Paul Luke Williams v JMZ Roof Restorations Pty Ltd
[2010] FWA 6181
•16 AUGUST 2010
[2010] FWA 6181 |
|
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Paul Luke Williams
v
JMZ Roof Restorations Pty Ltd
(U2010/7847)
COMMISSIONER SIMPSON | BRISBANE, 16 AUGUST 2010 |
Unfair dismissal - jurisdictional objections - independent contractor and minimum employment period.
[1] On 9 April 2010 Mr Paul Williams (the Applicant) filed an application pursuant to s.394 of the Fair Work Act 2009 (the Act) alleging that the termination of his employment by JMZ Roof Restorations Pty Ltd (the Respondent) was harsh, unjust or unreasonable.
[2] The Respondent filed a response to the application and raised two jurisdictional objections to the application. The first objection was on the grounds that the Applicant had not completed a period of employment of at least the minimum employment period, and a second objection on the grounds that the Applicant was engaged as an independent contractor and was not an employee of JMZ Roof Restorations Pty Ltd.
[3] The matter was listed for a conciliation conference on 10 May 2010. The matter was not resolved and was subsequently listed for a Directions/Conciliation Conference before Commissioner Spencer on 21 June 2010. That listing was cancelled and the matter was listed for a Jurisdiction Conference/Hearing on Friday 30 July 2010 with Directions for filing submissions and witness statements.
[4] Mr Dean Cameron of the Queensland Master Builders Association filed a Notice of Representative Commencing to Act for JMZ Roof Restorations Pty Ltd on 25 June 2010. On 21 July 2010 an application was filed on behalf of the Applicant seeking permission to be represented by a lawyer Mr Adam Tayler of Workers First Australia Pty Ltd.
[5] Two witness statements were filed on behalf of the Applicant, one from himself and the other from Mr Brian Newman an Industrial Advocate at Workers First Australia Pty Ltd and submissions were also filed on behalf of the Applicant. The Respondent filed submissions with a signed statement from Ms Basia Lydzbinski.
Representation by a Lawyer
[6] The Respondent raised an objection to the Applicant being represented by a lawyer. At the commencement of the hearing on 30 July 2010 the Respondent pressed this objection. I made a determination to grant permission for the Applicant to be represented by a lawyer. I was persuaded by the submission of the Applicant and the material before me that a jurisdictional objection on the grounds that the contract was a contract for service and not a contract of service was by its very nature technical and it would enable the matter to be dealt with more efficiently, taking into account the complexity of the matter to grant permission for legal representation. I also believed it would be unfair not to allow the Applicant to be represented in such a matter when the Respondent was represented by an experienced industrial advocate from the Queensland Master Builders Association.
[7] The Applicant gave evidence on his own behalf at the hearing and was cross examined by Mr Cameron for the Respondent. The Respondent did not seek to cross examine Mr Newman and his evidence in the form of his witness statement was admitted uncontested. The Respondent did not seek to call Ms Lydzbinski or any other witnesses to give oral evidence.
Background
[8] The Respondent offers a range of products and services including commercial and industrial roofing. 1 This includes all aspects of painting. Mr Williams completed his apprenticeship as a painter with the Respondent in three and a half years between 17 January 2005 and 13 June 20082. After the completion of the apprenticeship Mr Williams worked for another company for an unspecified period of time. Mr Williams’ affidavit3 states that he was employed by the Respondent on a full-time basis on 22 January 2009.4 Mr Williams’ engagement was terminated on the 29 March 2010. The Respondent maintains that the engagement was terminated by the Applicant and not the Respondent however that is not a matter for determination at this stage.
[9] The Applicant says he approached the Respondent to see if there was work available in January 2009. The Applicant said in his statement that the Respondent required the Applicant to use his ABN and to provide tax invoices to the Respondent for the work performed by the Applicant which he said he agreed to do as that was the only basis on which he could work for the Respondent. 5 In his witness statement the Applicant said that he was paid $30 per hour when re-engaged6, however in cross examination recalled that he believed he was paid $25 an hour for the first month or two and then increased to $30. 7
[10] The Applicant always worked with at least one other person engaged by the Respondent which was an apprentice who looked to Mr Williams for direction. 8 During his employment as an apprentice between 2005 and 2008 Mr Williams was required to report for work at 5.30am. When the Applicant was engaged in January 2009 by the Respondent he said that he was required to commence work at 5.30am each morning.9 In oral evidence he explained that he was at the shed every morning at 5.30am.10
[11] The Respondent tendered a document, 11 entitled “Zorlan Pty Ltd Contractor Information Form”. The Applicant agreed that he had filled the form out.12 It was not established precisely when the form was completed by the Applicant but it appears from the evidence that it was at the time of engagement. The form provides a start date of 22 January 2009 and an end date of 29 March 2010 which appears to have been written in at or after the end of the contract.
[12] The form includes a section where the Applicant has provided his ABN. The form provides a further section to establish whether the Applicant was GST registered and the Applicant answered “no”. The form also asked that the Applicant provide his superannuation fund name and superannuation fund number and also his bank details. All of this information was provided by the Applicant. Other than completing the “Zorlan Pty Ltd Contractor Information Form” there is no other evidence of any contractual agreement being committed to writing.
[13] The Applicant also completed a weekly time sheet setting out the days of the week he worked and hours he worked on each day under a sub heading of ‘contractors’. The same time sheet had separate sub headings for apprentices: roof tiling, apprentices: painting, supervisors and they were completed by those engaged within those sub groups in the same manner as the Applicant. 13
[14] The Respondent provided the Applicant with a separation certificate dated 1 April 2010 signed by the Administration Manager Ms Lydzbinski stating that the Applicant had been employed by the Respondent from 22 January 2009 until 23 March 2010, and that the reason for leaving was “employment terminated”. 14 The last sentence of the separation certificate states as follows:
“Should you wish to discuss any further details pertaining to the employee in concern please do not hesitate to contact this office....”
[15] The Respondent completed a Centrelink Employment Separation Certificate dated 1 April 2010 15 which provided the same employment start and end dates. In the section providing a reason for separation Ms Lydzbinski, on behalf of the Respondent ticked the boxes ‘unsatisfactory work performance’ and ‘employee ceased working voluntarily’. In a further box headed ‘Please give reason and/or further details’ the Respondent wrote ‘continual disputes over instructions and directions given by managements conflicts’.
[16] The Respondent’s advertising on its web site states as follows:
“..JMZ only employs full-time trade qualified specialists in roofing, painting and decorating and we do not use any sub-contractors...” 16
It was the submission of the Respondent that this was only promotional puff.
Objection
[17] I have adopted the approach of the Full Bench of the AIRC in Abdalla v Viewdaze Pty Ltd 17in addressing this jurisdictional objection.
Was the Applicant conducting a business
[18] A central question in this matter turns on whether the Applicant’s contract with the Respondent was a contract of service or a contract for service. The Respondent as a business holds itself in its promotional material 18 to offer a range of roofing and painting services. The Applicant is a qualified trade painter. Mr Tayler made the following submission on this point:
“…Now, in this case the respondent’s business is to paint roofs and to restore roofs. They have a tiling group and a painting group, as can be seen from the time sheets you’ve been handed up.
That is the nature of their business, so they’re engaging Mr Williams to do what it is that they’re in business to do. It’s not something ancillary to their business. It’s not like they’re getting in an electrician to fix a power point or they’re getting in a plumber to fix the toilet. They’re actually getting Mr Williams to do the work that they do in the business that they in. That, in my submission, is also another significant indicator that Mr Williams is an employee. The services he’s providing, the things that he is doing, are what the employer does in its business…” 19
[19] The Respondent must necessarily engage painters in order to offer the services it promotes itself as offering to the community at large. The fact that the Respondent cannot operate without engaging the services of qualified painters supports the contention that the Applicant was not in business himself as a painter but was an integral part of the Respondent’s business.
[20] The Respondent provided a sample from its purchase register from July 2009 until March 2010 setting out varying amounts paid to the Applicant. Attached to this were a number of tax invoice/statements from the Applicant to the Respondent. 20 These were provided to support the contention that the Applicant was operating a business as a painter as he was providing an invoice to the Respondent for services he had been contracted to perform for the Respondent. However there is no evidence to support the contention that the Applicant was generating any business for himself. The evidence generally points to the conclusion that any contact the Applicant had with clients was organised by, and at the direction of the Respondent.
[21] The Applicant reported for work at a set time and was directed from that point by the Respondent as to what work would be performed. There is no evidence that the Applicant had any involvement in negotiating with clients. The Applicant worked exclusively for the Respondent 21 and was directed not to work at certain times.22 The Applicant was also required to wear a uniform with the logo of the Respondent.23 There is no evidence that the Applicant produced any promotional material or took any steps to promote a business of his own.
[22] The evidence supports a conclusion that the Applicant served the Respondent in their business.
The nature of the work performed and the manner in which it is performed
[23] The Applicant was a qualified trade painter who served his apprenticeship with the Respondent. He was not supervised during the performance of his work once he had arrived at a job location and in fact was generally overseeing the work of an apprentice. However his hours of work were largely controlled by the Respondent. He was required to report for commencement at the same time as others and he was directed where he would work on any given day, so to that extent he was not free to arrange his own work. As the Respondent did not call Ms Lydzbinski to give evidence there was no opportunity for cross examination on the Centrelink Employment Separation Certificate dated 1 April 2010. 24 The statement in the section titled reasons for separation ‘continual disputes over instructions and directions given by managements conflicts’ is indicative of the Respondent believing that they had a right to exercise control over the work performed and the manner in which it is performed.
The terms of the contract
[24] The document entitled the ‘Zorlan Pty Ltd Contractor Information Form’ 25 was completed by the Applicant at the commencement of employment. This document points in both directions in terms of assistance in establishing if the Applicant is an employee or an independent contractor. Certainly the title is indicative of intent for the relationship to be one with an independent contractor.
[25] It provides for a start date of 22 January 2009 and an end date of 29 March 2010. It provides a section for nominating the employment type as being casual, full time or contractor however none of those options has been nominated on the form completed by the Applicant. It provides a section for an ABN number which the Applicant provided. It provides a section for advising if the person completing the form is GST registered and the Applicant answered “no”. The form also asked that the Applicant provide his superannuation fund name and superannuation fund number and also his bank details. The Respondent subsequently paid superannuation contributions to the Applicant for the period of his engagement with the Respondent.
[26] The Respondent has pointed to this document to say that the Applicant was engaged as an independent contractor. In Abdalla v Viewdaze Pty Ltd the Full Bench said as follows:
“The terms and terminology of the contract are important, and must be considered. However, in doing so, it should be borne in mind that parties cannot alter the true nature of their relationship by putting a different label on it. In particular an express term that a 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: that is the parties cannot deem the relationship to be something it is not.” 26
The indicia of an employment relationship
Whether the Respondent exercises, or has the right to exercise control over the manner in which the Applicant’s work is performed, place of work, hours of work and the like
[27] The Applicant did not choose his own hours of work. He performed work initially each day at ‘the shed’ where other workers also reported and assisted to load trucks with paint and tools to complete the day’s work. Having reported to ‘the shed’ he would then be directed to proceed to the worksite at which he would work that day. 27 It was the Applicant’s understanding that he did not have a choice as to whether he worked or not unless he was sick.28
[28] The Applicant was in the practice of completing a time sheet which was kept at ‘the shed’. His evidence was that sometimes he completed the time sheet himself but on occasion it was done on his behalf by Mr John Zorbas or Mr Eddie Manuel who are representatives of the Respondent. The Applicant said the following in evidence:
“Now, you were shown these time sheets and tax invoices. It was suggested to you that your handwriting appears on the time sheets. Are all the time sheets in your handwriting for your particular lines?---Not all the time, no.
So when would it not be your handwriting?---Sometimes it would be when I wasn’t in the shed and Eddie was there or someone else was there, and they filled it out for me. I wasn’t always the only one there, like, that filled out the hours.
Were you the final say on how many hours you worked and what went into your time sheet?---Not always.
Could you explain that? So when would it be that you wouldn’t be the final say on that?---When you took too long on a job or you took too long to drive somewhere.
Occasionally your wages would be docked by half an hour or an hour sometimes, so that’s when it would be changed by someone else or written in by someone else.
And it would be changed on the time sheets?---On the time sheet, yes.
And you submitted your tax invoices based on the time sheets?---Time sheets, yes.
So who determined if you had taken too long on a job?---Eddie and John.
Who determined if you had taken too long to drive to a job?---Eddie or John.
By Eddie and John, you’re referring to Eddie Manuel?---Yes.
And John Zorbas?---Yes.” 29
[29] This evidence indicates that not only was the Applicant required to report the hours of work he completed on each day on a time sheet but that representatives of the Respondent would make deductions in the number of hours the Applicant would be paid if it was deemed a job took too long or the time spent travelling was too long. The Applicant did not make arrangements regarding where, or for who he worked as this was done by the Respondent. This supports the conclusion that the Respondent was exercising control over the manner in which the Applicant’s work is performed, the place of work and the hours of work.
Whether the Applicant works for others (or has a genuine and practical entitlement to do so)
[30] The Applicant said that he worked exclusively for the Respondent. 30 The time sheets31 tendered would indicate that the hours of work the Applicant was performing for the Respondent on an ongoing basis were close to what would ordinarily be regarded as full-time hours of work if the relationship was a contract of service.
[31] The Applicant gave evidence that he worked most days unless there was slow work or a rainy day. 32 On that basis there would have been a limited scope for the Applicant to have a genuine and practical entitlement to perform work for others.
Does the Applicant have a separate place of work and/or advertises his or her services to the world at large?
[32] The Applicant was not cross examined specifically on this point. There is no evidence that the Applicant had a separate place of work or made any effort to advertise his services to the world at large. He said in his witness statement 33 that he was advised not to turn up to work for 3 weeks over the Christmas period in 2009. It was his evidence that he stayed at home during this period and did not perform any other work.34
Whether the Applicant provides or maintains significant tools or equipment
[33] In his witness statement the Applicant said that the Respondent supplied all tools, materials, paint, personal protective equipment and plant and equipment required to complete his work other than the odd paint brush which he would supply himself if there were no others available. 35 He confirmed he did supply brushes or rollers on occasion in oral evidence.36 The evidence is that he did not provide significant tools or equipment. Paint was supplied by the Respondent.37
Whether the work can be delegated or subcontracted
[34] The Applicant was asked directly in cross examination if he thought he had the right to engage others and he answered no. 38
Did the Respondent have the right to suspend or dismiss the person engaged?
[35] There is no written contract between the parties that addresses this issue however the written statements made by representatives of the Respondent in the separation certificate provided to the Applicant and also the Centrelink Employment Separation Certificate indicate that the Respondent believed they had the right to dismiss the Applicant.
Did the Respondent present the Applicant to the world at large as an emanation of the business?
[36] The Applicant was required to wear a uniform with the logo of the Respondent. It was the Applicant’s evidence that payments for work performed were generally made by cheque or credit card and less often by cash. Deposits were first processed through the office. If paying by cheque, the cheque would be made out to the Respondent 39 and given to the Applicant who would then provide an invoice. If the client was paying by credit card the Applicant would direct the client to the office where staff would process payment over the phone. The Applicant said where he did receive money from clients on behalf of the Respondent at the end of a job he would return to the workplace and hand the money to Mr Manuel or another administration person employed by the Respondent. Both the requirement to wear a uniform with a company logo and the method of receiving payment from clients is indicative of the Applicant being an emanation of the business.
Was income tax deducted from remuneration paid to the Applicant?
[37] No income tax was deducted from payments made to the Applicant.
Was the Applicant paid a periodic wage or salary or by reference to completion of tasks?
[38] The Applicant was paid by reference to the hours of work he completed each week which were recorded on a time sheet. He would then submit an invoice each Monday morning for a sum which was calculated by multiplying the number of hours performed in the week based on the hours recorded on the time sheet by the hourly rate of pay. The Applicant did not charge GST for his services. It is clear the method of payment was based on hours performed not tasks completed.
Was the Applicant provided with paid holidays or sick leave?
[39] No.
Did the work performed by the Applicant involve a profession, trade or distinct calling on the part of the person engaged?
[40] The Applicant was a trade qualified painter.
Whether the Applicant created goodwill or saleable assets in the course of his or her work
[41] There is no evidence that the Applicant created any goodwill or saleable asset in the course of his work.
Whether the Applicant spends a significant proportion of his remuneration on business expenses
[42] The Applicant gave evidence that he had to pay for his own fuel and the maintenance of his vehicle which he used to transport himself and others to and from job sites. From time to time he also provided his own paint brushes and rollers but not always. The purchase register tendered during the hearing 40 sets out that the Applicant was paid $40,930 for the period from 6 July 2009 to 29 March 2010 which is approximately nine months. I understand the pattern of employment between July 2009 and March 2010 is representative of the preceding period and on that basis the Applicant would have been paid somewhere in the order of $55,000 for the twelve month period prior to his termination. I do not believe the proportion of his remuneration spent on business expenses was significant.
Conclusion on jurisdictional objection that the Applicant was not an employee
[43] For all of the reasons set out above the nature of the relationship between the Applicant and the Respondent leads me to a clear conclusion that the Applicant was an employee of the Respondent and not an independent contractor.
[44] In performing his role as a trade qualified painter the Applicant was an integral part of the business of the Respondent. It is also clear to me from the evidence that the Applicant was not conducting his own business during the time he was engaged by the Respondent. The jurisdictional objection that the Applicant was not an employee is dismissed.
Objection Minimum Employment Period
[45] The Respondent raised a jurisdictional objection on the grounds that the Applicant is not protected from unfair dismissal on the grounds that the Applicant had not completed the minimum employment period. The relevant parts of the legislation regarding this objection are 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
…………………..................
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.
384 Period of employment
(1) An employee’s period of employment with an employer at a particular time is the period of continuous service the employee has completed with the employer at that time as an employee.
(2) However:
(a) a period of service as a casual employee does not count towards the employee’s period of employment unless:
(i) the employment as a casual employee was on a regular and systematic basis; and
(ii) during the period of service as a casual employee, the employee had a reasonable expectation of continuing employment by the employer on a regular and systematic basis; …………”
[46] The Respondent did not contend that it was a small business employer. The Respondent has argued that the Applicant was not engaged on a regular and systematic basis as a casual for six months and the Applicant could not hold a reasonable expectation of continuing employment on a regular and systematic basis. To support this submission the Respondent made the claim that the Applicant was engaged in the building and construction industry with an inherent turnover on a job by job or day by day basis.
[47] On review of the purchase register 41 tendered by the Respondent it is evident that the Respondent made payments every week to the Applicant between 6 July 2009 and 29 March 2010 with the exception of a three week period in late December 2009 and early January 2010. As I understand it a similar pattern of employment occurred from January 2009 to July 2009 but for the purposes of this argument and convenience I have had regard to the period referred to above as written records were provided. The period from 6 July 2009 to 29 March 2010 represents 38 weeks.
[48] It was uncontested that the payments recorded in the purchase register represented the weekly totals based on the hourly rate (which was $30 per hour during this period) multiplied by the number of hours worked in each week. It is also uncontested that the Applicant reported for work at the same starting time of 5.30am however payment did not commence on an hourly basis until 7.00am.
[49] The total paid to the Applicant in this period was $40,930. Across the period this equates to an average of $1,077.10 per week over the preceding nine months and an average of 35.9 hours per week. It should be remembered that this average figure includes a 3 week period in December 2009 and January 2010 where no work was performed at all. Over the last 26 weeks in which the Applicant actually performed work before the end of his engagement he was paid a total of $29,460 which averages out to $1133 per week or an average of 37.76 hours per week. The purchase register also demonstrates that the pattern of hours in those weeks of the Applicant’s employment was regular and systematic in that in only 5 of those 26 weeks that he worked did he earn less than $1,000 (or therefore less than 33 hours). The lowest figure he earned with the exception of the three week break over the Christmas period was $540 which equates to 18 hours of work. It was acknowledged that the Applicant did not work from 18 December 2009 until 11 January 2010 and did not earn an income during that period.
Conclusion on jurisdictional objection on minimum employment period
[50] In A Willems v Susan Gunn trading as Eureka Coaches 42 Ms Willems worked as a bus driver on a regular roster three weeks on and one week off, however as she was engaged as a casual she did not work during school holiday periods. Despite this, her casual employment was found to be on a regular and systematic basis. I find in this case that despite the three week break the Applicant was directed to take from December 2009 to January 2010 his employment was on a regular and systematic basis.
[51] Having regard to all of the evidence including the pattern of employment worked by the Applicant, I am also satisfied that the Applicant had a reasonable expectation of continuing employment by the employer on a regular and systematic basis.
[52] I find that the Applicant satisfies the requirements of the legislation regarding the minimum employment period of six months; and the requirement that the employment was on a regular and systematic basis; and that he had a reasonable expectation of continuing employment on a regular and systematic basis. I dismiss this jurisdictional objection on these grounds.
Conclusion
[53] Having dismissed both grounds for jurisdictional objection the matter will now be listed for hearing of the substantive application.
COMMISSIONER
Appearances:
A Tayler on behalf of the Applicant.
D Cameron on behalf of the Respondent.
Hearing details:
2010.
Brisbane:
30 July.
1 Exhibit 1 attachment BAJN 1
2 Exhibit 2 Para 20
3 Exhibit 2 Para 3
4 Exhibit 2
5 Exhibit 2 Para 7
6 Exhibit 22 Para 22
7 PN 111-113
8 PN 78 to 81
9 Exhibit 2, Para 28
10 PN 94-96
11 Exhibit 3
12 PN 116
13 Exhibit 4
14 Exhibit 2 PLW 1
15 Exhibit 2 PLW 2
16 Exhibit 2 PLW 3
17 Abdalla v Viewdaze Pty Ltd t/as Malta Travel, PR927971 at pn 34, 14 May 2003, Lawler VP, Hamilton,DP, Bacon C).
18 Exhibit 2 PLW 3 and 4 Exhibit 1 BAJN 1, BAJN 2
19 PN 315 and 316
20 Exhibit 4
21 Exhibit 2 Para 8
22 Exhibit 2 Para 10 PN68-72
23 Exhibit 2 Para 14
24 Exhibit 2 PLW 2
25 Exhibit 3
26 Abdalla v Viewdaze Pty Ltd t/as Malta Travel, PR927971 at pn 34, 14 May 2003, Lawler VP, Hamilton DP, Bacon C).
27 Transcript PN75
28 Transcript PN155
29 Transcript PN272-281
30 Exhibit 2 Para 8 and transcript PN68-72
31 Exhibit 4
32 Transcript PN137
33 Exhibit 2 Para 10
34 Transcript PN68-72
35 Exhibit 2 Para 35
36 Transcript PN102-104
37 Transcript PN206
38 Transcript PN160
39 Transcript PN152
40 Exhibit 4
41 Exhibit 4
42 A Willems v Susan Gunn trading as Eureka Coaches PR9099671 (3 October 2001) Gay C
Printed by authority of the Commonwealth Government Printer
<Price code C, PR500493>
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