Re Australian Industrial Relations Commission and Arends; ex parte Commonwealth of Australia

This case involved a dispute between Mr Arends and the Commonwealth of Australia regarding the nature of Mr Arends’ employment status. Mr Arends had worked as a radiographer at the Medical Centre at HMAS Albatross, Nowra for a period of almost eight years, signing six contracts with the Commonwealth. Each contract described Mr Arends as an "independent contractor." Mr Arends applied for relief under s 170CE of the Act, arguing that his termination was harsh, unjust or unreasonable and that the Commonwealth was in breach of s 170CK of the Act. The Commonwealth objected to the Commission’s jurisdiction, arguing that Mr Arends was not an employee of the Commonwealth. The Full Bench of the Commission dismissed the appeal, finding that Mr Arends was an employee of the Commonwealth. The Commonwealth sought to challenge the correctness of the Full Bench decision in the Federal Court.

The legal issue before the court was whether Mr Arends was an employee of the Commonwealth, and thus eligible for relief under the Act. The court had to determine whether Mr Arends’ contracts with the Commonwealth constituted an employment relationship or an independent contractor relationship. The court noted that the Full Bench had found the necessary employment relationship as a jurisdictional fact, and that the existence of that jurisdictional fact could be determined in this Court without any challenge to the Full Bench’s primary findings of fact.

The court held that the process of reasoning by which the Full Bench reached the conclusion that there was a contract of service authorised by the Defence Act 1903 (Cth) by virtue of the Defence Instruction (General) ADMIN 24-1 (DI(G) ADMIN 24-1) cannot be supported. The court found that the form provided for by DI(G) ADMIN 24-1 reflected a contract for services according to its terms, and that the relationship to which it would give rise could not be described as that of employer and employee. The court held that the statutory authority to which reference is made was to engage persons in accordance with a standard form of contract for services, which is inconsistent with a finding that, by entering into such contract, a contract of service resulted.

The court issued a writ of certiorari to bring in and quash the decisions of the Australian Industrial Relations Commission made by the Full Bench on 28 July 2003 and by Senior Deputy President Drake on 25 September 2002. The court also issued a writ of prohibition prohibiting the first respondent, the Australian Industrial Relations Commission, from further hearing and determining the proceeding in matter number C2002/2273 in the New South Wales District Registry of the first respondent; and prohibiting the second respondent, Malcolm Arends, from further proceeding against the Department of Defence in matter number C2002/2273 in the New South Wales District Registry of the first respondent.