Pruessner v Caelli Constructions Pty Ltd
[2022] FedCFamC2G 206
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Pruessner v Caelli Constructions Pty Ltd [2022] FedCFamC2G 206
File number(s): MLG 4184 of 2020 Judgment of: JUDGE MCNAB Date of judgment: 25 March 2022 Catchwords: INDUSTRIAL LAW – FAIR WORK – question of whether the applicant was an employee or independent contractor engaged through a third party – terms of oral contract – subsequent conduct – applicant not an employee – claims for superannuation and long service leave – application dismissed. Legislation: Construction Industry Long Service Leave Act 1997 (Vic) ss 5, 6(1), 12.
Fair Work Act 2009 (Cth) s 13.
Superannuation Guarantee (Administration) Act 1992 (Cth) s 12(3).
Cases cited: Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1
Oze–Igehion v Uber Technology Inc [2017] FCA 1024
Regreen Asset Holdings Pty Ltd v Castricum Brothers Australia Pty Ltd [2015] VSCA 286
ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2
Division: Division 2 General Federal Law Number of paragraphs: 70 Date of last submission/s: 19 November 2021 Date of hearing: 16-19 November 2021 Place: Melbourne Counsel for the Applicant: Mr Howard Solicitor for the Applicant: Holding Redlich Counsel for the Respondent: Mr Fetter Solicitor for the Respondent: Davies Lawyers Pty Ltd ORDERS
MLG 4184 of 2020 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MR PETER PRUESSNER
Applicant
AND: CAELLI CONSTRUCTIONS (VIC) PTY LTD
Respondent
ORDER MADE BY:
JUDGE MCNAB
DATE OF ORDER:
25 MARCH 2022
THE COURT ORDERS THAT:
1.The application filed 3 December 2020 be dismissed.
2.Any application for costs by the Respondent be made within 7 days of these orders supported by written submissions with the Applicant to file written submissions in response within 14 days.
3.The question of costs be determined on the papers in chambers.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
Judge McNab
INTRODUCTION
The Applicant Mr Peter Pruessner (“the Applicant”), makes claims against the Respondent Caelli Constructions (Vic) Pty Ltd (“CC”) that from about August 2012 until about
15 July 2020 he was employed by CC pursuant to an employment contract made in
August 2012.
Paragraph [5] and [6] of the statement of claim filed to the Court on 3 December 2020 provide:
5.In about August 2012, Mr Caelli asked Mr Pruessner to work at Caelli as a full-time employee in the position of formwork supervisor, and Mr Pruessner agreed to do so (Employment Contract).
Particulars
The discussion and agreement was oral, constituted by an informal discussion between Mr Caelli and Mr Pruessner during which Mr Caelli asked Mr Pruessner to come on board full time to supervise concrete formwork pours work and organise safety screens for multi-storey jobs because of the number of projects at the time.
6.At all material times from about August 2012 until about 15 July 2020 (Employment Period), pursuant to the Employment Contract Mr Pruessner:
a. worked, on average, in excess of 38 hours per week; and
b.was a national system employee within the meaning of section 13 of the FW Act.
CC denies that the Applicant was an employee from August 2012 until 15 July 2020. It is said by CC that it engaged Pruessner Holdings Pty Ltd (“PH”) as a supplier of services from time to time under a contractor agreement, and that the Applicant supplied services to CC on behalf of PH.
BACKGROUND
The Applicant is 58 years of age. He commenced working in the building industry as a bricklayer at age 14. He does not hold formal qualifications but says that he learned his trade working with his Father who was also a bricklayer by trade. The Applicant’s Father also performed work for CC in the past. Through that work he came to know Mr Caelli and subsequently formed a friendship with him.
In about 1992, PH was incorporated involving the Applicant, his wife and other members of his family, and in 1999 they established a family trust. Through PH and the trust, they conducted business growing proteas and also selling flowers through a florist shop in Templestowe. PH continued to conduct the protea growing, florist business, then subsequently a hobby type business selling finger boards (miniature skate boards) and a construction contracting business. Since 2011, the Applicant has also been a partner in a crane hire business, known as PGP, together with Mr Caelli.
The protea growing and the florist shop ceased operation in or about 2005.
The Applicant gave evidence that in about 2000 he went back to work as a bricklayer and that in about 2005 commenced completing work for CC. He did that work through PH rendering invoices under that companies ABN. This was not claimed to be employment but was in the nature of jobs that came up and that were offered through contract managers with CC. The Applicant (through PH) also worked for other parties at that time.
From about 2008 until about 2012, for reasons that are not relevant, the Applicant was in a financial position where he did not have to work.
THE APPLICANT’S CLAIMS AND EVIDENCE
At the final hearing, the Applicant gave oral evidence before the Court on 16 & 17 November 2021. Mr Caelli, the former managing director of CC during the relevant period was called on behalf of the Applicant as well as Mr Madjeric, a Project Manager who was an employee of CC.
Outlines of evidence were filed by each of the witnesses who gave evidence before the Court, however both witnesses gave evidence in their own words and evidence was elicited through examination in chief and each of the witnesses were cross-examined.
The Applicant’s Evidence regarding the Employment Contract
The Applicant claims he was employed during the relevant period. As a consequence of that employment, it is claimed he was entitled to benefits as an employee including annual leave pay, redundancy pay upon termination of his employment, long service leave and superannuation-contributions based on the salary he was paid. The Applicant also seeks pecuniary penalties for contraventions of the Fair Work Act 2009 (Cth) (“the FW Act”) by reason of the failure to pay the benefits outlined above.
In relation to questions from his Counsel as to what occurred in 2012 with respect to dealings with CC, the Applicant gave the following evidence:
Paul said “You know, you are just bumming around so you may as well do something. I’ve got some – We have – just signed a couple of big projects so there will be a lot of work coming up”[1]
[1] Transcript page 12, line 24.
The following exchange indicates the evidence that was given by the Applicant in relation to the agreement pleaded to have been made in August 2012. I set the exchange out in full because it shows the flavour of the evidence given and demonstrates the lack of connection between the evidence and contract as pleaded.
So, Mr Pruessner, we just need to go a bit slower. And so we will just go back to 2012 when you started. And your evidence that you were approached by Paul to start working. Now, can you tell the Court what the terms were of that; firstly, what were the hours that you negotiated?---Well, it was a – you know, it was a eight hour day. So I started at 7 o’clock and – and knocked off at 3.30.
Yes. Okay. Pause there. What were the duties that you were asked to do?---Well, I – I started because they – they had a – a lot of factory sites which was called a yard, and it was like a bog hole so I started putting down crushed rock and ---
Yes?---And vibrating it in to – I actually had a little jig that we use on the farm. I started with that, doing some work so they could use all the land for storing, you know cord.
Yes. Did you discuss any other duties that you were going to do?---Well, then I started putting down hard sand, so – because I had a lot – lot of scaffold and – and so – and to get all the drainage right, so we started putting down a lot of concrete.
Okay?--- That I was looking after.
Yes. Did you – what were the terms you negotiated regarding pay?---Well, I just kept billing through Pruessner Holdings, so ---
Yes. What was the amount?--- Well, it – it was an hourly rate at that stage every week, and you know, I put an invoice in maybe every fortnight or something.
And to pause there, did you discuss with Paul at that time the invoicing? Was there a discussion about how you were going to be paid?---Not particularly, no.
No?---He knew that I had that company that – because I – I worked previous, you know, in the early or mid-2000s, so I worked through – through the same company, so - - -
Did you discuss whether it was going to be ongoing?---Yes, he said, “You could come on full board because we have got a lot of work to do.” So - - -
Did you discuss anything about leave?---No.
Did you work - so this is 2012 onward in the chronology?---yes.
Now, just on and from this point, did you work for anyone else?---No.
Okay. When did your work with Caelli end?---When was it? July 2020.[2]
[2] Transcript page 13, line 22 to page 14, line 18.
In relation to the engagement of the Applicant, Mr Caelli gave evidence stating that he started working with the Applicant 20 years ago. In response to the question as to when the Applicant started working with CC permanently, Mr Caelli stated:
Around about eight years we started him off as a sub-contractor, he just continued on from there.[3]
[3] Transcript page 148, line 41.
Mr Caelli gave evidence as put below that there was no discussion about whether the Applicant was going to be an employee or a subcontractor, and the only discussion as to how he was going to be paid was for him to present and invoice.[4]
And what was – what the discussion about the invoice?---It was for how much it was and how many hours and that was that. And time grew – as time grew, we had a – a payroll officer – a – who managed person and so on, and you know, no one readjusted his wage.
[4] Transcript page 149, line 40
Mr Caelli gave evidence about the performance of work done by which was to the effect that he was not required to work set hours but there was an expectation that he would be there when there was work to be done, “we expected him to be there when the other employees were there”. Evidence was given that he was sufficient and that if CC did not have work for him or he had family responsibilities he would not put in an invoice to CC. [5]
[5] Transcript page 162 line 15.
Mr Caelli gave evidence under cross-examination in relation to his understanding of the nature of relationship between the Applicant and the CC was as follows:
“Two questions: (1) You knew the whole time he was a subcontractor?”
“We employed him as a subcontractor and he stayed on permanently”.
(2) “Yes, and so when you said before that your belief was that he was an employee, that is not right. Your belief was that he is a sub-contractor?”
“My belief was that he was part of our team”
“Yes as a subcontractor”
“As a permanent subcontractor”[6]
[6] Transcript page 172, line 18.
As is apparent from those exchanges there was very little in the way of details as to what was agreed. What is apparent is that it was agreed that the Applicant would continue to supply his labour through PH with the difference being that more hours would be worked.
THE RESPONDENT’S EVIDENCE
The following people gave evidence on behalf of CC:
(1)Ms Caelli, current Director of CC, relying on an affidavit filed on 10 May 2021 and witness statement filed 14 September 2021.
(2)Ms Findlay, Office Manager of CC, relying on a witness statement filed on 14 September 2021.
The evidence provided to the Court by these two witnesses summarised the work arrangements of the Applicant during the relevant period. The substance of their evidence is that the Applicant was not regarded as an employee for the purposes of the administration of CC.
Evidence of Ms Caelli
Ms Caelli filed an affidavit of documents on 10 May 2021 outlining specific invoices that were sent by PH to CC for the period of the Applicant’s employment from 2012 until 2020.
Ms Caelli gave oral evidence to the Court on 18 November 2021. She gave evidence as to the background of CC as a family business, where she became the sole director of CC in
March 2020 when her brother, Mr Caelli, resigned his directorship. Ms Caelli gave evidence as to her relationship with her brother Mr Caelli, and that there was tension between herself, her parents and Mr Caelli regarding Mr Caelli’s management of CC prior to his resignation.
In relation to CC’s engagement of the Applicant and PH, she stated that coinciding with the rapid expansion of CC from 2012 onwards, the Applicant completed more jobs for CC. The Applicant was described by Ms Caelli as the person CC would call upon to complete
“ad hoc things”[7] at CC’s yards such as “attending for some maintenance or something like that”.[8]
[7] Transcript page 192, line 7.
[8] Transcript page 192, line 11.
Ms Caelli gave evidence about the steps by which the Applicant was let go, and how that Applicant was given no notice of his cessation of work at CC.
Evidence of Ms Findlay
Relying on her witness statement of 14 September 2021, Ms Findlay as Office Manager of CC detailed how she was responsible for the financial and administrative matters in relation to the company.
With respect to the Applicant, Ms Findlay knew of the Applicant as a person who ran errands and understood that he could be engaged to assist with odd jobs from time to time. From her knowledge, she gave evidence that:
He was a subcontractor, and a lot of the time he ran errands for staff that needed things to be picked up and delivered.[9]
[9] Transcript page 218 line 21.
Ms Findlay provided evidence that invoices from PH were delivered to her by hand by the Applicant each week, with dockets attached to each invoice. Each invoice charged GST and Ms Findlay did not withhold PAYG from payments paid to PH.
Ms Findlay provided oral evidence that the Applicant never made claims to be paid for an RDO, unless he had physically worked it.
Ms Findlay provided oral evidence in relation to WorkCover that:
Subcontractors supply their own WorkCover, and Peter did supply his own WorkCover.[10]
[10] Transcript page 219 line 2.
CONSIDERATION
The evidence in the form of invoices show that from about August 2012, PH rendered invoices to CC for services such as bricklaying, painting of cranes, steel fixing, pumping concrete and supervision. The invoices do not show that there was a fixed minimum number of hours to be worked and there are periods where no invoices were recorded as the Applicant did not work.
The invoices show that the Applicant completed work hours at a rate of $65.00 per hour later increasing to $75.00 per hour and also regularly included the cost of other labour engaged by PH to perform the work for CC. On occasions, the labour included the cost of the Applicant’s son’s labour (he was described as “Mini-me” in the invoices). The Applicant gave evidence that the labour engaged by PH would receive less than the amount invoiced for their work and that PH would retain the difference.
GST was added to each of the invoices and PH obtained tax credits for the GST paid on business expenses.
The tax returns of PH for the relevant period show that the money received by PH in respect of services supplied by the Applicant to CC was treated as income of that company, whilst PH’s business expenses of the construction contracting business were deducted. Director’s fees, trust distributions and for a time wages, were paid to the Applicant and his wife.
By the terms of the discussion between the Applicant and Mr Caelli set out above, the Court finds that there was an agreement that PH agreed to supply services to CC, with that agreement made between the Applicant as a director and shareholder of PH and Mr Caelli on behalf of CC.
As is apparent from the evidence of both the Applicant and Mr Caelli, the evidence does not support a finding that as at August 2012, the Applicant and Mr Caelli as managing director of CC agreed that the Applicant would do work as an employee of CC.
The evidence does not support a finding that this arrangement was forced on the Applicant. Nor is it the case that the Applicant was engaged as an employee and that arrangement was unilaterally changed at the behest of CC so that he was transferred from being an employee to being a subcontractor.
If there is any doubt about this finding, the evidence in relation to the conduct of PH, point to the fact that a business was being conducted by PH. The evidence in relation to the conduct is set out below:
(a)the rendering of invoices to CC by PH;
(b)the filing of tax returns by PH which accounted for the income received based on the invoices rendered by PH to CC; and
(c)that PH paid superannuation contributions on behalf of the Applicant in a number of years .
By way of outline of submissions filed to the Court on 19 November 2021 at paragraph [11] the Applicant contends that the evidence presented to the Court establishes that on and from August 2012:
a)Mr Pruessner worked on a full-time basis according to site schedules, averaging 38 hours per week. He had no choice as to the timing of his work, or the amount he was to deliver. His duty was to generally obey, according to a span of hours, just like every other Caelli employee.
b)Mr Pruessner’s day to day tasks involved supervision of concrete pours, support tasks associated with the same, remodelling safety screens, ordering and collecting materials, and general management and administration duties. He was to serve on the instructions of Caelli’s project managers, foreman, contract managers and directors. He had no control over what he was to do each day, nor how he was to do it.
c)Mr Pruessner was paid $65 per hour between August 2012 and March 2015, $70 or $75 per hour between April 2015 and June 2015, and $75 per hour from July 2015 to July 2020. GST was paid in addition to these amounts. Mr Pruessner was paid by the hour for his labour, rather than on the completion of a task or result.
d)Mr Pruessner was an emanation of Caelli’s business. He was given authority to represent Caelli when dealing with third parties. He worked exclusively for Caelli. He wore Caelli uniform, undertook training at Caelli’s direction and expense, was provided with a Caelli email address, and was given a Bunnings ordering card for the purposes for and on behalf of Caelli. He could not delegate his tasks to other contractors. He was not treated as if he was in business on his own account.
e)Commercial risk for Mr Pruessner’s work was borne by Caelli, rather than Mr Pruessner. Mr Pruessner was not required to maintain any insurance. Caelli provided all of the equipment and materials for the purposes of Mr Pruessner to carry out his tasks. Caelli assumed responsibility for the quality of the Mr Pruessner’s work as they did for every employee.
Much of the evidence of the Applicant was directed at seeking to persuade the Court that it should look past the structures established to supply labour and the rendering of invoices by PH. It was contended that the Court should instead focus on the totality and all other features of the performance of work by the Applicant, where the Court should find that in fact the Applicant was an employee of CC.
The evidence by way of invoices shows that PH engaged other contractors to work on the CC sites and obtained a benefit in doing so. The engagement of contractors by PH was not a one off thing and but in fact occurred regularly. That conduct suggests that PH was running a business and the Applicant was part of that business as an employee or alternatively a director or shareholder.
The invoices rendered by PH also include the supply of parts and materials on occasion to CC on which a mark-up was applied.
Fundamentally I am bound to follow the approach taken by the High Court in ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2 (9 February 2022) and Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1 (9 February 2022). The Court was aware that a decision in the cases was pending at the time when judgment was reserved and has waited until the judgements were published to complete these reasons, in case they have some impact on the analysis in this matter.
The decisions emphasise the primacy of the contract between the parties in determining the true relationship between them. At [162] in Personnel Contracting, Gordon J. stated in relation to the resolution of the question as to whether a person is employed or usually employed by a national system employer:
162.The resolution of the central question requires consideration of the totality of the relationship between Construct and Mr McCourt, which must be determined by reference to the legal rights and obligations that constitute that relationship. Where the parties have entered a wholly written employment contract, as in this case, the totality of the relationship which must be considered is the totality of the legal rights and obligations provided for in the contract, construed according to the established principles of contractual interpretation. In such a case, the central question neither permits nor requires consideration of subsequent conduct and is not assisted by seeing the question as involving a binary choice between employment and own business.[11]
[11] see also Jamsek at [9] per Kiefel CJ, Keane and Edelman JJ.
In this proceeding there is no written contract, and the Court may look at post-contractual conduct to ascertain the terms of the agreement: see Regreen Asset Holdings Pty Ltd v Castricum Brothers Australia Pty Ltd [2015] VSCA 286 at [133-134]:
133.It is well established that evidence of the parties’ post-contractual conduct is not admissible for the purpose of construing the provisions of a formal written contract.
134.It is also well established that, where no formal written contract exists, such evidence is admissible for the purpose of determining whether a contract was formed, who the parties to the contract are and whether a particular term should be inferred. Similarly, in the case of an oral contract, when the issue is not interpreting words but determining the subject matter of the contract as a fact, the Court may have regard to post-contractual conduct.[12]
[12] see also Personnel Contracting at [48] ] per Kiefel CJ, Keane and Edelman JJ and [177],178] per Gordon J
Whilst the evidence given by the Applicant and Mr Caelli about what was agreed in August 2012 was vague, it is clear that there was no agreement that the Applicant would be employed by CC. The subsequent conduct of the parties in relation to PH rendering invoices and supplying labour other than the Applicant which is outlined above, indicates that the arrangement agreed was that PH would supply labour to CC.
PH had rendered invoices to CC prior to August 2012 in relation to the Applicant’s labour and the arrangement continued with the difference being that the Applicant worked more hours from August 2012. The evidence of PH’s conduct in the way that it treated the remuneration it received from CC (both in terms of taxation and the allocation of revenue in excess of expenses) also confirms that the contract was between PH and CC. Contrary to the supplementary submissions of the Applicant, the use of PH and the commercial arrangement employed do provide evidence of what both parties intended to enter into.
This is not a case where sham contracting has been alleged and it is not suggested that the arrangements were entered through the exercise of duress.
The Applicant submits at [7](a) & (b) of his supplementary written submissions that his tax affairs serve no purpose in ascertaining what was mutually agreed by the parties to the contract and is not evidence of what the parties entered into or performed throughout the relationship.
In Jamsek at [63], Kiefel CJ, Keane J and Edelman J make plain that the tax arrangements are highly relevant in determining the question of whether a person is an employee:
63.Even if this disguised submission of sham were to be countenanced, the reality of the situation is that the partnerships, and not the respondents individually, owned and operated the trucks. The partnerships contracted with the company and invoiced the company for delivery services provided by the operation of the trucks. The partnerships earned income from the company, incurred expenses associated with the ownership and operation of the trucks, and took advantage of tax benefits of the structure. It is not possible to square the contention that the respondents were not conducting a business of their own as partners with the circumstance that, for many years, they enjoyed the advantages of splitting the income generated by the business conducted by the partnerships with their fellow partners. [13]
[13] See also Jamsek at [89] –[90] and Barro Group Pty Ltd v Fraser [1985] VR 577
There are matters that may point to an employment relationship, in particular in the way that work was performed by the Applicant and that he worked exclusively at CC for the period. It is the case that the Applicant worked substantial hours at the CC sites and had a supervisory role over CC employees and with subcontractors’ onsite. He was given authority to engage labour for CC and he may have attended in the livery of the company. He was also authorised to purchase goods and supplies for CC. However this was all done in circumstances where the Applicant, Mr Caelli and the witnesses called on behalf of CC were proceeding on the basis that he was not an employee of CC because it was agreed that PH would render invoices which accounted the Applicant’s labour.
I also accept that the rate that PH charged for the labour supplied was at a higher rate that the Applicant would have been paid as an employee of CC. I note that his labour was charged out at $65.00 plus GST per hour for services between 2012 and April 2015 and thereafter $75.00 per hour plus GST to July 2020. This compared to the Award rate of $35.00 per hour for labourers.
The oral evidence of the Applicant and Mr Caelli clearly indicates that they understood the distinction between an employee and a subcontractor and they proceeded on the basis that by PH rendering invoices that the Applicant was not an employee of CC.
The Applicant submits that the existence of PH only goes to the manner in which the parties agreed to administer payment, and that the agreement confirmed arrangements that had been in place when the Applicant was performing odd jobs between 2004 and 2012. It is submitted that there is no evidence of a contract between PH and the Applicant.
The PH accounts for the year ending 30 June 2015 show revenue of $202,183 and expenses of $185,212 which expenses include director’s fees of $121,976, sub-contractor expenses of $15,480 and worker’s insurance.
The accounts show that the Applicant was paid a salary by PH in the financial year of 2017/18, as well as superannuation contributions and WorkCover expenses. Additionally employee amenities were paid: (See CB page 222 of 2061).
The PH profit and loss statement for the year ending 30 June 2019 show total revenue of
$191,239.46 which comprises $182,260.40 as professional fees paid by CC. The expenditure of $200,090.72 includes wages of $70,000, employee amenities of $1,846.79 and superannuation contributions of $6,650.Similarly, the draft accounts for the year ending 30 June 2020 show expenses of wages, superannuation and staff amenities. There is no evidence that there was anyone other than the Applicant and his wife who were employees of PH.
That evidence does support a finding that the Applicant was working for PH whether providing services as a director for which he received director’s fees (in 2015), or as an employee for which he received wages.
Superannuation
In relation to claims that the Applicant was entitled to superannuation pursuant to section
12(3) of the Superannuation Guarantee (Administration) Act 1992 (Cth) (“the SGA Act”), I accept that submission that under that Act only the ATO has the standing to enforce that regime:
Oze–Igehion v Uber Technology Inc [2017] FCA 1024 at [4]&[10]-[20]. This is not a case an entitlement to enforce superannuation contributions is said to arise as part of proceeding to enforce Award entitlements.Further, given that the Court has found that the Applicant has a contract with PH, the ATO ruling SGR 2005/2 takes the position that the SGA Act does not require CC to pay the Applicant superannuation. The accounts of PH also show that superannuation contributions have been made by that company in respect of the Applicant’s services: (See CB page 222 of 2061).
Otherwise I adopt the approach taken by the High Court in Jamsek at [75] when considering whether it should determine arguments that the truck drivers in that case were entitled to the benefit of section 12(3) of the SGA, it was held that it was appropriate for the Commissioner of Taxation to be joined to such proceeding and accordingly the Court remitted that question back to the Full Court of the Federal Court to determine.
Long Service Leave
The Applicant pleads at [28]-[34] of his statement of claim filed on 3 December 2020 that he was entitled to long service Leave ( “LSL” ) pursuant to the Construction Industry Long Service Leave Act 1997 (Vic) (“the CoInvest Act”) .
Section 6(1) of the CoInvest Act provides that:
(1)Every worker is entitled to long service leave, and to be paid benefits out of the fund, in respect of continuous service in the construction industry.
(2)Every working sub-contractor who has paid long service leave charges is entitled to be paid benefits out of the fund in respect of continuous service in the construction industry.
(3)The amount of the entitlement and the method by which that amount is to be calculated are as determined from time to time by the trustee in accordance with the trust deed.
Section 5 of the CoInvest Act provides that:
(1)The trustee may recover any amount of long service leave charge owing to the trustee by an employer or working sub-contractor, together with interest in accordance with subsection (2), as a debt in any Court of competent jurisdiction.
(1A)The trustee may recover an amount referred to in subsection (1) from a related body corporate (within the meaning of the Corporations Act) of an employer or working sub-contractor.
It appears from the scheme of the CoInvest Act that the enforcement of entitlements arising under that Act lies with the Trustee of the fund established under the Act. I accept the submission of the Respondent that there is no evidence that the Applicant has made any claim for LSL monies from the CoInvest fund such so that the Trustee of the fund could make a determination as to whether leave entitlements are payable. A submission has been made by the Respondent that the Applicant has no standing to make a claim against CC in respect of LSL entitlements and has no standing to enforce an entitlement by way of a remedy of a declaration or damages. It also raises that no declaration should be made in relation to LSL entitlements in the absence of the Trustee of the CoInvest fund.
That submission accords with the provisions of the CoInvest Act that I have been referred to by both parties. I note that section 12 of the CoInvest Act has a dispute settlement provision dealing with disputes including at section 12(1)(c):
(c)any other dispute concerning the scheme dealt with by the trust deed between—
(i)an employer and a person or persons employed or engaged by the employer; or
(ii)any person referred to in subparagraph (i) and the trustee; or
(iii)a working sub-contractor and the trustee.
Section 12(2) of the CoInvest Act provides:
If a dispute is not settled, the parties to the dispute must be taken to have entered into an agreement in writing to refer the dispute to arbitration in accordance with the Commercial Arbitration Act 2011 before a sole arbitrator appointed by the Secretary-General for the time being of the Australian Centre for International Commercial Arbitration.
I accept the Applicant has no standing to bring the claim for LSL entitlements under the CoInvest Act as the claim is currently formulated.
Balance of Claims
As to the balance of the Applicant’s claims to redundancy, notice and penalties in relation to record keeping obligations, I find that those matters arise as an incident of employment and in circumstances where I have determined that the Applicant is not an employee of CC, he has no entitlement to the relief sought in respect of those matters.
CONCLUSION
For the reasons outlined I will make orders dismissing the application.
I certify that the preceding seventy (70) numbered paragraphs are a true copy of the Reasons for Judgment of Judge McNab. Associate:
Dated: 25 March 2022
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