Timothy Dugan v The Vein Institute

[2018] FWC 2131

[2018] FWC 2131

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Timothy Dugan
v
The Vein Institute
(U2018/997)

DEPUTY PRESIDENT DEAN SYDNEY, 2 MAY 2018

Application for an unfair dismissal remedy.

[1] On 1 February 2018 Mr Timothy Dugan made an application for a remedy for unfair dismissal under s.394 of the Fair Work Act 2009. His application states that he commenced employment with The Vein Institute (the Respondent) on 19 June 2017 and that his dismissal took effect on 12 January 2018.

[2] The Respondent raised a jurisdictional objection to the application on the ground that Mr Dugan had not completed a minimum employment period.

[3] Section 382(a) of the Act provides:

“A person is protected from unfair dismissal at a time if, at that time:

(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and ...”

[4] The minimum employment period is defined in s.383 of the Act:

“383 Meaning of minimum employment period

The minimum employment period is:

(a) if the employer is not a small business employer—6 months ending at the earlier of the following times:

(i) the time when the person is given notice of the dismissal;

(ii) immediately before the dismissal; or

(b) if the employer is a small business employer—one year ending at that time.”

[5] The Respondent contended that as at the date of Mr Dugan’s dismissal, it employed fewer than 15 employees and was therefore a ‘small business employer’ within the meaning of s.23 of the Act. This was disputed by Mr Dugan.

[6] Section 23 sets out the meaning of ‘small business employer’:

“(1) A national system employer is a small business employer at a particular time if the employer employs fewer than 15 employees at that time.

(2) For the purpose of calculating the number of employees employed by the employer at a particular time:

(a) subject to paragraph (b), all employees employed by the employer at that time are to be counted; and

(b) a casual employee is not to be counted unless, at that time, he or she has been employed by the employer on a regular and systematic basis.

(3) For the purpose of calculating the number of employees employed by the employer at a particular time, associated entities are taken to be one entity.

(4) To avoid doubt, in determining whether a national system employer is a small business employer at a particular time in relation to the dismissal of an employee, or termination of an employee’s employment, the employees that are to be counted include (subject to paragraph (2)(b)):

(a) the employee who is being dismissed or whose employment is being terminated; and

(b) any other employee of the employer who is also being dismissed or whose employment is also being terminated.”

[7] The application was listed for hearing on 13 April 2018 to determine whether the Respondent was a small business employer at the time of Mr Dugan’s dismissal, and accordingly whether Mr Dugan had met the minimum employment period as prescribed by the Act. It was accepted by Mr Dugan that if the Respondent was a small business employer, he would not have met the minimum employment period and accordingly his application could not proceed.

[8] At the hearing Mr Dugan appeared on his own behalf and Dr Yassine appeared for the Respondent.

[9] For the reasons set out below, I find that the Respondent is a small business employer. It follows that Mr Dugan had not completed the required employment period of one year and is therefore not a person protected from unfair dismissal.

The evidence and submissions

[10] Mr Dugan asserted that there were 18 potential employees of the Respondent, and to that end provided a list comprising the names of 15 persons, and three position titles. The list included five medical practitioners and one Sonographer (now referred to as ‘the doctors’).

[11] During the hearing, Dr Yassine provided a printed copy of the Respondent’s payroll records together with computer access to ‘live’ payroll records for the pay period before and after the date of Mr Dugan’s dismissal. The payroll records showed that the doctors were not included in the Respondent’s payroll. The payroll records also showed that there were fewer than 15 employees on the payroll at the time of Mr Dugan’s dismissal.

[12] Dr Yassine submitted that the doctors were independent contractors and not employees of the Respondent. He gave evidence that the doctors all carried on their own business, and from time to time provided services to the Respondent. The doctors were generally surgeons, radiologists or specialist anaesthetists, two of whom had not provided services to the Respondent since December 2017 (prior to Mr Dugan’s dismissal). The Respondent provided copies of “Independent Contractor Agreements” for three of the doctors. Mr Dugan did not contest the validity of the contractor agreements, however he asserted that because the doctors were included on the Respondent’s website ‘their association with the Respondent was strongly implied’.

[13] Dr Yassine also gave evidence that the doctors held their own insurances and determined the times that they would make themselves available for work with the Respondent. The doctors also provided their services to a number of other medical practices.

[14] There are well established principles that have been developed by courts to determine whether an individual is an employee or an independent contractor. In Jiang Shen Cai trading as French Accent v Michael Anthony Do Rozario 1 (French Accent), a Full Bench summarised the general law approach to distinguishing between employees and independent contractors. The Full Bench stated that in “determining whether a worker is an employee or an independent contractor the ultimate question is whether the worker is the servant of another in that other’s business, or whether the worker carries on a trade or business of his or her own behalf: that is, whether, viewed as a practical matter, the putative worker could be said to be conducting a business of his or her own of which the work in question forms part? This question is concerned with the objective character of the relationship. It is answered by considering the terms of the contract and the totality of the relationship”.

[15] I adopt the approach in French Accent.

[16] In addition, I respectfully agree with the statement of Watson VP in Cherif Meena v Biripi Aboriginal Corporation Medical Centre T/A Werin Aboriginal Medical Centre (Werin) 2 in which he said:

“Where a strong inference of any independent contractor relationship arises from the way in which the parties have drafted the contract between them, that inference will only be displaced if there are strong factors as to the practical working arrangements that contradict and outweigh that inference.”

[17] In applying the approach set out in French Accent and Werin to the evidence in this case, I find that the doctors are independent contractors and not employees. Three of the doctors had signed comprehensive independent contractor agreements. All of the doctors held their own insurances, worked with the Respondent when convenient for them, and provided their services to other medical practices. Two of the doctors had not performed any work for the Respondent since prior to Mr Dugan’s dismissal. There was no evidence to contradict a finding that the doctors are independent contractors rather than employees.

[18] Further, Dr Yassine gave evidence that another person on the list provided by Mr Dugan, Mr Elnakeeb, was Dr Yassine’s brother in law, who held a full time position with ANZ Bank. While he had assisted the Respondent with marketing, he was not an employee of the Respondent. Dr Yassine provided a copy of an email from Mr Elnakeeb to the Commission, in which he stated that he was not an employee or contractor to the Respondent, and had assisted the Respondent “pro bono, as a brother in law and a mate”. In the absence of any evidence to the contrary, I am satisfied and find that Mr Elnakeeb was not an employee of the Respondent.

Conclusion

[19] Based on the evidence and submissions made in this matter, I am satisfied and find that the Respondent had fewer than 15 employees and was therefore a small business employer. As a result, I find that Mr Dugan had not completed the minimum employment period and is not a person protected from unfair dismissal.

[20] Accordingly, I uphold the Respondent’s jurisdictional objection and dismiss the application. An order to that effect will be issued separately.

DEPUTY PRESIDENT

Appearances:

T Dugan, on his own behalf.

Z Yassine, for the Respondent.

Hearing details:

2018.

Sydney:

April 13.

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 1   [2011] FWAFB 8307

 2   [2013] FWC 4502