The provision of tools and equipment is a relevant factor. The Applicant stated that she worked in the Respondent’s office and used only their equipment to complete the work 55. The Applicant also stated that she did not spend any of her own money on business expenses or purchase any supplies to conduct her work for the Respondent56.

[59] The Respondent submitted that the Applicant was able to use the Respondent’s laptop and mobile phone but was expected to provide any other material that may be required to perform her role 57. Significant weight cannot be attributed to the Applicant using the Respondent’s laptop and phone given the nature of the role of a workplace health and safety officer, which may be performed without many tools or equipment.

[60] In relation to an ancillary matter, the Applicant submitted that the parties entered into an agreement surrounding a horse float for the Applicant, whereby the Respondent would pay for it and the Applicant’s salary for the next 12 months would be reduced accordingly 58. This horse float, it was stated by the Applicant, was also to take Ms Giles’ daughter to horse events. The horse float is relevant to the arrangements reached separately between the parties regarding the Applicant’s arrangements for her personal accommodation at the Respondent’s residence when she moved to the area in July 2013, and do not undermine the contractor arrangement.

Periodic wage or salary by reference to tasks and income tax deducted

[61] Ace Insurance is authority for the proposition that the method of payment was the least important of all indicia. However, on the current material, the payments made to the Applicant, via her invoices and her ABN (no income tax withheld), do not denote that the Applicant was an employee.

Work of a professional, trade or distinct calling on the part of the person engaged

[62] In relation to the work undertaken by the Applicant, it is not uncommon for workplace health and safety officers, appraising the company’s business and implementing the required workplace health and safety policies, to undertake this work on a contract. It is also not unusual for companies to engage such professionals as consultants to review and produce workplace health and safety policies and records as the company requires. The fact that all of the Applicant’s work, when she returned to the area, was with the Respondent does not necessarily negate a contractor arrangement, particularly given the location and accommodation arrangements.

Did the worker create goodwill or saleable assets?

[63] This criterion is not determinative in the current circumstances. The Applicant was involved in updating or effecting changes for the Respondent to meet their workplace health and safety obligations.

Consideration

[64] On the material provided, taking into account a review of the indicia, it is concluded that the Applicant’s arrangement with the Respondent transitioned from an independent contractor to an employment relationship on 2 January 2014. It was agreed the Applicant commenced as an independent contractor and the parties had operated via a contractor arrangement via the provision of an ABN since March 2013 and the Applicant was remunerated in response to her invoices until late December 2013.

[65] The terms of an employment relationship were then negotiated between the parties in late December 2013, and the Applicant became an employee of the Respondent on 2 January 2014. The finish of the invoicing and the payments reflect this change.

[66] The nature of the working relationship prior to that point has been considered according to the indicia in the relevant case authorities. This is not a case where the Respondent has deliberately avoided their obligations to an employee. Whilst, on the evidence, the parties had been contemplating the Applicant’s transition from contractor to employee, the varying invoices occurred up to December 2013. Although the Applicant’s invoices changed from an hourly rate to a daily rate in July 2013, the Applicant neither received any annual leave or payment for public holidays. The actual commencement of an agreed employment relationship with a negotiated salary began on 2 January 2014 with the changed remuneration arrangements and the end of invoicing.

[67] On the evidence, the Applicant was conducting her own business until such a time as the terms of an employment relationship were negotiated and commenced. A contractor or health and safety consultant may well start providing services as a contractor and transition to employment with a company, if the company decides to offer a role as an employee. This does not mean that the period performed as a contractor must be deemed to be employment by the company prior to engagement as such, even though the role and the work performed has not significantly changed. Given the nature of the initial and on-going work, the Applicant continued to maintain autonomy over her work.

[68] That the Applicant worked as a contractor commencing in March 2013 is not disputed. A contractor relationship was in place until the Applicant commenced as an employee on 2 January 2014. On this basis, (given the period of employment), it cannot be construed that when the Applicant’s employment ended, the Applicant was protected from unfair dismissal. The application is jurisdictionally barred pursuant to s.382(a), on the basis that the Applicant has not met the minimum period of employment, as the Applicant, between 2 January 2014 and either of the alleged end of employment dates (14 February 2014 or 11 March 2014), had not been employed for six months.

Was there a dismissal?

[69] The Respondent also objected to the application on the basis that the Applicant was not dismissed.

[70] The Applicant filed a written complaint regarding bullying and sexual harassment against a separate employee of the Respondent on Friday 14 February 2014. The Respondent stated that the Applicant was directed not to discuss the allegations with any other employee, whilst the complaint was under investigation. The Respondent submitted that (after this direction) it became apparent that the Applicant had contacted other employees and discussed the allegations. In response to this, the Respondent submitted, the Applicant and the accused employee were stood down on full pay pending an investigation.

[71] The Respondent submitted that they determined that the Applicant had made further contact with the Respondent’s employees on these matters, and therefore managerial representatives met with the Applicant to discuss this communication they had prohibited. It was submitted, by the Respondent, that an argument ensued between Ms Giles and the Applicant. During this argument, the Applicant was directed to leave the Respondent’s premises (where the Applicant had been residing) and to take her horses with her. The Applicant submitted that she was physically assaulted during this exchange and that her employment was terminated as a result of the direction to leave and the assault.

[72] On 18 February 2014, the Respondent’s solicitor wrote to the Applicant stating that following a discussion with Ms Giles, the Applicant had been directed to return home on full pay until the matter has been fully investigated. The letter stated that the Applicant was currently on full pay and further, that this time away from the Respondent will count as a continuation of service, that the Applicant’s employment had not been terminated, and that the Applicant continued to accrue all statutory entitlements.

[73] In contrast, the Applicant argued her employment came to an end when the altercation involving the alleged assault occurred with Ms Giles and she submitted she was directed to leave the property and take her horses with her, as her employment had been terminated.

[74] In line with this, on 20 February 2014, the Applicant’s solicitor wrote to the Respondent’s solicitor stating that the Applicant’s employment was unlawfully terminated the previous Friday (14 February 2014) and that the Applicant was unlawfully assaulted by Ms Giles at that time.

[75] On 21 February 2014, the Respondent’s solicitor wrote to the Applicant’s solicitor stating that the Applicant was asked to leave the Respondent’s premises on 14 February because the Applicant had breached the lawful instruction that the Applicant not contact other employees to discuss the allegations. The letter states that the Applicant was never dismissed and she is still on full pay and continued to accrue all her statutory entitlements. The letter also states that once the investigation is completed, the Applicant will be required to return to her normal duties and if the Applicant refuses to return to work, in the absence of any reasonable explanation, it may be determined that she has abandoned her employment.

[76] On 26 February 2014, the Applicant’s solicitor wrote a letter setting out the Applicant’s instructions in relation to the complaint and the events occurring on 14 February 2014. The letter states that in the afternoon of 14 February 2014, the Applicant was told that she was sacked (and for her and her horses to be removed from the premises) and then charged at and knocked over by Ms Giles, who it is then alleged threw a bucket at the Applicant.

[77] On 28 February 2014, the Applicant filed the current unfair dismissal application and served a copy of the application on the Respondent’s solicitors.

[78] On 7 March 2014, the Respondent’s solicitors wrote to the Applicant’s solicitors responding to the letter dated 26 February 2014 indicating that their clients denied the following; using the quoted expletives; assaulting the Applicant; threatening the Applicant and terminating the Applicant’s employment. The letter stated that the investigation was complete and the Respondent enquired if and when the Applicant would be able to return to her normal duties. This letter requested that the Applicant contact the Respondent’s solicitors, by close of business on 11 March 2014, regarding the Applicant’s return to work.

[79] On 12 March 2014, the Respondent’s solicitors sent a letter by email to the Applicant’s solicitor noting that no response had been received to the Respondent’s solicitor’s letter of 7 March 2014; the Respondent had determined that the Applicant had abandoned her employment and that the Applicant had accordingly terminated her employment without notice on 11 March 2014. In the conference the Applicant agreed that she was paid until 11 March 2014.

[80] On 12 March 2014, the Applicant’s solicitors replied to the Respondent solicitors letters of 7 and 12 March 2014. The letter states that the Respondent terminated the Applicant on “14 March last”, which I consider, given the date of the correspondence, was meant to be a reference to 14 February 2014. The letter stated that the prospect of the Applicant returning to the Respondent’s employ were remote given the Applicant was assaulted, abused, and given the Respondent’s lack of support to the Applicant regarding the circumstances of the sexual harassment and bullying complaint and the related wrongful termination. The letter stated that the Respondent’s solicitor had not advised as to the outcome of the investigation and therefore the Applicant’s solicitor indicated that the Respondent’s offer for the Applicant to return to work was not genuine and was instead made as a tactical response to the Applicant’s unfair dismissal application.

[81] Ms Giles of the Respondent denied the allegations that she assaulted, abused, threatened or dismissed the Applicant. Ms Giles’ fiancé, Mr Jamie Byrnes, a director of the Respondent, stated in an affidavit that he did not see Ms Giles strike the Applicant or throw a bucket at her, and that no derogatory language was used in his presence, as alleged in the letter dated 26 February 2014. Mr Byrnes stated that he never told the Applicant she was sacked 59.

[82] The Applicant provided as an attachment to her affidavit, a medial consultation note recorded by her Doctor on 17 February 2014. The Doctor recorded that the Applicant stated that she was assaulted by her employer on 14 February 2014. The consultation notes state, that the Applicant reported, that she was hit on the left shoulder and then punched in the face multiple times.

[83] There is significant disparity between the parties, regarding the events of the alleged altercation on 14 February 2014. Given the determination on the other jurisdictional objection, it is not necessary to determine the issue of the dismissal.

[84] Whilst the conflicting circumstances surrounding the end of the employment relationship have been set out, on the evidence, the Applicant was initially an independent contractor and then an employee from 2 January 2014, but the period of the employment relationship, on either final date, was less than the statutory requirement of six months to afford protection from unfair dismissal. Therefore, a determination is not required as to whether a dismissal occurred, given the application is already jurisdictionally barred in accordance with s.382(a).

Conclusion

[85] It is determined that the Applicant commenced as an employee on 2 January 2014. Prior to this she was an independent contractor. Accordingly, the Applicant is not a person protected from unfair dismissal under s.382(a) of the Act, as she has not met the minimum period of employment of six months. The application for unfair dismissal remedy, made pursuant to s.394, is jurisdictionally barred and is therefore dismissed.

[86] I Order Accordingly.

COMMISSIONER

 1   Lewis v Altus Traffic Pty Ltd[2015] FWCFB 259.

 2   Defined in s.383.

 3   ACE Insurance Limited v Tifunovski and others [2013] FCAFC 3.

 4   ACE Insurance Limited v Tifunovski and others [2013] FCAFC 3 per Lander J at [9].

 5   ACE Insurance Limited v Trifunovskiand others [2013] FCAFC 3.

 6   Lee v Klean King Pty Ltd[2013] FWC 6759 at [70].

 7   French Accent v Michael Anthony Do Rozario [2011] FWAFB 8307.

 8   French Accent v Michael Anthony Do Rozario [2011] FWAFB 8307 at [30].

 9   Marshall v Whittaker's Building Supply Co (1963) 109 CLR 210 at p. 217 per Windeyer J approved by the majority in Hollis v Vabu (2001) 207 CLR 21 at para [40]; see also Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 (Brodribb) at p. 37.3 per Wilson and Dawson JJ.

 10   Hollis v Vabu (2001) 207 CLR 21 at [47] and [58].

 11   Brodribb esp Mason J at p. 29.3.

 12   Brodribb per Wilson and Dawson at p. 37.2.

 13   “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 at p. 184 per Gray J; Massey v Crown Life Insurance [1978] 2 All ER 576 at p. 579 per Lord Denning approved by the Privy Council in AMP v Chaplin (1978) 18 ALR 385 at p. 389.

 14   AMP v Chaplin (1978) 18 ALR 385 at 389.

 15   Hollis v Vabu (2001) 207 CLR 21 at [58].

 16   AMP v Chaplin (1978) 18 ALR 385 at p. 394.

 17 (1986) 160 CLR 16.

 18   Brodribb.

 19   Flows from the reasoning of Mason J in Brodribb at p 24.

 20   Brodbribb esp Mason J at p 24.4.

 21   Zuijs v Wirth Bros. Pty. Ltd (1955) 93 CLR 561 at p. 571.

 22   Hollis v Vabu (2001) 207 CLR 21.

 23   Humberstone v Northern Timber Mills (1949) 79 CLR 389 at p. 404 per Dixon J.

 24   Brodribb per Wilson and Dawson JJ at p. 36.

 25   Ibid at p. 37.1.

 26   Brodribb per Mason J at p 24.6.

 27   Hollis v Vabu (2001) 207 CLR 21 at [47] see also [58].

 28   Brodribb per Mason J at p. 24.7.

 29   Queensland Stations Pty Ltd v Federal Commissioner of Taxation (1945) 70 CLR 539; AMP v Chaplin (1978) 18 ALR 385 at p. 389.

 30   Brodribb per Wilson and Dawson JJ at p. 36.9.

 31   Hollis v Vabu at [50].

 32   Brodribb per Mason J at p. 24.6; Wilson and Dawson JJ at p. 37.2.

 33   cf Brodribb per Mason J at p. 24.6.

 34   as to paid holidays, see Brodribb per Mason J at p. 24.6.

 35   Brodribb per Wilson and Dawson JJ at p. 37.1.

 36   Ibid at p. 37.2.

 37   Ibid at p. 37.2.

 38   Massey v Crown Life Insurance [1978] 2 All ER 576 at page 579 per Lord Denning.

 39   French Accent v Michael Anthony Do Rozario [2011] FWAFB 8307 at [10]-[29]; TNT Worldwide Express (NZ) Ltd v Cunningham (1993) 3 NZLR 681 at 699.

 40   ACE Insurance Limited v Tifunovski and others [2013] FCAFC 3 per Buchanan J at [25].

 41   For example, ACE Insurance Limited v Trifunovski and others [2013] FCAFC 3.

 42   ACE Insurance Limited v Trifunovskiand others [2013] FCAFC 3 per Buchanan J at [25].

 43   ACE Insurance Limited v Trifunovskiand others [2013] FCAFC 3.

 44   ACE Insurance Limited v Trifunovski and others [2013] FCAFC 3.

 45 (1949) 79 CLR 389 per Dixon J at [404].

 46 Affidavit of Jodie Marie Giles sworn 1 July 2014 at [17].

 47 Affidavit of Louise Michelle Kimber filed 18 July 2014 at [34].

 48   ACE Insurance Limited v Tifunovski and others [2013] FCAFC 3 per Buchanan J at [32]-[33].

 49   ACE Insurance Limited v Trifunovski and others [2013] FCAFC 3 at [34].

 50 Affidavit of Jodie Marie Giles sworn 1 July 2014 at [17].

 51   Affidavit of Louise Michelle Kimber sworn 12 November 2014 at [5(c)].

 52   Affidavit of Louise Michelle Kimber sworn 12 November 2014 at [5(d)].

 53 Affidavit of Jodie Marie Giles sworn 30 October 2014 at [10].

 54 Affidavit of Louise Michelle Kimber sworn 12 November 2014 at [8].

 55 Affidavit of Louise Michelle Kimber filed 18 July 2014 at [34].

 56 Affidavit of Louise Michelle Kimber sworn 12 November 2014 at [14].

 57 Affidavit of Jodie Marie Giles sworn 1 July 2014 at [17].

 58 Affidavit of Louise Michelle Kimber filed 18 July 2014 at [34].

 59   Affidavit of Jamie Hunter Byrnes sworn 1 July 2014 at [47] - [49].

Printed by authority of the Commonwealth Government Printer

<Price code C, PR559676>