Paulis and Secretary, Department of Social Services (Social services second review)

This matter concerned an appeal by Mr Paulis against a decision of the Department of Social Services (the Department) to reject his claim for Newstart Allowance (NSA). Mr Paulis contended that he was unemployed and therefore eligible for NSA, arguing that his involvement in four businesses – two hairdressing salons, a kebab shop, and a café – constituted part-time work, allowing him sufficient time to seek other employment. The Department had rejected his claim on the basis that he did not meet the criteria for unemployment.

The primary legal issue before the Tribunal was to determine whether Mr Paulis was "unemployed" for the purposes of the relevant social security legislation at the time he lodged his claim. This required the Tribunal to consider the meaning of "unemployed" in the context of individuals engaged in their own businesses, even if those businesses were not profitable. The Tribunal also had to assess the adequacy of the financial documentation provided by Mr Paulis to support his claim of business losses.

The Tribunal considered established case law, including *Director-General of Social Services v Thomson*, which clarified that while "unemployed" generally means being without paid work, it does not encompass everyone without work. The court in *Thomson* noted that activities pursued by a person without paid work could be fundamentally incompatible with being considered unemployed, and in such exceptional cases, no further inquiry might be necessary. The Tribunal also referred to *Malaj* and *Brabenec*, cases where individuals engaged in self-employment, even with little financial return or unsuccessful prospecting, were found not to be unemployed. The Tribunal found Mr Paulis's business worksheets lacking in detail, particularly regarding staff costs, and noted that he was working approximately 22 hours per week across his businesses.

Ultimately, the Tribunal affirmed the Department's decision, finding that Mr Paulis did not satisfy the requirements of section 591(1)(a) and (b) of the Act at the time of his claim. The Tribunal concluded that his engagement in his businesses, despite their lack of profitability, meant he was not "unemployed" in the statutory sense. The Tribunal noted that Mr Paulis had since sold or closed his businesses and might be eligible to make a fresh claim if he had not yet found employment.