Sebille v Workers Compensation Nominal Insurer (iCare)

CERTIFICATE OF DETERMINATION OF MEMBER
CITATION:	Sebille v Workers Compensation Nominal Insurer (iCare) & Anor [2024] NSWPIC 576
APPLICANT:	Trevor Van Sebille
FIRST RESPONDENT:	Steven John Guinea
SECOND RESPONDENT:	Workers Compensation Nominal Insurer (iCare)
MEMBER:	Adam Halstead
DATE OF DECISION:	16 October 2024
CATCHWORDS:	WORKERS COMPENSATION - Workers Compensation Act 1987 (1987 Act); Workplace Injury Management and Workers Compensation Act 1998 (1998 Act); claim for weekly compensation payments pursuant to section 37 of the 1987 Act; whether the applicant was a worker pursuant to section 4 of the 1998 Act or a deemed worker pursuant to section 5 of the 1998 Act and clause 2 of Schedule 1 to the 1998 Act; Held – applicant not a worker or deemed worker; award for the respondent.
DETERMINATIONS MADE:	The Commission determines: 1. The applicant was not a worker according to s 4 of the Workplace Injury Management and Workers Compensation Act 1998. 2. The applicant was not a deemed worker according to s 5 and cl 2 of Schedule 1 to the Workplace Injury Management and Workers Compensation Act 1998. 3. Award for the respondent. A brief statement is attached setting out the Commission’s reasons for the determination.

STATEMENT OF REASONS

BACKGROUND

The applicant, Mr Trevor Van Sebille, was working at a building site at Tyalgum on
11 August 2022 when he fell to the ground from a trestle and was injured. He was taken to hospital and received medical treatment then rehabilitation for the injuries.
It is claimed the applicant was employed, or otherwise is deemed to have been employed by the respondent, Steven John Guinea and sustained head and facial injuries in the course of employment.
On or about 30 September 2022 the applicant made a claim for weekly payments of compensation to iCare, the Workers Compensation Nominal Insurer, (the second respondent), given the respondent did not have workers compensation insurance. Both respondents deny liability for the applicant's claim on the basis that he was not a worker or a deemed worker.
An Application to Resolve a Dispute (ARD) related to the claim was filed by the applicant in the Personal Injury Commission (Commission) on 28 June 2024.
The applicant seeks weekly payments of compensation for the period from 5 December 2022 to date and continuing.

ISSUES FOR DETERMINATION

The following issues remain in dispute and require determination by the Commission:
(a) whether the applicant was a “worker” according to s 4 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act);
(b) whether the applicant was a “deemed worker” according to s 5 and cl 2 of Schedule 1 to the 1998 Act, and if so,
(c) the extent and quantification of any entitlement to weekly payments of compensation for the period from 5 December 2022 to date and continuing, pursuant to ss 36 and 37 of the Workers Compensation Act 1987 (the 1987 Act), including the calculation of pre-injury average weekly earnings (PIAWE).

PROCEDURE BEFORE THE PERSONAL INJURY COMMISSION

The matter was before the Commission for arbitration on 6 September 2024 in a virtual hearing room. Mr Carney of counsel, instructed by Mr Cardone solicitor, appeared for the applicant, who was also present. The respondent attended and was represented by Mr Doak of counsel, instructed by Mr Smith solicitor. An officer of the second respondent,
Ms Barnsley, was present and was represented by Mr Griscti of counsel, instructed by
Mr Dolan solicitor.
Submissions were made on the issues in dispute except for PIAWE. The parties filed written submissions on that remaining issue following the arbitration hearing.
I am satisfied that the parties to the dispute understand the nature of the application and the legal implications of any assertion made in the information supplied. I endeavoured to bring the parties to the dispute to an acceptable settlement and am satisfied that the parties have had sufficient opportunity to explore settlement. They were unable to reach agreement on resolution of the dispute.

EVIDENCE

Documentary evidence

The following documents were in evidence before the Commission and considered in making this determination:
(a) ARD and attached documents, and
(b) Reply with attachments from both the respondent (Reply) and second respondent.

Oral evidence

There was no application to call oral evidence or cross-examine any witness.

Applicant’s statements

The applicant provided his evidence for the proceedings by statements dated 19 June 2023, 21 November 2023 and 27 June 2024. The statement dated 18 October 2022, obtained from the applicant by an investigator in relation to the claim for compensation, was also provided with the ARD.

The 18 October 2022 statement

In the first statement given in relation to his claim, as taken by an investigator on
[1] ARD p 3 para 19.
[2] ARD p 3 para 18.
18 October 2022, the applicant referred to holding an Australian Business Number (ABN) and being registered for Goods and Services Tax (GST).[1] The applicant obtained an ABN to facilitate working independently, “[t]hat’s why I got an ABN” he stated in reference to “working for myself” after leaving employment.[2]
He completed a carpentry apprenticeship “about 20 years ago”. Other than for a year spent in Melbourne during 2019 employed by Vision Corporate Interiors “on wages” (a company where he had been employed previously for about 10 years and was paid “wages and superannuation and tax”), the applicant had been undertaking direct client work and sub-contracting work in New South Wales as a carpenter since 2015.[3] He had also previously worked “around Australia” as a sub-contractor.
[3] ARD pp 3-4 para 21.
The applicant and Mr John Ward “sided together” from around March 2021 to undertake building work up to the value of $20,000 or sub-contracting to a principal contractor or builder.[4] They would bill direct clients for labour and materials with payments for work being received alternately into either the applicant’s or Mr Ward’s bank accounts. The other would then invoice the receiver of the money for their share of work.
[4] ARD p 4 paras 22-23.
When they “did sub-contract jobs” the applicant and Mr Ward “would invoice individually based on an hourly basis and the principal would pay for materials”.[5] They did work for
Mr Dave Bambach through his company Bambach Pty Ltd. They used a skilled labourer,
[5] ARD p 4 para 25.
[6] ARD p 4 para 26.
Mr Dane Peterson, who had his own ABN and would invoice either the applicant or Mr Ward, whichever of the two “was invoicing the client”, Mr Peterson was not paid superannuation.[6]
Northern Rivers Building & Construction Pty Ltd is a company that was formed in June 2022 by the applicant and Mr Ward to better facilitate their business arrangement but had not yet traded or been registered as a building company with NSW Fair Trading as at the time the statement was made.[7]
[7] ARD p 5 para 27.
The applicant first met the respondent “in about late 2021 or early 2022” at the Tyalgum Hotel when the applicant and Mr Ward were then contracted by the respondent to assist with some re-roofing work at that location. The respondent was the “principal contractor” and the applicant gave “a total price for labour” on that job.[8] The applicant invoiced the respondent separately to Mr Ward.[9] After the job finished, the applicant and Mr Ward “had a few other little jobs here and there of our own and we were still doing jobs for [Mr Bambach].”[10]
[8] ARD p 5 para 28.
[9] ARD p 5 para 28.
[10] ARD p 5 para 29.
In early August 2022 the applicant and Mr Ward started a job with the respondent at Tyalgum Road, Tyalgum (Tyalgum Road job). They all travelled to the site and met with the owner,
Mr Neil Sutherland, “for about 10 minutes”. The applicant assessed the work to be “a bigger job than expected” with uncertainty around its scope and “[a]s such I was not able to price the job”. The materials would be provided by the respondent, who also “went through what he was expecting us to do and the methods he uses”.[11] According to the applicant, the respondent:
“…wanted us working Monday – Friday. He wanted it done as quickly as possible but gave us no time frame. He spoke about adding walls also. I could not price the whole job as I was not aware of how far they wanted to take the job. It was using a lot of recycled material from an old shed. It was agreed with [the respondent] to do the job on an hourly rate of $65 + gst each. I think [the respondent] had quoted the client $40,000 for the shed.”[12]
[11] ARD p 5 para 30.
[12] ARD p 5 para 31.
The applicant stated that he was “working on the job site for only 3 days before my accident” and for “the first couple of days [the respondent] worked putting up rafters” and “left John and I to do the batons”. The applicant and Mr Ward worked from trestles, provided by the respondent,[13] at a height of about 4.2m, which had “an A frame at each end with boards between the A frames”.[14] They “were not using harnesses or using any barrier to prevent a fall”.[15]
[13] ARD p 6 para 35.
[14] ARD p 6 para 34.
[15] ARD p 6 para 36.
In relation to the work he did for the respondent, the applicant recounted:[16]
“40. The jobs I did with [the respondent] were not my jobs so all changes went through [the respondent]. On a day-to-day basis he was there at some point every day. We do know what we are doing but that job had a lot of changes and missing materials.
41. [The respondent] gave us instructions on how he wanted the roof batons installed due to the materials being rough sawn timber. He did not supervise everything we needed to do, he was not micromanaging. I knew what to do each day and just got on with it. [The respondent] did not provide daily instructions or directions. It was self-explanatory from our initial instructions. He said how many fixings he wanted on every baton to every rafter and how many fixings he wanted from the posts to the rafters. He may have been following an engineer's requirements, I never saw any.
42. Our agreements with [the respondent] were all verbal. That was typical of our builder subcontracting jobs. We do a written quote when dealing with the client ourselves for small jobs. The agreement for this job was on an hourly rate of $65+ gst until the roof was finished. That's our base trade rate. There was talk of doing the walls later and maybe other sheds that were similar. There was ongoing work.
43. I was invoicing [the respondent] as Steve Guinea and not a company name. I do not know how [the respondent] was the principal contractor I don't know how he is registered. I just presumed [the respondent] was a registered builder. He was just a local guy that reached out to us. He may have been putting it through his brother who might have a registered building business.
44. I was paying my own tax and I was paying my own superannuation. [The respondent] paid neither.
45. [The respondent] provided all the materials, fixings and trestles but no tools. He also had a small excavator and caterpillar on site to help lift and move materials. John and myself operated those. Steve was responsible for refuelling, maintenance and repairs of that equipment. I provided basic carpenter tools like a chainsaw, power saw, sawhorses and drills.
46. If I broke any of my own tools I would have to fix that myself. I would have to pay for all my own repairs of my own equipment. I didn't use the chainsaw enough to request he pay for fuel.”
[16] ARD pp 7-8.
While undertaking work at the Tyalgum Road job for the respondent the applicant “was not doing any other work” which was said to be “the same when doing sub-contract work” where “[i]t’s one job at a time”.[17] The applicant did not provide “any guarantee on [his] workmanship” and the respondent gave “instructions on how the roof was to be built and we followed those instructions”[18].
[17] ARD p 9 para 53.
[18] ARD p 8 para 51.
Mr Peterson was at the Tyalgum Road job and according to the applicant regarding that arrangement and the job generally:
“56. We had Dane Peterson on this job with [the respondent]. We pay him $30 pr [sic] hour, I had not made an agreement with [the respondent] as to what we would charge him for Dane's hours. We would have got a margin for Dane's hours. To a degree we could sub-contract on that site but would have to be cleared by [the respondent] first.
…
58. [The respondent] had all the commercial risk on that job, it was his job. That’s normal for all the sub-contracting jobs.”[19]
[19] ARD p 9.
The respondent did not provide the applicant branded clothing or personal protective equipment[20] and there “was no holiday, sick or paternity leave” provided by the respondent.[21] The applicant did not need to travel to collect goods and the respondent had all materials delivered to the site.[22]
[20] ARD p 8 para 49.
[21] ARD p 8 para 47.
[22] ARD p 8 para 48.
When the applicant sub-contracted to Mr Bambach it was full-time for more than 90 days per year. In the year prior to making the statement, the applicant “would have worked for [the respondent] including the hotel work, a total of 20 days”. The respondent would make payment “of the straight hourly rate” to the applicant’s bank account after an invoice was received from the applicant, which was said to be “the same with all sub-contracting jobs”.[23]
[23] ARD p 8 para 47.
The applicant held “a Public Liability policy with the NRMA and … an Income Protection Policy with MLC” as well as private health insurance.[24] The applicant paid his own tax and superannuation, that is, they were not paid by the respondent in addition to the hourly rate charged. The applicant had never advertised his services[25] and operated on a “word of mouth” basis with Mr Ward.[26]
[24] ARD p 7 para 39.
[25] ARD p 9 para 54.
[26] ARD p 4 para 23.
Although the respondent’s truck displayed his business name, the applicant and Mr Ward did not have any of the respondent’s branding on their vehicles.[27]
[27] ARD p 8 para 50.

The 19 June 2023 statement

The next statement in evidence made by the applicant was made on 19 June 2023 and contains similar background information to the earlier statement. It also includes a comprehensive account of the injuries received by the applicant on 11 August 2022, the effects of those injuries and the medical treatment received by the applicant.
The applicant’s evidence in the 19 June 2023 statement is that in or around December 2021 he “commenced employment with [the respondent] for a job I completed with him” and “then worked with him again in early August 2022”. The applicant “was employed as a Carpenter on a full-time basis working more than 50 hours per week” where his “gross average weekly earnings were approximately $3250”. [28]
[28] ARD p 16 para 9.
The applicant refers to having been injured on 11 August 2022 after falling to the ground from a trestle.
In relation to the Tyalgum Road job, the applicant states that he “never met the client prior to the work starting”, the respondent “was the only person to deal with the client” and “organised and planned all aspects of the job”.[29]
[29] ARD p 22 paras 26-27.
The applicant states that he did not provide a quotation and “only negotiated to be paid an hourly rate” with the respondent. The applicant “did not have an arrangement to pay Dane Peterson” and that although he “would sometimes pay Dane an hourly rate for his services” such an “arrangement only works on a quoted job”, which the Tyalgum Road job was not. The applicant identified Mr Ward, not him, as Mr Peterson’s employer on that job. The applicant had “no other work arranged” at the time he worked for the respondent and understood he and Mr Ward would work for the respondent on an indefinite and ongoing basis thereafter.[30]
[30] ARD p 23 para 27.
The statement concluded with the applicant referring to himself a “deemed worker in accordance with the Workers Compensation Act”.[31]
[31] ARD p 23 para 28.

The 21 November 2023 statement

The statement made by the applicant on 21 November 2023 recites much of the same content as that made on 19 June 2023, indeed most of it is identical.
Relevant additional evidence included in the statement was that the applicant “brought [his] own tools to the job site but this is the common practice in [his] industry”, that “[a]ll workers bring their own tools” and “[w]hen specialised tools are required they are provided by the boss”.[32]
[32] ARD p 30 para 26.
The statement concludes with applicant referring to himself as “a worker in accordance with the Workers Compensation Act”[33] and purports to attach two invoices related to the Tyalgum Road job along with “text message exchanges” between Mr Ward and the respondent.[34] The attachments cited do not follow immediately in the ARD but are presumably those at later pages.[35]
[33] ARD p 31 para 28.
[34] ARD p 31 para 29.
[35] Being ARD pp 49-53 for the SMS messages and pp 91-92 for the invoices.

The 27 June 2024 statement

The 27 June 2024 statement made by the applicant contains evidence that he was not doing any other work at the time of working for the respondent and was “exclusively performing work for [the respondent’s] projects”.[36]
[36] ARD p 32 para 4.
He reiterated that work done for the respondent was an hourly rate and that a fixed price job would have been quoted, “which never happened” for the Tyalgum Road job.[37] Other factors were also present, such as changes to the job by the respondent and no deposit being required, that confirm the applicant worked for an hourly rate.
[37] ARD p 32 para 5.
The applicant goes on to state that he “was never going to invoice” for Mr Peterson and it “was always the understanding that [Mr Peterson] would raise his own invoices”.[38]
[38] ARD p 32 para 7.

Statements of John Ward

Mr Ward provided statements dated 31 October 2022 and 6 May 2024.
In the first statement, Mr Ward recalled that he started working with the applicant when they “both worked as employees for Dave Bambach” and “were on wages”. After becoming qualified, Mr Ward “started working together as contractors” with the applicant two years prior to making the statement. Mr Ward had his “own ABN, public liability insurance, [was] a sole trader and [was] registered for GST, just like [the applicant]”.[39]
[39] ARD p 13 para 5.
Mr Ward and the applicant were doing “sub-contract work” for Mr Bambach and individually invoicing for an hourly rate. Although Mr Bambach did not pay superannuation, “he did cover us with his workers compensation”.[40] They did “smaller jobs directly for clients and depending on which one of us had got the job they would invoice the client”. They would then invoice each other for profit after the cost of materials. The arrangement was not considered ideal and so they set up a company, which had not traded as at the time of the making of
[40] ARD p 13 para 6.
[41] ARD p 13 para 7.
Mr Ward’s statement.[41]
According to Mr Ward’s evidence, he and the applicant would also undertake “larger jobs as sub-contractors to principal contractors” when they would “charge for our own hourly rate and only provide labour and tools” where the “principal contractor would provide the materials”.[42] In relation to the “bigger jobs”:[43]
“… like when we worked for [the respondent] there would be a negotiation prior to starting. That would be around an hourly rate and whether superannuation or workers compensation was included. It’s different on each job. This negotiation did not occur with [the respondent]. We just worked the hourly rate of $65 plus gst.”
[42] ARD p 13 para 8.
[43] ARD p 13 para 9.
Mr Ward said that Mr Peterson “works with us as well” and that “[w]e invoice for him and take a margin”.[44] He referred to undertaking a “roofing job” for the respondent on the Tyalgum Pub, where the respondent “provided all the materials and we invoiced our hourly rates individually”.[45]
[44] ARD p 13 para 10.
[45] ARD p 13 para 11.
On 8 August 2022 the applicant and Mr Ward started at the Tyalgum Road job. The applicant was injured on 11 August 2022 when Mr Ward “only just saw him fall from the top of a trestle to the ground out of the corner of [his] eye”. According to Mr Ward, the respondent “was not on site, it was me [the applicant], Dane Peterson, the owner and his son”.[46] Mr Ward later invoiced the respondent $4,800 for the work done by Mr Ward, Mr Peterson and the applicant. The respondent “invoiced the client and paid for all the materials and provided the trestles for the [Tyalgum Road job]”.
[46] ARD p 14 para 13.

Mr Ward’s second statement, made on 6 May 2024, refers to him not having worked with the applicant “since his injury in August 2022”. It was confirmed that Mr Ward and the applicant “would do larger jobs as subcontractors to principal contractors” and they “would bring our tools and the principal contractor provided the materials”.[47]
[47] Reply p 8 para 9.
In relation to the work undertaken by Mr Ward and the applicant at the Tyalgum Hotel,
[48] Reply p 8 paras 12-14.
Mr Ward confirmed it had been a “roofing job” where they provided their own tools and labour. There were “no strict guidelines as to our working hours on these jobs”, Mr Ward and the applicant worked an eight-hour day at a “standard pace and for standard hours in a working day”. Mr Ward could not recall who invoiced the respondent for the Tyalgum Hotel job but he was “pretty sure” they were “paid at an hourly rate”.[48]
In referring to the negotiation of the Tyalgum Road job, Mr Ward said it “was actually between [the applicant] and [the respondent]”, that it “was organised without me” and he was “not involved in the pricing of that job”.[49]
[49] Reply p 8 para 10.
Mr Ward otherwise generally affirmed the other content of his earlier statement about the Tyalgum Road job, stating that “we brought our own tools to the site” and also invoiced the respondent for the work based on an amount he was told by the respondent.

Respondent’s statements

The respondent provided evidence in statements dated 1 May 2024 and 25 June 2024.
According to the first statement, the respondent is a licenced carpenter, has an ABN as a sole trader and is registered for GST. He also operates a banana farm at Tyalgum. As a carpenter, the respondent has specialised in building sheds. The respondent found shed building work had become too physically demanding for his back and wanted to cease.[50]
[50] Reply p 1 paras 5-7.
The respondent was undertaking roofing work at the Tyalgum Hotel at the time of meeting the applicant there in late 2021. The applicant was at the time with Mr Ward, who was already known to the respondent. The respondent understood the applicant and Mr Ward to be “working together in some kind of partnership” and spoke to them about providing help with roofing work at the Tyalgum Hotel. He “thought that if they did a good job then [he] could gradually pass the work [he] was getting to them, so [he] was no longer involved at all and he “didn’t want to do any of the carpentry or labour work [he] was doing due to [his] back”.[51]
[51] Reply p 1 para 10.
The work the applicant and Mr Ward provided to the respondent for the Tyalgum Hotel job was invoiced by them at an hourly rate at the end of that job for payment. The respondent understood that was a common arrangement for subcontract work and was “common commercial practice”.[52]
[52] Reply p 2 paras 11-12.
The respondent recalled the applicant and Mr Ward attending the Tyalgum Road job site at a time before the poles for the shed were erected. The applicant provided the respondent a “verbal fixed price quote of $4,500 plus GST”, which was agreed by the respondent. In relation to the applicant and Mr Ward, the respondent thought “it was clear that [the applicant] led the business side of their relationship” as the respondent “would talk about the job and agree price with [the applicant] rather than [Mr Ward]”. The respondent considered that “natural” given the applicant’s age and experience.[53]
[53] Reply p 3 paras 20-21.
Sometime in July 2022 the respondent notified the applicant and Mr Ward the Tyalgum Road job was ready for them to commence and that they needed to “put in the purlins and install the roof”, which was “not a very big job” according to the respondent.[54] In relation to the applicant and Mr Ward working on that job, the respondent considered:[55]
“24. They were fully qualified carpenters, and they did not need supervision to complete the job, or to be told what to do. My impression, after the job they had done at the Tyalgum Hotel, was that they were competent and qualified to do a roof installation of a shed. This is why I sub-contracted to them again for the [Tyalgum Road job].
25. I told [the applicant] and [Mr Ward] that I had an account at Murwillumbah Hire they could use to hire any trestles, scaffold or other hire equipment that they needed. I told them they could hire whatever they needed to complete the job.
26. They never used any of my tools and they did not use my account at Murwillumbah Hire to hire any equipment for the job. I even offered for them to use my chainsaw, but [the applicant] said that he didn't need it as he could use his own.”
[54] Reply p 3 para 22.
[55] Reply p 3.
The respondent referred to the applicant falling at the Tyalgum Road job on 1 August 2022, which he believed to be the first day the applicant was on site. The work was subsequently completed by the respondent, Mr Ward and Mr Peterson. The respondent said he “was not involved in arranging for [Mr Peterson] to come and assist on the job”.[56] Mr Ward invoiced the respondent for the work done at the Tyalgum Road job.[57]

SUBMISSIONS

[56] Reply p 3 para 28.

[57] Reply p 4 paras 29-30.

Applicant’s submissions

The applicant contends he was employed by the respondent when injured on
11 August 2022 and therefore a worker for the purposes of s 4 of the 1998 Act. If he is found to have not been a worker, then he was a deemed worker according to s 5 of the 1998 Act.
According to ZG Operations Australia Pty Ltd v Jamsek[58] (Jamsek) the contract between the parties needs to be considered to determine the nature of their relationship. As there was no written contract between the applicant and respondent, their oral agreement and intentions are relevant.
[58] [2022] HCA 2.
The applicant did not advertise his services and work was obtained “word of mouth”. An hourly rate in an employed capacity was agreed with the respondent for the Tyalgum Road job. The applicant was required to provide labour and brought his own tools to the job. He did not employ Mr Peterson. He did the work he was told to do by the respondent, who controlled the job and method of work.
Although the applicant did do small jobs for people, the job he was doing at the time with the respondent is what is relevant for consideration by the Commission: Marinic v RPC Interiors Management Pty Ltd.[59] To an observer, the applicant would have presented as part of the respondent’s business, which is indicative of an employment relationship: On Call Interpreters and Translators Agency Pty Ltd v Commissioner of Taxation (No 3).[60]
[59] [2019] NSWWCCPD 11.
[60] [2011] FCA 366.
In summary there were regular hours worked by the applicant that were paid at an hourly rate. The respondent did not pay either income tax or superannuation on the applicant’s behalf and the applicant provided his own tools, which are indicia against an employment contract. However, there was a fair degree of control by the respondent where the applicant was taking instruction as to how the job was to be done. There were regular hours worked and the applicant was paid an hourly rate. When viewed overall, the arrangement was one of employment.
In the alternative, the applicant was a deemed worker according to cl 2 of Schedule 1 to the 1998 Act. There was no company involved and the arrangement was direct between the applicant and respondent. The main issue is whether it was work carried on by the applicant that was incidental to a trade or business he regularly conducted, which he says it was not. When working for the respondent, and otherwise doing this kind of work, the applicant was always on an hourly rate. They also had other work together arranged for the future.
On the other relevant issue, the applicant did not employ Mr Peterson on the Tyalgum Road job. As the applicant was working for an hourly rate, he also assumed Mr Peterson would have been paid an hourly rate by the respondent. The applicant had no intention to pay
Mr Peterson for that job.
The applicant’s work at the Tyalgum Road job was not incidental to a trade or business he regularly carried on and he did not employ or otherwise retain Mr Peterson on that job. The effect is the applicant was a deemed worker of the respondent for the work performed at the Tyalgum Road job.

Respondent’s submissions

Simply because the applicant was working for an hourly rate does not mean that he was employed. The applicant’s first statement was clear, he was operating a business under his own name, with an ABN and was registered for GST, which indicate he was not an employee of the respondent.
When the applicant and Mr Ward “sided together” in March 2021, they in effect formed a loose partnership where one or the other would invoice contractors or clients for work they did and then later split the money received. The arrangement is consistent with the operation of a business. The applicant’s own evidence in his first statement is that when working as a sub-contractor, he would tend do so charging an hourly rate. He also paid his own income tax and superannuation.
The first statement by the applicant contains a “full and frank” description of the relevant arrangements and that statement has been corroborated by his business partner, Mr Ward. The applicant’s original evidence is that he travelled with the respondent to the Tyalgum Road job site to “price the job”, which is not an activity that would occur if the applicant was employed by the respondent. The applicant provided his own tools, they were not supplied by the respondent. There was no specific timeframe or hours of work given by the respondent only that he wanted the job done quickly. The nature of the job was such that a fixed price could not be given and so it was charged at an hourly rate of $65 plus GST for each the applicant and Mr Ward. The arrangement was consistent with sub-contracting and employees do not charge GST. There is no indication in the first statement that the applicant considered himself to be an employee of the respondent.
While the respondent may have wanted the job done in a particular way does not take it away from a sub-contractor relationship. The applicant’s original evidence that the respondent did not supervise everything done on the job, did not micromanage and left applicant to get on with the work. Daily instructions or directions were not given by the respondent and that is inconsistent with an employment relationship.
The applicant did not do other work when he worked for the respondent. It was his evidence that was the case whenever doing sub-contracting work; he used a “one job at a time” business model. That is consistent with a small business that does not have the resources to split between jobs at the same time. The applicant’s reference to getting a margin for hours worked by Mr Peterson is incontrovertible evidence that the applicant and Mr Ward were either employing or sub-contracting him.
In later statements the applicant referred to himself as an employee and that there was an employment relationship. It should be noted those statements were made after denial of liability by the insurer. The applicant claimed in his later evidence that Mr Peterson would invoice himself, which contradicts the arrangements described in the applicant’s first statement about paying Mr Peterson and getting a margin. One of the statements must be false, which affects the applicant’s credibility.
Employment indicia are a guide only and not determinative according to Hollis v Vabu Pty Ltd,[61] the relationship needs to be considered holistically. There must be offer and acceptance in contract with an intention to create legal relations with valuable consideration. When all of those issues are considered, the relationship was one of sub-contract. There was no evidence of an employment relationship being agreed; no hours of work, degree of control, payments of taxation, holidays and the other usual matters that would be expected. The applicant was carrying on his own business in a loose partnership with Mr Ward, he was not employed by the respondent.
[61] [2001] HCA 44.
On the issue of deemed worker, the relevant authority is Scerri v Cahill[62] (Scerri), that decision contains the elements that must be established by the applicant. One of which is whether work was incidental to a business. It is clear the applicant was carrying on a business when undertaking the work for the respondent. The applicant has not established otherwise, for which he has the onus. It is also clear from his first statement that he was using Mr Peterson as either a sub-contractor or employee, which is relevant to another element to be established. The applicant cannot meet the requirements for deemed worker in the circumstances.
[62] (1995) 14 NSWCCR 389.

Second respondent’s submissions

The second respondent adopted the submissions made by the respondent and reiterated various points in those.
The decision of the High Court in Jamsek and the related decision in Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd[63] (Personnel Contracting) were considered by the Full Court of the Federal Court in EFEX Group Pty Ltd v Bennett[64] with respect to a situation such as this matter where there was no written contract. The focus should be to ascertain the legal rights and obligations of the parties at the time of the contract rather than a retrospective examination of their subsequent behaviour.
[63] [2022] HCA 1.
[64] [2024] FCAFC 35.
The applicant’s initial statement is that which should be relied upon given it is the most contemporaneous and contains relevant history to determine the nature of the contract between the parties. That evidence is overwhelmingly that the applicant was a sub-contractor to the respondent not an employee. The work performed by the applicant for the respondent was incidental to his carpentry business and so he could not be a deemed worker.

FINDINGS AND REASONS

An issue that needs to be resolved prior to considering the relevant law, is the nature of, and weight to be given, to the applicant’s evidence as contained in his various statements. The submissions made by the respondent about the contradictions between the content of the applicant’s statement of 18 October 2022 and those that followed of 19 June 2023,
21 November 2023 and 27 June 2024 are noted and require consideration.
The applicant’s evidence differs significantly on several matters, most notably the nature of his relationship with the respondent and the arrangements for Mr Peterson. The content of the applicant’s 18 October 2022 statement has not been recanted or retracted in any way. It has not been argued that the applicant did not have the capacity to make the statement or that he was impaired at the time it was given.
I consider the applicant’s statement of 18 October 2022 to be the most accurate and reliable available evidence about his business and general affairs. It is the most contemporaneous on those issues and was made prior to him being aware of the dispute on the claim that would follow. The statement was given independently to an investigator and the content, to a very large extent, is corroborated by the statement given separately by Mr Ward on 31 October 2024.
The applicant’s first statement is accepted as the best evidence from him and is preferred to those made later in relation to the nature of the relationship with the respondent. The statements made by the applicant on 19 June 2023, 21 November 2023 and 27 June 2024 contains inconsistencies that cannot be reconciled with the first statement.
For example, in the 19 June 2023 and 21 November 2023 statements, the applicant claims he “never met the client” of the Tyalgum Road job whereas his initial statement refers to him having met with the client “for about 10 minutes”. In the 27 June 2024 statement the applicant contends he “was never going to invoice” for Mr Peterson’s work, whereas his first statement refers to paying Mr Peterson an hourly rate and obtaining a margin for his work. The difference being that in the earlier statement the applicant freely declared he retained Mr Peterson to work for him on the Tyalgum Road job, whereas he later sought to distance himself and deny that arrangement existed.
The 19 June 2023, 21 November 2023 and 27 June 2024 statements were made significantly after the relevant events and have a complexion of being specifically tailored to repair perceived deficiencies in the applicant’s case. As far as those statements refer to arrangements with the respondent and the Tyalgum Road job, they do not assist the Commission in the circumstances and are given no weight on the issues to be determined in these proceedings.
Although the respondent has raised the issue of the applicant’s credibility given the content of the later statements, it is unnecessary to make a finding on that issue where the impugned evidence is given no weight. I am satisfied the first statement given by the applicant has not been tainted with any credibility issue given the conditions that prevailed at the time it was made.
The statement made by Mr Ward on 31 October 2022 is similarly accepted as reliable and the best available, for the same reasons already given about the applicant’s first statement.
The statements made by the respondent on 1 May 2024 and 25 June 2024 were prepared significantly after the relevant events, at least some 20 months following the date the applicant was injured. The evidence was not obtained in a timely manner and other than reference to some invoices, the statements do not appear to have been made from contemporaneous notes or other material. The respondent’s recollection of events has undoubtedly faded over time. Except where corroborated by other evidence, the content of the October 2022 statements made by the applicant and Mr Ward is preferred to the extent of any inconsistency with the respondent’s statement evidence.

Was the applicant a worker?

Section 4 of the 1998 Act defines a “worker” as:
“worker means a person who has entered into or works under a contract of service or a training contract with an employer (whether by way of manual labour, clerical work or otherwise, and whether the contract is expressed or implied, and whether the contract is oral or in writing).”
Establishing a contract of service involves contract law principles such as offer and acceptance, consideration and mutual obligation. A contract of service requires a mutuality of obligation in the formation of the contract with the intention to create legal relations: Dietrich v Dare.[65] If there is unambiguous evidence a person offered services for reward, and the proposed employer accepted the offer on the basis that payment for those services would be made, there will be an intention to enter into legal relations, and a contract of employment will exist.
[65] (1980) 30 ALR 407.
There has been no claim about the existence of any training contract between the parties and so that aspect of the definition is not relevant in these proceedings. I must therefore consider whether the applicant entered into or worked under a contract of service with the respondent.
In Stevens v Brodribb Sawmilling Company Pty Limited[66] (Stevens), the High Court identified factors to determine whether an employment or principal and independent contractor relationship exists. Factors that indicate employment include the employer control, direction and supervision over a worker, nature of remuneration, provision and maintenance of equipment, obligation to work, hours of work and provision for holidays, deduction of income tax, ability to delegate work, the right of the employer to have a particular person do the work, right to suspend or dismiss the worker, right to the worker’s exclusive services, and the right to stipulate the place of work.
[66] [1986] HCA 1.
According to the High Court in Jamsek, to establish whether a person is an employee or independent contractor it is necessary to give primacy to the legal rights and obligations contained in the contract entered between the parties and not their subsequent conduct. And in the related Personnel Contracting decision,[67] referring to Stevens, it was found the characterisation of a relationship as one of employment or one of principal and independent contractor is to be determined by reference to ‘the totality of the relationship between the parties’ rather than using a checklist approach.
[67] At para 34.

In Malivanek, Roche DP referred to the indicia set out in Stevens as well as the observation of McColl JA in Australian Air Express Pty Ltd v Langford:[68]
“The second observation concerns the distinction between an employee and an independent contractor. That distinction has been said to be ‘rooted fundamentally in the difference between a person who serves his employer in his, the employer’s business, and a person who carries on a trade or business of his own’: Marshall v Whittaker’s Building Supply Co [1963] HCA 49; (1963) 109 CLR 210 at 217 per Windeyer J. Although this statement was criticised by Wilson and Dawson JJ in Stevens (at 34) as ‘posing the ultimate question in a different way rather than offering a definition which could be applied for the purpose of providing an answer’, it was referred to with approval by the majority in Hollis (at 38 – 39 [39] – [40] [Hollis v Vabu Pty Ltd [2001] HCA 44; 207 CLR 21 (Hollis)]).”
[68] [2005] NSWCA 96 at 16.
The applicant bears the onus, on the balance of probabilities, to establish that he was a worker. For the reasons already explained, the initial evidence of the applicant and Mr Ward is considered the best available in these proceedings. It is primarily from that evidence that the terms of the oral contract reached between the applicant and respondent for the Tyalgum Road job can distilled.
The parties agree, and it is accepted on the evidence, there was an oral contract for the Tyalgum Road job. The evidence of both the applicant and respondent is that related discussions occurred sometime in either July or early August 2022, the precise date is unclear. In any case, it was in effect by the time work commenced onsite on or about 8 August 2022.
Although the respondent has referred to there having been agreed a “verbal fixed price quote of $4,500 plus GST”,[69] the applicant’s evidence is preferred, which is that it was agreed “to do the job on an hourly rate of $65 + gst each” for him and Mr Ward.[70] The applicant was to pay tax and his own superannuation.[71] The applicant was to invoice the respondent, who would make payment to the applicant’s bank account.[72] Holiday, sick and paternity leave were not provided by the respondent.[73]
[69] Reply p 3 para 20.
[70] ARD p 5 para 31.
[71] ARD p 8 para 44.
[72] ARD p 8 para 47.
[73] ARD p 8 para 47.
Several essential terms of the agreement between the applicant and respondent can be identified from that evidence; the applicant would provide carpentry services for the job in return for an hourly rate invoiced at $65, where GST would be paid in addition to that rate and the applicant would attend to statutory obligations for his own tax and superannuation. A further relevant term associated with that part of the discussion is that Mr Ward would also be providing services for the respondent on the job and paid at the same rate as the applicant, plus the additional GST component.
According to the applicant’s evidence, the respondent wanted him and Mr Ward “working Monday – Friday” and for the work to be “done a[s] quickly as possible” but not within any specified time frame[74] or defined hours.[75] That evidence was not refuted by the respondent in his statements. Those requirements were discussed by the parties at the time the payment rate was agreed, and they are accepted to have been terms for the Tyalgum Road job. Other related terms were that the applicant was to provide his own tools[76] and be responsible if any breakages to those occurred.[77] The respondent would provide building materials and “instructions about how the roof was to be built”.[78]
[74] ARD p 5 para 31.
[75] ARD pp 8-9 para 52.
[76] ARD p 8 at para 45 and Reply p 2 para 13.
[77] ARD p 8 para 46.
[78] ARD p 8 para 51.
The primary contentions made by the applicant are centred on the issues of control of the method of work by the respondent, an hourly rate of payment and regular work hours. It is claimed that there was no relevant relationship with Mr Peterson for the Tyalgum Road job. These are all said to be indicia of an employment contract between the parties.
On the issue of control, the applicant’s evidence was that although the respondent’s instructions about the work required were followed by the applicant and Mr Ward, the respondent “did not supervise everything we needed to do” and was “not micromanaging”.[79] There were no “daily instructions or directions”[80] and the applicant “knew what to do each day and just got on with it”[81]. The inference that can be drawn is that the job requirements were explained by the respondent and the applicant then executed the instructions at his discretion as a qualified professional, in a way a sub-contractor would do when working for a principal contractor. Although the applicant was working solely for the respondent at the time of the Tyalgum Road job, that was his standard method of business according to his evidence, that is “one job at a time”,[82] rather than any indicator of exclusive employment.
[79] ARD p 7 para 41.
[80] ARD p 7 para 41.
[81] ARD p 7 para 41.
[82] ARD p 9 para 53.
It is accepted that it was agreed the applicant would be paid at an hourly rate, however GST was to be paid in addition to that rate. It was an arrangement familiar to the applicant as one he used when sub-contracting.[83] The applicant was also required to invoice for his work. These are not indicative of an employment relationship.
[83] ARD p 4 para 25.
As to the regularity of work, the parameters provided by the respondent were for the job to be completed as quickly as possible on a Monday to Friday basis. The inference that can be drawn from this is that although the respondent wanted the job completed in a timely manner, it was not expected the applicant and Mr Ward would work on weekends to do so. There is no evidence the respondent set defined hours of work for the Tyalgum Road job. This does not weigh in favour of employment.
When his evidence of 18 October 2022 is considered overall, it is apparent the applicant viewed his relationship with the respondent to have been that of a sub-contractor for the Tyalgum Road job. He made various references to his subcontracting arrangement in that statement.[84] He also referred to the respondent as being the principal contractor at the job,[85] with the inference that his role was subordinate, that is, as sub-contractor.
[84] See for example, ARD p 7 para 42 and p 8 para 47.
[85] ARD p 7 para 43.
Other matters that need to be taken into account are that the applicant held public liability insurance cover, made his own provision for income tax, superannuation and leave as well as apparently intended to charge for Mr Peterson (sub-contracted or otherwise retained by the applicant and Mr Ward) including with a margin applied.[86] It is also evident the “loose partnership”, arrangement as it was described by the respondent’s counsel, with Mr Ward continued at the time of the Tyalgum Road job. As was also identified by the respondent’s counsel, the applicant referred to attending the job site with the respondent to “price the job”.[87] None of these arrangements and activities are consistent with an employment relationship.
[86] ARD p 9 para 56.
[87] ARD p 5 para 30.
The applicant had been employed in the past, receiving wages and superannuation with deductions made for income tax. He also worked as a tradesman directly for clients and did sub-contracting work. His evidence makes clear that he knew the difference between those types of work arrangements. When sub-contracting to a principal contractor, he would initially discuss terms and later invoice for his work. His ABN and GST registration were relevant to type of work he provided for the respondent since it was agreed he would invoice with additional GST. He had previously done this in the context of sub-contracting to a principal contractor or working for direct clients. There can be little doubt given his 18 October 2022 statement that the applicant knew the difference between employment and sub-contracting as his evidence refers to both types of work and delineates one from the other. He viewed himself as a sub-contractor in that statement, which is consistent with the evidence of his circumstances, and I accept that view as correct.
In considering the nature of the agreement between the parties, and the arrangements that flowed from it, the evidence does not support a finding that it is more probable than not the applicant entered a contract of service, that is employment, with the respondent for the Tyalgum Road job. The weight of the evidence is that the applicant was at all relevant times a sub-contractor to the respondent. Accordingly, the applicant was not at the relevant time a worker for the purposes of s 4 of the 1998 Act.

Was the applicant a deemed worker?

Section 5 of the 1998 Act provides that Schedule 1 to the Act has effect to determine whether a person is deemed to be a worker. The applicant has the onus to establish he was a deemed work on the balance of probabilities. Clause 2 of Schedule 1 provides:
“Other contractors
(1) Where a contract—
(a)to perform any work exceeding $10 in value (not being work incidental to a trade or business regularly carried on by the contractor in the contractor’s own name, or under a business or firm name), or
(b)(Repealed)
is made with the contractor, who neither sublets the contract nor employs any worker, the contractor is, for the purposes of this Act, taken to be a worker employed by the person who made the contract with the contractor
…”
According to the Court of Appeal in Scerri the applicant needs to establish all of the following:[88]
“1. that they were a party to a contract with the respondent to perform work;
2.that work exceeds $10 in value;
3.that work is not work incidental to a trade or business regularly carried on by the applicant in their own name or under a business or firm name; and
4.that the applicant has neither sublet the contract nor employed workers in the performance of it.”
[88] At 399.
It is undisputed there was an oral contract between the parties for the applicant to perform work for the respondent. At the rate of $65 per hour, the value of the work was more than $10. The first two elements are therefore satisfied; the remainder are disputed.
The first issue in dispute is whether the work was not incidental to a trade or business regularly carried out by the applicant in his own name or under a business or firm name. In Pasqua v Morelli Constructions Pty Ltd[89] (Pasqua), Roche DP observed at:
“As observed by Dixon J in Humberstone, a distinction must be drawn between an independent contractor whose relationship with the principal is ‘special or particular’, on the one hand, and, on the other hand, an independent contractor who ‘performs work successively or perhaps concurrently for his customers or others in the course of a definite trade or business carried on systematically or who holds himself out as ready to do so.’[90]
…
[I]t is necessary to consider whether the contractor is in business for himself or herself and whether a trade or business is carried on systematically and regularly.”[91]
[89] [2009] NSWWCCPD 153.
[90] At 50.
[91] At 58.
The underlying principle of whether “holding out” is necessary was considered in Malivanek v Ring Group Pty Ltd:[92]
“The question of whether there must be a “holding out” before an applicant is prevented from relying on Sch 1 was considered by the High Court in Higgins v Jackson [1976] HCA 37; 135 CLR 174 (Higgins) at 176 where Barwick CJ (Stephen, Mason and Murphy JJ concurring) said:
‘The subsection requires the business to be carried on with regularity. Thus a contractor who regularly contracts can scarcely be said not to hold himself out as carrying on the business in the course of which he makes the contracts. But in my opinion, there is no separate element required by the subsection of holding out. It is sufficient, as I have said, that the contractor regularly carries on business in his own or a firm name.’”
[92] [2014] NSWWCCPD 4.
The applicant performed work for the respondent on the Tyalgum Road job and the evidence of both parties is there was apparently an intention the respondent would provide future work to the applicant after its completion.[93]
[93] ARD p 6 para 33 and Reply p 2 para 17.
The evidence does not however support a finding that the applicant did not continue his carpentry business that he otherwise regularly carried on for other contractors and direct clients, including in the “loose partnership” arrangement with Mr Ward.
In the weeks prior to the Tyalgum Road job, the applicant and Mr Ward had created a company in June 2022, Northern Rivers Building & Construction Pty Ltd, apparently to formalise and streamline their working arrangement.[94] They continued doing work for
[94] ARD p 5 para 27.
[95] ARD p 5 para 29.
Mr Bambach around the time of the Tyalgum Road job.[95] The balance of the evidence is the applicant continued to be available for business as a carpenter, either to other principal contractors or direct clients. There is nothing in the applicant’s reliable evidence that indicates the work performed for the respondent was other than in the ordinary course of his carpentry business, in that case as a sub-contractor.
Accordingly, I am not satisfied the applicant met the requirement “that work is not work incidental to a trade or business regularly carried on by the applicant in their own name or under a business or firm name”. This means an essential element of cl 2 of Schedule 1 to the 1998 Act is not satisfied.
Even though that requirement is not met, the remaining element has also been considered for the sake of completeness. That is, as to whether the applicant had sublet the contract or employed workers.
The applicant’s evidence is that exactly such an arrangement was present in relation to
Mr Peterson. That evidence is extracted again here, in full, as it provides clarity of the circumstances when read in its totality in relation to the Tyalgum Road job:[96]
“56. We had Dane Peterson on this job with [the respondent]. We pay him $30 pr [sic] hour, I had not made an agreement with [the respondent] as to what we would charge him for Dane's hours. We would have got a margin for Dane's hours. To a degree we could sub-contract on that site but would have to be cleared by [the respondent] first.”
[96] ARD p 9.
The evidence from Mr Ward is also that Mr Peterson was present with him and the applicant at the Tyalgum Road job.[97] Whether or not there had been additional payment agreed with the respondent for Mr Peterson, it is evident he was present. That was undoubtedly pursuant to the arrangement described by the applicant, where it was presumed a “margin” could be obtained, either on an employed or sub-contracted basis. The reference to “we” by the applicant is plainly reference to his shared business arrangement with Mr Ward.
[97] ARD p 14 para 13.
I am satisfied on the balance of the reliable evidence that it is more likely than not the applicant, whether individually or in conjunction with Mr Ward, either sublet work to, or employed, Mr Peterson at the relevant time. The applicant cannot therefore satisfy the final requirement of cl 2 of Schedule 1 to the 1998 Act.
As the applicant does not satisfy all essential elements of cl 2 of Schedule 1, he cannot be deemed to be a worker for the purposes of the 1998 Act.

Entitlement to weekly compensation

As the applicant has been found to not have been a worker or deemed worker, he is not entitled to compensation as provided by the 1987 Act and so it is not necessary to further consider that issue or PIAWE.

SUMMARY

The applicant was not a worker according to s 4 of the 1998 Act or a deemed worker according to s 5 and cl 2 of Schedule 1 to the 1998 Act.
In the circumstances there must be an award for the respondent following determination of the application.

[2024] NSWPIC 576

16 October 2024