[2024] FWC 1572
The attached document replaces the document previously issued with the above code on 17
June 2024 to amend typographical errors.
Associate to Deputy President Dobson
Dated 20 June 2024
1
Fair Work Act 2009
s.394—Unfair dismissal
Karen Lesley Jeske
v
Noosa Confidential Pty Ltd
(U2024/857)
DEPUTY PRESIDENT DOBSON BRISBANE, 17 JUNE 2024
Application for relief from unfair dismissal – jurisdictional objection - whether Applicant an
employee or independent contractor – jurisdictional objection upheld
[1] On 25 January 2024, Ms Karen Jeske (Applicant) made an application to the Fair Work
Commission (Commission) under s.394 of the Fair Work Act 2009 (Cth) (FW Act) for a
remedy, alleging that she had been unfairly dismissed from her employment with Noosa
Confidential Pty Ltd (Respondent). The Applicant seeks reinstatement and compensation.
[2] Before proceeding to consider the merits of this case, I heard the parties on the
jurisdictional objection. Having heard the parties, I now proceed to give these reasons for my
decision ex tempore.
[3] This published decision reflects the decision I gave ex tempore on 17 June 2024 with
more fulsome reasons, corrections for grammatical, syntactical and any other insignificant
errors, as foreshadowed in its delivery.
When can the Commission order a remedy for unfair dismissal?
[4] Section 390 of the FW Act provides that the Commission may order a remedy if:
(a) the Commission is satisfied that the Applicant was protected from unfair dismissal
at the time of being dismissed; and
(b) the Applicant has been unfairly dismissed.
[5] Both limbs must be satisfied. I am therefore required to consider whether the Applicant
was protected from unfair dismissal at the time of being dismissed and, if I am satisfied that the
Applicant was so protected, whether the Applicant has been unfairly dismissed.
When is a person protected from unfair dismissal?
[2024] FWC 1572
EX TEMPORE DECISION
AUSTRALIA FairWork Commission
[2024] FWC 1572
2
[6] Section 382 of the FW Act provides that a person is protected from unfair dismissal if,
at the time of being dismissed:
(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
(b) one or more of the following apply:
(i) a modern award covers the person;
(ii) an enterprise agreement applies to the person in relation to the employment;
(iii) the sum of the person’s annual rate of earnings, and such other amounts (if
any) worked out in relation to the person in accordance with the regulations,
is less than the high income threshold.
When has a person been unfairly dismissed?
[7] Section 385 of the FW Act provides that a person has been unfairly dismissed if the
Commission is satisfied that:
(a) the person has been dismissed; and
(b) the dismissal was harsh, unjust or unreasonable; and
(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
[8] Section 386 of the Act sets out the circumstances in which a person is taken to have
been “dismissed” for the purposes of s.365. That section provides, relevantly, as follows:
386 Meaning of dismissed
(1) A person has been dismissed if:
(a) the person’s employment with his or her employer has been
terminated on the employer’s initiative; or
(b) the person has resigned from his or her employment, but was forced
to do so because of conduct, or a course of conduct, engaged in by
his or her employer.
[9] As is apparent from the terms of s.386(1) above, a person can only be dismissed when
their employment comes to an end in the circumstances described. In the absence of a
relationship of employer and employee, a person cannot be dismissed within the meaning of
s.386 and an application under s.394 can proceed no further. This decision deals with the issue
of whether an employer and employee relationship existed between the Applicant and the
Respondent.
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Background
[10] Some of the background is uncontested and can be briefly summarised.
[11] The relationship between the Applicant and the Respondent commenced on or around
January 2014. The relationship ended on or around 7 February 2024.
[12] The Respondent provides a “premium Residential Rehabilitation facility where a
maximum of 4 clients with substance abuse issues, addiction, depression, anxiety and/or post
traumatic stress disorder stay onsite at any one time for a minimum of 4 weeks….. Often
extended beyond 4 weeks.”1 And “….clients are promised discrete, on-on-one care, rigorous
case management, a team of expert medical and health professionals and tailored solutions to
identify and successfully treat the underlying cause of their condition/s.”2
[13] The parties entered into a Services Agreement on 20 November 17.3 The Applicant
performed work pursuant to that contract. The Applicant performed work as a Psychologist
performing “Creative Arts Therapy” and “Somatic Experiencing.” 4 The Applicant performed
work on the residential programs onsite where those programs were conducted and the patients
staying. She also performed work called ‘after-care’ work for ongoing support and maintenance
usually by phone, zoom or at the Applicants private business premises Chi Hub.5
[14] On 4 January 2024, the relationship came to an end when the Respondent notified the
Applicant in writing that the relationship would be brought to an end. On 24 January 2024, the
Respondent issued a letter informing that the Agreement was being terminated on 14 days
notice being 7 February 2024 pursuant to clause 16.1 of the Services Agreement.
The hearing
[15] There being contested facts involved, the Commission is obliged by s.397 of the FW
Act to conduct a conference or hold a hearing.
[16] After taking into account the views of the Applicant and the Respondent and whether a
hearing would be the most effective and efficient way to resolve the matter, I considered it
appropriate to hold a determinative conference for the matter (s.399 of the FW Act).
Permission to appear
[17] The Respondent sought to be represented before the Commission by a lawyer.
[18] Relevantly, section 596(1) of the FW Act provides that a party may be represented in a
matter before the Commission by a lawyer or paid agent only with the permission of the
Commission.
[19] Section 596(2) provides that the Commission may grant permission for a person to be
represented by a lawyer or paid agent in a matter before the Commission only if:
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(a) it would enable the matter to be deal with more efficiently, taking into account the
complexity of the matter; or
(b) it would be unfair not to allow the person to be represented because the person is
unable to represent himself, herself or itself effectively; or
(c) it would be unfair not to allow the person to be represented taking into account
fairness between the person and other persons in the same matter.
[20] The decision to grant permission is not merely a procedural step but one which requires
consideration in accordance with s.596 of the FW Act.6 The decision to grant permission is a
two-step process. First it must be determined if one of the requirements in s.596(2) have been
met. Secondly, if the requirement has been met, it is a discretionary decision as to whether
permission is granted.7
[21] On the question of representation, the Applicant submitted that:
• The Respondent should not be granted permission to be represented by a lawyer or
paid agent at hearing due to unfairness.
• The Respondent has already deployed sufficient legal expertise in preparing
submissions, before providing notice to the Applicant that they intended to be
represented. The Applicant provided its objection to leave once notice that the
Respondent intended to be represented was tendered.8
• The Respondent’s termination of the Applicant caused her significant financial
hardship, which prevents her from being able to afford representation. Allowing the
Respondent to be represented at hearing would widen the unfairness and power
imbalance.9
• The Respondent is well abled to assist the Commission in its prosecution by its
director Ms Pettina Stanghon, and the Applicant is concerned that it seeks legal
representation as a preface to a punitive application for a costs order.
[22] On the question of representation, the Respondent submitted that:
• Due to the matter involving a jurisdictional objection, it is necessary for the
Commission to determine complex matters of law. Legal representation may assist in
the efficiency of determining the jurisdictional issue.10
• The Respondent is a small business employer with less than 15 employees and has
no specialist human resources staff, and is unable to effectively represent itself.
[23] Having considered those matters, I determined that:
• allowing the Respondent to be represented by a lawyer would enable the matter to be
dealt with more efficiently, taking into account the complexity of the matter and that
complexity in part includes that the Applicant is self represented; and
• it would be unfair not to allow the Respondent to be represented because the
Respondent is unable to represent itself effectively.
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[24] I therefore decided to exercise my discretion to grant permission for the Respondent to
be represented and this was conveyed to the parties on 26th April 2024.
[25] Accordingly, at the hearing on 17 June 2024, the Applicant was self-represented and
aided by a support person from a HR Consulting business and the Respondent was represented
by Mr Brendan Leighton from New Era Lawyers and Miss Ella Smith from New Era Lawyers
acted as instructing.
Witnesses
[26] The Applicant gave evidence on her own behalf.
[27] The following witnesses gave evidence on behalf of the Respondent:
• Ms Pettina Stanghon, director of the Respondent; and
• Ms Kristianne Paul, Operations Manager of the Respondent. (Ms Paul’s evidence was
uncontested and was admitted into evidence during the hearing).
Evidence and Submissions
[28] The Applicant filed submissions in the Commission on 14 April and 10 May 2024. The
Respondent filed submissions in the Commission on 8 April, 22 April, 24 May and 16 June
2024.
Applicant’s Submissions
[29] The Applicant submitted that the relationship between her and the Respondent was one
of an Employee/Employer relationship and further submitted that the contract of services was
a sham contract. The Applicant submitted that she was contracted for her labour, rather than
her services.
[30] The Applicant stated that the nature of the Respondent’s operations demonstrated that
she was an employee, specifically in relation to the ‘heavy case management approach to all
clients’11. The Applicant stated that the Respondent’s Sales Manager hands over clients to Ms
Stanghon as Director of the Respondent. Ms Stanghon would then actively take the role of how
the “pieces and services” of the Respondent’s offering came together.
[31] The Applicant stated that she undertook two different types of work for the Respondent,
being the in-residence, initial psychotherapy direct client services (Residential Care) and
sessions conducted after the client is discharged from the services (After Care). The Applicant
stated that she considered the Residential Care aspect to be the basis of the employment
relationship, whereas the After Care work was a distinct offering separate to the Respondent’s
Residential Care program. The Applicant stated that After Care appointments were ‘pencilled
into’ her diary by the Respondent’s administrator and that she would change the appointment
day/time according to both her and the client’s availability.
[32] The Applicant stated in response to the Respondent’s submissions that she considered
the Services Agreement to be invalid or ineffective. The Applicant stated that she had been
[2024] FWC 1572
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engaged and working in the Respondent’s business in the same capacity since early March 2014
and that the clauses in the Services Agreement did not reflect how the Applicant operated in
the period leading up to November 2016 and therefore how she would operate after November
2016.
[33] The Applicant stated that in the months before November 2016, that Ms Stanghon had
sent out a questionnaire to all workers, asking, inter alia, whether they viewed themselves as an
employee or independent contractor. The Applicant stated that to the best of her recollection,
that despite having been invoicing the Respondent for the Appointments, that she considered
herself an employee. The Applicant stated that the new terms of engagement offered by the
Respondent at the date of the Services Agreement had been framed to protect the Respondent
and its Staff legally due to the nature of their work and that the Respondent would assume the
risk of any legal action.
[34] The Applicant received an email from the Respondent to indicate that to continue her
contractor status, that she would need to become a Family Trust or a Company and to invoice
the Respondent as such. The Applicant stated that she acquiesced to the pressure and established
a Family Trust and had delayed the state date from July 2016 to November 2016.
[35] The Applicant stated that she was aware of another Psychotherapist who had her work
end with the Respondent after not creating a Family Trust or Company. The Applicant stated
that another psychotherapist was asked to discontinue working at other mental health programs
if she sought to continue working for the Respondent.
[36] The Applicant stated that she was certain that as far back as March 2014, that if she had
ever made a request or placed a requirement on the Respondent to be an employee for the
purposes of performing residential psychotherapy, that it would have been declined and her
work with the Respondent would have ceased. She stated that for this reason, she felt pressured
and intimidated and ‘went along with’ the independent contractor requirement for so long and
that she genuinely knew there was no other option.
[37] The Applicant stated that she did not have control over when, where or how she provided
the Services under the Service contract. The Applicant stated that it was a result of heavy case
management which included instructions such as “you need to go hard on person today,
Karen” and other such directions, that she knew what was meant from those directions.
[38] The Applicant stated that she was required to complete a report form in each session as
a summary and record of every session and that she had signed an agreement which stipulated
that if she did not complete these forms she would not be paid at all. The Applicant stated that
on occasions, she had not uploaded a report for some reason or another and would not have
been paid until she did so.
[39] The Applicant stated that she had not ever delegated or subcontracted her services and
nor did she ask to as it was “very clear” that she would not be permitted to do so. The Applicant
stated that it was not an accepted practice.
[40] The Applicant stated that she was not free to choose to accept or refuse referrals to her
from the Respondent. The Applicant stated that the Respondent would decide which clients
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would be referred to her and that on any given day she was working on the premises, she was
allocated therapy sessions with the clients onsite. The Applicant stated that there were a handful
of occasions where she would have refused to work with a client had it been a genuine option.
The Applicant stated that she was confident that had she refused to work with a client, it would
have been the end of her tenure at the Respondent.
[41] The Applicant stated that she was not permitted to deliver psychotherapy sessions at any
other location than at the Respondent’s Residence, and that any request she had made had been
rejected. The Applicant stated that only once had she delivered therapy external to the location
when she had a broken leg. The Applicant stated she performed After Care appointments either
virtually, or from other locations, including at her own location.
[42] The Applicant stated that she had nominated three days that she was available to the
Respondent for onsite appointments, and that there was little flexibility to change these
nominated days. After Care appointments had been conducted outside of these days.
[43] The Applicant stated that she provided all her own equipment for any arts or craft
activities used in therapy. The Applicant stated that she had her own insurance and was not
provided a uniform, with the exception of being directed to wear white shirts.
Respondent’s Submissions
[44] The Respondent submitted that the Services Agreement set out the following relevant
clauses:
“(a) by clause 3, the contract commenced on 20 November 2017 and continued until terminated
in accordance with clause 16;
(b) by clause 4.1, and Item 8 of the Schedule, the Applicant was to provide creative arts therapy
and somatic experiencing services (“the Services”);
(c) by clause 4.4, the Applicant was entitled to exercise her independent discretion as to the most
appropriate and effective manner of performing the Services;
(d) by clause 4.5 and clause 15.5, the Applicant was entitled to delegate, substitute, or
subcontract all or part of the Services to a third-party, provided the Respondent’s written
approval was first obtained, and in which case the Applicant was liable for the costs and all
necessary equipment reasonably required for the performance of the Services;
(e) by clause 5.6, the Applicant was free to trade, operate and provide other services to any other
person in the conduct of her business as she thought fit, provided it did not interfere with the
performance of her Services under the contract;
(f) by clause 6.1 and Item 10 of the Schedule, the Applicant was to be paid a fixed sum of
$90.00 per unit of Services delivered under the Contract, subject to the Applicant first tendering
a tax invoice for the provision of those services that conformed with clause 6.2 of the contract;
(g) by clause 8.1, the Applicant was responsible for the payment of all relevant taxes and
superannuation expenses arising in respect of the contract;
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(h) by clause 8.4, the Applicant warranted that she had her own ABN;
(i) by clause 8.5, the Respondent would pay the Applicant GST associated with the supply of the
Services, provided the Applicant submitted a valid tax invoice in respect of the relevant Services;
(j) by clause 9.2 and Item 7 of the Schedule the Applicant was to provide at her own expense all
plant, equipment, tools labour, travel costs and any other things necessary to provide the
Services;
(k) by clause 10.1, the Applicant was entitled to retain all right, title and interest in the
intellectual property contained within her own materials used in connection with the services,
provided those materials are declared prior to the commencement of the contract;
(l) by clause 13.1, the Applicant was required to take out and maintain her own policies of
public and product liability, employer’s liability, and professional indemnity insurance;
(m) by clause 15.1, the parties acknowledged and agreed that the Applicant was carrying out
the Services under the contract as an independent contractor, and nothing in the contract was
intended to create an employment relationship;
(n) by clause 15.2, the Applicant was liable for any debts and obligations incurred in respect of
the provision of the Services;
(o) by clause 16.1, the Respondent was entitled to terminate the contract, for any reason
whatsoever, by giving no less than 14 days’ notice to the Applicant to such effect.1”
[45] The Respondent submitted that it terminated the Services Agreement with termination
to take effect 14 days thereafter as per clause 16.1 of the contract.
[46] The Respondent submitted that the Applicant was an independent contractor by reason
of the following:
“(a) The rights and duties of the parties are comprehensively committed to writing in the
Services Agreement. There is no indication that the parties conducted themselves other than in
accordance with the terms of the contract. In circumstances where that contract is not a sham, it
is decisive of the character of the parties’ relationship.
(b) The relevant provisions of the Services Agreement as extracted in paragraph 1 of these
submissions are all demonstrative of an independent contractor relationship. The parties went to
the extent of expressly denying the existence of an employment relationship existing between
them. Whilst not determinative, the rights and duties that the parties agreed be bound by in the
Services Agreement are not in any way inconsistent with this statement as to the proper
characterisation of their legal relationship.
(c) The Applicant was entitled to, and in fact did, control how she delivered the Services
(without any direct oversight by the Respondent), where she delivered the Services (including
at various locations that were not owned or controlled by the Respondent), as well as when she
delivered the Services (she was able to nominate the referrals she wished to accept and the days
on which she worked to suit her personal schedule).32
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(d) This “major signifier”33 points clearly to the existence of an independent contractor
relationship.
(e) The Applicant was not paid a wage or salary and was instead paid at an hourly rate for the
delivery of each of the Services upon presentation of a valid tax invoice, which invoices included
a sum for GST.34
(f) The Applicant did not work solely for the Respondent. She had her own business, a
separate place of work, and her own private clients.35 She has various websites for her
business in which her services are advertised to the world at large.36
(g) The Applicant provided and maintained her own equipment. Some of her therapy sessions
required equipment such as craft items or clay. It was her professional choice to use this
equipment and she was financially responsible for it. The Respondent did not provide the
Applicant with any equipment.37
(h) The Applicant was not prohibited from delegating or subcontract her work to other people to
complete.38
(i) The Applicant was entitled to maintain ownership of her intellectual property in the course
materials she had developed as part of her therapy sessions.39
(j) The Applicant wore clothing of her choice and was not supplied business cards by the
Respondent.40
(k) The Applicant was responsible for her own tax and superannuation affairs.41
(l) The Applicant did not receive paid holiday or sick leave. She was not required to request
leave but would advise the Respondent in advance of time off so that the Respondent could
organise someone to take over her therapy sessions.42
(m) The Services supplied by the Applicant involved a distinct calling on her part. She was
required to have counselling qualifications and was responsible for maintaining those
qualifications. The Applicant was also required to hold her own professional indemnity
insurance.43
(n) The Applicant was personally responsible to her patients for the work she carried on in her
capacity as a therapist.”
Consideration
[47] Deputy President Roberts helpfully set out the relevant law which I will follow here.12
The Fair Work Act regulates many aspects of workplace relationships and interactions in great
detail. It leaves the fundamental issue of who is an employee to the common law.13
[48] The High Court has relatively recently considered that question in the decisions of
CFMMEU v. Personnel Contracting Pty Ltd [2022] HCA 1 and ZG Operations Pty Ltd and
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Jamsek [2022] HCA 2. The principles set out by the Court in those decisions have been
conveniently distilled14 by Wigney J in the matter of JMC Pty Limited v Commissioner of
Taxation [2022] FCA 750 as follows:
First, where the rights and duties of the parties are comprehensively committed to a written
contract, the legal rights and obligations established by the contract are decisive of the
character of the relationship provided that the validity of the contract has not been challenged
as a sham, or that the terms of the contract have not been varied, waived or are subject to an
estoppel: Personnel Contracting at [43], [44], [47], [59] (Kiefel CJ, Keane and Edelman JJ),
[172] (Gordon J, Steward J relevantly agreeing at [203]). The task is to construe and
characterise the contract made between the parties at the time it was entered into: Personnel
Contracting at [174] (Gordon J).
Second, in order to ascertain the relevant legal rights and obligations, the contract of
employment must be construed in accordance with the established principles of contractual
interpretation: Personnel Contracting at [60] (Kiefel CJ, Keane and Edelman JJ), [124]
(Gageler and Gleeson JJ), [173] (Gordon J). In that respect, regard may be had to the
circumstances surrounding the making of the contract, as well as to events and circumstances
external to the contract which are objective, known to the parties at the time of contracting and
which assist in identifying the purpose or object of the contract: Personnel Contracting at
[174]-[175] (Gordon J); Jamsek at [61] (Kiefel CJ, Keane and Edelman JJ), referring to
Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 at 352. The
nature of the specific job that the putative employee applied for and the nature and extent of
any tools or equipment they have to supply for that job may also be relevant: Personnel
Contracting at [175] (Gordon J). It is, however, generally not legitimate to use in aid of the
construction of a contract anything which the parties said or did after it was made: Personnel
Contracting at [176] (Gordon J).
Third, and flowing from the first two principles, the characterisation of the relationship between
the parties is not affected by circumstances, facts or occurrences arising between the parties
that have no bearing on their legal rights: Personnel Contracting at [44] (Kiefel CJ, Keane and
Edelman JJ), [173]-[178] (Gordon J); Jamsek at [109] (Gordon and Steward JJ). A “wide-
ranging review of the entire history of the parties’ dealings” is neither necessary nor
appropriate: Personnel Contracting at [59] (Kiefel CJ, Keane and Edelman JJ); see also [185]-
[189] (Gordon J). For a “matter to bear upon the ultimate characterisation of a relationship,
it must be concerned with the rights and duties established by the parties’ contract, and not
simply an aspect of how the parties’ relationship has come to play out in practice but bearing
no necessary connection to the contractual obligations of the parties”: Personnel Contracting
at [61] (Kiefel CJ, Keane and Edelman JJ) (emphasis added).
It follows that the fact that the parties’ subsequent conduct may not have precisely aligned with
their contractual rights and obligations, or the fact that a particular contractual right may have
never been exercised or utilised, will generally be irrelevant when it comes to characterising
the relationship. That is so unless the manner in which the parties conducted themselves after
entering into the contract was such as to establish that the contract was a sham, or that the
contract had been varied, or that certain rights under the contract were subject to an estoppel.
Fourth, the contractual provisions that may be relevant in determining the nature of the
relationship include, but are not limited to, those that deal with the mode of remuneration, the
provision and maintenance of equipment, the obligation to work, the hours of work, the
provision for holidays, the deduction of income tax, the delegation of work and the right to
exercise direction and control: Personnel Contracting at [113] (Gageler and Gleeson JJ);
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[174] (Gordon J), referring to Brodribb at 24 (Mason J); see also 36-37 (Wilson and Dawson
JJ).
Fifth, the characterisation of the relationship as one of service or employment involving an
employer and employee, as opposed to a relationship involving an independent contractor
providing services to a principal, often hinges on two considerations. The first consideration is
the extent to which the putative employer has the right to control how, where and when the
putative employee performs the work: Personnel Contracting at [73]-[74] (Kiefel CJ, Keane
and Edelman JJ); [113] (Gageler and Gleeson JJ); see also Brodribb at 24 (Mason J) and 36-
37 (Wilson and Dawson JJ). The second is the extent to which the putative employee can be
seen to work in his or her own business, as distinct from the business of the putative employer
– the so-called “own business/employer’s business” dichotomy: Personnel Contracting at [36]-
[39] (Kiefel CJ, Keane and Edelman JJ); [113] (Gageler and Gleeson JJ); cf [180]-[183]
(Gordon J). Neither of those considerations are determinative and both involve questions of
degree.
Sixth, a “label” which the parties may have chosen to describe their relationship is not
determinative of the nature of the relationship and will rarely assist the court in characterising
the relationship by reference to the contractual rights and duties of the parties: Personnel
Contracting at [63]- [66] (Kiefel CJ, Keane and Edelman JJ); [127] (Gageler and Gleeson JJ);
[184] (Gordon J). The parties’ “legitimate freedom to agree upon the rights and duties which
constitute their relationship” does not “extend to attaching a ‘label’ to describe their
relationship which is inconsistent with the rights and duties otherwise set forth” – to permit
otherwise would elevate the freedom to “a power to alter the operation of statute law to suit …
the interests of the party with the greater bargaining power”: Personnel Contracting at [58]
(Kiefel CJ, Keane and Edelman JJ).
The characterisation of a relationship as being either one of employer and employee, or one
involving the engagement of an independent contractor, is ultimately an evaluative judgment
that takes into account the totality of the parties’ contractual rights and obligations. The
exercise may not necessarily be straightforward because, in some cases at least, the parties’
contractual rights and obligations may point in different directions. The evaluative exercise also
should not be approached on the basis that there is some checklist against which ticks and
crosses may be placed so as to produce the right answer. Some degree of uncertainty is
unavoidable, particularly in the case of many modern-day work or service contracts.
[49] In this case the parties committed the terms of their relationship to writing. The terms
were contained in the Services Agreement.15 There was some evidence about the nature of the
relationship prior to the signing of the documents. In this respect I accept the evidence of the
parties that there was no change in the day to day practicalities of the relationship other than to
continue to perform the work in accordance with what was set out in the services agreement.
This is partially consistent with submissions by the parties and as given in evidence during cross
examination.
[50] Whilst there are a number of instances where the Applicant protests that certain indicia
are performed in a particular way, in each case upon closer examination it is my view that the
indicia are in practical terms supportive of an independent contractor relationship.
Control
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[51] In considering the issue of control, the Applicant submitted in her evidence that the
Respondent held regular case management meetings in which the Applicant was told how to
treat patients including when she needed to take a harder approach with them. I heard the
evidence of the Respondent in this respect who described some patients having a number of
professionals involved in their therapy eg exercise physiologists, psychotherapists and the like,
and that the purpose of these case management meetings was to ensure all parties were working
together in the best interests of the patient. Further, the Respondent gave evidence that she could
not tell the Applicant how to treat a patient in closed doors. Like Personnel, the Respondent
provided certain assurances to its clients and it was not unreasonable for the Respondent to
exercise a high level of control to ensure that the assurances provided were honoured at a high
level. For example, in terms of providing timely, high quality services.
[52] It is clear though the minutiae of how that work was performed was in the hands of the
Applicant. This is particularly the case where the risk and the insurance for the wellbeing of the
patient lies with the Applicant. The Applicant gave her own evidence that she was required to
have her own insurance and professional accreditation. In consideration of all of these factors I
accept that the Applicant is responsible for the clinical treatment and outcomes of her patients
and that there was no control over her. In this respect Applicant concedes that on her own
evidence she admits that “after care appointments were “pencilled into” my diary and I would
change the appointment day/time according to both mine and client’s availability.”16 This in
effect demonstrates that the Applicant did have control over when this work was done. I do not
accept that After care work and residential care can be separated for the purposes of where and
how that work was conducted as it pertains to the Applicant’s control of her work. I accept
simply that residential work does need to occur where the patient is in residence, this is a
common sense outcome and the after-care work has more flexibility as to where it is conducted
and in that sense the Applicant has had control as to where that occurred with some performed
at her home by phone or video or some in her private offices at Chi Hub which are premises
not in any way associated with the Respondent.
[53] In this present matter the Applicant claimed she had little control over what work she
accepted or performed,17 however when reading on into the Applicant’s submissions and further
in cross examination the Applicant conceded that she had never been told verbally or in writing
that she could not do so. She was unable to give an example where she was unable to do so.
[54] Other examples are:
a) In respect of controlling when she worked, the Applicant made submissions that she
advised the Respondent when she was available for work at 3 days a week,18 in cross
examination the Applicant acknowledged that she had changed that to 2 days a work
at the Respondent’s residential facility and 1 day a week from her home with the
other two days of work a week being private work she performed for other clients.
b) In respect of being able to delegate work to others, in cross examination the
Respondent gave a number of examples naming two other contractors who were
able to delegate work to other contractors when they would not be available.
c) The Applicant accepted that income tax was not deducted from her pay and she
charged her client for GST in invoices that were sometimes issued weekly and
[2024] FWC 1572
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sometimes monthly at the Applicant’s discretion when she had time to attend to
uploading the required reports that accompany the invoices. I accept she was paid
for completing results which might be also linked to time. Given the Applicant had
worked for the Respondent for such a significant time, I don’t accept that such a
situation was not accepted by the Applicant as there were actions that could have
been taken to dispute this situation if it were a sham arrangement.
d) The Applicant gave evidence that she did not receive sick leave, annual leave,
payment for public holidays etc She claimed she recently sought public holiday
payments at Christmas 2023 however there was no evidence before the commission
of this and the Respondent denied any knowledge or that any such payment had
been made.
e) The services contract contained a provision that the Applicant was responsible for
providing her own equipment and tools.19 In the Applicant’s own evidence she
acknowledges paying for any art material required for use in therapy she provided.20
f) On the Applicant’s own evidence she performed work for others around 25% of her
time,21 and this was further confirmed in cross examination.
g) The Applicant gave evidence that her field was a specialist field of work requiring
significant qualifications and experience. It required ongoing monitoring and
training. The Respondent gave evidence in cross examination that it assisted all
contractors with training to ensure they could provide the highest quality of services
to their clients. It is my view that the work performed by the Applicant involves a
profession with a distinct calling on her part.
Was the contract a Sham?
[55] The Applicant submitted that the Respondent had misrepresented the true nature of the
relationship and was engaging in a “sham arrangement.” I do not think the evidence in this
matter goes so far as to show that the validity of the contract itself could be successfully
challenged on that basis. Nor was it argued cogently, supported by any relevant evidence, that
the legal effect of the written terms was affected by a variation, waiver or estoppel. I turn then
to consider the nature of the legal rights and duties created by the written terms to determine
the true character of the relationship between the parties.
[56] I consider that the terms of the Service Agreement create the relevant rights and duties
that bound both parties for the purpose of characterising the relationship between them. I have
considered those terms in their totality.
[57] The Services Agreement describe the Applicant as an independent contractor. On the
basis of the submissions and evidence before me, there is no evidence to support or conclude
that the arrangement which has been in place is a sham. I accept the evidence of the Respondent
given in cross examination that in 2017, she sought advice from her accountant as to how she
should be engaging staff in her business. She conducted a survey of her staff and then met with
them one on one. The outcome was that some staff became employees and some continued as
contractors but with the new contracts put in place for which the Applicant in this matter is
[2024] FWC 1572
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presently bound by. This is a legitimate process for an employer to ensure that employees or
contractors are engaged correctly in accordance with the law, and I accept that this was the
purpose for which the Respondent offered the Services Agreement to the Applicant. The
Applicant considered that Services Agreement and signed it. There is no evidence of a lack of
capacity, and I accept that the Applicant is a well-educated and intelligent professional. She
understood what she was signing, she had been working within its terms for some years prior
and she continued to work within its terms up until the time it was terminated in early 2024.
“Own business/employer’s business” dichotomy
[58] It was accepted by the plurality in Personnel that although not determinative, the
question of whether someone is conducting their own independent business as opposed to
serving in the business of another could be a useful framework to guide the characterisation of
the relationship.22 The Applicant in this matter did demonstrate she conducts her own business
‘Make Sense’ which was as contemplated in Personnel. The Applicant gave evidence as to the
nature of her business and that she was growing the business in the days she was not performing
work for the Respondent. The services she provides in this business are around the same fields
of expertise for which she performs work for the Respondent. I accept that to be the case.
[59] The evidence before the Commission was that the Applicant’s business Make Sense did
perform work for other parties and that she used her office at Chi Hub to deliver these services.
There was no evidence before the Commission that the Respondent took any action to stop or
minimise the Applicant’s efforts in this respect. This is further indicative of the independent
contractor relationship pursuant to Personnel.
[60] Clause 9.2 of the Agreement provides that the Contractor is responsible for providing
any equipment, including safety equipment, tools and resources. Additionally, the Applicant is
responsible for travel costs for which they would be reimbursed at a cost of 66 cents per km
where clients were to be transported to appointments or events. These are factors which in the
overall assessment, points to the relationship as being one of principal and independent
contractor.
[61] Clause 2.7 of the Services Agreement provides that it can only be varied by agreement
in writing. There was no evidence put before the Commission that any such variation had
occurred.
[62] Clause 4.5 of the Services Agreement provides that the Applicant can delegate substitute
or subcontract all or part of the services therein. Clause 8 of the Services Agreement makes it
clear that taxes, superannuation, workers compensation and insurance premiums are the
responsibility of the Applicant.
[63] As to remuneration, the Services Agreement provides (at Item 10 of the Schedule) that
the Applicant was to be paid a fee for completion of certain services, which appear to have been
measured in time and paid upon completion and the uploading of a relevant report substantiating
the work performed. The Services Agreement demonstrates that the fees are negotiated with
the Respondent and the Applicant. I take this to mean that ultimately, the rates applying to the
Applicant at the point of engagement set out in the Service Agreement were determined by the
[2024] FWC 1572
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Respondent, presumably after some negotiation with third parties, and passed on to the
Applicant.
[64] The Services Agreement obliges the Applicant to submit weekly reports to the
Respondent’s systems for processing. I note that at times the Applicant could only do this
monthly and that she was then paid accordingly. This is an administrative requirement justified
in such an arrangement.
[65] Whilst the plurality in Personnel cautioned that not all contractors are entrepreneurs,23
the utility of the “own business/employer’s business” dichotomy was nonetheless accepted. I
am of the view that the contractual arrangements taken as a whole leave plenty of scope for
entrepreneurship on the part of the Applicant and this is supported by the Applicant’s own
evidence of the business she is building through her business Make Sense which has included
assignments overseas.
[66] The determination as to whether a person is an employee or independent contractor is a
question of law. I do not find that the Services Contract was a Sham contract for all of the
reasons set out. Having taken into account the various rights and obligations that the parties
created for themselves by their contractual arrangements, I am of the view that the relationship
between the Applicant and Respondent in this case was one of Principal and independent
contractor.
[67] The Respondent’s jurisdictional objection is upheld. The Applicant’s unfair dismissal
application is dismissed.
DEPUTY PRESIDENT
Appearances:
Ms Jeske for herself.
Mr Leighton for the Respondent.
Hearing details:
In Person
Brisbane
17 June 2024
WORK COMA boon AUS MISSION THE SEAL OFESTE
[2024] FWC 1572
16
Printed by authority of the Commonwealth Government Printer
PR776101
1 DCB p.12.
2 Ibid.
3 DCB p.107-120D.
4 DCB p. 120A.
5 DCB p.18.
6 Warrell v Fair Work Australia [2013] FCA 291 (Warrell).
7 Ibid.
8 Stephen Fitzgerald v Woolworths Limited [2017] FWCFB 2797.
9 Warrell at 27.
10 Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v
UGL Resources Pty Limited (Project Aurora) [2012] FWA 2966
11 Page 12 DCB
12 Ms Jessica Tidmarsh v Aspire 2 Life Pty Ltd [2024] FWC 289.
13 There are some minor statutory amendments to the common law, none of which are presently relevant or in issue. See
Gordon J in Personnel at [161].
14 See also Chambers and O’Brien v Broadway Homes Pty Ltd [2022] FWCFB 129 at [74].
15 DCB p. 107-120D.
16 DBC p. 13.
17 DCB p. 13.
18 DCB p. 18.
19 DCB p.78, cl. 9.2-9.3.
20 DCB p. 20.
21 DCB p.20.
22Personnel op cit at [35].
23 At [39].
https://www.fwc.gov.au/documents/decisionssigned/html/2017fwcfb2797.htm
https://www.fwc.gov.au/documents/decisionssigned/html/2012fwa2966.htm
https://www.fwc.gov.au/documents/decisionssigned/pdf/2024fwc289.pdf
https://www.fwc.gov.au/documents/decisionssigned/html/2022fwcfb129.htm
