Clarkson v Dent

Clarkson v Dent (1998) 84 IR 250 Dee Donovan v Tanya Sullivan t/as Blaze on Stage Pty Ltd [2005]NSWIRComm 362 CASES CITED: Dhillon v Call Australia (1996) 68 IR 1 Stevens v Bodribb Sawmilling Company Pty Ltd (1986) 160 CLR 16 Vabu Pty Limited v Federal Commissioner of Taxation (1996) 96 ATC 4898

APPLICANT: Mr J Tay LEGAL REPRESENTATIVES: RESPONDENTS: Mr A Fanous

DECISION: - 1 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

Joseph Tay and A Fanous & F Fanous & J Goubran & M E Goubran trading as Five Dock Newsagency

Application by Joseph Tay re unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996

1 This is an application by Joseph Tay against A Fanous & F Fanous & J Goubran & M E Goubran t/as Five Dock Newsagency for a remedy pursuant to s. 84 of the Industrial Relations Act 1996. Mr Tay alleged that he was dismissed from his position of Delivery Driver with the respondents on the 13 April 2009. He sought monetary compensation in lieu of reinstatement or re-employment. 2 The matter was listed for conciliation and directions before Commissioner Macdonald on the 19 May 2009. However this date was vacated at the request of the respondents and re-listed on the 9 June 2009 at which time conciliation took place. At this stage both sides were represented by Solicitors. As no settlement could subsequently be reached directions as to the filing and exchange of witness statements were issued pursuant to Practice Direction 17 and the file returned to the Registry for allocation of a hearing date.

3 The matter was set down for hearing before the Commission as currently constituted on the 28 August 2009. Mr Tay appeared on his own behalf. There was no appearance on the part of the respondents and no advice had been received as to their inability to attend. No witness statement had been file by the respondents. It appeared that previous correspondence (including the initial directions issued) had been sent to the Solicitors then appearing for the respondents. No Notice of Ceasing to Act was filed by either the Solicitors for the applicant or the Solicitors for the respondents. 4 However the applicant had also not filed an appropriate witness statement, only a handwritten 1 page letter indicating an intention to produce various documentation at the hearing. That being the case, the Commission declined to proceed with the hearing on that day and set the matter down for hearing on the 22 October 2009. New directions were issued as to the filing and exchange of witness statements (in accordance with Practice Direction 17). Mr Tay was also advised as to the need to incorporate any documentation upon which he sought to rely into an appropriate witness statement and serve in on the respondents. 5 Correspondence of the 1 October 2009 was also directed to the respondents' business address advising of their non-appearance on the 28 August 2009, the new directions issued and the revised hearing date. Both parties subsequently complied with the directions as issued. 6 At the hearing Mr Tay appeared on his own behalf and gave oral evidence in addition to the witness statement he had filed (Exhibit 1). 7 Mr A Fanous appeared on behalf of the respondents and gave oral evidence in addition to the witness statement filed (Exhibit 4). Mr Fanous also called the following witnesses: Lesley Tredwell - employee, Five Dock Newsagency (Exhibit 2) Kerry McCullough - Manager, Five Dock Newsagency (Exhibit 3) The Evidence

8 Mr Tay deposed that he commenced working for Five Dock Newsagency about September 2005. His duties involved rolling the newspapers and delivering them to households, supermarkets and petrol stations. He was provided with a car by Mr Fanous to carry out the deliveries and was responsible for ensuring that the car was maintained and repaired as necessary. He also monitored the condition of the rolling machine and on occasion took it to be maintained and repaired.

9 When he first commenced with the Newsagency he was paid in cash but was not paid tax and did not receive overtime or superannuation. He was then paid with a pay slip and received a group certificate. 10 He deposed that he commenced work usually at around 4:30 am, finished by 7 a.m. and worked the following hours each day: Monday to Thursday......2 hours, Friday..............................2 ½ hours, Saturdays........................4 ½ hours, and Sundays...........................4 hours. 11 When the delivery car or paper rolling machine required repair, he worked six hours on those days. When the rolling machine was broken he worked an extra 1½ hours on weekdays, an extra 3 hours on Saturdays and an extra 2½ hours on Sundays. 12 Mr Tay said he followed the delivery route that the previous delivery driver had used but he could make changes and change the route if he wanted to. He started work when the newspapers arrived. If they turned up at 3 a.m. or 4 a.m they would get rolled first and then delivered. They usually turned up at 5 a.m on the weekends. He wasn't paid for waiting time. If the newspapers didn't arrive till after 6 a.m. then Mr Fanous told him he could go home. 13 He deposed that from the 4 July 2008 to the end of January 2009 the delivery car was being repaired and he used his own van to do the deliveries. He was paid an additional $10 per day for use of his van. He said that Mr Fanous then demanded a tax invoice with the ABN and told him he wasn't paying the GST. Mr Tay had to pay for the petrol and also pay the 10% GST out of his pocket. He was also told by Mr Fanous that he was not a contractor and they had no contract. 14 Mr Fanous disputed the claims made by Mr Tay and said the car was never under repair for six months, that it was sold in June 2008, on Mr Tay's suggestion, and that Mr Tay was the one who put forward that he would use his new van for the deliveries, be paid for petrol and maintenance of his vehicle and submit an invoice. Mr Tay had an ABN number. 15 However Mr Tay subsequently confirmed in evidence that he suggested to Mr Fanous that he sell the car because it broke down too often and he was the one that had to take it to be repaired and he was not paid for that time. It was bad for business, caused lateness and people complained. Mr Tay bought a new vehicle and suggested using that and being paid for petrol and some maintenance costs and Mr Fanous agreed. 16 Ms McCullough also deposed that in approximately June 2008 Mr Tay told her he had found a buyer for the car because he wanted to use his own vehicle for deliveries and wanted to be a contractor. He was then paid for his delivery service fees inclusive of GST by invoice which he supplied from July 2008. 17 Mr Tay also uses his van to carry out contract deliveries for Australia Post, Monday to Friday, commencing at 8 a.m. He has a written contact with Australia Post. He is also employed to do deliveries by a bakery but is paid as an employee. 18 Mr Tay also said that Mr Fanous proposed that he buy the rolling machine and become a contractor. Mr Tay said the machine was 17 years old and was always breaking down and he would have to take the machine to Ryde to be repaired which would take six hours and he would not be paid for that. If the paper rolling machine wasn't working it would take him three hours to roll the newspapers by hand and use rubber bands. 19 He also said that Mr Fanous told him he was not a contractor until he bought the machine and then he would be a contractor and could sell the business, however he didn't buy the machine. 20 Mr Tay deposed that in or around April 2009 Mr Fanous told him to start work at 2 a.m. Mr Tay accepted this on the basis that if the newspapers came he could start work immediately but if the newspapers did not come at 2 a.m. he still had to be paid for his waiting time. He deposed that Mr Fanous agreed. He was never paid the agreed waiting time wages. 21 On Saturday 11 April 2009 he told Mr Fanous that if he did not pay his waiting time he would go on strike that day. Mr Fanous told him that even if he did not pay his waiting time he would still have to work and if he refused he would be dismissed. Mr Tay insisted that he be paid waiting time and Mr Fanous told him not come to work anymore. 22 From 11 April 2009 Mr Fanous employed another person to replace him (Tony). That person told Mr Tay that he was an overseas student and had another full-time job in a restaurant. 23 On the 13 April Mr Fanous asked Mr Tay to teach Tony two hours a day from Monday to Friday, which he did for the next three weeks. Mr Tay kept on working his usual hours on Saturdays and Sundays. 24 Mr Tay deposed that he had not been paid wages for this work on 11 and 12 April and 6 and 7 June 2009 and was told that if he wanted the money he had to write a letter saying he was a contractor and withdraw this application. Mr Tay refused to do this. Mr Tay also alleged that he was underpaid during the time he worked for Mr Fanous. 25 Mr Tay said that because of problems using his vehicle and having to make repairs (the rain getting in when he had the window wound down to throw the newspapers) he wrote a letter to an employee of the Newsagency (Christie) saying he wasn't going to continue using his van anymore because he was only paid $10 a day. Mr Fanous ignored the letter, still wanted him to use his car, didn't buy another car and still wanted him to write tax invoices with the ABN number. 26 Mr Tay continued to maintain in cross examination that he was not a contractor, and was an employee. He did not have a written contract. He only issued the tax invoice because Mr Fanous told him to. 27 Mr Tay was taken to photocopies of his tax invoices which were annexed to Exhibit 4 and it was pointed out to him that at the bottom of the invoice, in front of the total amount, it said "TOTAL INCLUSIVE OF G.S.T". 28 Copies of a number of the invoices submitted by Mr Tay (with his ABN number supplied on the invoice) from 4 July 2008 to 18 April 2009 were attached to Exhibit 4. 29 The handwritten entries on the Invoices for the periods in 2008 showed the following, with payments listed in the "TOTAL" column: Labour .............. 400 Van...................... 70 Petrol................... 80 TOTAL INCLUSIVE OF G.S.T ... 550 30 The Invoices for 2009 show the same entries but labour is listed as $410, with a total shown of $560. 31 Ms Tredwell deposed that she paid the following amounts to Mr Tay on presentation of Invoices: 3/7/08 to 24/7/08......................................$550.00 per week 31/7/08.....................................................$485.00 per week 7/8/08.......................................................$325.00 per week 2/10/8 to 8/4/09........................................$560.00 per week 16/4/09 to 19/4/09....................................$280.00 per week Except for the 6/7march09 as he didn't turn up for work. 32 Mr Tay maintained that essentially there were no complaints about his delivering of the newspapers. Most complaints were because of mistakes written in the diary. A customer would complain that he didn't deliver to that house and most of the reason was that he had been asked to stop delivering to this house (because they didn't pay or they were on holiday) and the diary said stop delivering, so he stopped. When he stopped the complaint would come by phone to the Newsagency asking why the delivery had stopped. They would say it was a mistake and was missed. This was to get themselves out of trouble when it was actually their fault. Most of the complaints came from mistakes in the diary. 33 Ms McCullough deposed that Mr Tay had the habit of coming to work late and finishing late which frustrated both the customers and the publishers. She thought he was late because he told her he had to finish the post office courier run early in the day. They received "countless" complaints from customers. 34 She also said that Mr Tay would leave bundles of newspapers either untied or uncovered causing them to get blown about the street. Mr Fanous also referred to this and said he spoke to Mr Tay about his and there were entries in the diary concerning this issue. 35 Mr Tay acknowledged that when he first started with Australia Post as a contractor he started work on an early shift, but he would finish his newspaper deliveries before doing the Australia Post deliveries, then he changed his Australia Post time to the later time of 8 a.m. because of the newspaper deliveries. 36 Mr Tay had a run sheet and had to make deliveries according to that sheet. Any changes were written in a diary kept at the Newsagency. Mr Tay also had a diary in which he wrote any required changes. 37 Mr Tay was taken to a number of diary entries attached to Exhibit 2 and detailing instances on a number of dates where there was recorded an entry concerning a missed delivery (or deliveries). Those entries were written by whichever employee was in the Newsagency at the time. 38 Mr Tay maintained in response that the mistakes were 95% caused by the girls in the Newsagency making mistakes. Mr Fanous didn't want to correct them and they kept making mistakes. The replacement employee Tony also made three or four mistakes and didn't turn up for work one day but that was okay, he wasn't sacked. 39 Mr Tay's attention was drawn to messages left in the Newsagency diary by Mr Fanous concerning missing deliveries. He maintained that he every time he saw the notes he called Mr Fanous and explained and always wrote back in his diary as well. Any changes in the shop diary were photocopied and stuck in Mr Tay's diary each day. Mr Tay said he did not have access to the diary in the Newsagency. His diary was returned to the shop every day. That diary was not tendered in evidence. 40 Both Ms Tredwell and Ms McCullough worked part time on certain days. They confirmed that complaints were received by them and other staff from customers who did not get their paper delivered on a particular day (or days). These complaints would be over the phone or the customer would come into the shop. There were also some complaints about not throwing the newspaper over the fence or in the driveway as required. 41 Mr Fanous gave evidence that he had received a number of letters from Fairfax Media concerning complaints about repeated late or missed deliveries (as attached to Exhibit 4). He viewed the complaints by Fairfax Media as serious and he was warned that he might lose his contract if the breaches continued. 42 Mr Fanous said that he showed Mr Tay a copy of the letters but his general response was a denial in a loud and aggressive manner. 43 Mr Fanous also had a meeting with Fairfax Media on the 6 March 2009 to "absorb their anger" and assure them the delivery run would improve and not to take action against him. He asked the staff to remind Mr Tay every morning of his obligations.

44 Mr Fanous deposed that on the 7 March 2009 (a Saturday) Mr Tay, without warning, did not turn up and no newspapers were delivered at all that day. The next day Mr Fanous arranged to have the former delivery driver (a 75 year old man) carry out the deliveries with the assistance of a younger man, known to him as a friend of his brother who was looking for work. 45 Mr Fanous also received a letter of complaint from Fairfax Media on the 20 March 2009 about the non-delivery on 7 March. 46 Mr Fanous deposed that he phoned Mr Tay and was told that because he didn't pay him waiting time he would never work for him again. Mr Fanous "begged" him to come to work and he would pay what whatever he owed but Mr Tay refused. Later that afternoon Mr Tay rang him, said he was sorry and would like to work weekends only. Mr Fanous agreed because he was desperate and asked him to train a driver for the weekdays which he adreed to do. 47 Mr Tay acknowledged that he didn't turn up that day because Mr Fanous didn't pay him waiting time. 48 However Mr Tay maintained that this occurred in around April 2009, and arose after Mr Fanous said that he should start at 2 a.m. Mr Tay agreed to do this if the newspapers came and he could start immediately and if he would be paid waiting time if they did not come. He maintained Mr Fanous agreed to this. 49 Mr Tay maintained that subsequently on the 11 April 2009, because Mr Fanous would not pay his waiting time he told him he would go on strike that day. Mr Fanous told him that even if he didn't pay waiting time he still had to work and if he didn't he would "dismiss" him. Mr Tay insisted he be paid, and Mr Fanous told him not to come to work. 50 Mr Fanous denied that Mr Tay rang him and told him he wasn't going to work on that day. He said that if he had he would have avoided the disaster of non-delivery of the newspapers. Mr Fanous also disputed the dates that this occurred (see above). 51 Mr Tay said that Mr Fanous then employed someone else to replace him and on 13 April asked him to teach this new person 2 hours per day which he did for three weeks. Mr Tay continued to work his usual hours on Saturdays and Sundays. 52 Mr Tay filed his s.84 application on the 28 April 2009 and referred to a termination date of 13 April 2009. 53 He deposed that Mr Fanous told him on the 1 June that he no longer needed him. He wasn't paid for the days of the 6 and 7 June nor the 11 and 12 April and was told by Mr Fanous that if he wanted his money he would have to write a letter saying he was a contractor and withdraw his application to the Commission. Mr Tay said he refused to do this. 54 Mr Fanous disputed this and queried why Mr Tay was claiming payment for the 5 and 7 June if he said he was told he was fired on the 1 June. Mr Fanous said Mr Tay was still doing the weekend delivery as at the time of this matter coming before Commissioner Macdonald. He was also paid for the 11 and 12 April as well as the 6 and 7 June 2009. 55 Ms McCullough confirmed these payments as did Ms Tredwell. 56 Mr Fanous deposed as to a further incident which occurred on 21 June (a Sunday) when Mr Tay did not do the delivery run and did not deliver the bulk newspapers to the subagents. Without informing Mr Fanous, Mr Tay went home after complaining to the shop staff that the paper rolling machine was not working. Mr Fanous pointed out that newspapers in bulk did not have to be rolled and should have been delivered to the subagents. Mr Tay also didn't deliver all the newspapers on the Saturday. 57 Mr Tay acknowledged that he did not deliver the newspapers because the paper rolling machine broke down and he would have had to spend three hours rolling the newspapers and use rubber bands. The machine had not been repaired because the week day delivery man had not taken the machine to get it repaired. 58 Mr Fanous subsequently phoned Mr Tay and asked why he didn't tell him the machine wasn't working, that he should have done the run without folding the papers and should have delivered to the subagents. 59 Mr Fanous deposed that he subsequently found out on the following Monday that the week day delivery man had been able to roll the newspapers and deliver them that day. 60 Ms McCullough confirmed in her evidence that she was aware that Mr Tay did not deliver newspapers on that Sunday because he said the paper rolling machine was not working, however the week day delivery man rolled the newspapers and delivered them on the Monday which indicated to her that the machine was working the previous day. 61 Mr Tay however maintained that just because the machine was working on a Monday that didn't mean it worked on the weekend because the papers were thicker. The machine was 17 years old. 62 The Commission notes here that Ms McCullough, in her witness statement, referred to the dates of those two days as being 22 and 23 June respectively which were a Monday and Tuesday. I accept that there was an inadvertent mistake made and that she intended to refer in fact to the Sunday and Monday (21 and 22 June) and the apparent discrepancy was not drawn to her attention during proceedings to enable her to correct those dates. 63 Mr Fanous telephoned Fairfax Media to advise them about the non-delivery on the Sunday and subsequently received a further letter from Fairfax Media dated 26 June 2009 concerning the non-delivery of newspapers on Sunday 21 June and also complaining of non-delivery occurring on Saturday 20 June. The letter advised that they were issuing another "default" notice (the second default notice so issued) and further advised that if any further instances of non-delivery occurred then ..."Fairfax will prepare its own delivery run and will take over all Fairfax distribution within the territory". 64 Mr Fanous deposed that he then rang Mr Tay explained the situation, told him that he had called Fairfax, who were not happy with the delivery and therefore, he told Mr Tay he was no longer to do the delivery run. He offered to pay one extra week's pay but this was refused by Mr Tay. 65 He denied that he told Mr Tay to stop delivering because of this application but said that he offered a settlement of two weeks' pay if Mr Tay would withdraw the application.

Submissions 66 Mr Tay said that he was sacked unfairly (from the deliveries Monday to Friday) because he didn't turn up to work because he didn't pay waiting time when he had agreed to pay him. He did not refuse to work but said he should pay him for the waiting time. He said Mr Fanous had already arranged for two other guys to replace him. 67 The second time he sacked him (from the weekend deliveries) was because he refused to drop his case and Mr Fanous said he didn't need him any more. Mr Tay told him he didn't deliver the papers because the machine was not working and he doesn't pay overtime. 68 Mr Fanous said he received four or five warnings from the publisher and numerous complaints from the customers. It was all documented in the evidence. 69 However the big thing was the non-delivery of the newspapers. That was the reason why he could not trust Mr Tay any longer. There were valid reasons why he stopped him. Mr Fanous referred to the evidence of Ms McCullough and Ms Tredwell in support, particularly in relation to the invoices. 70 Mr Fanous also pressed during proceedings that Mr Tay was a contractor and that the case should be dismissed. 71 Mr Fanous also sought costs. 72 The Commission explained the grounds upon which costs could be awarded and their relevance to this matter. Mr Fanous did not press that claim. Consideration

73 I have carefully considered the evidence and transcript in this matter. That has not been an easy task as there was some confusion and discrepancy between the dates referred to by Mr Tay as compared with Mr Fanous and the other witnesses for the respondents. Additionally there have been allegations (some quite far fetched on the part of Mr Tay against Mr Fanous) and accusations of lying and lies by both Mr Tay and Mr Fanous against each other generally.

74 However in my view there is the very strong corroborative evidence as contained in the letters to Mr Fanous from Fairfax Media which confirm and support his evidence as to the dates of the incidents of non-delivery of newspapers by Mr Tay in March (7) and June (20 and 21). There is also the corroborative evidence of Ms McCullough as to the non-delivery incident in June. 75 The Invoices indicate that Mr Tay was paid for his services the usual $560.00 per week until 8 April 2009 and $280.00 per week from the following week until the cessation of the relationship between the parties (19 June). That latter amount seems to be for when he was only delivering on the weekends. The Invoices would also tend to suggest that when Mr Tay was teaching this new person the route from 9 March for approximately the next three weeks he was paid his normal weekly amount of $560.00. This would also confirm the changed arrangements as from early March rather than April. 76 I also accept that there were numerous complaints made about Mr Tay. Those complaints are also reflected in the letters from Fairfax Media and some are clearly of an ongoing and repetitive nature and nothing to do with newspapers having been stopped/re-started and mistakes being made in the diary by the staff in the Newsagency. Fairfax Media also refer to a number of instances of newspapers delivered after 7 a.m. on weekdays and 8.30 a.m. on weekends in breach of the contract it had with the Newsagency that newspapers be delivered by 6.30 a.m. 77 I accept the evidence of Mr Fanous as to the problems he had with Mr Tay, and notwithstanding Mr Tay's complaint about the paper rolling machine, I can fully understand and accept that Mr Fanous had to do something about the situation and take the action he did in dispensing with Mr Tay's services firstly on weekdays, and finally on weekends as well. I do not accept that he had already arranged to have two persons replace Mr Tay. When he was left in the lurch by Mr Tay, without notice, it was entirely appropriate, indeed essential that he made urgent arrangements at what must have been extremely short notice. 78 Mr Tay has claimed he was unfairly dismissed and sought the remedy of monetary compensation in lieu of reinstatement or re-employment. 79 However for the Commission to even consider whether or not there has been a dismissal that is harsh, and or unjust, and or unreasonable and sufficiently so as to warrant any intervention on behalf of an applicant, the Commission must be satisfied that an employment relationship existed between the parties. 80 The respondents have pressed that Mr Tay was a contractor. 81 I have to say that after considering the evidence carefully and applying the relevant principles as enunciated in the cases below, I agree that Mr Tay was in fact a contractor. 82 The relevant indicia to be considered by the Commission in determining the existence or otherwise of an employment relationship have been established in cases such as Stevens v Brodribb Sawmilling Company Pty Ltd (1986) 160 CLR 16 and Vabu Pty Limited v Federal Commissioner of Taxation (1996) 96 ATC 4898. Those cases have been applied in a number of decisions of this Commission such as Dhillon v Call Australia (1996) 68 IR 1, Clarkson v Dent (1998) 84 IR 250 and Dee Donovan and Tanya Sullivan t/as Blaze on Stage Pty Ltd [2005] NSWIRComm 362. 83 After carefully considering the evidence it is possible to establish the following facts: 1) The relevant period for consideration is July 2008 to June 2009. 2) Prior to this time Mr Tay was considered an employee. 3) There was no written contract between the parties. However a written contract is not necessary to establish that in fact a contract for the provision of services existed. 4) Mr Tay performed a service rolling and delivering newspapers to subagents and customers on seven days per week. 5) He provided his own vehicle for this purpose and was paid a fee for maintaining his vehicle and an amount for petrol (a flat amount regardless of the amount of petrol used or fluctuations in the price of petrol from time to time). 6) Mr Tay was responsible for maintaining his vehicle. 7) Mr Tay was able to use his van for other business purposes and did so, being also a contactor for Australia Post. 8) The only equipment supplied by the respondents was the paper rolling machine, but if this broke down newspapers could be rolled by hand and secured with a rubber band or delivered unrolled. 9) Mr Tay was paid a flat weekly amount for the service he performed regardless of the hours worked (e.g. any additional hours required due to any circumstance). 10) He was not paid overtime or waiting time. 11) Whilst he had a set route for deliveries he could make changes as to how he carried out the route. The only proviso being the delivery of the newspapers. 12) Whilst Mr Tay had certain hours he scheduled for deliveries (see above) if he was able to deliver in less time he would have been able to leave and go home. 13) The starting time of deliveries was dependent on the time the newspapers arrived at the Newsagency. The only proviso being that the contract between the Newsagency and Fairfax Media required newspapers to be delivered to customers by 6.30. a.m. 14) Mr Tay had a registered ABN. 15) Mr Tay provided invoices to the respondents for the services he provided setting out amounts for Labour, Van and Petrol. 16) The total sum paid was inclusive of GST. 17) It does not make any difference as to who it was who suggested the invoice arrangement in the first place, a verbal agreement came into being between the parties that such arrangement would commence as from July 2008. 18) That verbal agreement became the contract between the parties and the nature of the relationship, (due to the matters listed above) changed from one of employer/employee to that of an independent contactor. 19) Mr Tay's contract was essentially terminated without notice on the grounds of failing to perform the contract (the non-delivery of newspapers on the days indicated above). 84 Applying the principles encapsulated in the above decisions and taking into account the above facts I have come to conclusion that Mr Tay was a contractor and not an employee of the respondents. 85 That being the case there is no jurisdiction for the Commission deal with the applicant's claim pursuant to s.84. 86 The application is therefore dismissed and this matter concluded accordingly.

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