Raphael Arce v Roller Truck Australia Pty Ltd T/A Roller Truck Australia Pty Ltd

[2020] FWC 3352

[2020] FWC 3352

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Raphael Arce
v
Roller Truck Australia Pty Ltd T/A Roller Truck Australia Pty Ltd
(U2019/11995)

DEPUTY PRESIDENT CROSS SYDNEY, 26 JUNE 2020

Application for an unfair dismissal remedy.

BACKGROUND

[1] An application was filed on 28 October 2019, by Mr Raphael Arce (the “Applicant”) pursuant to s.394 of the Fair Work Act 2009(Cth) (the “Act”). The Applicant sought an unfair dismissal remedy of monetary compensation and payment of entitlements following his alleged dismissal by Roller Truck Australia Pty Ltd (the “Respondent”) that took effect on 8 October 2019.

[2] In the Form F3 Employer Response to Unfair Dismissal Application, the Respondent stated that the Applicant had been an employee of the Respondent, however that employment had ceased by way of the Applicant’s resignation in March or April 2012. It further stated that the Applicant was an employee of International Network Express Pty Ltd (“INE”), and that INE provided labour hire to the Respondent, with the Applicant being one of the persons provided to the Respondent by INE. The jurisdictional objection was identified as being that the Applicant was not an employee of the Respondent.

[3] On 29 January 2020, directions were issued for the filing of submissions, statements and other documentary materials upon which each party would rely in relation to the jurisdictional objection. In accordance with the directions the following materials were filed by the parties:

(a) On 18 February 2020, the Applicant filed a document titled “Applicant’s Submission for an Unfair Dismissal Remedy” with seven annexures (the “Applicant’s Submission”);

(b) On 17 March 2020, the Respondent filed a document titled “Outline of Submissions in relation to Jurisdiction” (the “Respondent’s Submission”), together with a statement by Robert Burge with four attachments, and a statement by Mark Zanetic with two attachments; and

(c) On 7 April 2020, the Applicant filed a document titled “Applicant’s Submission for an Unfair Dismissal Remedy” with ten annexures (the “Applicant’s Reply Submission”).

[4] The matter was heard on 17 April 2020. At that hearing the Applicant represented himself and the Respondent sought to be represented by their agent, Mr D Houlihan of First IR Consultancy. The Applicant objected to permission to represent being granted, or continued as there was previous representation, to Mr Houlihan in the matter.

[5] I determined to grant the Respondent permission to be represented by Mr Houlihan. I did so because I found that there was a complexity in the matter and that the Commission would be assisted by the involvement of Mr Houlihan. I particularly noted the following concession by Mr Houlihan, in response to my suggestion that where an applicant is unrepresented that it would not be unusual for the Commission Member to take a more proactive role in questioning witnesses:

“I absolutely accept that, Deputy President, and I think due to the nature of the material that Mr Arce has filed, either you, sir, would have to take a very proactive role or I would have to take more of a role of an amicus to try and extract the relevant information that’s required before the Commission. I would be very happy for the Commission to take an active role in assisting Mr Arce.” 1

The Evidence

(a) The Applicant

[6] The Applicant did not file any statements. The Applicant’s Submission and the Applicant’s Reply Submission, however, contained numerous factual assertions. A practical approach to dealing with those submissions was adopted, with the consent of the Respondent, and the factual assertions contained in the Applicant’s Submission and the Applicant’s Reply Submission were treated as the statements of the Applicant.

[7] The Applicant stated that he was employed by the Respondent on 1 October 2008, as a Truck Driver. The Applicant was required to provide an Australian Business Number (‘ABN’) and invoiced the Respondent on a weekly basis. From October 2008 to October 2019, the Applicant was paid $27.50 per hour. On or about July 2011, the Applicant was directed by the Respondent to undertake clerical and administrative duties, and from March 2012 was also directed to allocate and manage the Respondent’s vehicles in addition to the clerical and administrative duties.

[8] From October 2008 to October 2019, the Applicant stated that he was under the direction, control and instruction of the Respondent. However, on or about 3 October 2012, the Applicant was directed by Mr Robert Burge (“Mr Burge”), Managing Director of the Respondent, to invoice INE. INE is a courier labour hire agency. The Applicant stated that he continued to perform the same work for the Respondent under its direction and control, using its equipment and in its uniform, and continued to be paid $27.50 per hour. In the 2018 - 2019 financial year the Applicant earned approximately $58,000.00.

[9] The Applicant provided an undated organisation chart of the Respondent that recorded the Applicant as being “Administration”.

[10] On 20 September 2019, the Respondent notified the Applicant of his dismissal. Thereafter, and until the termination taking effect on 8 October 2019, the Applicant was required to attend various meetings with clients of the Respondent.

[11] The Applicant stated that he worked consistent hours, which were: Monday to Friday from 8.00am to 6.00pm, and Saturdays from 5.00am to 2.00pm. He would sometimes work on Sundays and Public Holidays. He was always paid a flat rate of $27.50 per hour. The Applicant worked solely for the Respondent, and did not engage in work elsewhere or have any additional jobs.

[12] The Applicant noted that the Respondent provided him with:

(a) An identification card that listed the Applicants name and photograph, and the Respondent’s name;

(b) The Respondent’s uniform consisting of work shirts, jumpers and vest;

(c) A mobile telephone with a telephone number for the Respondent;

(d) A desk and computer in the Respondent’s workplace to carry out duties during business hours; and

(e) Business cards that identified the Applicant as Administration/Accounts Manager of the Respondent.

[13] The Respondent did not withhold or deduct income tax. This was the responsibility of the Applicant. The Applicant was paid on Fridays on a weekly basis. The Respondent did not provide paid holidays or sick leave.

(b) The Respondent

[14] The Respondent lead evidence from Mr Burge, the Managing Director of the Respondent, and Mr Zanetic, the Managing Director of INE.

(i) Burge

[15] Mr Burge stated that the Applicant started working with the Respondent from at least May 2007. The Applicant originally started as an independent contractor, performing driving duties. He moved from those duties to providing IT and administrative support from around July 2011. Mr Arce was paid $25 per hour plus GST for the entire period that he was a contractor with the Respondent.

[16] Mr Burge stated that in late July 2012, the Applicant left the Respondent to take care of some personal issues that he had in Queensland. He was unsure of the exact date that the Applicant stopped working with Roller Truck, but a review of bank statements showed the last deposit made by the Respondent into the Applicant’s account was made on 3 August 2012.

[17] Mr Burge stated that up to 2012, the Applicant was an independent contractor, and was not paid any leave or superannuation on his leaving from his service with the Respondent in 2012. The Applicant would prepare an invoice of the hours that he worked, and the Respondent would pay weekly in accordance with that invoice. At the time that the Applicant left the Respondent in 2012, there was no agreement or understanding that the Applicant would return, or that if he did return, that a position would be held open for him.

[18] The Respondent has used INEas a courier service, and as a labour hire service, since approximately 2000. INE provided 4 labour hire candidates to the Respondent. Mr Burge recalled that on the Applicant’s return from Queensland in October 2012, that he told the Applicant that he was using INE, and that he had a position available for the Applicant through INE. He did not negotiate with INE as to the rate that the Applicant charged INE for his services, nor the method of payment, nor on what basis he was engaged by INE. He left all of those arrangements to be settled between the Applicant and Mr Zanetic.

[19] The Respondent’s arrangement with INE was described by Mr Burge as “straight forward”. INE provided candidates to perform work within the Respondent, and each month INE prepared an invoice for services rendered. The Respondent generally had control as to how the work was performed, and the Respondent directed the performance of the work and provided the workplace where that work was performed. The Respondent provided an office for the Applicant to use, however, in the last 2 years the Applicant performed his duties mainly from home.

[20] Mr Burge stated that the Respondent did not provide the tools necessary for the performance of the Applicant’s work. They were all provided by INE. These tools included a mobile phone, a laptop and printer. From time to time, the Respondent may have sourced the equipment, but it was always reimbursed by INE, and INE always retained ownership of the tools that the Applicant used.

[21] Where the Applicant was not available for work, such as him taking a period of leave, INE continued to supply a person to fill the Applicant’s role. At various times Mr Burge discussed with the Applicant the taking of periods of leave. The Respondent did not require the Applicant to give notice of when he took leave.

[22] Mr Burge noted that the Respondent did provide training to the Applicant, and did provide documentation, such as business cards that held out that the Applicant was part of the Respondent. The Respondent did not from October 2012 pay any money to the Applicant.

[23] In August 2019, Mr Burge decided that the role that the Applicant was performing was probably no longer necessary. He tried to speak to Mr Zanetic about this, but due to the ill health of his mother, Mr Zanetic was not available. On 20 September 2019, Mr Burge spoke to the Applicant and informed him that the Respondent would not be needing anyone in his role in an ongoing basis, and that he was telling the Applicant this because Mr Zanetic was away. Mr Burge told the Applicant that the work would probably finish around 10 October. On Mr Zanetic’s return, Mr Burge spoke to him about the Applicant’s role. In that discussion they agreed that the Applicant’s last day at the Respondent would be 8 October 2019.

(ii) Zanetic

[24] Mr Zanetic stated that INE provides a range of services, worldwide, to a range of clients, including Qantas Freight, Rell Freight and the Respondent. INE had in excess of 600 different clients operating out of Australia, the USA, Japan, New Zealand, the UK, Singapore, China and South Africa.

[25] The services INE provides to its clients include domestic and international couriering as well as labour hire services. Regarding the Respondent, INE provide both a couriering service, and a labour hire service. At the time of making his statement, INE provided 4 other people to the Respondent as labour hire. INE has provided a labour hire service to the Respondent since 1999. There is no written contract between INE and the Respondent.

[26] Mr Zanetic stated that the Applicant started with INE in or about October 2012. The Applicant performed work at the direction of the Respondent, and billed INE for his time. If the Applicant could not attend work on any day, INE would provide another candidate, sometimes Mr Zanetic himself, to perform the work instead of the Applicant. Generally, the Applicant would contact Mr Zanetic by email or text and let him know when he couldn’t attend.

[27] Mr Zanetic noted that, while the Applicant commenced with INE in October 2012, in July 2016 he and the Applicant agreed to written terms of his arrangement with INE. He attached a document to his statement that he said were “a copy of those terms as agreed on 1 July 2016” (the “Terms of Agreement Document”).

[28] The Terms of Agreement Document annexed to Mr Zanetic’s statement was to a large extent illegible. After the hearing of the matter the Respondent kindly provided the Commission with a clearer copy of that document. That clearer document disclosed that it was an “On Hire Casual (Temp) Industrial Assignment Order”, apparently directed to an undisclosed employer client of INE. It was only signed by Mr Zanetic, and while mentioning the Applicant, did not seem to be directed to the Applicant.

[29] INE provided the Applicant all of the tools that he required to perform his role. Where the Respondent purchased any equipment, such as a laptop, INE would reimburse the Respondent upon provision of a receipt for such expenditure.

[30] The Applicant was paid weekly by electronic funds transfer by INE. The Applicant would produce a timesheet, and INE would pay on that time sheet.

Factual Findings

[31] Each of the witnesses was cross-examined, and each witness provided considered answers with appropriate candour and concession where necessary. The evidence received from those witnesses in the hearing clarified many of the matters before the Commission, and assisted my determination of the following facts.

(a) The Applicant was employed by the Respondent as a truck driver on 1 October 2008, to around July 2011. He thereafter performed clerical and administrative duties, and from March 2012, also undertook allocation and management of the Respondent’s vehicles in addition to the clerical and administrative duties.

(b) In about July to September 2012, the Respondent suffered an apparent downturn in business. That lead to Mr Burge restructuring the Respondent.

(c) Up until 3 August 2012, the Respondent paid the Applicant by directly depositing monies into the Applicant’s bank account. After 3 August 2012, and in the period encompassing August and September 2012, the Applicant received cash payments or cash deposits from the Respondent of around $2,400.00, representing around 80 hours work in that two month period. While Mr Burge, in examination in chief, stated he did not remember making such payments 2, I note his recollection of the events in that period were vague, and prefer the specific evidence of the Applicant that such payments were made.

(d) While in his statement Mr Burge had stated that in late July 2012, the Applicant left the Respondent to take care of personal issues he had in Queensland, he candidly conceded that he had no direct knowledge that the Applicant had so travelled to Queensland 3. I find that the Applicant did not travel to Queensland, and instead worked at the Respondent at that time for significantly less than what would be considered full-time hours.

(e) On or about 3 October 2012, the Applicant was directed by Mr Burge to direct his invoices to INE instead of the Respondent. Mr Burge explained that the change was “simply for tax purposes”. While in his statement Mr Burge stated that the Applicant had reconnected with the Respondent in October 2012 after a period of absence, in examination in chief he gave the following candid evidence:

Okay. So when - your evidence is that Mr Arce finished up with you in July. How did Mr Arce reconnect with you the end of September, beginning of October? How did that occur?  -In all honesty I don’t know that I exactly remember that but it would have been - it was probably, yes, I don’t know that I remember that. Yes, I don’t know that I remember that.

So how can you be certain that - so how did the arrangement to your knowledge, what you know, how do you know that an arrangement between Mr Arce and INE was entered into?  -Well, the only way I know that is because I didn’t have a job or I wasn’t willing to put Mr Arce on the books of my company at that time because we were restructuring and we didn’t have a full - or any position that he was looking for at that time.

So how was that communicated to Mr Arce?  -Well, just that the structure of the company was now different to what it was originally and I had no intention of employing certain people under arrangements that were in the past or - I mean not just Mr Arce but others that had left or - yes.

Do you recall when, where this conversation occurred?  -I would - no, in all honesty I don’t remember the exact location of where it occurred, no.

(f) At all times from 1 October 2008, until 8 October 2019, whether he was invoicing the Respondent (until 3 October 2012), or INE, the Applicant would charge $27.50 per hour, being $25.00 plus GST. The Applicant did not remit the GST to the Australian Tax Office, but kept the total amount as income and disclosed such income to the Australian Tax Office. In the 2018/2019 financial year the Applicant earned approximately $58,000.00. The Applicant had provided the Respondent with an ABN in 2008, but it was never used for GST purposes.

(g) At all times from 1 October 2008, until 8 October 2019, the Applicant was under the direction, control and instruction of the Respondent. He was described variously in documents of the Respondent as Administration, Operations Manager and Compliance Administration Manager. As Mr Burge accepted, the Applicant wore a number of hats within the Respondent. The Applicant worked solely for the Respondent, and did not engage in work elsewhere or have any additional jobs.

(h) The Applicant worked relatively consistent hours, which were: Monday to Friday from 8.00am to 6.00pm, and Saturdays from 5.00am to 2.00pm. He would sometimes work on Sundays and Public Holidays. He was always paid the flat rate of $27.50 per hour. The only time sheet in evidence 4 lists the Applicant working 64 hours in a week, with the following hours being worked:

Friday 13 hours

Saturday 8.5 hours

Monday 10 hours

Tuesday 10.5 hours

Wednesday 11 hours

Thursday 11 Hours

(i) The Respondent provided the Applicant with an identification card that listed the Applicants name and photograph, and the Respondent’s name, a uniform of the Respondent, a mobile telephone with a telephone number for the Respondent, and business cards that identified the Applicant as Administration/Accounts Manager of the Respondent.

(j) The Respondent also provided the Applicant with a desk and computer in the Respondent’s workplace to carry out duties during business hours, though in the last two years the Applicant had worked predominantly from home.

(k) The Respondent and INE did not withhold or deduct income tax. The Applicant was paid on Fridays on a weekly basis. The Respondent and INE did not provide paid holidays or sick leave. On some occasions when the Applicant was sick, Mr Zanetic would perform the Applicant’s work for the Respondent.

(l) At various times the Applicant purchased various tools of trade, such as a mobile phone and a laptop computer, on the Respondent’s credit card. Upon presentation of the invoices, INE reimbursed the Respondent for the cost of those purchases.

(m) On 20 September 2019, the Respondent notified the Applicant of his dismissal. Thereafter, and until the termination taking effect on 8 October 2019, the Applicant was required to attend various meetings with clients of the Respondent.

[32] The labour hire arrangement between the Respondent and INE by which the Applicant was provided to the Respondent was far from a standard commercial arrangement. The circumstances in which the contracting with INE came about was described by Mr Burge in paragraph [31(e)] above.

[33] Mr Zanetic gave somewhat different evidence regarding why it was that the Applicant came to be paid by INE. Mr Zanetic’s evidence was 5:

“Why did it change to you?  -Well, Bobby [Mr Burge] and I go back 30 years and some of the - because I’m a one-man band since about five years ago - six years ago, we share the labour, so some of the guys are paid by INE and the majority of the guys are paid by Roller Truck.”

[34] The Respondent went from a position pre 3 October 2012, where it was paying the Applicant $27.50 per hour, to a position post 3 October 2012 where it was paying INE $27.50 per hour for the Applicant’s services. Not only was INE not making any money on the provision of the services of the Applicant, it was actually making a loss because INE reimbursed the Respondent for the cost of any tools of trade that the Applicant had purchased on the Respondent’s credit card.

[35] Mr Zanetic explained why he was involved in such an unprofitable arrangement. His evidence was as follows 6:

“So you don’t make a cent?  -No.

In fact, you make less than a cent because you provide equipment?  -That’s correct. But that’s the arrangement we made. I’m going to make money on a working relationship. If I do a job - if Bobby [Mr Burge] bills me for a job, say, from Port Botany out to Lansvale for example, $400 and he bills me 400 GST plus fuel. It works both ways.

So your employment - to use the vernacular your - I won’t use the word “employment”, but your engagement of Mr Arce and the basis upon which you provided it to Mr Burge’s company was - - -?  -Yes.

- - -a loss-leader?  -Yes. That’s - - -

Do you understand what I mean by the term loss-leader?  -Yes. Yes, but what I’m saying is whatever Ralph [the Applicant] billed me that’s what I billed Bob [Mr Burge], and then at the end of the month or whatever the contra operates, if I - for example if I bill Bob 32 grand, he might bill me 42 grand for the other work that I’ve done or he’s done for me.”

Applicant’s Submissions

[36] The Applicant submitted that he:

(a) was an employee of the Respondent employer under a sham contracting arrangement;

(b) had been employed by the Respondent for more than twelve (12) months;

(c) was covered by the Clerks – Private Sector Award 2010;

(d) had an annual rate of earning that was less that the high-income threshold;

(e) was unfairly dismissed pursuant to section 385 of the Fair Work Act 2009 (“the Act”).

[37] The Applicant submitted that the Respondent was the employing entity due to a sham contracting arrangement between INE, the Respondent and the Applicant.

[38] While on or about 3 October 2012, the Applicant was directed by Mr Burge, to invoice INE, he remained under the direction, control and instruction of the Respondent. The Applicant referred in his submissions to Respondent providing the Applicant with:

(a) The Respondent’s Identification Card;

(b) The Respondent’s uniform consisting of work shirts, jumpers and vest;

(c) A mobile telephone with a telephone number for the Respondent;

(d) A desk and computer in the Respondent’s workplace to carry out duties during business hours;

(e) Business cards for meetings stating that the Applicant was represented by the Respondent as Administration/Accounts Manager.

[39] The Applicant relied upon the judgment of the Full Court of the Federal Court in Damevski v Giudice 7 and the judgment of the Federal Circuit Court of Australia in Fair Work Ombudsman v Happy Cabby Pty Ltd & Anor8.

Respondent’s Submissions

[40] The Respondent commenced its submissions by clearly delineating the basis of its jurisdictional objection to the Application. The Respondent’s jurisdictional challenge was that the Respondent was not the employer of the Applicant. It was no part of the Respondent’s challenge that the Applicant was not an employee per se, simply that the Applicant was not the employee of the Respondent.

[41] The Respondent submitted that for there to be an employment relationship between the Applicant and the Respondent there must be a contract of employment between the Applicant and the Respondent. In relation to the existence of such a contract, the Respondent noted that:

(a) There was no legal intention to create such a contract. The evidence is that from October 2012, there was a contract between the Applicant and INE. At best for the Applicant, whilst engaged by INE, he continued to perform work in the premises of the Respondent. This was no different to an IT consultant or accountant working in a client’s business and by itself, does not establish any objective indication that the parties intended to enter into a legally binding arrangement.

(b) The evidence of the Respondent is that after October 2012, there was an offer from INE that the Applicant would be paid $25 per hour plus GST. The evidence is clear that the Applicant accepted this offer, and the acceptance is evidenced by his conduct in attending and performing work the subject of the offer. There is no evidence that post October 2012, there was any offer from the Respondent to the Applicant. In fact, the evidence of the Respondent is all the other way, that the contractual relationship was with INE and not with the Applicant.

(c) As to valuable consideration, the evidence is clear that each week the Applicant would prepare an invoice of the hours that he worked and provide that invoice to INE. INE would pay that invoice.

[42] In conclusion, the Respondent submitted that post July 2012, there was no contract between the Applicant and the Respondent, let alone a contract of employment. Hence there was no employment relationship, and accordingly, the Respondent was never the employer of the Applicant.

[43] In its submission the Respondent made a number of concessions. It conceded that

the Respondent:

(a) Exerted control over the performance of work of the Applicant;

(b) Had the Applicant work consistent hours during regular business hours; and

(c) Presented the Applicant as an emanation of itself. This manifested in the use of business cards, security passes and the provision of a uniform.

[44] The Respondent also relied upon the judgment of the Full Court of the Federal Court in Damevski v Giudice 9 (Damevski), in particularthe observation of Marshall J thatthe formation of a contract is not to be lightly implied10. The Respondent also submitted that while in Damevski the alleged resignation took effect on 19 August 2001, and the new arrangement commenced on 20 August 2001, in this matter there was a gap of at least 3 months between the last time that the Applicant worked and was paid by the Respondent, and when he started with INE.

Consideration

[45] The Applicant was clearly dismissed by Mr Burge of the Respondent. On 20 September 2019, Mr Burge spoke to the Applicant and informed him that the Respondent would not be needing anyone in his role in an ongoing basis. Mr Burge told the Applicant that the work would probably finish around 10 October 2019.

[46] The question for determination in this matter is whether the Respondent was the employer of the Applicant. That involves an examination of whether there existed a contractual relationship between the Applicant and the Respondent, although such determination also requires an understanding of the nature of the contract, if any, between the Applicant and INE.

[47] Damevski involved the Full Court of the Federal Court determining an application for prerogative relief arising from decisions of both Grainger C, and a Full Bench, of this Commission. The Full Court identified that Grainger C had correctly identified the prerequisites for an enforceable contract. 11. Those elements of a contract had been identified by the Full Bench in Australian Workplace Solutions Pty Ltd v P. Fox12(Fox and Kangan Batman TAFE) as follows:

“The elements of a contract are stated in Macken, McCarry and Sappideen’s “The Law of Employment” (4th edition, 1997 by the Hon James Macken, Paul O’Grady and Carolyn Sappideen) (Macken, McCarry and Sappideen), a text to which reference was made both before Simmonds C and us, as follows (p.74):

The law holds that before any simple contract is enforceable it must be formed so as to contain various elements. These are:

1.There must be an “intention” between the parties to create a legal relationship, the terms of which are enforceable.

2.There must be an offer by one party and its acceptance by the other.

3.The contract must be supported by valuable consideration.

4.The parties must be legally capable of making a contract.

5.The parties must genuinely consent to the terms of the contract.

6.The contract must not be entered into for any purpose which is illegal.

In relation to the first of these elements, the learned authors say (p. 74):

The first element essential to the existence of any contract is the requirement that the parties have a mutual intention to create a legally enforceable bargain.”

[48] No written contract exists in this matter with either the Respondent or INE. While Mr Zanetic stated that in July 2016, he and the Applicant agreed to written terms of his arrangement with INE in the form of the Terms of Agreement Document, that document was an “On Hire Casual (Temp) Industrial Assignment Order”, apparently directed to an undisclosed employer client of INE. It records no such contractual terms.

[49] The Respondent conceded that the Applicant was an employee of the Respondent until 2012, when the Applicant resigned, and thereafter became an employee of INE. In the Form F3 Employer Response to Unfair Dismissal Application, the Respondent stated that the Applicant’s resignation occurred in March or April 2012. That was later corrected in evidence to August 2012.

[50] I find that the contract of employment between the Applicant and the Respondent that existed between 2008 and 2012, continued thereafter until it was terminated in 2019. The Applicant continued to perform the same duties for the Respondent at the same place of work and for the same remuneration. At all times the Applicant was under the direction, control and instruction of the Respondent, and was held out by the Respondent as an emanation of itself.

[51] The only change that occurred in about October 2012, was that the Applicant thereafter provided the weekly invoice for his work, for exactly the same rate of pay, to INE instead of the Respondent. The Respondent intended to continue to employ the Applicant. However, Mr Burge was not “willing to put Mr Arce on the books of my company at that time”. As a result, the Applicant was put on the books of INE, and INE processed the payments to the Applicant. That was the extent of INE’s involvement with the Applicant. Notwithstanding the triangular contracting arrangement 13 that was put in place, the Applicant remained an employee of the Respondent. In fact the establishment of that triangular contracting arrangement was itself an objective demonstration of the Respondent’s desire to create legal relations with the Applicant. The payment of wages by a third party is not fatal to the existence of a contract between a worker and a putative employer.14

[52] While the engagement of three or four other persons by the Respondent through INE may be said to demonstrate a more typical labour hiring agency between the Respondent and INE, the evidence of Mr Zanetic outlined at paragraph [33] above discloses that there had just been a division of payment obligations to shared labour. As he said, “…we share the labour, so some of the guys are paid by INE and the majority of the guys are paid by Roller Truck.”

[53] In Damevski, Merkel J noted that Courts have ordinarily held that the interposition of a labour hiring agency between the agency’s clients and the workers it hires out does not result in an employee-employer relationship between the client and the worker, the facts in Damevski were distinguishable. He observed 15:

“However, the present case differs in significant respects from those cases. In those cases, in general, the hiring agency interviewed and selected the workers, and determined their remuneration, without reference to the client. Usually, a client requesting a worker with particular skills was provided with one, who may or may not have been “on the books” of the hiring agency at the time the order was placed. The workers of such hiring agencies were usually meant to keep the agency informed of their availability to work, and in many cases were not to agree to undertake work for the client which had not been arranged or directed by the hiring agency. Equipment was either supplied by the worker themselves, or by the hiring agency, except for specialist safety equipment which the client often supplied. Dismissal of a worker was only able to be effected by the hiring agency. The client can only advise the hiring agency that the particular worker is no longer required by it. Had AICA/MLC acted as a labour hiring agency for Damevski to contract his services to other cleaning companies, as suggested in the chart and in the information pack, then the decisions in the above cases may have been applicable to this situation. However, that did not eventuate in the present case.”

[54] Similarly, the facts as found in this matter depart significantly from the usual labour hiring agency. INE simply took on the payment responsibility for the Applicant without interview, selection or determination of remuneration, because the Respondent no longer wanted the Applicant “on its books”. Other than for invoicing there was no real communication between the Applicant and Mr Zanetic or INE. While INE reimbursed the Respondent for purchases of equipment, such purchases were initially supplied by the Respondent through purchases on the Respondent’s credit card. Finally, it was Mr Burge who dismissed the Applicant.

[55] The Respondent relied heavily on the asserted gap in engagement between August and October 2012, to distinguish the decision of Damevski. I have found that the asserted gap did not occur, and that there was continued employment of the Applicant by the Respondent in that period, albeit with reduced hours for a time. However, even if there had been a gap in employment of two months, due to the continued direction, control and instruction of the Respondent, I would have found that from October 2012, to October 2019, viewed objectively, the Applicant was again an employee of the Respondent on the same terms but for INE performing the simple administrative function of processing payments.

[56] A realistic reading of the facts indicates that consideration passed between the Applicant and the Respondent from October 2012. The Applicant continued to provide provide IT and administrative support to the Respondent, and the Respondent continued to pay the same rates of pay to the Applicant, albeit through the agency of INE. The only entity not receiving consideration was INE. It was in fact losing money pursuant to its arrangement to pay the Applicant for the Respondent.

Conclusion

[57] At the time the Applicant’s dismissal took effect he was an employee of the Respondent. The Applicant has identified the correct employer in his application that was filed on 28 October 2019.

[58] Accordingly the proceedings will proceed to a hearing of the merits of the Applicant’s claim.

Additional Considerations

[59] I have found that the Applicant was an employee of the Respondent, and was such an employee from October 2008 to October 2019. Throughout that period the Applicant was paid $25 per hour plus GST. The Applicant kept the total amount of $27.50 as income and disclosed such income to the Australian Tax Office.

[60] The Applicant submitted that he was covered by the Clerks – Private Sector Award 2010. The task of determining whether the Applicant was an employee of the Respondent in October 2019, did not involve a determination of Award coverage, or relevant classification under such Award.

[61] I do observe, however, that it was agreed that the Applicant worked relatively consistent hours, which were Monday to Friday from 8.00am to 6.00pm, and Saturdays from 5.00am to 2.00pm, with sometimes work on Sundays and Public Holidays. The Applicant was always paid the flat rate of $27.50 per hour, with no casual loading. Further, the only time sheet in evidence 16 lists the Applicant working 64 hours in a week, with the following hours being worked:

Friday 13 hours

Saturday 8.5 hours

Monday 10 hours

Tuesday 10.5 hours

Wednesday 11 hours

Thursday 11 Hours

[62] Were the Applicant covered by the Clerks – Private Sector Award 2010, or another Award, it is difficult to perceive how a payment of $27.50 per hour, without casual loading or overtime payments, could not result in some underpayment.

[63] Further, considering that the Respondent did not dispute that the Applicant was an employee from October 2008 to October 2019, but merely disputed that it was the employer from October 2012, it is difficult to understand how the Applicant has not been paid Annual Leave and Long Service Leave payments.

[64] If the Respondent was correct in its contention, at the very least INE would seem to have been required to have made Annual Leave and Long Service Leave payments in relation to the period from October 2012 to October 2019. Pursuant to my determination of continued employment by the Respondent from October 2008 to October 2019, Annual Leave and Long Service Leave payments would seem to have been required to made in relation to that period.

[65] The Applicant may consider raising these additional considerations with the Fair Work Ombudsman, with particular attention being given to the limitation periods that may apply. 17

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

<PR720510>

 1   Transcript PN 13

 2   Transcript PN 423.

 3   Transcript PN 434 to 436.

 4   Attachment 2 to the Statement of Mark Zanetic.

 5   Transcript PN 731.

 6   Transcript PN 753 to 757.

 7 [2003] FCAFC 252.

 8 [2013] FCCA 397.

 9 [2003] FCAFC 252.

 10 At [82].

 11   Damevski at [40] and [83].

 12   [Print S0253].

 13   As that term is used in Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd (2015) 256 CLR 137.

 14   Damevski at [63] referencing Building Workers' Industrial Union of Australia and Others v Odco Pty Ltd (1991) 29 FCR 104.

 15 At [174].

 16   Attachment 2 to the Statement of Mark Zanetic.

 17 See s.544 of the Fair Work Act 2009.