EFEX Group Pty Ltd v Bennett

Registry: South Australia

National Practice Area: Employment and Industrial Relations

Date of hearing: 25 October 2021

Counsel for the Applicant: Mr S Wood KC with Mr B Jellis

Solicitor for the Applicant: Kardos Scanlan

Counsel for the First Respondent: Mr S Blewett with Mr P Dean

Counsel for the Second Respondent: The Second Respondent entered a Submitting Notice, save as to costs

AND: GERRARD BENNETT First Respondent

order made by: BESANKO J DATE OF ORDER: 24 May 2023

1. The applicant's Originating application be dismissed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Introduction 1 This is an application by EFEX Group Pty Ltd (EFEX) under s 562 of the Fair Work Act 2009 (Cth) (the FW Act) and s 23 of the Federal Court of Australia Act 1976 (Cth) for an order prohibiting the Fair Work Commission (the FW Commission) from continuing to hear and determine an unfair dismissal application brought by Mr Gerrard Bennett. In addition, or in the alternative, EFEX seeks an order requiring the FW Commission to determine the application according to law and thereby dismiss it. Mr Bennett brought an unfair dismissal application in the FW Commission under s 394 of the FW Act claiming that he had been unfairly dismissed by EFEX. Mr Bennett's application came on for hearing before Commissioner Hampton of the FW Commission (the Commissioner). The Commissioner addressed an objection by EFEX to the jurisdiction of the FW Commission to hear and determine the unfair dismissal application. That objection turned on whether Mr Bennett was an employee of EFEX during the relevant period which was from 1 February 2018 to 8 November 2019. The Commissioner decided that Mr Bennett had been engaged by EFEX as an employee and that he was an employee for the full period of his engagement by EFEX. The Commissioner found that the FW Commission had the necessary jurisdiction to deal with the application (Bennett v EFEX Group Pty Ltd [2020] FWC 2503). 2 EFEX lodged an appeal under s 604 of the FW Act against the Commissioner's decision. Permission to appeal was required. EFEX claimed that Mr Bennett was not protected from unfair dismissal because he was not an employee of EFEX. The Full Bench of the FW Commission heard the parties on permission to appeal and the substantive appeal. The Full Bench decided that, in totality, the evidence weighed in favour of Mr Bennett having been characterised as an employee. The Full Bench considered all of the evidence and found that the Commissioner's conclusion that Mr Bennett was an employee of EFEX was not an error with respect to a jurisdictional fact. The Full Bench was not satisfied that, for the purposes of s 400(1) of the FW Act, it would be in the public interest to grant permission to appeal. The Full Bench was not persuaded that there was any other basis as a matter of discretion upon which permission to appeal should be granted. The Full Bench refused permission to appeal (EFEX Group Pty Ltd v Bennett [2020] FWCFB 6112). 3 Mr Bennett is the first respondent to the present application and the FW Commission is the second respondent. The FW Commission has filed a submitting appearance. To avoid confusion, I will refer to the parties by their names. The issue before this Court is one of jurisdictional fact and the parties are agreed that it is for this Court to determine whether Mr Bennett was an employee of EFEX for the period from 1 February 2018 to 8 November 2019 (Enfield City Corporation v Development Assessment Commission [2000] HCA 5; (2000) 199 CLR 135; Australian Postal Corporation v D'Rozario [2014] FCAFC 89; (2014) 222 FCR 303). 4 The evidence before this Court consists of two affidavits of the applicant's solicitor, Ms Nicole Town, affirmed on 10 December 2020 and 26 February 2021 respectively. The affidavits of Ms Town contain the decisions of the FW Commission, the written statements of the three key witnesses before the Commissioner, the transcript of the evidence given before the Commissioner, submissions made to the FW Commission and a number of documents. Neither party sought to adduce before this Court oral evidence from the witnesses who had given evidence before the Commissioner. 5 The Commissioner made some observations on the evidence before him, including of the witnesses themselves. The Commissioner said that where there was a factual conflict between Mr Bennett and Mr Dean Brogan on matters each directly observed, he generally preferred the evidence of Mr Brogan, particularly as he was not challenged on some of the disputed factual matters. Mr Brogan was a witness called by EFEX. The Commissioner went on to say the following (at [25]): … I was also not persuaded by Mr Bennett's position that he was not aware of the stated nature of the relationship and that the term "contractor" was not used at the formation of the relationship. Given his education, business experience, some of the preceding discussions, and at least one email raising the issue, I consider that Mr Bennett sought to underplay this aspect of the discussion leading to the formation of the relationship. I do however accept that the discussions about these matters were superficial and focused upon the nature of, and administrative arrangements for the remuneration. 6 The Commissioner noted, correctly in my view, that some of the statements in the written witness statements which formed the basis of each witness' evidence-in-chief before the Commissioner "tended to subjectively summarise the proponent's view about the thrust of some of the exchanges, rather than the detail of the discussion" (at [24]). 7 An issue which appeared to arise at one point was the extent, if any, to which I can and should rely on the Commissioner's assessment of the witnesses in circumstances where he has seen and heard them and I am asked to proceed by reference to the written record. Counsel for Mr Bennett seemed to concede that I can and should have regard to how the Commissioner resolved the conflicts. He referred to Uranerz (Aust) Pty Ltd v Hale (1980) 54 ALJR 378. As will become clear, the resolution of this issue is not necessary. The factual issues before the Commissioner were not factual issues before this Court, mainly because of the way in which counsel for Mr Bennett argued the matter. 8 I record that EFEX, in its written submissions, advanced an argument that an estoppel by convention precluded Mr Bennett from contending that he was an employee of EFEX. That argument was abandoned at the hearing. I also record that I asked the parties for and received from them supplementary submissions addressing the decisions of the High Court in Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1; (2022) 398 ALR 404 (Personnel Contracting); ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2; (2022) 398 ALR 603 (ZG Operations). 9 I begin by outlining Mr Bennett's case as set out in his written witness statement which formed the basis of his evidence-in-chief before the Commissioner.

Mr Bennett's Case 10 At the relevant time, EFEX conducted a services business providing voice, data, printing management and other technology-based services. It had a strong presence in eastern Australia and had an office in Adelaide where Mr Bennett was based. 11 Mr Bennett claims that he was employed by EFEX as the Business Development Manager of South Australia. He remained in that position throughout his time with EFEX. He was offered a role in the finance department under the financial controller of the company, but he declined to undertake that role. He commenced working for EFEX on 1 February 2018. On 8 November 2019, he was notified of his dismissal by Mr Nick Sheehan who is the Chief Executive Officer of EFEX. He claims that he only performed work for EFEX during this period. 12 There was no written contract between EFEX and Mr Bennett and, as will be seen, the arrangement was an informal one. The three key figures, Mr Bennett, Mr Sheehan and Mr Brogan, were and had been friends for some time.

Preliminary Discussions 13 Mr Bennett states that in October 2017, he had preliminary discussions with Mr Brogan who was the Branch Manager of EFEX, about potentially working for the company. In addition, in early January 2018, he had a conversation with Mr Sheehan to discuss the details of his "coming on board" with EFEX. 14 Mr Bennett claims that he was instructed that EFEX would remunerate him for his work for the company at a flat rate of $120,000 per annum plus GST. The monthly payment of $10,000 was to be invoiced on the 9th or 10th of each month. Mr Bennett was required to obtain an Australian Business Number (ABN). 15 Mr Bennett said that as he had never operated by providing invoices before, he followed the lead of Mr Brogan and "our accountant", Wallace Vroulis Bond. He claims that they suggested that if he was to be paid in the way that he had been instructed by Mr Sheehan and the Chief Financial Officer of EFEX (Ms Elizabeth Case) as to how it worked with the company, then he should set up a trust. He had not previously had a trust. He claims that the setting up of the trust was entirely due to the payment method of EFEX. He claims that he had never before had an ABN or worked as a contractor. 16 Mr Bennett claims that at no stage was there a discussion about whether he would be an employee or a contractor and he did not recall any discussion about superannuation, sick leave or annual leave entitlements. 17 The documents establish the following: (1) On or about 29 January 2018, Mr Bennett established the Bennett Enterprises Trust; (2) At about this time, Mr Bennett obtained an ABN; (3) Between February 2018 and October 2019, the Bennett Enterprises Trust sent a tax invoice on or about the 13th of each month for $10,000 plus GST of $1,000 for what was stated in the invoices to be the supply of the following: Gerrard Bennett - Provision of Sales Contracting Services for the month of [month] [year]. The invoice sought direct payment to the Bennett Enterprises Trust at a nominated bank account. The bank account was in the name of Gerrard John Bennett as trustee for the Bennett Enterprises Trust.

Mr Bennett's Role with EFEX 18 Mr Bennett described his role with EFEX as follows. Upon the commencement of his work with EFEX, he was provided with business cards, a company laptop, a company email and an EFEX polo shirt. He claims that he worked a standard business week of Monday to Friday from 8 am to 5 pm. On occasions, he would service clients on the weekend. 19 Mr Bennett claims that his role was primarily in generating sales. This involved him in creating proposals and putting together deal sheets using EFEX template documents. He was required to see existing and potential clients and collaborate with Mr Brogan on building networks. These were the requirements of Mr Blair Hatherley, who was the Chief Operating Officer of EFEX, and Mr Sheehan. 20 Mr Bennett claims that he would perform what he called other operational matters or tasks for EFEX or Mr Sheehan, including providing technical support and deliveries. On what Mr Bennett said were multiple occasions during working hours, Mr Sheehan would instruct him to attend his home to meet delivery clients. On one occasion during working hours, he was required to be at Mr Sheehan's house in South Australia to meet a contractor to install a television. 21 Mr Bennett said that EFEX had control over his day to day activities. In July 2019, he was instructed by Mr Sheehan that he was to stop working so closely with Mr Brogan and that they were to separate in order to give the business more "bang for buck". He was told that he and Mr Brogan were to distinguish individual targets creating "individual pipelines". 22 Mr Bennett said that after returning from a holiday in Canada, he was invited by Mr Hatherley to attend a lunch in Sydney a day earlier than his scheduled day in the Sydney office of EFEX. At the time of the trip, he had a telephone conversation with Mr Sheehan in which Mr Sheehan instructed him he was not to go. He claims that Mr Sheehan said the following to him: Mate what are you doing heading up to Sydney a day earlier for and spending another day away from Adelaide? You need to be increasing activity back in the office, need you to be here concentrating on sales, and you need to get momentum back, you've just had two weeks off. 23 Mr Bennett identified another event which occurred after he went to the Hyde Park Tavern. A client had contacted him and said that he was unimpressed by the state of cabling, network switches, computer cables etcetera after the technicians had completed their work. He went to the client's premises early in the morning and did not arrive at the applicant's office until approximately 8.45 am. He said that Mr Sheehan gave him "a verbal spray" and said the following to him: Mate what are you doing. That's not sales, get One Solution to do it! Concentrate on sales!! 24 Mr Bennett claims that this was not the case as he had on multiple occasions performed operational duties or tasks on the instructions of Mr Sheehan or Mr Brogan. 25 Mr Bennett said that EFEX instructed him to attend sales conferences and he was told by Mr Sheehan and Mr Hatherley that attendance was compulsory. He recalls attending conferences in Sydney, Adelaide and the Gold Coast during his work with EFEX. He was required to attend one conference in Sydney prior to the commencement of his first day with EFEX. 26 Mr Bennett said that in addition to interstate conferences, he was required to undertake ongoing training with a third party company called Sales Extra. He was instructed that attendance was compulsory. The interstate conference involved a two day training exercise in Sydney followed by weekly or fortnightly training via a computer.

Arrangements as to Invoicing and Other Entitlements 27 Mr Bennett was instructed to submit invoices on or around the 9th or 10th of each month with payment to be received on the 15th. Each month he submitted invoices for $10,000 plus GST. I have already referred to the tax invoices (at [17]). On multiple occasions he would attend the company's corporate box at the football to entertain clients of EFEX. In addition, he was invited to company race days and to the Christmas party and this was all paid for by EFEX. 28 Mr Bennett said that at times he was required to claim a reimbursement from the applicant. This required him to submit a reimbursement form. He was instructed not to claim reimbursements on monthly invoices. He gave as examples a requirement to purchase a network switch for inputting network cables at the Hyde Park Tavern and purchasing a flight to Brisbane that had to be reimbursed after his original flight was booked by human resources for the morning instead of the afternoon. 29 With respect to sick leave or annual leave, Mr Bennett claims that there was no fluctuation in his pay even when he was away sick or on holidays. If he was taking leave, he would inform Mr Brogan and Mr Hatherley. At that time, Mr Hatherley was the General Manager of the company. 30 Mr Bennett said that he recalled an occasion when he was invited by Mr Hatherley to attend lunch with the rest of the group in Sydney. Mr Sheehan said the following to him: I pay you while you are away on holidays

EFEX offers Mr Bennett a Contract of Employment 31 Mr Bennett said that on 31 October 2019, Mr Brogan said the following to him: There are going to be changes in the office, changing the payment structures to line up with other States. I do not know the particulars, my payments will be changing too. The new payment structure will be effective as of next payment cycle. Instead of being a flat rate, it will be more performance based and someone from head office will give you a call today. This has been in the pipeline for a while, I have known for about 6-weeks. 32 Mr Bennett said that he did not receive a telephone call from head office. 33 On 1 November 2019, Mr Bennett had a 45 minute conversation with Mr Hatherley who was prompted again by Mr Brogan as no-one from head office had called him. Mr Bennett was attempting to obtain more information about the new structure which he understood was due to take effect very soon. 34 Mr Bennett said that the following conversation took place: Mr Bennett: Blair, what is going on? Dean said something is changing, I am not happy about the way that tis [sic] has been handle [sic] or communicated, I have been waiting for someone to call me for 2 days, and I have no notice. Mr Hatherley: It only just happened. Mr Bennett: This is a short period of notice. Mr Hatherley: As a contractor you give up your rights and benefits. Mr Bennett: How well do you know employment and contract law, my arrangement could be seen as an employee, as I don't work for anyone else. Mr Hatherley: You do not want to go legal. Mr Bennett: This new structure, or at least the notice, should be something fair and reasonable. Mr Hatherley: I could run you through everything now if you have the time Mr Bennett: Mate I am in the carpark at the shops, they are about to close, can you send to me via email? Mr Hatherley: Yeah mate I can, let me know if you have any questions. 35 Mr Bennett said that after the telephone call with Mr Hatherley he still had no further information and no-one had spoken to him about the new employment terms. He was told that he would receive all the details by an email. Eventually, he discovered that the new structure involved half his base salary, that is to say, $60,000 per annum with commission in addition to the base salary. There would otherwise be no change to his role as he understood it and it was to be a sales role with the same title. 36 EFEX wrote a letter to Mr Bennett dated 1 November 2019 offering him full-time employment. 37 On 6 November 2019, Mr Bennett received a telephone call from Mr Sheehan to discuss his contract. Mr Bennett said that the following conversation took place: Mr Bennett: Its hard to hear you, It's a bit muffled mate. Mr Sheehan: Just putting my Earpiece in, I'm by myself. 38 Mr Bennett recalled Mr Sheehan's comment about being by himself as a bit strange. The following conversation then occurred. Mr Sheehan: You aren't happy, are you? We have spoken about this structure before. Mr Bennett: There was no previous conversation to change to performance-based contract.

EFEX Dismisses Mr Bennett 39 On 8 November 2019, Mr Bennett communicated with Mr Sheehan by text message about the new employment terms. The communication was as follows: Mr Sheehan: Let me know how you're placed for a call, I need to wrap this up today. I'm good from1:30 to 3. Mr Bennett: I am still working through what the change in landscape means from target revenue, GP etc. I have an exam tomorrow, another next week so evening have been studying. I need a bit more time I don't want to rush a decision that for me is significant. Mr Sheehan: Ok I understand. I'm finishing your current contract arrangement up, effective today. If you'd like to take a sales role I'll leave that decision up to you, but until I get some clarity on which way you'd like to go, I'll take it that you no longer work here and have your email etc closed down. Please leave your notebook with Dean. 40 Mr Bennett viewed this communication as involving his dismissal. 41 On 10 November 2019, Mr Bennett met with Mr Brogan to discuss his future with EFEX. Mr Brogan said the following: mate I think you should leave, they have had it in for you for a while, and they are going to make it hard for you to stay, and that if you do, they aren't going to let you do uni anymore, as it is affecting your work. 42 Mr Bennett said that he had no other conversation about his dismissal with either Mr Sheehan or Mr Brogan. He claims that overall, he believed that he was an employee of EFEX and not a contractor. 43 The key points which emerge as to Mr Bennett's case are as follows: (1) He was EFEX's Business Development Manager and he worked only for that company from 1 February 2018 to 8 November 2019; (2) He was instructed as to the arrangements for his remuneration and followed the lead of Mr Brogan; (3) There was never any discussion as to whether he would be an employee or a contractor and there was no discussion about superannuation, annual leave or sick leave; (4) He was provided with the necessary tools for his position by EFEX and he used EFEX template documents; (5) He worked a standard business week of Monday to Friday from 8 am to 5 pm each day; (6) He performed operational tasks while working for EFEX, including technical services and deliveries: (7) During his "employment" by EFEX, he was instructed by Mr Sheehan or Mr Hatherley: (a) not to work so closely with Mr Brogan; (b) not to attend a lunch the day before a meeting; (c) not to attend to cabling problems, but to attend to sales; (d) to attend sale conferences; and (8) He received the same monthly payment even when he was away sick or on holidays.

Mr Sheehan 44 Mr Sheehan is a founding shareholder of the EFEX business. As I have said, he is the Chief Executive Officer of EFEX. 45 Mr Sheehan and Mr Bennett were friends for a number of years before Mr Bennett joined EFEX. In or around January 2018, Mr Sheehan met Mr Brogan and Mr Bennett at Rundle Mall in Adelaide to discuss Mr Bennett taking up an engagement with EFEX as a contractor. Mr Brogan had previously suggested that Mr Bennett be engaged. Mr Brogan remained at the meeting for only a short period. After he had left, the following conversation took place between Mr Sheehan and Mr Bennett: Mr Sheehan: We need to grow our Adelaide business and you have some great contacts that could help us do that. I know Dean has told you what contracting arrangements he is engaged under. Would you be happy to come on board on the same terms as Dean is on? The guys will explain the targets and other details during the onboarding process but essentially it will in line with Dean's terms and targets. Mr Bennett: Yes, I am happy with that arrangement. 46 With respect to Mr Bennett's statement in his written witness statement that he worked a standard business week, Mr Sheehan said that he neither expected nor instructed Mr Bennett to work a standard business week, Monday to Friday 8 am to 5 pm. He said that Mr Bennett was engaged to achieve sales on behalf of EFEX and there was no set time in which this was expected. Neither Mr Sheehan nor anyone else at EFEX, as far as Mr Sheehan is aware, required Mr Bennett to work set times or for any particular minimum amount of time. 47 Mr Sheehan was aware that Mr Bennett was studying to obtain a Master of Business Administration (MBA) and attended university during business hours on a weekly basis. In fact, as part of his studies, Mr Bennett did a case study on the EFEX business. Mr Sheehan was also aware that during his engagement by EFEX, Mr Bennett attended the gym during business hours on a regular basis. Mr Sheehan was unconcerned about those matters and he said that his only concern was whether Mr Bennett achieved the sales targets set for him. Like other EFEX salespersons, Mr Bennett had an annual sales target which Mr Sheehan described as a critical business tool for the sales team. 48 Mr Sheehan did not agree with Mr Bennett's assertion in his written witness statement that EFEX had control over Mr Bennett's day to day activities. From Mr Sheehan's point of view, Mr Bennett was expected to achieve sales targets in exchange for the payment of a monthly fee. Mr Sheehan said that Mr Bennett was not directed as to how he should achieve the sales targets, and nor was he directed as to who he should visit. Guidance was available from the training and team networking meetings and conferences at EFEX. 49 Mr Sheehan said that Mr Bennett was not required to wear a uniform, including a polo shirt at any time as part of his role. 50 With respect to the cabling issue at the Hyde Park Tavern, Mr Sheehan said that he recalled Mr Bennett arriving somewhere closer to lunch time on the day in question rather than approximately 8.45 am and that after Mr Bennett had described to Mr Sheehan that he had undertaken non-sales related activities on behalf of EFEX, Mr Sheehan said words to the effect described by Mr Bennett. Mr Sheehan said that this was in the context of Mr Bennett being engaged to achieve sales targets. 51 Mr Sheehan did have an expectation that Mr Bennett would perform sales roles and not operational roles. Mr Bennett did not perform operational roles "often" as he asserted. That may have happened from time to time. 52 Mr Sheehan said that Mr Bennett was expected to use his own motor vehicle and mobile telephone and that he was not reimbursed for those expenses through his monthly invoices or through the EFEX payroll system. He was not paid a motor vehicle or telephone allowance during his engagement by EFEX. 53 Mr Bennett was engaged through the Bennett Enterprises Trust which had an ABN. I have already described the content of the tax invoices. 54 Mr Sheehan can recall a conversation early in Mr Bennett's engagement wherein he asked Mr Bennett to purchase plants on behalf of EFEX for the new Adelaide office. Mr Bennett instructed EFEX to reimburse him by payment to an account unrelated to the Bennett Enterprises Trust.

Mr Brogan 55 Mr Brogan was engaged by EFEX in September 2017 and at the time of his written witness statement, he was employed as the Branch General Manager of South Australia. The South Australian branch commenced at the time of his engagement. He said that he was engaged as an independent contractor and continued as a contractor until December 2019. 56 Mr Brogan is responsible for the operations of the South Australian business. EFEX's head office is located in North Sydney, New South Wales. 57 Mr Brogan said that he was initially engaged to ascertain sales leads and upon those sales leads generating business for EFEX, the company established an Adelaide office in Magill in or around mid-January 2018. 58 Mr Brogan states that during Mr Bennett's engagement by EFEX, he reported to Mr Brogan as the South Australian branch manager. Mr Brogan, in turn, reported to Mr Hatherley before June 2019 and thereafter to Mr Mark Sandral. Both Mr Hatherley and Mr Sheehan are based in Sydney, although Mr Sheehan travelled to Adelaide and sometimes worked from the Adelaide office. 59 Mr Brogan's role between September 2017 and December 2019 was primarily a sales role. 60 Mr Brogan and Mr Bennett had been close friends for approximately 18 years. Mr Brogan knew that Mr Bennett had been very successful in a previous cleaning business known as TJ Services Group and that he performed the selling role for that business. 61 In or around October 2017, Mr Brogan talked to Mr Bennett about Mr Bennett working for EFEX. He explained to Mr Bennett that he, Mr Brogan, was engaged as a contractor and that he was paid $10,000 per month after issuing an invoice for that month. Mr Brogan said to Mr Bennett the following: I will ask Nick Sheehan to pay you the same amount as me and using the same structure as me. 62 Mr Brogan was aware that Mr Sheehan and Mr Bennett were friends prior to Mr Bennett being engaged by EFEX. 63 Mr Sheehan told Mr Brogan that he was prepared to engage Mr Bennett on the same basis as Mr Brogan's "contractor arrangement". Mr Brogan said that, although he could not recall the actual words used, he did recall Mr Bennett telling him that he was happy to be engaged as a contractor. 64 Mr Brogan recommended his accountant, Wallace Vroulis Bond, to Mr Bennett. That accountant had explained to Mr Brogan that GST had to be included in his invoices to EFEX when he commenced his contracting arrangement with EFEX. He also told him that he had to submit Business Activity Statements (BAS) to the Australian Taxation Office (ATO) every quarter. Mr Brogan remembered having a number of conversations with Mr Bennett about the timing of issuing the invoices to EFEX. Mr Brogan worked with his accountant every quarter to finalise his BAS and on one occasion he can remember Mr Tony Vroulis saying to him the following: If you are talking to Gerrard can you please get him to call me he needs to submit his BAS statements? 65 Mr Brogan recalls suggesting to Mr Bennett that he needed to sort out his BAS and tax and Mr Bennett saying that he would get around to it. 66 Before the engagement of Mr Bennett, or early in the engagement, Mr Bennett told Mr Brogan that he was going to be studying and would need to attend university on some mornings or afternoons. Mr Bennett asked Mr Brogan whether he was okay with that and Mr Brogan said that that was fine with him. Mr Brogan was, in fact, attending the Port Adelaide Football Club each Wednesday for at least half a day as he was the club's specialist ruck coach and Mr Sheehan was happy to accommodate that. Mr Brogan said that he was always informed by Mr Sheehan that he had flexibility as a contractor. On multiple occasions, Mr Sheehan said to Mr Brogan that he did not care what Mr Brogan did during the week so long as he "hit" his sales numbers. 67 Mr Brogan did not agree with Mr Bennett's assertion in his written witness statement that he worked a standard business week of Monday to Friday, 8.00 am to 5.00 pm. Mr Bennett was studying for his MBA and Mr Brogan was aware that he attended classes during business hours on Tuesdays and, he thinks, Thursdays. They discussed that on multiple occasions and Mr Brogan recalled trying to contact Mr Bennett and Mr Bennett saying that he could not speak because he was in class. 68 Mr Brogan produced excerpts of Mr Bennett's Outlook calendar. That calendar had entries for lectures and tutorials during normal business hours. In addition to Mr Bennett's attendance at the university, both Mr Bennett and Mr Brogan would go to the gym during business hours mostly at around 3 or 4 pm. 69 Mr Brogan never told Mr Bennett that he had to work at or for any particular time, or be in the office during any particular time, other than fortnightly branch meetings that both Mr Bennett and Mr Brogan would attend with the company's technicians. Mr Brogan said that both he and Mr Bennett had freedom as to when they performed their sales work and no-one from EFEX would check up on them as to when (or whether) they were working, other than by keeping track of their respective sales results. Mr Brogan said that he would see Mr Bennett in the office for at least part of the day on most weekdays. 70 Mr Brogan did not agree with Mr Bennett's assertion in his written witness statement that EFEX had control over Mr Bennett's day to day activities. He considered that both he and Mr Bennett had "free reign" as to how they went about achieving sales. EFEX was only concerned with the sales results achieved. The company did not dictate the manner in which sales were to be pursued, although it did provide Mr Brogan and Mr Bennett with sales training as well as product information and other materials to support their sales work. All EFEX salespersons were given an annual sales target and each month sent a "leader board" showing how their sales performance compared with their sales targets. 71 Mr Brogan did not agree with Mr Bennett's assertion that on multiple occasions he performed operational duties or tasks at the request of Mr Sheehan or Mr Brogan. Mr Brogan said that he may have asked on the odd occasion for Mr Bennett to do something operational, such as a delivery to a client. The major focus of their respective roles was achieving sales and Mr Sheehan would sometimes say to them that they did too many operational tasks which was not their role. 72 With respect to compulsory attendance at sales conferences, Mr Brogan said that there was a sales "kick off" conference each year that all EFEX workers were asked to attend. That was an annual conference which occurred in about September each year. In addition, there was a two day sales extra training conference. Mr Brogan could not recall being told that this training conference was compulsory. He saw it as training that EFEX provided to assist the salespersons to perform better and to help win sales. Both he and Mr Bennett wanted to attend and he cannot recall Mr Bennett ever indicating that he did not want to attend that training or do the follow-up on-line training. 73 Mr Brogan's engagement/employment arrangements changed in approximately December 2019 and from that point, he was given an EFEX mobile telephone. Although Mr Bennett was issued with an EFEX laptop, Mr Brogan recalls that Mr Bennett had a personal Apple laptop with him most days at the office and regularly saw him using that Apple laptop while he was in the office. Mr Bennett used his own mobile telephone and motor vehicle and did not claim any reimbursement from EFEX. 74 Mr Brogan produced a copy of Mr Bennett's LinkedIn profile. That profile shows Mr Bennett was the Business Development Manager for EFEX between February 2018 and December 2019. With respect to the TJ Services Group (a group providing cleaning services), the LinkedIn profile shows Mr Bennett as State Manager from October 2005 to April 2016 and Company Director from October 2005 to September 2017. It also shows him as the Business Development Manager SA for the TJ Services Group from April 2016 to October 2018. Mr Bennett commenced a Batchelor Degree in Accounting and Corporate Finance at the University of Adelaide in 2019. He obtained an MBA, Business Administration and Management, General from the Australian Institute of Business between 2016 and 2018. 75 Mr Brogan said that he had a number of conversations with Mr Bennett during 2018 about work that he was performing to help a former colleague to secure cleaning contracts that had previously been held by the TJ Services Group. The former colleague was a colleague from the time when Mr Bennett worked for the TJ Services Group. The colleague was Mr Sam Saliva and he came to the offices of EFEX to meet with Mr Bennett on one or two occasions. At one point, Mr Bennett said the following to Mr Brogan: I signed a non-competition clause when I left TJ Services, so I have to be careful about not being found to have helped someone else win their work. They pay me cash if the contract is won. 76 Mr Brogan also recalled Mr Bennett introducing him to a person by the name of Jacob during business hours at the offices of EFEX. Mr Brogan does not recall the man's surname. Jacob ran a cleaning business called JCM Services. Mr Brogan can recall Mr Bennett meeting Jacob on a number of occasions. At one point, Mr Bennett said to Mr Brogan the following: I am helping Jacob to secure some cleaning contracts as his English is not great so I'm giving him a hand. 77 Mr Brogan can recall Mr Bennett explaining to him that a representative of Franzon Hotels met with him at one of the Franzon Hotels for an introduction with Mr Saliva to quote on cleaning work for their hotels. Mr Brogan spoke to Mr Franzon on 13 March 2020 and he told Mr Brogan that Mr Bennett had helped Mr Saliva and his cleaning business to win the cleaning contracts for all of the Franzon Hotels. 78 Mr Brogan said that he was not concerned with Mr Bennett doing this other work whilst engaged by EFEX as it did not compete with EFEX and he understood that Mr Sheehan was not concerned about how they spent their time during weekdays. Mr Sheehan's only concern was with whether they met their sales targets. 79 Mr Brogan and Mr Bennett had a discussion about their working arrangements with EFEX and, according to Mr Brogan, they both agreed that they had it "pretty good" in the way they were paid each month.

Matters which Emerged from Cross-Examination 80 Mr Bennett agreed in cross-examination that he knew that Mr Brogan was being paid $10,000 per month as a contractor and that Mr Sheehan said to him that he would look after him in the same way as he had Mr Brogan. He knew that he would be engaged as a contractor and that he would be paid by issuing invoices to EFEX. He agreed that the discussion with Mr Sheehan was informal, but it was on the same basis as Mr Brogan. He agreed that he went to see an accountant in connection with issuing invoices to EFEX and obtaining an ABN and the accountant assisted him with establishing the Bennett Enterprises Trust which meant that as trustee, he could distribute funds to relatives and other persons and companies associated with him. He agreed that he arranged for invoices to be issued over the period of the engagement and that GST was charged. He knew that GST of $1,000 per month was, subject to any offsets, to be remitted to the ATO. Mr Bennett had not, as at the date of the hearing before the FW Commission, paid any GST or income tax on money paid through the trust to the ATO. The bank statements of the Bennett Enterprises Trust show that there was a monthly payment of $7,000 to a private account of Mr Bennett which was described as "wages". 81 Mr Bennett agreed in cross-examination that no records were kept of annual leave or sick leave and that there was no requirement to complete an application or other documentation in respect of leave. If he was going to be away for a period of time, he told Mr Brogan or others as a courtesy or he "alerted" others that he would be away "so it didn't clash with anything". Mr Bennett agreed that a mobile telephone and motor vehicle were essential tools for his sales role and he used his own mobile telephone and motor vehicle. He was not reimbursed for, or given an allowance in respect of, those uses. 82 Mr Bennett knew that he had no formal entitlement to annual leave or sick leave. 83 Mr Bennett agreed that no-one was keeping track of the hours he worked each week. He agreed that there was no requirement that he devote the whole of his time and activities during normal working hours to the performance of his duties. He agreed that he had freedom as to when he would visit clients or potential clients. He agreed that there was no requirement to be in the office "as such" save for meetings with Mr Brogan or South Australian branch meetings. He agreed that he did not need permission from EFEX or Mr Brogan to attend private appointments, that is, appointments unrelated to EFEX. The focus of EFEX and Mr Sheehan was on sales results and the major focus was not operational duties. 84 The bank statements for the Bennett Enterprises Trust show that there were expenses associated with Mr Bennett's travel which were paid by the trust and not by EFEX: taxes, travelling expenses, food and beverages for potential clients. 85 Mr Bennett agreed that there was no requirement that he wear a corporate uniform. 86 In his evidence, Mr Sheehan explained why he considered Mr Bennett was a contractor as follows: Mr Bennett was a contractor because I gave Mr Bennett no direction in relation to how to conduct and perform his tasks; I didn't know what time he got in in the morning; I had no care for when he went home at night. All I was concerned about, Mr Snow, was Gerrard's ability to perform and meet the obligations under that arrangement whereby I wanted Gerrard to write his sales target. 87 Mr Brogan was asked only a handful of questions in cross-examination by counsel for Mr Bennett and they related to the fact that Mr Bennett sent his sales forecasts to Mr Hatherley and not to him. He was not challenged on his statement that Mr Bennett did not work a standard business week of Monday to Friday 8 am to 5 pm or his statement as follows: … Gerrard and I had free reign as to how we went about achieving sales. The company was only concerned with the results that we achieved. All of EFEX's salespersons were given an annual sales target, and each month we were sent a 'leader board' showing how our sales performance tracked against our sales targets. EFEX did not dictate the manner in which we had to chase sales, or who we had to try and win business from, or provide us with lists of prospects. …

Analysis 88 I start with the parties' respective submissions about the effect of the recent High Court decisions in Personnel Contracting and ZG Operations. 89 EFEX submits that the recent decisions of the High Court in Personnel Contracting and ZG Operations support the following propositions. First, in the case of an informal contract, that is, a contract which is not in writing and is one entered into in circumstances of considerable informality, the Court in Personnel Contracting (at [43], [46] per Kiefel CJ, Keane and Edelman JJ; and [162] per Gordon J) said that a court may have regard to the conduct of the parties to ascertain their common intention (Connelly v Wells (1994) 55 IR 73 at 74 per Gleeson CJ), but the emphasis must be on contractual rights and obligations and not on matters that bear no necessary connection with the contractual obligations of the parties. Secondly, the Court in ZG Operations (at [63] per Kiefel CJ, Keane and Edelman JJ) emphasised the importance of the taxation arrangements between the parties in determining the nature of their relationship. Finally, EFEX accepts that as a result of Personnel Contracting (at [63]-[66] per Kiefel CJ, Keane and Edelman JJ; at [127] per Gageler and Gleeson JJ; at [184] per Gordon J), not only is the label the parties attribute to their relationship not determinative, but it will rarely assist the Court in characterising the parties' relationship by reference to their contractual rights and obligations. Unsurprisingly in the circumstances of this case, that proposition is not disputed by Mr Bennett. 90 Mr Bennett submits correctly that both Personnel Contracting and ZG Operations involved a comprehensive written contract and not an informal arrangement as is the arrangement in this case. In ZG Operations, the Court noted (at [63] per Kiefel CJ, Keane and Edelman JJ) that the contracting party was a partnership of which the alleged employee was a member. That means, Mr Bennett submits, that the case is of limited relevance. Mr Bennett submits that a number of relevant principles emerge from Personnel Contracting. First, the dichotomy between a worker conducting their own independent business and a worker serving in the business of another is a meaningful framework for determining the nature of the relationship (at [39] per Kiefel CJ, Keane and Edelman JJ; at [113] and [121] per Gageler and Gleeson JJ). Secondly, the multifactorial approach remains appropriate providing the focus is on the contractual rights and obligations of the parties (at [59]-[61] per Kiefel CJ, Keane and Edelman JJ; at [113], [119]-[120] per Gageler and Gleeson JJ; at [174] and [185]-[189] per Gordon J). Thirdly, the right to control is important because it focuses attention on the subservient and dependent nature of the work of the employee (at [73] per Kiefel CJ, Keane and Edelman JJ; at [113] and [122] per Gageler and Gleeson JJ). Finally, exercises of control must be manifestations of a contractual right of control. Mr Bennett submits that the exercises of control in this case do manifest "the right of control that the parties must be taken to have agreed as a right exercisable by EFEX" (at [42] per Kiefel CJ, Keane and Edelman JJ). 91 This case is at the other end of the spectrum from a case where the terms of the parties' relationship are comprehensively committed to a written contract (Personnel Contracting at [43] per Kiefel CJ, Keane and Edelman JJ). The key figures were friends, there was no written document, the oral discussions were brief and one of the key statements was that the engagement would be on the same basis as another person providing "work" for or to the company. 92 As I understand it, both parties in this case accept that the Court can and should have regard to subsequent conduct to determine the nature of their relationship. EFEX submits that the Court is confined to a consideration of contractual rights and obligations. That is significant because the arrangement did not involve, for example, a contractual obligation on Mr Bennett to work particular hours or follow particular instructions from EFEX. Mr Bennett did not seem to disagree with the emphasis on contractual rights and obligations, but he submitted that the Court could examine subsequent conduct to see what the parties tacitly agreed. The differences between these two approaches was not the subject of detailed submissions. 93 The parties plainly intended for the arrangement to work and acted under the arrangement. I consider that the Court can consider subsequent conduct to determine what the parties tacitly agreed. 94 The second general matter relates to the use of the multifactorial approach. It would seem that it remains a useful approach providing the focus is on contractual rights and obligations (Personnel Contracting at [61] per Kiefel CJ, Keane and Edelman JJ; at [120]-[121] per Gageler and Gleeson JJ). 95 The third general matter is that the assessment of the various factors is affected by the nature of the role performed by the alleged employee. An employed professional such as a solicitor may by virtue of his or her role be subject to less control than an employed factory worker. An employed salesperson may be accorded considerable latitude in terms of the performance of his or her role. Mr Bennett was a Business Development Manager, almost entirely involved in sales and, in effect, a salesperson. 96 The fourth general matter is that a useful framework for analysis is the dichotomy between a person conducting their own independent business and a person serving in the business of another. 97 Mr Bennett identified 10 matters which he submitted were relevant to the characterisation of his relationship with EFEX and he submitted that seven of them supported to varying degrees a finding of an employment relationship. The seven matters were as follows: (1) EFEX had the right to control Mr Bennett's performance of his work; (2) EFEX held Mr Bennett out as part of the EFEX organisation; (3) Mr Bennett's right to obtain other employment was limited in that he had a limited ability to work for others; (4) In practical terms, Mr Bennett had no ability to delegate any of his work for EFEX to others; (5) Mr Bennett did not provide significant capital or assets towards or in relation to his work for EFEX; (6) Mr Bennett had no ability to generate goodwill or other saleable assets in connection with his work for EFEX; (7) the basis upon which Mr Bennett was remunerated by EFEX, namely, by payment of a fixed amount each month, was strongly suggestive of an employment relationship. 98 Mr Bennett accepted that there were matters which pointed to an independent contractor relationship, but submitted that these matters were clearly outweighed by the matters pointing to an employment relationship. Two of the matters he identified were as follows: (1) the taxation arrangements adopted by the parties suggested an independent contractor relationship; and (2) the informal arrangements concerning "leave" for Mr Bennett are consistent with an independent contractor relationship. Mr Bennett also referred to the fact that the parties understood that Mr Bennett was a contractor not an employee. 99 EFEX relied on the three matters Mr Bennett identified, but also submitted that the right of control was minimal as reflected in the following: (1) there was no direction that Mr Bennett be in the office at any particular time; and (2) Mr Bennett had almost total freedom in how he carried out his sales activities. He also submitted at one point that the English approach of the "organisation test" had not been adopted in Australia. That is correct (Stevens v Brodribb Sawmilling Co Pty Ltd [1986] HCA 1; (1986) 160 CLR 16), but that should not be taken to mean that, as the High Court said in Personnel Contracting, the own business/employer's business dichotomy does not provide a useful framework of analysis.

What was the common understanding of the parties as to the nature of their relationship? 100 The Commissioner said that there was evidence that the parties entered into the relationship "with at least some general understanding that they were going to treat this as a (non-employment) relationship with payments based upon invoices" (at [113]). However, the "label was used in conversation without any real discussion about the consequences, other than the payments would be based on a set amount invoiced to EFEX" (at [115]). The Commissioner said that the Court was to examine the totality of the relationship. That led to a conclusion of employment and the label and payment arrangements did not lead to a contrary conclusion (at [117]). 101 Mr Bennett said in his written statement that at no stage was there a discussion as to whether he was to be an employee or a contractor. That is not correct. 102 First, Mr Brogan said that he had a conversation with Mr Bennett in October 2017 about Mr Bennett working for EFEX on the same basis as he did, that is, as a contractor rendering an invoice for $10,000 each month. Mr Brogan was not challenged on this conversation in cross-examination. 103 Secondly, there is the email dated 23 November 2017 from Mr Bennett to Mr Sheehan in which Mr Bennett raises a number of issues about his proposed engagement by EFEX and in which he asks whether he is on the books as an employee "or does he invoice Efex as contractor?". Mr Bennett said that he was aware of the difference between an employee and a contractor. 104 Thirdly, there is the conversation between Mr Sheehan and Mr Bennett in January 2018 which is set out above (at [45]) in which Mr Bennett agrees that he is prepared to enter into an arrangement on the same terms as Mr Brogan. Mr Sheehan was not challenged about that conversation in cross-examination. 105 In addition to these matters, there is Mr Bennett's evidence in cross-examination that he knew he would be engaged as a contractor and that he would be paid by issuing invoices to EFEX. 106 Mr Bennett completed an MBA in 2018. Prior to his engagement by EFEX, he had been involved in conducting a cleaning business that had engaged both "employees" and "contractors". He had a general understanding of the difference between employment and independent contractual arrangements. 107 The evidence from Mr Bennett is instructive. Mr Bennett said the following in cross-examination: PN160 MR MOORHOUSE: Now, Mr Bennett, by that time, by November 2017, you had been a director of TJS Services?---Yes. PN161 That was a cleaning company or a cleaning contractor?---Company, yes. PN162 And I would be guessing, as a cleaning business, that you used both employees and contractors to fulfil the cleaning contracts?---Yes. PN163 And by that stage you were in the midst of or coming towards the end of, in fact, an MBA as well?---Yes. PN164 So by that time you understood the difference between an employee and a contractor, didn't you?---Yes. PN165 And by that time you knew that an employer was supposed to deduct PAYG tax from an employee's wages. You had experienced that previously, hadn't you?---Yes. PN166 And you also knew that on the other hand contractors were generally paid by invoices submitted without PAYG tax being deducted, didn't you?---Yes. PN167 And Mr Brogan told you at some point before you started with Effex, didn't he, that he was engaged as a contractor and paid $10,000 a month. You agree with that?---Yes. 108 The difficulty in EFEX's reliance on this factor is as follows. The factor would be relevant if the evidence went so far as to show that the reference to engagement as a contractor meant that the parties were and understood themselves to be contracting on a particular set of terms and conditions. In other words, it would be relevant if "contractor" clearly conveyed a complete set of terms and conditions that were to govern the relationship. However, the evidence does not go that far. In other words, the evidence was such that one party might have considered engagement as a contractor meant particular arrangements as to payment and taxation only and the other party may have considered that it meant things in relation to a right of control. Absent a clear understanding of the terms and conditions (other than that invoices would be rendered to EFEX and perhaps some understanding of the consequences of that), it has little substantive effect, rather like the label the parties might apply to their relationship (see [89] above).

What was the extent of EFEX's right of control 109 Mr Bennett accepted that there was little exercise of control by EFEX in how he undertook his sales role in the sense of who he approached, how he approached them and when he approached them. His counsel submitted that Mr Bennett's own knowledge of those matters and his expertise with respect to them was one of the reasons EFEX engaged him and that, nevertheless, EFEX had a sufficient right of control to support a conclusion of an employment relationship. His role as a salesperson by definition involved a certain amount of freedom in how he went about his work. 110 Mr Bennett submits that he was part of the EFEX organisation and was accountable in terms of reporting to a superior within the organisation. 111 A document in evidence is a "Proposed Organisational Chart" for EFEX dated July 2019. This chart shows various persons employed or performing work for EFEX and what appears to be reporting lines for each person. Mr Brogan, Mr Bennett and a Ms Trudy Ward are shown as part of the Adelaide sales team and Mr Brogan is described as the Adelaide General Manager of Sales. Mr Bennett, as I would read the organisational chart, reports to Mr Brogan and Mr Brogan reports to Mr Mark Sandral, who is described as the Group General Manager for Sales. The issue of who Mr Bennett reported to, if anyone, is somewhat unclear on the evidence. It was put to Mr Sheehan by Mr Bennett's counsel that Mr Bennett was "ultimately" responsible to Mr Hatherley. Whatever the precise position may be, the significant point is that Mr Sheehan said in his cross-examination that Mr Bennett in his role as Business Development Manager was, in the first instance, actually accountable to the local branch manager, that is to say, Mr Brogan. 112 In terms of attendance in the office, Mr Bennett's counsel focussed on what was required of Mr Bennett and he pointed out that the evidence of Mr Brogan was that Mr Bennett was required to be in the office to attend fortnightly branch meetings with Mr Brogan and "our technicians". Aside from that, although it was anticipated that he would be in the office a reasonable amount of time, there was no requirement by EFEX that he attend the office at particular times. Furthermore, he undertook private activities such as going to the gym and attending classes and tutorials at the university during what would be considered normal business hours. 113 In terms of attendance at sales conferences, Mr Bennett was required to attend sales conferences. Mr Bennett's evidence was that EFEX instructed him to attend sales conferences and that he was informed that attendance was compulsory. He was told that by Mr Sheehan and Mr Hatherley. He recalled attending conferences in Sydney, Adelaide and the Gold Coast and he was required to attend a conference in Sydney prior to the commencement of his work for EFEX. Mr Brogan said that there was a sales "kick off" conference each year that all EFEX workers were asked to attend. Mr Bennett's counsel submitted that there was at least agreement about attendance at the annual conference and I accept that Mr Bennett was, in the relevant sense, required to attend that conference. There was disagreement about whether sales extra training was compulsory which, having regard to the fact that Mr Bennett's counsel did not press me to accept Mr Bennett's evidence in preference to that of Mr Brogan, it is not necessary for me to resolve. Mr Bennett, like Mr Brogan, considered it an appropriate and worthwhile thing to attend such conferences. 114 In terms of Mr Bennett's performance of operational tasks for EFEX, Mr Bennett's counsel noted the dispute between the parties as to the frequency of Mr Bennett being required to perform operational tasks. The submission made by Mr Bennett's counsel was that rather than on multiple occasions, he was from time to time required to perform operational tasks. That seems to me to be a fair, albeit general description. Mr Bennett's counsel submitted that it is a very unlikely thing that would be required of someone who was genuinely an independent contractor engaged to provide business development management services to EFEX. That is true, but at the same time, the emphasis was on sales and this is not a significant factor. 115 The use of EFEX template documents by Mr Bennett in creating proposals and putting together deal sheets is relevant. In his evidence, Mr Bennett agreed that there were sales targets that he was expected to achieve. He said that there were sales processes that they were instructed to follow. He agreed that the salespersons, including himself, were trained in those processes. Mr Bennett's counsel submitted that it was clear that Mr Bennett was trained to use, and required to use, the sale processes of EFEX and that is a matter of significance. That is true to a point because one would not expect to see that occur in the case of an independent contractor. 116 An expectation that Mr Bennett not compete with EFEX is also relevant. This expectation is clear in Mr Brogan's comment when dealing with other work performed by Mr Bennett that he was not concerned about Mr Bennett doing other work while engaged by EFEX as long as it did not compete with EFEX. 117 A matter of significance is that Mr Bennett did comply, apparently without objection, with a direction by Mr Sheehan in three instances. First, he was given a direction not to work so closely with Mr Brogan. Secondly, he was given a direction not to attend the lunch in Sydney. Finally, he was given a direction in relation to his attendance at the Hyde Park Tavern to concentrate on sales and to get One Solution to attend to non-sales tasks.

Was Mr Bennett held out as a part of the EFEX organisation? 118 Mr Bennett relied on the fact that he was held out as a part of EFEX and that is a relevant factor: Hollis v Vabu Pty Ltd [2001] HCA 44; (2001) 207 CLR 21 (Hollis v Vabu) at [50]; Sweeney v Boylan Nominees Pty Ltd [2006] HCA 19; (2006) 226 CLR 161 at [32]. Mr Bennett's counsel submitted with force that it is a most unlikely scenario that Mr Bennett, an independent contractor, reported to Mr Brogan, another independent contractor, as far as relationships with EFEX are concerned. I agree with counsel's submission that that seems an unlikely web of relations. 119 Mr Bennett had an EFEX business card. He was shown as the Business Development Manager, that is to say, the Business Development Manager of EFEX. There is an email address of EFEX on the card. In addition, Mr Bennett's evidence was that upon the commencement of his work with EFEX, he was provided with, among other things, a company email and, as I have said, that he used the sales template documents of EFEX. As counsel for Mr Bennett submitted, every time a sale was being negotiated, the business card and the sales templates used by Mr Bennett would reinforce the impression that the person with whom those clients, or potential clients, were dealing with, was a representative of EFEX.

Did Mr Bennett have the ability to work for others? 120 Mr Bennett's counsel submitted that at a practical level, he was required to devote all his time to EFEX's business. He accepted that he had some flexibility in that he was able to attend some university tutorials "the commencement and ending lecture of the university courses". However, the need to achieve his sales targets meant that he would not have had the time, and did not devote time, to any other matters. Mr Bennett accepted that he made one introduction of a cleaning contractor to an EFEX client. He received an unsolicited payment as a gift. Mr Bennett submits that that is not work. The evidence on this point was to the effect that he performed no other work beyond that one introduction. Two other circumstances were raised with him in cross-examination. One was the introduction of Amed and Mohammed to someone called Ellie. That was an introduction which was a five minute introduction and he was not paid for that work. He had an interaction with a man called Chen and, in fact, Chen introduced Mr Bennett to Spotless as a potential client. The submission is that none of that would support a conclusion that, in terms of Mr Bennett's self-development as set out in his LinkedIn profile, that constituted networking and consulting. 121 I accept Mr Sheehan's evidence that he was only concerned with whether Mr Bennett met his sales targets. If he had been very lucky or an exceptional salesperson, he may have had time to work for others. The reality, I think, is otherwise. The salary and tenor of discussions (such as they were) is that the position to be undertaken by Mr Bennett was a full-time, or nearly full-time, position.

Did Mr Bennett have the ability to delegate any of his work for EFEX to others? 122 There is no evidence that Mr Bennett either did or would have been permitted to delegate his work as Business Development Manager to a third party. The nature of the work and the circumstances in which it was to be carried out suggests that delegation was not practical or, indeed, possible. 123 In Ace Insurance v Trifunovski [2013] FCAFC 3; (2013) 209 FCR 146 (Trifunovski), Buchanan J (with whom Lander and Robertson JJ agreed) said the following (at [25]): Contracts of employment (contracts of service traditionally so-called) are contracts for personal service. Benefits and obligations of contracts of individual service of this kind are not unilaterally assignable by either party (Nokes v Doncaster Amalgamated Collieries Ltd [1940] AC 1014 at 1018-1019, 1024, 1026, 1029, 1048; Mersey Docks and Harbour Board v Coggins & Griffith (Liverpool) Ltd [1947] AC 1 at 14, 15 (Mersey Docks); Denham v Midland Employers Mutual Assurance Ltd [1955] 2 QB 437 at 443 (Denham)). The requirement for personal service has the effect that a contract which truly permits discharge in another fashion or by another person, is not a contract of employment. Thus, contracts with corporations, contracts with partnerships, contracts permitting unlimited delegation and contracts which do not actually compel the performance of work but pay only on results, are each prima facie not contracts of the necessary quality (although the last category is more contestable than the first three).

Did Mr Bennett provide capital or assets towards or in relation to work for EFEX? 124 Mr Bennett makes the point, correctly in my opinion, that he made no significant contribution in terms of capital or assets towards his work for EFEX. Mr Bennett submits that the fact that he provided his own motor vehicle and telephone for use in his employment is an indicator, but not a strong indicator. He relies on the comment in Hollis v Vabu at [56] as follows: Sixthly, the situation in respect of tools and equipment also favours, if anything, a finding that the bicycle couriers were employees. Apart from providing bicycles and being responsible for the cost of repairs, couriers were required to bear the cost of replacing or repairing any equipment of Vabu that was lost or damaged, including radios and uniforms. Although a more beneficent employer might have provided bicycles for its employees and undertaken the cost of their repairs, there is nothing contrary to a relationship of employment in the fact that employees were here required to do so. This is all the more so because the capital outlay was relatively small and because bicycles are not tools that are inherently capable of use only for courier work but provide a means of personal transport or even a means of recreation out of work time. The fact that the couriers were responsible for their own bicycles reflects only that they were in a situation of employment more favourable than not to the employer; it does not indicate the existence of a relationship of independent contractor and principal.

Did Mr Bennett have the ability to generate goodwill or other saleable assets? 125 There is no suggestion that Mr Bennett was developing, by his work with EFEX, a saleable asset, such as goodwill. Relatedly, the mode of remuneration is important (Roy Morgan Research v Federal Commissioner of Taxation [2010] FCAFC 52; (2010) 184 FCR 448 at [42]; and Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd [2015] FCAFC 37; (2015) 228 FCR 346 at [181]). As Mr Bennett's counsel submitted, Mr Bennett was paid $10,000 plus GST per month. The amount paid to him was not linked in any way with his performance or with any result or with any product. Mr Bennett was not at risk, in terms of his remuneration, in the performance of his work and he had nothing to gain by performance. He simply received the same remuneration. He was paid when he was on leave or when he was sick. That is consistent with someone who is in a relationship of employment.

What is the relevance of the mode of remuneration, leave (annual and sick) and taxation arrangements? 126 Mr Bennett accepts that there are factors pointing in the other direction. The first amongst these are the arrangements as to payment. They are suggestive of a relationship of independent contractor in that the method of payment involves invoicing monthly, the charging of GST and the fact that PAYG taxation was not withheld. 127 In response to EFEX's reliance on these matters, Mr Bennett referred to the observations of Buchanan J in Trifunovski as follows (at [37]): It is also difficult, in my view, to give much independent weight to arrangements about taxation, or even matters such as insurance cover or superannuation. These are reflections of a view by one party (or both) that the relationship is, or is not, one of employment. For that reason, in my view, those matters are in the same category as declarations by the parties in their contract (from which they often proceed). They may be taken into account but are not conclusive. These matters are less important than the adoption by the parties (where this occurs) of rights and obligations which are fundamentally inconsistent with basic requirements of a contract of employment, such as the ability to delegate the discharge of obligations under a contract to another person, or where there is a lack of control over how work is done. 128 For its part, EFEX relied on observations in ZG Operations about the tension between, on the one hand, a submission that the truck-driving partnerships were not conducting business of their own and, on the other, the income splitting advantages of the structures adopted (at [63] per Kiefel CJ, Keane and Edelman JJ). 129 There is more direct support for EFEX's submission as to the importance of the taxation arrangements in the following observation of Jessup J (with whom Allsop CJ and White J agreed) in Tattsbet Ltd v Morrow [2015] FCAFC 62; (2015) 233 FCR 46 at [70] as follows: Fifthly, in contemporary Australia, it is impossible to ignore, and difficult to depreciate, the taxation implications of the mode of operation which parties to a relationship have voluntarily adopted. In the past, the deduction of what are now called PAYG instalments was always treated, uncontroversially, as indicative of an intention that the relationship in question was one of employment. To any suggestion that the absence of such instalments tended to point to the relationship being one of principal and independent contractor, it was often rejoined that such an argument was circular, in the sense that a consequence of the relationship being one of employment was, under legislation, that such instalments had to be deducted. In contemporary times, however, there are legislative markers on both sides, as it were. It is no longer just the absence of PAYG deductions that may make it more difficult to characterise the relationship as one of employment, it is the presence of GST collections by the putative contractor, and his or her compliance with the regulatory requirements which apply to the provision of services by persons who are not employees, that point quite strongly against the relationship being characterised in this way. These observations are made, of course, in the context of the present case, where there is no suggestion that the respondent's participation in the GST system did not reflect her own conscious, well-informed, intentions. 130 The mode of remuneration, and I mean by that the charging of GST and the payments to a trust without the deduction of PAYG payments, is one significant factor pointing towards a finding of independent contractor relationship. It is to be noted in this context that, as I have previously said, the amount of remuneration is fixed and not variable according to result and that is a factor suggesting an employment relationship. 131 An entitlement to a certain amount of paid leave is a characteristic of an employment relationship. An accrual of paid leave is a feature of an employment relationship. Mr Bennett was not given a certain amount of leave. EFEX did not record an entitlement to leave in its books and nor was a formal application process in place for the taking of leave. Mr Bennett went on holidays. He gave notice as a courtesy or to alert people so that it did not clash with something else. I am inclined to think that arrangements as to leave cannot be put in the same category as how the parties label their relationship. After all, the arrangements as to leave are part of the legal rights and obligations of the parties. The absence of formal rights to leave supports a conclusion of a non-employment relationship. At the same time, it is relevant that the payment arrangements between the parties meant that Mr Bennett was paid during his holidays.

Another matter 132 Mr Bennett relied on the offer of employment made on 1 November 2019. The letter of offer contains the following: This letter sets out the complete terms of your employment that are being offered and supersedes and replaces any prior agreed terms regarding your employment with EFEX (Contract). These terms and conditions of employment set out in this letter are underpinned by the Business Equipment Award 2010 (Award), the Fair Work Act 2009 (Cth) (Fair Work) and other workplace laws. These documents are not incorporated into this document in any way. 133 Mr Bennett points out that there is no suggestion in the letter that the previous relationship was a contractual relationship. I do not consider that this submission advances Mr Bennett's case.

Conclusions as to the Nature of the Relationship 134 As will be clear from what I have said, there are matters pointing towards a conclusion of an employment relationship and matters pointing towards a finding of an independent contractor relationship. I do not consider that the understanding of the parties advances the matter for reasons I have given. 135 Mr Bennett might have been judged in the final analysis by results, but he was not paid by results. He was entitled to receive $10,000 plus GST every month irrespective of how he performed in terms of sales. The matters I have identified mean that the expectation must have been that he would devote his time, or the bulk of time, to his work for EFEX as was the case with Mr Brogan who was the branch manager. True it is that he was allowed to attend university and the gym during business hours and that Mr Sheehan's concern was with the level of sales, but his relationship has the hallmarks of full-time employment with some flexibility. That is consistent with his role as a salesperson with sales targets. Furthermore, a level of control was exercised on occasions, most notably when he was told not to work so closely with Mr Brogan. 136 Considered by reference to the "own business/employer's business" dichotomy, the trust and payment arrangements provide some indication of the former, but the overwhelming weight of evidence in terms of control, ability to work for others and the inability to delegate the EFEX work, leads to a conclusion of the latter. 137 I find that Mr Bennett was an employee of EFEX between 1 February 2018 and 8 November 2019.

Conclusion 138 EFEX's application must be dismissed. I will hear the parties on the question of costs. I certify that the preceding one hundred and thirty-eight (138) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Besanko.