Haire v WorkCo Australia Pty Ltd

Federal Court of Australia|2024-11-04|Before: Horan J

Fair Work Act 2009 (Cth) ss 14, 338(1)(a), 338(1)(b), 340(1)(a), 340(1)(b), 342(1), 346(a), 346(b), 550(2), 793 Legislation: Federal Court of Australia Act 1976 (Cth) s 31A Superannuation Guarantee (Administration) Act 1992 (Cth) Federal Court Rules 2011 (Cth) rr 16.21, 16.41, 16.43, 16.45, 26

Agar v Hyde (2000) 201 CLR 552 Amcor Packaging (Australia) Pty Ltd v The Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union of Australia [2006] FCA 1265; 157 IR 32 Ashbury v Reid [1961] WAR 49 Australian Building and Construction Commissioner v Hall (2018) 261 FCR 347 Australian Competition and Consumer Commission v Productivity Partners Pty Ltd (t/as Captain Cook College) (No 3) [2021] FCA 737; 154 ACSR 472 Australian Securities and Investments Commission v Cassimatis (2013) 220 FCR 256 Banks v Alphatise Pty Ltd [2014] NSWSC 1437 Banque Commerciale SA en Liquidation v Akhil Holdings Ltd (1990) 169 CLR 279 Batistatos v Roads and Traffıc Authority (NSW) (2006) 226 CLR 256 Baweja v Capital Insurance Group Limited [2023] FWC 2401 Buurabalayji Thalanyji Aboriginal Corporation v Onslow Salt Pty Ltd (No 2) [2018] FCA 978 Construction, Forestry, Mining and Energy Union v Clarke [2007] FCAFC 87; 164 IR 299 Construction, Forestry, Mining and Energy Union v State of Victoria [2013] FCA 445; 302 ALR 1 Dandaven v Harbeth Holdings Pty Ltd [2008] FCA 955 Danthanarayana v Commonwealth of Australia [2016] FCAFC 114 Eliezer v University of Sydney (2015) 239 FCR 381 Fair Work Ombudsman v Al Hilfi [2012] FCA 1166 Fair Work Ombudsman v Devine Marine Group Pty Ltd [2014] FCA 1365 Fair Work Ombudsman v Priority Matters Pty Ltd [2017] FCA 833 Fair Work Ombudsman v South Jin Pty Ltd [2015] FCA 1456 Fair Work Ombudsman v Valueair Limited (No 2) (2014) 224 FCR 415 Forrest v Australian Securities and Investments Commission (2012) 247 CLR 486 Gall v Domino's Pizza Enterprises Limited (No 2) [2021] FCA 345; 391 ALR 675 Gore v Australian Securities and Investments Commission (2017) 249 FCR 167 Gunawardena v Boeing Aerostructures Australia Pty Ltd [2024] FCA 1206 Haire v WorkCo Australia Pty Ltd [2024] FCA 668 Jefferson Ford Pty Ltd v Ford Motor Company of Australia Limited (2008) 167 FCR 372 Cases cited: Spencer v The Commonwealth (2010) 241 CLR 118 Imobilari Pty Ltd v Opes Prime Stockbroking Ltd [2008] FCA 1920; 252 ALR 41 Kernel Holdings Pty Ltd v Rothmans of Pall Mall (Australia) Pty Ltd (1991) 217 ALR 171 Kimber v The Owners of Strata Plan No 48216 (2017) 258 FCR 575 Kowalski v MMAL Staff Superannuation Fund Pty Ltd (2009) 178 FCR 401 Leach v Burston [2022] FCA 87 Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union [2006] WASC 144; 154 IR 228 Luck v University of Southern Queensland (2009) 176 FCR 268 McAleer v University of Western Australia (No 3) (2008) 171 FCR 499 McKellar v Container Terminal Management Services (1999) 165 ALR 409; [1999] FCA 1101 Monash Health v Singh [2023] FCAFC 166 Polar Aviation Pty Ltd and Another v Civil Aviation Safety Authority and Others (2012) 203 FCR 325 Qantas Airways Ltd v Transport Workers' Union of Australia [2011] FCA 470; 280 ALR 503 R v Tannous (1987) 10 NSWLR 303 Rauland Australia Pty Ltd v Johnson (No 1) [2019] FCA 1174 Sabapathy v Jetstar Airways (2021) 283 FCR 348 Sadie Ville Pty Ltd v Deloitte Touche Tohmatsu (A Firm) [2017] FCA 1202; 123 ACSR 223 State of Victoria v Construction, Forestry, Mining and Energy Union (2013) 218 FCR 172 Stefanovski v Digital Central Australia (Assets) Pty Ltd [2018] FCAFC 31 Takemoto v Moody's Investors Service Pty Limited [2014] FCA 1081 Thomson v STX Pan Ocean Co Ltd [2012] FCAFC 15 ThoughtWare Australia Pty Limited v IonMy Pty Ltd [2023] FCA 906 Three Rivers District Council v Bank of England [No 3] [2003] 2 AC 1 Trade Practices Commission v Australian Meat Holdings (1988) 83 ALR 299 Trade Practices Commission v Total Australia Ltd (1975) 24 FLR 413 Whitby v ZG Operations Australia Pty Ltd (No 2) [2019] FCA 201 White Industries Australia Ltd v Federal Commissioner of Taxation (2007) 160 FCR 298 Yorke v Lucas (1984) 158 CLR 661 Young Investments Group Pty Ltd v Mann [2012] FCAFC 107; 293 ALR 537

Division: Fair Work Division

Number of paragraphs: 116

Date of hearing: 11 and 14 October 2024

Counsel for the Applicant: Ms R Preston

Solicitor for the Applicant: Longton Legal

Counsel for the First and Second Respondents: Mr N Furlan

Solicitor for the First and Second Respondents: Lander & Rogers

Counsel for the Third and Fourth Respondents: Ms K Holcombe

Solicitor for the Third and Fourth Respondents: Gilbert + Tobin

BETWEEN: ALISON HAIRE Applicant WORKCO AUSTRALIA PTY LTD (ACN 653 085 253) First Respondent KENNETH O'FRIEL AND: Second Respondent MEGAN KLIMEN Third Respondent FILECOIN FOUNDATION Fourth Respondent

order made by: HORAN J DATE OF ORDER: 4 November 2024

THE COURT ORDERS THAT:

The third and fourth respondents' interlocutory application dated 12 July 2024 be dismissed.
The third and fourth respondents pay the applicant's costs of the interlocutory application.
The proceeding be listed for a case management hearing on 6 December 2024 at 9.30am. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT HORAN J:
This is an interlocutory application made by the third respondent, Ms Megan Klimen, and the fourth respondent, Filecoin Foundation, for summary dismissal of the proceeding brought by the applicant, Ms Alison Haire, as against them, or alternatively for strike out of the claims against them in the applicant's amended statement of claim dated 13 March 2024 (ASOC).
Ms Haire was formerly employed by the first respondent, WorkCo Australia Pty Ltd. In the substantive proceeding, Ms Haire claims that she was dismissed by WorkCo in contravention of Pt 3-1 of the Fair Work Act 2009 (Cth) (FW Act). Ms Haire also claims that WorkCo subjected her to non-dismissal adverse action in response to her concerns and complaints about underpayment, including in relation to the payment of a cryptocurrency component of her remuneration.
Before she was employed by WorkCo, Ms Haire performed work for Filecoin as a Developer Advocate and Developer Relations Engineer. Filecoin is a legal entity established in the United States of America, of which Ms Klimen is alleged to be the "Founding Officer". It is alleged in the ASOC that Filecoin "co-ordinates and supports the creation and improvement of a decentralised cloud storage system using Filecoin", which is described as "an open-source public cryptocurrency and digital payment system, intended to be a blockchain-based cooperative digital storage and data retrieval method". Ms Haire alleges that she was engaged by Filecoin as a contractor from around 4 January 2022 until 31 May 2023, following which she was engaged by Filecoin "indirectly" through a labour hire arrangement with WorkCo, as an affiliate in a global enterprise known as "Toku" which provides labour related services to cryptocurrency businesses.
The second respondent, Mr Kenneth O'Friel, is the Chief Executive Officer (CEO) of WorkCo, and a co-founder and the CEO of Toku.
On 14 June 2024, I made orders for deemed service and substituted service of the originating process on Ms Klimen and Filecoin: see Haire v WorkCo Australia Pty Ltd [2024] FCA 668. Each of WorkCo and Mr O'Friel has filed a defence in response to the ASOC. Neither Ms Klimen nor Filecoin has yet filed any defence, which was due to be filed by 12 July 2024. Instead, by an interlocutory application dated 12 August 2024, Ms Klimen and Filecoin have applied for the following orders:
The proceeding as against the third and fourth respondents be dismissed pursuant to s 31A(2) of the Federal Court of Australia Act 1976 (Cth) and Federal Court Rules 2011 (Cth) (FC Rules) r 26.01(1).
In the alternative, the claims against the third and fourth respondents in the Amended Statement of Claim filed 13 March 2024 be struck out pursuant to FC Rules r 16.21(1).
The applicant to pay the third and fourth respondents' costs of and incidental to this Interlocutory Application.
The applicant to pay the third and fourth respondents' costs of and incidental to the proceeding.
Such further or other order the Court deems appropriate.
In broad terms, Ms Haire advances the following claims against Ms Klimen and Filecoin:
Accessorial liability in relation to WorkCo's general protections contraventions: Ms Haire alleges that Ms Klimen and Filecoin were involved in the alleged contraventions by WorkCo of s 340(1)(a)(i), (ii) and (iii) and s 346(a) and (b) of the FW Act; and
Direct liability of Filecoin (and accessorial liability of Ms Klimen) regarding Ms Haire's engagement following the cessation of her employment with WorkCo: Ms Haire alleges that, after the termination of her employment with WorkCo, Filecoin engaged in adverse action against her in contravention of s 340(1)(a)(i), (ii) and (iii), s 340(1)(b) and s 346(a) and (b) of the FW Act, and that Ms Klimen was involved in those alleged contraventions.
Ms Klimen and Filecoin seek summary judgment or strike out of the claims made against them in the proceeding on one or more of the following grounds that:
Ms Haire has no reasonable prospect of successfully prosecuting those parts of the proceeding;
no reasonable cause of action is disclosed; and
the relevant paragraphs of the ASOC are evasive or ambiguous, and/or likely to cause prejudice, embarrassment or delay in the proceeding.
In support of the interlocutory application, Ms Klimen and Filecoin rely on an affidavit of their solicitor Dianne Margaret Banks affirmed 10 August 2024 (Banks affidavit).
For the reasons that follow, I have concluded that the ASOC discloses a reasonable cause of action against each of Ms Klimen and Filecoin, who have not satisfied their onus to demonstrate that Ms Haire has no reasonable prospect of success in relation to those claims. Accordingly, the application by Ms Klimen and Filecoin for summary judgment in their favour must be dismissed.
I do not consider that the relevant parts of the ASOC in their current form are evasive or ambiguous or likely to cause prejudice, embarrassment or delay in the proceeding. Any outstanding issue concerning the particularisation of the claims against Ms Klimen and Filecoin can be addressed by a request for further and better particulars, and if necessary, by an application for an order for particulars.
Before considering the pleadings in greater detail and addressing the parties' submissions on the interlocutory application, it is convenient to identify the applicable principles governing summary dismissal and strike out applications.

Summary judgment

Section 31A of the Federal Court of Australia Act 1976 (Cth) (FCA Act) relevantly provides: (2) The Court may give judgment for one party against another in relation to the whole or any part of a proceeding if: (a) the first party is defending the proceeding or that part of the proceeding; and (b) the Court is satisfied that the other party has no reasonable prospect of successfully prosecuting the proceeding or that part of the proceeding. (3) For the purposes of this section, a defence or a proceeding or part of a proceeding need not be: (a) hopeless; or (b) bound to fail; for it to have no reasonable prospect of success.
This provision is complemented by r 26.01 of the Federal Court Rules 2011 (Cth), which relevantly provides: 26.01 Summary judgment (1) A party may apply to the Court for an order that judgment be given against another party because: (a) the applicant has no reasonable prospect of successfully prosecuting the proceeding or part of the proceeding; or (b) the proceeding is frivolous or vexatious; or (c) no reasonable cause of action is disclosed; or (d) the proceeding is an abuse of the process of the Court; or (e) the respondent has no reasonable prospect of successfully defending the proceeding or part of the proceeding. (2) The application must be accompanied by an affidavit stating: (a) the grounds of the application; and (b) the facts and circumstances relied on to support those grounds.
The seminal decision on the construction of s 31A of the FCA Act is Spencer v The Commonwealth (2010) 241 CLR 118. As Hayne, Crennan, Kiefel and Bell JJ observed, "the combined effect of sub-ss (2) and (3) [of s 31A] is that the inquiry required in this case is whether there is a 'reasonable' prospect of prosecuting the proceeding, not an inquiry directed to whether a certain and concluded determination could be made that the proceeding would necessarily fail": Spencer at [52]. In this way, s 31A of the FCA Act marks a departure from the stricter tests that were applicable to summary dismissal under earlier procedural regimes. The plurality in Spencer emphasised that full weight must be given to the expression "no reasonable prospect", avoiding any paraphrase of or judicial gloss on its operation: Spencer at [58]-[60]. Their Honours nevertheless accepted that "the power to dismiss an action summarily is not to be exercised lightly": Spencer at [60], see also at [24] (French CJ and Gummow J); compare Danthanarayana v Commonwealth of Australia [2016] FCAFC 114 at [4] (Jagot, Bromberg and Murphy JJ).
The background to the introduction of s 31A of the FCA Act was discussed by French CJ and Gummow J in Spencer at [18]-[21]. After referring to the judgment of Lord Hope of Craighead in Three Rivers District Council v Bank of England [No 3] [2003] 2 AC 1 at [94]-[95], French CJ and Gummow J identified (in a non-exhaustive fashion) several categories of case to which s 31A of the FCA Act might apply (at [22]): It will apply to the case in which the pleadings disclose no reasonable cause of action and their deficiency is incurable. It will include the case in which there is unanswerable or unanswered evidence of a fact fatal to the pleaded case and any case which might be propounded by permissible amendment. It will include the class of case in the longstanding category of cases which are "frivolous or vexatious or an abuse of process".
The notion of a defect or deficiency in a pleaded case which is incapable of being cured by amendment serves to distinguish the power of summary dismissal conferred by s 31A from the power to strike out pleadings (see r 16.21 of the Rules), although the latter can similarly be exercised on the ground that the pleading fails to disclose a reasonable cause of action or defence. In Spencer, French CJ and Gummow J referred to White Industries Australia Ltd v Federal Commissioner of Taxation (2007) 160 FCR 298 at [47], where Lindgren J observed that it may be disclosed on the evidence that a person has or may have a reasonable prospect of success or a reasonable cause of action even where that is not currently disclosed by the person's pleading, and that "the existence of a reasonable cause of action and the pleading of a reasonable cause of action remain distinct concepts". This contemplates that a party might be given an opportunity to amend in order to address pleading deficiencies although, as Lindgren J also recognised in White Industries at [47], a failure to plead a reasonable cause of action after ample opportunity has been given may suggest that there is no reasonable cause of action and that the party has no reasonable prospect of success.
Accordingly, summary judgment will not usually be granted where it is apparent that there are real questions of fact or law to be determined at trial, after the parties have had an opportunity to take advantage of the "usual interlocutory processes": see Spencer at [24] (French CJ and Gummow J), referring to Agar v Hyde (2000) 201 CLR 552 at [57] (Gaudron, McHugh, Gummow and Hayne JJ) and Batistatos v Roads and Traffıc Authority (NSW) (2006) 226 CLR 256 at [46] (Gleeson CJ, Gummow, Hayne and Crennan JJ). Such interlocutory processes encompass the completion of pleadings, the provision of further particulars, discovery and production of documents, and the filing of evidence. Conversely, where it is clear that the facts pleaded by a party do not entitle that party to the relief sought, or that an essential factual basis of the claim is contradicted by evidence that is "unanswerable or unanswered" (Spencer at [22] (French CJ and Gummow J)), it may be appropriate to make such a determination on a summary basis, thereby avoiding the "waste of time and money" that would be involved in the matter proceeding to trial, to borrow the language used by Lord Hope of Craighead in Three Rivers District Council at [95].
In Australian Securities and Investments Commission v Cassimatis (2013) 220 FCR 256 at [19], Reeves J considered the extent of any difference between the joint judgments in Spencer: In my view, the area of difference is quite confined. It is, in my view, this: the joint judgment of Hayne, Crennan, Kiefel and Bell JJ appears to discourage recourse to cases decided under earlier provisions for summary judgment in construing what is required by s 31A (see, for example, at [56]) and eschews any gloss being added to the text of s 31A itself (at [58]), while the joint judgment of French CJ and Gummow J appears to consider those cases to be of some continuing utility and relevance in that task (see, for example, at [24]). However, aside from this, both joint judgments emphasise the necessity for caution in dismissing proceedings summarily (see French CJ and Gummow J at [24] and Hayne, Crennan, Kiefel and Bell JJ at [60]). Furthermore, both joint judgments, in my view, emphasise that the decision is ultimately one for the judge hearing the application to determine in the particular circumstances of the case at hand. Indeed, the joint judgment of Hayne, Crennan, Kiefel and Bell JJ considered that context should be given to the provision "through a succession of decided cases" (see at [60]).
As is made clear by the terms of s 31A(3), it is not necessary to demonstrate that the proceeding (or the relevant part thereof) is hopeless or bound to fail. Nevertheless, the onus is on the party moving for summary judgment to establish that the claim or defence of the opposing party has no reasonable prospect of success. Section 31A requires the Court to form a judgment as to whether the case is "insufficiently strong to warrant the matter going to trial": see e.g. Buurabalayji Thalanyji Aboriginal Corporation v Onslow Salt Pty Ltd (No 2) [2018] FCA 978 at [3] (McKerracher J), referring to McAleer v University of Western Australia (No 3) (2008) 171 FCR 499 at [39] (Siopsis J). Such a judgment must be formed "in the absence of a full and complete factual matrix and argument": Eliezer v University of Sydney (2015) 239 FCR 381 at [37] (Perry J); Kimber v The Owners of Strata Plan No 48216 (2017) 258 FCR 575 at [62] (Logan, Kerr and Farrell JJ). Section 31A does not contemplate that, for the purposes of determining an application for summary judgment, the Court should conduct "a mini-trial based upon incomplete evidence to decide whether the proceedings are likely to succeed or fail at trial", but rather it "requires a critical examination of the available materials to determine whether there is a real question of law or fact that should be decided at trial": Cassimatis at [46] (Reeves J); see also Three Rivers District Council at [95] (Lord Hope of Craighead), quoted in Spencer at [21] (French CJ and Gummow J). For such purposes, it is necessary to draw all reasonable inferences in favour of the non-moving party, and it may be sufficient for that party to provide an outline of the evidence that will be relied upon at trial in order to show that there is a genuine dispute: Dandaven v Harbeth Holdings Pty Ltd [2008] FCA 955 at [6] (Gilmour J).
Differing views have been expressed as to whether s 31A of the FCA Act confers a discretion on the Court: see Jefferson Ford Pty Ltd v Ford Motor Company of Australia Limited (2008) 167 FCR 372 at [128]-[129] (Gordon J); compare Luck v University of Southern Queensland (2009) 176 FCR 268 at [110]-[112] (Rares J); Kowalski v MMAL Staff Superannuation Fund Pty Ltd (2009) 178 FCR 401 at [28] (Spender, Graham and Gilmour JJ); Eliezer at [37] (Perry J). In any event, even if a determination whether a party has a reasonable prospect of success does not itself constitute a judicial discretion, the Court retains some discretion in relation to whether or not it is appropriate to determine the proceedings by way of an application for summary judgment rather than allowing disputed matters of fact and law to proceed to trial: see Cassimatis at [50] (Reeves J); Takemoto v Moody's Investors Service Pty Limited [2014] FCA 1081 at [14] (Flick J).
In Cassimatis at [47]-[49], Reeves J elaborated on the kinds of questions that may be amenable to determination on a summary basis on an application under s 31A of the FCA Act as follows: Accepting there can be no "hard and fast" rule about this, as a general principle, these authorities show that the moving party on an application for summary dismissal of the present kind is likely to succeed on its persuasive onus if it is able to demonstrate to the Court that the applicant's success in the proceedings relies upon a question of fact that can be truly described as fanciful, trifling, implausible, improbable, tenuous or one that is contradicted by all the available documents or other materials. Conversely, as a general principle, it is unlikely to succeed where, on a critical examination of all the available materials, the Court is satisfied that there appears to be a real question of fact to be determined between the parties. This is more likely to be the case where the available materials include pleadings that raise factual disputes that can be truly described as significant, substantial, plausible or weighty. A real question of fact is also more likely to exist where the question/s of fact concerned is/are complex, eg involving numerous different events or transactions over a long period of time. Similarly, as a general principle, the moving party on an application for summary dismissal is likely to succeed on its persuasive onus if it is able to demonstrate to the Court that the applicant's success in the proceedings relies upon a question of law that is straightforward and confined, or is trite in the sense that it is well settled on authority, such that the question can be resolved summarily without the necessity for a full trial. On the other hand, the moving party would be unlikely to succeed if the Court is satisfied that the applicant's success in the proceedings relies upon a question of law that is serious or important, or is difficult and therefore likely to require lengthy argument for its resolution, or involves conflicting authority, or is apparently arguable, yet novel. Then there are proceedings involving questions of fact and law, or mixed questions of fact and law. Because this combination or mixing of factual and legal questions usually gives rise to the sort of complexity that traditionally requires a trial, where the Court is satisfied that this combination or mixing exists in the proceedings, it should, as a general principle, be particularly cautious about ordering summary determination. In other words, the moving party on an application for summary dismissal would, as a general principle, need to show a substantial absence of merit on either of the question of fact or law concerned, or where the two questions are mixed, on the mixed question, before having any chance of success in persuading the Court that questions of these kinds should be resolved summarily.

Strike out of pleadings

Under the Rules, a pleading is required, among other things, to "identify the issues that the party wants the Court to resolve" and to "state the material facts on which a party relies that are necessary to give the opposing party fair notice of the case to be made against that party at trial, but not the evidence by which the material facts are to be proved": r 16.02(1)(d). A pleading must not be "evasive or ambiguous" or "likely to cause prejudice, embarrassment or delay in the proceeding", and must not "fail to disclose a reasonable cause of action or defence or other case appropriate to the nature of the pleading": r 16.02(2)(c), (d), (e). A party must plead a fact if failure to plead that fact may take another party by surprise: r 16.03(1)(b).
Such rules reflect the primary purposes of pleadings, which include defining the issues in dispute between the parties and providing notice to opposing parties of the case to be met at trial: see Sadie Ville Pty Ltd v Deloitte Touche Tohmatsu (A Firm) [2017] FCA 1202; 123 ACSR 223 at [17] (Moshinsky J); McKellar v Container Terminal Management Services (1999) 165 ALR 409; [1999] FCA 1101 at [21]-[22] (Weinberg J); Banque Commerciale SA en Liquidation v Akhil Holdings Ltd (1990) 169 CLR 279 at 286 (Mason CJ and Gaudron J); Gunawardena v Boeing Aerostructures Australia Pty Ltd [2024] FCA 1206 at [6]-[12] (Wheelahan J).
Rule 16.21 deals with striking out pleadings. 16.21 Application to strike out pleadings (1) A party may apply to the Court for an order that all or part of a pleading be struck out on the ground that the pleading: (a) contains scandalous material; or (b) contains frivolous or vexatious material; or (c) is evasive or ambiguous; or (d) is likely to cause prejudice, embarrassment or delay in the proceeding; or (e) fails to disclose a reasonable cause of action or defence or other case appropriate to the nature of the pleading; or (f) is otherwise an abuse of the process of the Court.
The power to strike out a pleading for failure to disclose a reasonable cause of action is to be exercised sparingly and only in clear cases: Leach v Burston [2022] FCA 87 at [37(a)] (Halley J), referring to Polar Aviation Pty Ltd and Another v Civil Aviation Safety Authority and Others (2012) 203 FCR 325 at [42]-[43] (Perram, Dodds-Streeton and Griffiths JJ). In this context, a "reasonable cause of action" is one with some chance of success having regard to the allegations pleaded, even if the case is a weak one.
While a pleading must contain the material facts necessary to give rise to a complete cause of action, "technical" defects that do not raise issues of substance are sometimes better dealt with by amendment or the provision of particulars, albeit recognising that the function of particulars is not to fill "gaps" in the pleading of material facts: see McKellar at [29]-[32] (Weinberg J). As Halley J stated in Leach at [37(e)]: failure to plead all material facts does not necessitate exercise of the discretion. Restraint will be appropriate where the omission has not caused confusion nor raised substantive principles, or where the deficiency can be resolved through the provision of further particulars or evidence: Deep Investments Pty Ltd v Casey [2018] FCA 603 at [211] (Gleeson J) citing HECEC Australia Pty Ltd v Hydro-Electric Corp [1999] FCA 822 at [59]; State of Queensland v Pioneer Concrete (Qld) Pty Ltd [1999] FCA 499; [1999] ATPR 41-691 at 42,828-9;
If a pleading is struck out, the party will ordinarily be given an opportunity to replead unless it would be futile to do so: Leach at [37(b)] (Halley J).
In contrast to an application for summary judgment under s 31A of the FCA Act, a strike-out application under r 16.21 is concerned only with the adequacy of the pleading and does not involve consideration of facts or evidence outside the allegations of fact in the pleading and reasonable inferences drawn from those allegations: see e.g. Imobilari Pty Ltd v Opes Prime Stockbroking Ltd [2008] FCA 1920; 252 ALR 41 at [4]-[5] (Finkelstein J).
The principles applicable to an application to strike out the whole or part of a statement of claim were summarised in Young Investments Group Pty Ltd v Mann [2012] FCAFC 107; 293 ALR 537 at [6]-[7] (Emmett, Bennett and McKerracher JJ): In an application to strike out a pleading, all of the facts alleged in the relevant pleading are to be accepted as true, and it is to be taken for granted that, on all other points, the pleading is unassailable. Provided that a pleading fulfils its basic function of identifying the issues, disclosing an arguable cause of action and apprising the other party of the case that it has to meet at trial, the pleading should be allowed to stand and the proceeding should be allowed to go to trial. Further, a court of first instance should be careful not to risk stifling the development of the law by summarily dismissing a claim where there is a reasonable possibility that, as the law develops, a cause of action may be held to lie. The power to dismiss summarily is to be used only in cases that are unarguable and for which there is no reasonable prospect of success. A statement of claim must allege a cause of action with sufficient particularity and not simply make allegations in general terms. The adequacy of a statement of claim is to be assessed by reference to whether the cause of action is pleaded at a level of particularity that is sufficient to define the issues and inform the other party of the case that it has to meet, in the context of the particular allegations. A respondent or defendant is entitled to know the factual foundation for the case that is being alleged, so that the respondent or defendant can prepare to meet that case at trial. In order to disclose a reasonable cause of action, a statement of claim must contain an allegation of all of the relevant facts necessary to support any allegation made in it. A pleading that simply pleads a conclusion is embarrassing and should not be permitted to stand.
Division 16.4 of the Rules deals with particulars. A party must state in a pleading the necessary particulars of each claim, defence or other matter pleaded by that party: r 16.41(1). In broad terms, the necessary particulars are those required to inform the opposing party of the case the party has to meet, to prevent the opposing party being taken by surprise at the trial, and to enable the opposing party to collect whatever evidence is necessary and available: see Note 1 to r 16.41. While particulars can be contained in the pleading, they may also be separately stated in response to a request by the opposing party or an order made by the Court: see Note 4 to r 16.41. Where a party pleads a "condition of mind", including knowledge, the party must provide particulars of the facts on which the party relies: r 16.43(2).
In some circumstances, a party can apply to the Court under r 16.45 for an order for particulars: 16.45 Application for order for particulars (1) If a pleading does not give a party fair notice of the case to be made against that party at trial and, as a result, the party may be prejudiced in the conduct of the party's case, the party may apply to the Court for an order that the party who filed the pleading serve on the party: (a) particulars of the claim, defence or other matter stated in the pleading; or (b) a statement of the nature of the case relied on; or (c) if there is a claim for damages - particulars of the damages claimed. (2) An application under subrule (1) may be made only if: (a) the particulars in the pleading are inadequate; and (b) the party seeking the order could not conduct the party's case without further particulars. (3) A respondent who applies to the Court for an order under subrule (1) before filing the respondent's defence must satisfy the Court that an order is necessary or desirable to enable the respondent to plead. Note: The intent of the pleading rules is that a party should include all material facts in its pleadings as initially filed so that there is no unfairness to another party by any lack of particularity. If the party has not done so, the Court may at trial refuse to allow the party to present a case that is outside the terms of their pleading.

The pleadings

The ASOC relevantly alleges that WorkCo contravened the FW Act by terminating Ms Haire's employment after and in response to her complaints or inquiries about the payment of a component of her remuneration in the form of units of Filecoin cryptocurrency known as "FIL" Tokens, and in particular the withholding of tax from such remuneration. In the course of those complaints or inquiries, Ms Haire communicated her intention to consult with her union and with Filecoin about these issues, and to "escalate" the matter by involving third parties if her concerns could not be resolved: ASOC, [23(e)-(f)]. Ms Haire alleges that, by doing so, she indicated to WorkCo that she was a member of an industrial association and that she proposed to engage in industrial activity, and foreshadowed the prospect of initiating or participating in a process or proceeding under the FW Act: ASOC, [23(h)], [25(b)].
Critically, in paragraph 31 of the ASOC, Ms Haire alleges that WorkCo took adverse action against her "because of one or more prohibited reasons", namely, because she: (a) exercised her workplace right to make complaints or inquiries in relation to her employment that she was able to make within the meaning of s 341(c)(ii) of the FW Act - being one or more of the First to Fifth Complaints; (b) proposed to exercise her workplace right to initiate and participate in proceedings under the FW Act (s 341(1)(b)); (c) proposed to exercise her workplace right to make a complaint or inquiry to her trade union (s 341(c)(i)); (d) was a member of a trade union (s 346(a)); (e) proposed to seek to be represented by a trade union (s 346(b) read together with s 347(b)(vii)); (f) had a workplace right, being a benefit under a workplace law to have her Token remuneration treated as a fringe benefit, from which no PAYG withholding was required (FW Act s 341(1)(a)).
Ms Haire alleges in paragraphs 26 and 27 of the ASOC that, on or around 20 July 2023, after she had raised issues about WorkCo's response to her concerns with Filecoin's Chief of Staff, she had a discussion about those issues with the "Senior Tech Lead" of Filecoin in which the latter relevantly said that "he would discuss the issue further with WorkCo" and that WorkCo "had been spooked by Ms Haire threatening to involve her union and take matters further", and "wanted to fire Ms Haire". Ms Haire then alleges in paragraph 28 of the ASOC:
On 15 August 2023 Megan Klimen, Founding Officer of Filecoin Foundation, informed Ms Haire that WorkCo was going to terminate the Contract for reasons that included the threats Ms Haire had made about: (a) involving her union; and (b) taking matters further. Particulars This discussion occurred over Zoom.
The allegations regarding Ms Klimen's involvement in the alleged contraventions of the FW Act by WorkCo are set out in paragraph 42 of the ASOC:
Megan Klimen of Filecoin Foundation: (a) had detailed discussions with WorkCo management about Ms Haire's circumstances and WorkCo's desire to terminate her employment; (b) was aware that the reasons that WorkCo wanted to dismiss Ms Haire included one or more of the reasons pleaded in paragraph 31 above; Particulars Ms Klimen had informed Ms Haire of this, including as pleaded above. (c) had significant influence over WorkCo's decision-making in relation to Ms Haire; (d) by reason of this influence, could have persuaded WorkCo not to dismiss Ms Haire had Ms Klimen seen fit to do so; (e) acquiesced in WorkCo's proposed decision, believing it was justified; (f) by reason of the matters pleaded in this paragraph: (i) engaged in action that affected, was capable of affecting or was taken with intent to affect the activities, functions, relationships or business of a constitutionally-covered entity, namely WorkCo; (ii) was implicated in and knowingly concerned in WorkCo's contravention; (iii) by operation of section 550 of the FW Act, is taken to have contravened the FW Act.
The allegations regarding Filecoin's involvement in the alleged contraventions of the FW Act by WorkCo are based on Ms Klimen's alleged role as its Founding Officer and "directing mind and will", and on Ms Klimen's conduct being taken by s 793 of the FW Act to have been engaged in also by Filecoin: ASOC, [43]-[45].
As mentioned above, Ms Kliman and Filecoin have not yet pleaded to these allegations by way of defence.
Each of WorkCo and Mr O'Friel have filed a defence stating that they do not know and cannot admit the allegations in paragraphs 26 to 28 of the ASOC, and that they do not plead to the allegations made against Ms Klimen and Filecoin in paragraphs 42 to 52 of the ASOC. More generally, WorkCo and Mr O'Friel deny Ms Haire's claims of underpayment and deny that her employment was terminated for any of the alleged prohibited reasons.

The parties' submissions

Ms Klimen and Filecoin submit that no reasonable cause of action is disclosed in paragraphs 42 to 45 of the ASOC. They submit that Ms Haire has not pleaded the elements necessary to establish their involvement in WorkCo's contraventions under s 550 of the FW Act, which requires intentional participation in the contravention. In the absence of any alleged power or obligation on the part of Ms Klimen or Filecoin to intervene in the contractual relationship between WorkCo and Ms Haire, they submit that an allegation of knowledge of or "acquiescence" in WorkCo's decision to dismiss Ms Haire is incapable of amounting to involvement in the alleged contravention of the FW Act by WorkCo.
The Banks affidavit addresses the grounds of the application for summary judgment or strike out of the claims made against them in the proceeding, namely that: (a) the applicant has no reasonable prospect of successfully prosecuting those parts of the proceeding; and/or (b) no reasonable cause of action is disclosed; and/or (c) the ASOC is evasive or ambiguous, and/or likely to cause prejudice, embarrassment or delay in the proceeding.
In relation to the accessorial liability claim, Ms Klimen and Filecoin contend that the ASOC does not plead any material fact which would establish that they have a practical connection with or link to the alleged dismissal adverse action taken by WorkCo against Ms Haire, and that the allegations of knowledge as against Ms Klimen (and, through her, Filecoin) are "rolled-up, inadequately particularised and give rise to the potential for uncertainty or confusion". Further, they submit that the pleading of this claim is vague and ambiguous, such that it does not give Ms Klimen and Filecoin notice of the case to be made by Ms Haire at trial.
The Banks affidavit addresses the factual background and contractual arrangements between Filecoin, WorkCo and Ms Haire.
Ms Haire commenced a consultancy with Filecoin on or about 4 January 2022, pursuant to a Consultancy Agreement executed by Ms Haire on 4 November 2021. Filecoin was described in the Consultancy Agreement as "a Delaware corporation", and Ms Haire's address was stated to be in New South Wales, Australia. Ms Haire agreed to provide specified services to Filecoin as an independent contractor in return for monthly fees. The Consultancy Agreement was governed by the laws of the State of California.
On or about 16 September 2022, Filecoin entered into a professional services agreement with WorkCo Inc, a United States company that is not to be confused with the first respondent to these proceedings. WorkCo Inc agreed to provide Filecoin with "temporary agency workers" to perform services for the benefit of Filecoin, and to act as the employer of those workers. WorkCo Inc was permitted to subcontract to its "Affiliates", which relevantly included entities owned or controlled by, or under common ownership with, WorkCo Inc.
On or about 31 May 2023, Ms Haire and Filecoin mutually agreed to terminate the Consultancy Agreement.
On 1 June 2023, Ms Haire entered into an employment agreement with WorkCo pursuant to which she was employed as a Developer Relations Engineer at a base salary of USD $16,250 per month together with a monthly payment of a number of "Filecoin "tokens". The contract relevantly provided that Ms Haire's normal place of work would be at her home office located in the State of Victoria, and she agreed to travel to and work at such other places in Australia as WorkCo may require for the proper and efficient performance of her duties.
Ms Haire's employment with WorkCo was terminated as of 25 September 2023, by notice given on 25 August 2023.
Filecoin entered into a consulting agreement with Expanso Inc, which in turn engaged Deel Australia Services Pty Ltd who subsequently employed Ms Haire to perform work in the "Lilypad Network", which "provides cloud computing resources for artificial intelligence and works with decentralised technologies such as Filecoin". Ms Haire's employment agreement with Deel specified that the term of her employment commenced on 23 September 2023 for a "definite period until December 31st, 2023".
The application by Ms Klimen and Filecoin for summary dismissal or strike out of the accessorial liability claims against them focuses on two principal aspects of the ASOC.
First, they attack the allegations in paragraphs 42(c), (d) and (e) of the ASOC that Ms Klimen had "influence" over the decision by WorkCo to dismiss Ms Haire, and that she "acquiesced" in that decision notwithstanding that she could have persuaded WorkCo not to dismiss Ms Haire. It is submitted on behalf of Ms Klimen and Filecoin that Ms Haire "has no more than a fanciful prospect of establishing that a failure to seek to persuade an employer not to dismiss an employee, in the absence of any obligation or power to do so, constitutes an 'act' for the purpose of involvement".
In this context, Ms Klimen and Filecoin rely on the decision in Sabapathy v Jetstar Airways (2021) 283 FCR 348, in which the Full Court addressed an allegation that a number of Jetstar pilots who provided performance assessments in relation to the applicant had aided, abetted, counselled or procured the applicant's unlawful dismissal by Jetstar within the meaning of s 550(2)(a) of the FW Act. In addition to other criticisms of this pleading, Logan and Katzmann JJ observed at [26] that "[t]he notion that it was relevant to [the pilots'] liability as accessories that none of them recommended or advised against termination is frankly preposterous".
Secondly, Ms Klimen and Filecoin submit that accessorial liability requires actual knowledge of the contravention, and that the pleading of Ms Klimen's alleged knowledge is deficient. They criticize the "rolled-up manner" in which knowledge is pleaded in paragraphs 31 and 42(b) of the ASOC, namely that the alleged adverse action was engaged in by WorkCo for "one or more prohibited reasons" and that Ms Klimen "was aware that the reasons that WorkCo wanted to dismiss Ms Haire included one or more of the reasons pleaded in paragraph 31". This is said to be "evasive or ambiguous" and "likely to cause prejudice, embarrassment or delay in the proceeding" (referring to r 16.21(c) and (d)), in that it "does not precisely and distinctly allege the reasons for the impugned conduct; rather it impermissibly plants a forest of forensic contingencies" (referring to Forrest v Australian Securities and Investments Commission (2012) 247 CLR 486 at [27] (French CJ, Gummow, Hayne and Kiefel JJ)).
Ms Klimen and Filecoin stress that an allegation that a person is knowingly concerned or otherwise involved in a contravention of the FW Act is an inherently serious allegation, akin to a pleading of dishonesty, that should be pleaded with precision and clarity: see Stefanovski v Digital Central Australia (Assets) Pty Ltd [2018] FCAFC 31 at [70] (McKerracher, Robertson and Derrington JJ); Whitby v ZG Operations Australia Pty Ltd (No 2) [2019] FCA 201 at [29] (Thawley J); Monash Health v Singh [2023] FCAFC 166 at [57(2)] (Katzmann, Snaden and Raper JJ).
More generally, Ms Klimen and Filecoin submit that the ASOC falls short of putting them on notice of the material facts necessary to make out their alleged involvement in the contraventions. In particular, they submit that the reference to "detailed discussions" in paragraph 42(a) is not particularised, and the basis or nature of the alleged "significant influence" referred to in paragraph 42(c) is not set out, contrary to the requirement in r 16.43 to give particulars of the facts on which the party relies in relation to an alleged condition of mind, such as knowledge.
In response, Ms Haire submitted that WorkCo, as her former employer, is an affiliate of WorkCo Inc, with whom Filecoin contracted for the supply of labour. The contractual arrangement between Filecoin and WorkCo Inc enabled the employment of labour based outside the United States by local affiliated entities. As pleaded in the ASOC, consistently with the Banks affidavit, Ms Haire was engaged by Filecoin directly as a contractor prior to her employment by WorkCo. It is alleged by Ms Haire that her employment by WorkCo was "put in place by Filecoin" following multiple requests by Ms Haire, and that this amounted to Filecoin "indirectly" engaging Ms Haire "through a labour hire arrangement" with WorkCo: ASOC, [2(d)].
Ms Haire submitted that, while "[t]he full extent of WorkCo Inc's (and WorkCo's) relationship with [Filecoin] and Ms Klimen is not yet known", it may be inferred that Ms Klimen as the Founding Officer of Filecoin is "an important link" in the relationship between WorkCo, WorkCo Inc and Filecoin. Ms Haire alleges that Ms Klimen had "detailed discussions" with WorkCo management in relation to the termination of Ms Haire's employment. In her submissions on the interlocutory application, Ms Haire indicated that she intends to lead evidence about those discussions, along the following lines: The applicant will lead evidence that on 21 August 2023 Ms Klimen responded to concerns raised by the applicant's colleagues about her dismissal, as follows: "Having talked to Toku [ie WorkCo] extensively about this, I don't think Toku is out of line…I'd prefer to not get in to a lot of detail over email but if you would like to discuss further I'd be happy to get on a call". Contextual evidence will also be led including that Ms Klimen met with silence the suggestion by the applicant's colleagues that Filecoin Foundation ought directly engage the applicant as it did others (and had previously engaged the applicant); and then considered an engagement through Expanso/Deel for a limited time and purpose following a petition from colleagues that "if the issue was that Ms Klimen did not want to engage the applicant through Filecoin Foundation, she could be engaged through Expanso/Deel".
Ms Haire submits that it may reasonably be inferred from the pleaded facts that WorkCo "was not prepared to dismiss the applicant without first consulting with, and effectively being given the go ahead by, Ms Klimen", and that this "enabling" conduct with knowledge that the dismissal was for a prohibited reason was sufficient to implicate Ms Klimen (and Filecoin) in WorkCo's contraventions of the FW Act. While Ms Haire does not allege that Ms Klimen had legal power or authority over WorkCo's decision to dismiss Ms Haire - in other words, it is not alleged that Ms Klimen or Filecoin was the decision-maker - she nevertheless is said to have had the power to influence that decision as a matter of "commercial reality" due to her seniority within Filecoin.
In such circumstances, Ms Haire submitted that there is a real question of fact and/or law as to the involvement of Ms Klimen and Filecoin in the dismissal decision for the purposes of s 550 of the FW Act. In so far as Ms Haire alleges knowledge on the part of Ms Klimen, including her awareness of the reasons that WorkCo wanted to terminate Ms Haire's employment, it is submitted that such knowledge is properly pleaded and particularised, including the facts on which Ms Haire relies to establish that knowledge (i.e. the alleged discussions between Ms Klimen and WorkCo management, and Ms Klimen's conversation with Ms Haire shortly prior to her dismissal by WorkCo).
Counsel for Ms Haire distinguished the decision in Sabapathy as dealing with a different factual context in which, unlike in the present case, the individual respondents against whom the claims were made had not been involved in the dismissal process and had no knowledge of the reasons for dismissal.
In so far as Ms Klimen and Filecoin levelled criticisms at the allegations regarding Ms Klimen's knowledge of the reasons for dismissal and her influence over WorkCo's decision-making (see ASOC [42(b)-(d)]), counsel for Ms Haire submitted that the respondents were able to plead to those allegations. It was submitted that matters such as Ms Klimen's state of mind and her practical influence over WorkCo (whether by reason of a commercial relationship or otherwise) were within the knowledge of Ms Klimen and Filecoin, who could admit or deny the allegations accordingly. Ms Haire relied on previous authority to the effect that, at least as a matter of pleading, a defendant does not need particulars to know whether or not to admit an allegation of actual knowledge, because the defendant's state or mind "is something that is primarily in the knowledge of the defendant": Banks v Alphatise Pty Ltd [2014] NSWSC 1437 at [17], [20] (Brereton J). Ms Haire submitted that Ms Klimen and Filecoin were on notice of the case that they had to meet, and were not entitled to be told the evidence that will be called to prove the case: see e.g. Trade Practices Commission v Total Australia Ltd (1975) 24 FLR 413 at 417 (Joske J). While knowledge is expressly included in r 16.43 as a "condition of mind" in respect of which a party must give particulars of the facts on which the party relies, Ms Haire submits that any order for particulars should not be made before the defence is filed: see Alphatise at [21] (Brereton J).
Similarly, Ms Haire submitted that Ms Klimen could plead as to whether or not she "acquiesced" in the dismissal decision by WorkCo, and any question about whether that was sufficient to amount to "involvement" for the purposes of s 550 of the FW Act would be determined at trial. To the extent that there was any novelty in this claim, Ms Haire submitted that summary judgment should not be used "to stultify the development of the law", referring to Spencer at [25] (French CJ and Gummow J).
There is one claim advanced by Ms Haire against Filecoin that is not the subject of challenge by way of summary dismissal or strike out. Ms Haire alleges that Filecoin failed to make superannuation contributions for her benefit in respect of her engagement under the Consultancy Agreement between 4 January 2022 and 31 May 2023, and seeks a declaration that she was the employee of Filecoin Foundation within the extended meaning set out in section 12(3) of the Superannuation Guarantee (Administration) Act 1992 (Cth): ASOC, [2(e)], [54(a)]. Accordingly, counsel for Ms Klimen and Filecoin accepted that the Court would not summarily dismiss the entire proceeding as against Filecoin, and that Filecoin would therefore be required to file a defence at least in relation to that extant claim.

Resolution

Section 550(1) of the FW Act provides that a person who is involved in a contravention of a civil remedy provision is taken to have contravened that provision. This concept is statutorily defined in s 550(2): (2) A person is involved in a contravention of a civil remedy provision if, and only if, the person: (a) has aided, abetted, counselled or procured the contravention; or (b) has induced the contravention, whether by threats or promises or otherwise; or (c) has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention; or (d) has conspired with others to effect the contravention.
Ms Haire's pleaded case is that Ms Klimen and Filecoin were "implicated in and knowingly concerned in" WorkCo's contravention of the FW Act, and that they are each taken by operation of s 550 to have contravened the FW Act, based on Ms Klimen's alleged knowledge of, and ability to influence or affect, WorkCo's decision to terminate Ms Haire's employment.
Filecoin's alleged involvement is put on the basis that Ms Klimen was its directing mind and will in respect of her engagement with WorkCo in relation to the decision to dismiss Ms Haire, and further that Ms Klimen's conduct is taken by s 793 of the FW Act to be the conduct of Filecoin. Section 793 of the FW Act relevantly provides that, for the purposes of that Act and the procedural rules, any conduct engaged in on behalf of a body corporate by an officer, employee or agent of the body corporate within the scope of his or her actual or apparent authority is taken to have been engaged in also by the body corporate.
The principles applicable to accessorial liability under provisions such as s 550 of the FW Act are well understood, although it has been observed that their application in particular cases may not be "without difficulty": Fair Work Ombudsman v Devine Marine Group Pty Ltd [2014] FCA 1365 at [176], [179] (White J). The concept of "involvement" under s 550(2) has four limbs, each of which has a "different emphasis": see Devine Marine at [178]. In many cases, the focus has been on paragraphs (a) and (c) of s 550(2), namely, aiding, abetting, counselling or procuring a contravention; or being knowingly concerned in or party to a contravention. The accessorial liability claims against Ms Klimen and Filecoin in the present case are directed only to the latter: see ASOC, [42(ii)]; compare the alleged involvement of Mr O'Friel, who is said both to have procured and to have been knowingly concerned in WorkCo's contravention: ASOC, [41(d)].
It is settled that involvement in a contravention under s 550(2)(c) comprises both a conduct element and a mental element.
In relation to conduct, in order to be knowingly concerned in or party to a contravention, the person must have engaged in some act or conduct which "implicates or involves" him or her in the contravention, giving rise to a "practical connection" between the person and the contravention: see Ashbury v Reid [1961] WAR 49 at 51; Devine Marine at [178] (White J); Fair Work Ombudsman v South Jin Pty Ltd [2015] FCA 1456 at [227] (White J); Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union [2006] WASC 144; 154 IR 228 at [27], [29] (Le Miere J); Qantas Airways Ltd v Transport Workers' Union of Australia [2011] FCA 470; 280 ALR 503 at [324] (Moore J); Construction, Forestry, Mining and Energy Union v Clarke [2007] FCAFC 87; 164 IR 299 at [26] (Tamberlin, Gyles and Gilmour JJ). As indicated by the express terms of s 550(2)(c), the conduct element can be satisfied either by act or by omission, and the requisite connection with the contravention can be either direct or indirect. Nevertheless, there must be something by which it can be said that the person participated in, or associated himself or herself with, the principal contravention.
In relation to the mental element, the alleged accessory must have actual knowledge of the essential matters that constitute the contravention: Yorke v Lucas (1984) 158 CLR 661 at 667, 670 (Mason ACJ, Wilson, Deane and Dawson JJ); Devine Marine at [176]-[177] (White J); South Jin at [229]-[231] (White J); Australian Competition and Consumer Commission v Productivity Partners Pty Ltd (t/as Captain Cook College) (No 3) [2021] FCA 737; 154 ACSR 472 at [99]-[100] (Stewart J). Accessorial liability under a provision such as s 550(2) of the FW Act is not strict, even if the principal contravention itself involves strict liability. While actual knowledge can be inferred from the surrounding facts and circumstances, it cannot be imputed. In other words, constructive knowledge is not sufficient to establish accessorial liability.
Because accessorial liability requires intentional participation in the contravention through conduct with the requisite knowledge, neither participation without knowledge nor knowledge without participation will satisfy s 550(2)(c): see Gore v Australian Securities and Investments Commission (2017) 249 FCR 167 at [6] (Dowsett and Gleeson JJ).
In so far as Ms Klimen and Filecoin seek summary dismissal of the accessorial liability claims made against them, the challenge is directed primarily to the allegations in relation to the conduct element.
The ASOC clearly alleges that Ms Klimen (and, through her, Filecoin) had knowledge of the essential facts or matters giving rise to the alleged "general protections contraventions" by WorkCo. Thus, it is alleged that Ms Klimen was aware of WorkCo's intention to dismiss Ms Haire for reasons that included her "threats" to involve her union and to take matters further, which provide the foundation for the allegation that WorkCo engaged in the dismissal adverse action for one or more "prohibited reasons": ASOC, [28], [31]. It is also alleged that Ms Klimen had discussions with WorkCo management about its desire to terminate Ms Haire's employment and was aware that the reasons that WorkCo wanted to dismiss Ms Haire included one or more of those prohibited reasons: ASOC, [42(a)-(b)]. While counsel for Ms Klimen and Filecoin complained that such knowledge was pleaded in a "rolled-up manner" (a submission which I will address below), that is not itself a basis on which to give summary judgment.
The crux of the submissions advanced by Ms Klimen and Filecoin in support of their application for summary judgment is that the case advanced by Ms Haire is incapable of establishing that they were involved in the alleged dismissal adverse action by WorkCo, because at its highest it is alleged only that Ms Klimen and Filecoin had knowledge of WorkCo's intention to take such action, but not that it engaged in any conduct (whether by act or omission) capable of amounting to participation in WorkCo's decision.
Relying on the contractual arrangements between Filecoin and WorkCo, it is submitted that neither Ms Klimen nor Filecoin had any authority or power over WorkCo's decision to dismiss Ms Haire, and that the ASOC did not contain any allegation to that effect. In particular, they submit that the alleged "acquiescence" by Ms Klimen in WorkCo's decision to dismiss Ms Haire cannot render her or Filecoin "knowingly concerned in or party to" that contravention, in circumstances where it is not alleged that Ms Klimen had any obligation to intervene in the contractual relationship between WorkCo and Ms Haire. An analogy is sought to be drawn with Sabapathy at [26], where the suggestion that the individual pilots who had provided performance assessments might be liable as accessories for not recommending or advising against the applicant's termination was regarded as "preposterous" (see paragraph 45 above).
It may be observed that Sabapathy was a case involving an application to strike out a statement of claim rather than for summary dismissal. While consequential orders had been made by the primary judge to remove the pilots as respondents to the proceeding, those orders were successfully challenged and were set aside by the Full Court, essentially on the basis that their effect was to give summary judgment in favour of the removed respondents without giving the applicant an opportunity to be heard on whether he had a reasonable cause of action against them, and if so to plead such a case: Sabapathy at [45], [47] (Logan and Katzmann JJ), [84] (Flick J).
More importantly, the observations made by Logan and Katzmann JJ in Sabapathy at [26] were clearly directed to the facts of that particular case, rather than seeking to establish any principle of general application. Unlike the present case, the relevant pleading in Sabapathy was also deficient in that it did not make any allegation that the pilots had actual knowledge of the essential matters constituting the contravention: Sabapathy at [29]-[30]. The present application must be determined in the light of the facts alleged in the ASOC. These encompass the history of the relationship between Ms Haire, Filecoin and WorkCo, including her engagement by Filecoin and subsequent employment by WorkCo to perform services for Filecoin. They also include the allegations in paragraph 42 of the ASOC in relation to Ms Klimen's alleged role in the decision by WorkCo to dismiss Ms Haire.
The conduct element of Ms Klimen's alleged involvement in the dismissal decision consists of her "significant influence" over WorkCo's decision-making in relation to Ms Haire (paragraph 42(c)), her capacity or ability to use that influence to persuade WorkCo not to dismiss Ms Haire (paragraph 42(d)), and her "acquiescence" in the proposed decision to dismiss Ms Haire based on her belief that it was "justified" (paragraph 42(e)). In conjunction with Ms Klimen's knowledge of the matters pleaded in paragraphs 42(a) and (b), it is alleged that Ms Klimen was "implicated" and knowingly concerned in the alleged contravention by WorkCo: ASOC, [42(f)].
As discussed above, it is accepted that mere knowledge of a contravention carried out by another person is not enough to establish accessorial liability for that contravention for the purposes of s 550 of the FW Act. However, the case pleaded by Ms Haire goes well beyond mere knowledge. She seeks to establish that Ms Klimen was in a position to dissuade WorkCo from terminating her employment in contravention of the FW Act, and that Ms Klimen not only abstained from doing so but also "acquiesced" in the proposed dismissal in the belief that it was justified (presumably by reference to one or more of the prohibited reasons earlier alleged). This may raise questions about whether Ms Klimen's conduct (whether by act or omission) might be regarded as having encouraged WorkCo to dismiss Ms Haire, or as having brought about or rendered more likely that dismissal. In other words, did Ms Klimen, by what she said (or did not say) or did (or did not do) "in fact became associated with and thus involved, in the relevant sense, in the conduct constituting the contravention": see Leighton Contractors at [29] (Le Miere J), referring to R v Tannous (1987) 10 NSWLR 303 at 308 (Lee J); see also Fair Work Ombudsman v Priority Matters Pty Ltd [2017] FCA 833 at [116] (Flick J).
It must be kept in mind that the present application is one for summary dismissal, on which Ms Klimen and Filecoin bear the onus of establishing that Ms Haire's accessorial liability claims against them have no reasonable prospect of success. That is not a suitable context in which to make any final determination about the circumstances in which Ms Klimen or Filecoin might be found to have been knowingly concerned in or party to any alleged contravention by WorkCo arising from Ms Haire's dismissal. Provided that the allegations in the ASOC disclose a reasonable cause of action, what constitutes "involvement" in a contravention for the purposes of s 550(2) of the FW Act is more appropriately addressed in the light of the evidence that may ultimately be adduced at trial.
In Fair Work Ombudsman v Al Hilfi [2012] FCA 1166, Besanko J considered similar issues in the context of an application brought by Coles Supermarkets Australia Pty Ltd for summary dismissal, or alternatively strike out, of claims that it was involved in contraventions of the FW Act by contractors or subcontractors who had been engaged to supply trolley collection services at its supermarkets. The contractors were alleged to have underpaid their employees, together with other contraventions of the applicable award. There was no complaint about the pleading of the primary contraventions. The Fair Work Ombudsman alleged that Coles was involved in those contraventions within the meaning of s 550(2)(a), (b) and/or (c) of the FW Act. The relevant parts of the pleading are extracted in the judgment at [30], and encompassed the allegations to the effect that:
Coles "had the capacity to control and direct and/or influence the conduct of" the contractors in relation to the wages and conditions paid and accorded to the employees and the practices adopted in with respect to issuing pay slips and keeping employee records;
Coles knew that the trolley collection services would be performed by persons employed by its contractor, along with various matters about the cost of delivering those services and the payments under the head contract;
Coles was aware that it was likely that the wages and conditions of the employees would be regulated by an award, and that trolley contractors performing work for the contractor were being accorded wages and conditions that were below the applicable award;
Coles did not take "any action or any action likely to be effective" to ensure that its contractor required sub-contractors to comply with the applicable award or the FW Act, and thereby induced in the contractor and sub-contractor the belief that Coles did not require them to ensure compliance with the wages and conditions prescribed by the award, and that Coles "acquiesced" in the sub-contractor not complying with those wages and conditions and would not take any step adverse to the business of the contractor or the sub-contractor by reason of any non-compliance; and
as a result, Coles "encouraged and facilitated" the sub-contractor's conduct in contravention of the FW Act, associated itself with that conduct, and rendered that conduct more likely.
In seeking summary judgment or strike out of these claims, Coles argued that the pleading was not sufficient to establish that Coles had knowledge of all of the essential matters comprising the contraventions, or that it intentionally participated in the contraventions: Al Hilfi at [34]-[41]. In so far as Coles' challenge to the Ombudsman's pleaded case was directed to the mental element of knowledge, that aspect may have less direct relevance to the present case. Noting the "competing contentions as to the level of knowledge required for liability under s 550 of the FW Act" in relation to the alleged underpayment contraventions, Besanko J was not satisfied that the Ombudsman had no reasonable prospect of establishing the requisite knowledge "having regard to the broad terms of paragraph 550(2)(c) and the possibility that evidence will throw light on the issue": Al Hilfi at [44]. In relation to whether Coles intentionally participated in the alleged contraventions, Besanko J relevantly concluded at [49]: I am not satisfied at this stage that the Ombudsman has no reasonable prospect of succeeding on this aspect of his case. The Ombudsman pleads an element of control by Coles (paragraph 54), certain knowledge by Coles (paragraphs 55, 56 and 57) and non action by Coles (paragraph 58). The evidence with respect to those matters may inform the conclusions to be reached and I do not think it can be said at this stage that the Ombudsman has no reasonable prospect of success with respect to this aspect of his case.
In the present case, Ms Haire alleges that Ms Klimen was "implicated in and knowingly concerned in" the alleged contravention by WorkCo on the basis that she had "significant influence" over WorkCo's decision-making, by reason of which she could have persuaded WorkCo not to dismiss Ms Haire, and that she "acquiesced" in the dismissal. Counsel for Ms Klimen and Filecoin argued that this could not amount to involvement by Ms Klimen in WorkCo's contravention in the absence of any obligation or duty on Ms Klimen to do something to change WorkCo's decision. However, I am not satisfied that the concept of "involvement" under s 550(2) of the FW Act is so limited. In so far as it is said that a claim of involvement through acquiescence is "novel", that is not a basis on which such a claim ought to be summarily dismissed.
To use an example referred to by Lee J in Tannous at 308-309, a parent is not necessarily involved in an unlawful act committed by his or her child merely because the parent had knowledge that the child was about to commit the crime and refrained from taking steps to persuade the child from doing so. In that sense, mere knowledge of, or even anxiety or worry about, an unlawful act does not itself amount to involvement, if the parent does not "do something to connect himself with or involve himself in" the unlawful act: Tannous at 309. But it is open to argue that, on the facts of a particular case, a person's acquiescence in a proposed course of action to be taken by another person may be sufficient to amount to involvement in that course of action, in so far as the person may be found to have associated themselves with the course of action. The conduct element might be established by giving express or tacit approval to the contravening conduct, in circumstances where that facilitates or brings about the contravention, or renders it more likely: compare Amcor Packaging (Australia) Pty Ltd v The Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union of Australia [2006] FCA 1265; 157 IR 32 at [15] (Middleton J). That is not to suggest that there is any requirement to prove direct causation, nor that the contravention would or could not have occurred without the alleged conduct: compare e.g. Trade Practices Commission v Australian Meat Holdings (1988) 83 ALR 299 at 357 (Wilcox J). Particularly in circumstances where s 550(2)(c) of the FW Act extends to being knowingly concerned indirectly or by omission, a claim of involvement through "acquiescence" raises real questions of fact and law which are inapt for summary determination.
Accordingly, based on the current pleadings and the evidence before the Court, it cannot be said that Ms Haire has no reasonable prospect of successfully establishing that Ms Klimen and Filecoin were implicated in WorkCo's alleged contravention, and that there was a practical connection between Ms Klimen and Filecoin and that contravention, such that they were knowingly concerned in the contravention within meaning of s 550(2)(c).
That leaves the question whether the accessorial liability claims against Ms Klimen and Filecoin are properly pleaded in the ASOC.
The basis on which Ms Haire alleges that Ms Klimen was implicated in WorkCo's contraventions was elaborated in submissions to the effect that "[i]t may reasonably be inferred from the pleaded facts (including ASOC [27]) that WorkCo was not prepared to dismiss the applicant without first consulting with, and effectively being given the go ahead by, Ms Klimen (by her acquiescence: ASOC [42(e)])". This was described as "enabling conduct" that, in conjunction with Ms Klimen's alleged knowledge that the proposed dismissal was for a prohibited reason, was sufficient to implicate Ms Klimen in the alleged contraventions. Counsel for Ms Haire accepted that there is no allegation that Ms Klimen or Filecoin had any legal power over WorkCo's decisions, but submitted that "the commercial reality was otherwise" and that "Ms Klimen had the power to influence WorkCo's decision-making by virtue of her seniority within Filecoin Foundation". In the course of oral submissions, counsel for Ms Haire couched this in terms of WorkCo having approached Ms Klimen "because it's wanting, essentially, the green light to go ahead and do what it's going to do", and that her acquiescence was "essentially the enabling of that path to take place" and "either the silent or express agreement for that to occur".
Such an articulation of Ms Haire's case is not explicitly pleaded in paragraph 42 of the ASOC. While it is alleged that Ms Klimen had "influence" over WorkCo's decision-making and that she "acquiesced" in the proposed dismissal of Ms Haire, there is no distinct allegation directed to the nature of the relationship between WorkCo and Filecoin by reason of which the former would consult with or seek approval from Ms Klimen or Filecoin before making a decision in relation to Ms Haire's employment.
Nevertheless, the alleged acquiescence of Ms Klimen to Ms Haire's dismissal is capable of encompassing conduct by which Ms Klimen conveyed to WorkCo her acceptance of the proposed decision, if not her concurrence with and support of the justification for that decision. The ordinary meaning of "acquiesce" is "to accept or consent to something without protest" (Concise Oxford English Dictionary), or "to assent tacitly; comply quietly; agree; consent" (Macquarie Dictionary). The word is derived from the Latin "quiescere", which means "at rest" or "to be quiet". It suggests giving implicit agreement or support to an act or decision through silence or non-opposition, or allowing something to occur when there was a power or opportunity to prevent it. While in some contexts it can mean to accept something despite not wanting to do so (i.e. to accede or give in to another person's wishes), that is not consistent with the present context, in which it is alleged that Ms Klimen believed that the proposed decision by WorkCo to dismiss Ms Haire was justified.
In my view, the allegation that Ms Klimen acquiesced in WorkCo's proposed decision, in circumstances where she is alleged to have had significant influence over WorkCo's decision-making and had discussions with the management of WorkCo about the decision, is capable of establishing that Ms Klimen was implicated in and had a practical connection with the alleged contravention of the FW Act by WorkCo.
There may be scope for Ms Haire to provide further particulars of the allegations that Ms Klimen had influence over WorkCo's decision-making and that she acquiesced in the proposed decision to dismiss Ms Haire. Although counsel for Ms Haire submitted that such matters were within the knowledge of Ms Klimen and Filecoin, and that particulars were not required to enable them to plead to the allegations, Ms Haire might be called upon to articulate what Ms Klimen's alleged influence entailed and how her alleged acquiescence was given. The submission that WorkCo sought and obtained the "green light" or "go ahead" from Ms Klimen before dismissing Ms Haire suggests that Ms Klimen's alleged acquiescence in the proposed decision may have encouraged or facilitated that decision, by inducing WorkCo to believe that Ms Klimen and Filecoin did not oppose or object to the proposed dismissal. If that is how the case is to be put by Ms Haire, she should be capable of particularising it as such.
In correspondence exchanged between the parties' legal representatives, Ms Klimen and Filecoin initially foreshadowed a request for particulars, including in relation to the allegations in paragraphs 42(c) and (e) of the ASOC. Ms Haire's solicitors resisted the provision of particulars prior to the close of pleadings, stating that they had certified that Ms Haire has a proper basis for the claims made in the ASOC and contending that Ms Klimen and Filecoin were able to respond to the allegations. Rather than pressing an application for particulars, Ms Klimen and Filecoin brought the present application for summary dismissal or strike out of the claims against them.
In the circumstances of the present case, I do not consider that the ASOC fails to plead any material facts necessary to the cause of action, or that the absence of particulars is such as to warrant the relevant parts of the pleading being struck out. For such purposes, "[a] material fact is one that is necessary to formulate a complete cause of action", and which "must be pleaded with the degree of specificity necessary to define the issues and inform the parties in advance of the case they have to meet": Kernel Holdings Pty Ltd v Rothmans of Pall Mall (Australia) Pty Ltd (1991) 217 ALR 171 at 173 (French J), cited in Australian Building and Construction Commissioner v Hall (2018) 261 FCR 347 at [19] (Tracey, Reeves and Bromwich JJ). Paragraph 42 of the ASOC alleges material facts that are sufficient to establish a cause of action against Ms Klimen for her involvement in the alleged contravention by WorkCo. I consider that the relevant paragraphs of the ASOC appraise Ms Klimen and Filecoin of the case they have to meet. If they consider that the particulars in the ASOC are inadequate, and that they cannot conduct their case without further particulars, they may apply for an order for particulars under r 16.45. Any such application should be brought after they have filed a defence, unless they can satisfy the Court that an order for particulars is necessary or desirable to enable them to plead to the allegations: r 16.45(3).
In applying these principles, I have sought to avoid taking an unduly technical or pedantic approach to the adequacy of the pleadings: see e.g. Thomson v STX Pan Ocean Co Ltd [2012] FCAFC 15 at [13] (Greenwood, McKerracher and Reeves JJ); Gall v Domino's Pizza Enterprises Limited (No 2) [2021] FCA 345; 391 ALR 675 at [15]-[20] (Murphy J); Rauland Australia Pty Ltd v Johnson (No 1) [2019] FCA 1174 at [7]‑[9] (Stewart J); Gunawardena at [18] (Wheelahan J). I have also borne in mind the principles referred to in paragraph 26 above to the effect that, in so far as there is any deficiency in the pleading of material facts that does not lead to confusion or raise substantive principles, it may be preferable for that deficiency to be addressed or resolved through the provision of particulars or even the filing of evidence.
Accordingly, while the matter is somewhat finely balanced, I do not consider that paragraph 42 of the ASOC in its current form either fails to disclose a reasonable cause of action appropriate to the nature of the pleading, or is ambiguous, or is likely to cause prejudice, embarrassment or delay in the proceeding: see r 16.21(1)(c), (d) and (e).
The other complaints made by Ms Klimen and Filecoin about the relevant parts of the ASOC can be disposed of more briefly.
I do not consider that Ms Klimen's alleged knowledge of the reasons for the decision to dismiss Ms Haire is pleaded in an inappropriately "rolled-up" manner. In alleging that Ms Klimen was aware that WorkCo wanted to dismiss Ms Haire for reasons that "included one or more of the [prohibited] reasons pleaded in paragraph 31", Ms Haire is in substance alleging Ms Klimen's awareness of each of the reasons separately identified in paragraph 31(a) to (f) of the ASOC. In response to the allegation in paragraph 42(b), Ms Klimen and Filecoin are capable of pleading as to their knowledge or awareness in respect of each of those reasons set out in paragraph 31. Contrary to the submissions of Ms Klimen and Filecoin, this does not give rise to "a forest of forensic contingencies". It may of course be necessary to distinguish between WorkCo's reasons (as pleaded in paragraph 31, to which no objection is taken) and Ms Klimen's awareness of any such reason or reasons. Nevertheless, Ms Klimen is perfectly able to admit or deny that she had such an awareness as alleged in respect of each of the reasons in paragraph 31 (most of which are connected with the reasons referred to by Ms Klimen in an alleged conversation with Ms Haire identified at paragraph 28 of the ASOC).
More generally, I do not accept that, for the purposes of the strike out application, Ms Haire is required to provide further particulars of the basis of Ms Klimen's alleged knowledge or awareness of WorkCo's alleged contravention. While a pleading is required by r 16.43 to state the acts on which a party relies in alleging a condition of mind, including knowledge, there is a line of authority to the effect that knowledge can be pleaded as a material fact without further particulars, on the basis that "actual knowledge or the state of the defendant's mind in that respect is something that is primarily in the knowledge of the defendant", and it is unnecessary to plead the evidence which informs the material fact of actual knowledge: see Alphatise at [17] (Brereton J). The position may to some extent differ depending on the particular circumstances and the terms of any applicable court rules. In Young Investments Group Emmett, Bennett and McKerracher JJ stated (at [10]): The reason for not being required to particularise knowledge is not fully explained in the cases. It may be assumed that, on the one hand, there is the obvious difficulty of knowing what is inside another's mind. On the other hand, there may be instances where the evidence to be relied upon to establish knowledge could be identified by particulars. That evidence might be an admission or a communication, written or oral, that could only give rise to the relevant state of mind. In appropriate cases, the provision of particulars has been ordered when sought.
In the present case, the ASOC pleads the matters of which Ms Klimen is alleged to have been aware, together with the facts relied on to establish such knowledge - namely, an alleged conversation between Ms Klimen and Ms Haire, and alleged discussions between Ms Klimen and WorkCo management about the proposed dismissal of Ms Haire by WorkCo. It may be accepted that an allegation that a person is "knowingly concerned" in a contravention of the FW Act may be regarded as a serious allegation, which must be pleaded clearly and with sufficient precision: see Stefanovski at [70] (McKerracher, Robertson and Derrington JJ); Whitby at [29] (Thawley J); Singh at [57(2)] (Katzmann, Snaden and Raper JJ). In the circumstances, I consider that the ASOC adequately pleads the alleged knowledge of Ms Klimen, in a manner which both discloses a reasonable cause of action and puts the respondents on notice of the case they will be required to meet.
Accordingly, the application by Ms Klimen and Filecoin to strike out the accessorial liability claims against them is dismissed.

The pleadings

The ASOC alleges that, following WorkCo's decision to terminate Ms Haire's employment, Filecoin first determined that it would not continue to engage Ms Haire, and subsequently determined "to fund a further contract for the provision of services by Ms Haire" indirectly through Deel for the provision of services to Expanso: ASOC, [46]. In broad terms, it is alleged that this further contract was on less favourable terms, including as to remuneration and other benefits, than both her previous contract of employment with WorkCo and her earlier contract for services with Filecoin.
Ms Haire alleges that Filecoin discriminated against her in determining the terms or conditions that would be offered to her following the termination of her employment by WorkCo, so as to attract item 3(b) and (d) and item 4(a) and (b) of the table contained in s 342(1) of the FW Act: ASOC, [47].
Ms Haire alleges that Filecoin engaged in such adverse action for one or more prohibited reasons relating to the exercise of workplace rights, or membership of a trade union, or making complaints or inquiries in relation to her employment, in contravention of ss 340(1)(a)(i), (ii) and (iii), 340(1)(b) and 346(a) and (b) of the FW Act: ASOC, [48]-[49].
It is alleged that Ms Klimen, as the "operating mind and will" of Filecoin, was involved in and liable as an accessory to the alleged contraventions by Filecoin: ASOC, [50], [52].

The parties' submissions

The principal argument advanced by Ms Klimen and Filecoin in support of their application for summary judgment in relation to the alleged direct contravention is that Filecoin is not, and is not alleged to be, a "national system employer" within the meaning of s 14 of the FW Act. They submit that Filecoin did not employ Ms Haire, and that items 3 and 4 of s 342(1) of the FW Act do not apply because Ms Haire is neither an independent contractor with Filecoin nor a person employed or engaged by such an independent contractor. Rather, Ms Haire was an employee of Deel, which had a contract for services with Expanso rather than with Filecoin. To the extent that there was any employment relationship, Ms Klimen and Filecoin submit that there is insufficient connection between that relationship and Australia, referring to Fair Work Ombudsman v Valueair Limited (No 2) (2014) 224 FCR 415 at [68] (Buchanan J) and Baweja v Capital Insurance Group Limited [2023] FWC 2401 at [65]-[66] (Commissioner Hunt).
Ms Klimen and Filecoin also submit that the allegation in relation to the reasons for which Filecoin engaged in the adverse action (ASOC, [48]) should be struck out on the basis that it "contains a rolled-up allegation" and "does not precisely and distinctly allege the particular reason for the purported contravening action". For similar reasons to those set out above in relation to the accessorial liability claim, I do not accept this submission, and need say no more about it.
Finally, Ms Klimen and Filecoin submit that the pleading of the alleged contravention by Filecoin is "conclusory" in that it does not set out the "basis" on which it is alleged that Filecoin determined not to engage Ms Haire, or that it did so for any of the reasons in paragraph 48 of the ASOC. Further, it is submitted that the pleading fails to explain or give particulars of the facts "underlying" the allegation that Filecoin's purported decisions were made or authorised by Ms Klimen.
The allegation in relation to Ms Klimen's involvement in Filecoin's contraventions (ASOC, [52]) is also challenged on the basis that it makes no allegation in relation to the conduct or knowledge required to prove such involvement.
Ms Haire concedes that Filecoin was not a "national system employer" as defined in s 14 of the FW Act, but says that this is not fatal to her claim against Filecoin. She submits that Pt 3-1 of the FW Act is applicable to Filecoin as a "constitutionally-covered entity": FW Act, s 338(1)(a) and (b). Although the ASOC does not expressly plead that Filecoin is a "constitutionally-covered entity", it can be inferred from the allegation that Filecoin is a "legal entity established in the United States of America" that it is a foreign corporation and therefore a "constitutional corporation": ASOC, [2(a)].
Ms Haire submits that, in contrast to Valueair, there is a connection with Australia in that Ms Haire was resident in Australia, provided services from Australia, was employed by WorkCo and Deel under contracts made in Australia and governed by Australian law, and that wages and taxes were paid in Australia. She alleges that Filecoin was "deeply involved" in the decisions made in relation to her employment, and that this will ultimately be a matter for evidence at trial.
Ms Haire relies on items 3 and 4 of s 342(1) of the FW Act, which set out circumstances in which a person takes adverse action against another person. Thus, it is alleged that Filecoin was a principal vis-à-vis WorkCo and Expanso, with each of whom Filecoin entered into a contract for services, and vis-à-vis Ms Haire, as a person employed or engaged by such contractors. Ms Haire submits that items 3 and 4 of s 342(1) "are intended to apply down the contractual line to both corporate contractors and individuals like the applicant", and that "[t]his is the evident legislative intent despite any legislative drafting infelicities".

Resolution

Part 3-1 of the FW Act provides general workplace protections. The Part applies in the circumstances set out in Div 2. Section 338(1) relevantly provides that Pt 3-1 applies to "action taken by a constitutionally‑covered entity", and "action that affects, is capable of affecting or is taken with intent to affect the activities, functions, relationships or business of a constitutionally‑covered entity". The meaning of "constitutionally-covered entity" includes a "constitutional corporation", which is defined to mean a corporation to which s 51(xx) of the Constitution applies. As a foreign corporation, Filecoin is a constitutional corporation and therefore a constitutionally-covered entity for the purposes of s 338(1)(a) and (b) of the FW Act.
Division 3 of Pt 3-1 of the FW Act deals with workplace rights. Section 342(1) sets out circumstances in which a person takes "adverse action" against another person.
Item 3 of the table in s 342(1) relevantly defines the circumstances in which adverse action is taken by "a person (the principal) who has entered into a contract for services with an independent contractor against the independent contractor, or a person employed or engaged by the independent contractor". Adverse action encompasses terminating the contract, injuring the contractor in relation to the terms and conditions of the contract, prejudicially altering the position of the contractor, refusing to use the contractor's services, or refusing to supply goods or services to the contractor.
Item 4 of the table in s 342(1) makes similar provision in relation to adverse action taken by a principal proposing to enter into a contract for services with an independent contractor against the independent contractor, or a person employed or engaged by the independent contractor. In such circumstances, adverse action covers refusing to engage the contractor, offering discriminatory terms or conditions, refusing to use the contractor's services, or refusing to supply goods or services to the contractor.
In this context, the meaning of "independent contractor" is not confined to the functional equivalent of an employee: see Construction, Forestry, Mining and Energy Union v State of Victoria [2013] FCA 445; 302 ALR 1 at [163] (Bromberg J); State of Victoria v Construction, Forestry, Mining and Energy Union (2013) 218 FCR 172 at [12] (Kenny J), [120] (Buchanan and Griffiths JJ).
Section 342(1) extends to adverse action by a principal against a person who is employed or engaged by an independent contractor. This may give rise to questions as to the proper construction and application of the provision. If a principal takes adverse action against a person employed or engaged by an independent contractor, is it necessary to demonstrate that the action injures or prejudicially alters the position of the independent contractor, as opposed to injury or prejudice to the employee or sub-contractor? Does the provision extend to circumstances in which adverse action is taken against a person who is employed or engaged by a sub-contractor that has no direct contractual relationship with the principal?
Ms Haire's case is that, following the termination of her employment with WorkCo, Filecoin engaged in adverse action against her as a person employed or engaged by an independent contractor with Filecoin. In particular, it is alleged that Filecoin refused to engage her or to make use of her services, discriminated against her in the terms and conditions on which she was offered, and injured her in relation to the terms and conditions of her employment by Deel: ASOC, [47].
It may be accepted for present purpose that, in order for the FW Act to apply to a foreign corporation such as Filecoin, it is necessary to establish a sufficient connection with Australia "either so far as the corporation is concerned, or so far as its employees are concerned": Valueair at [68] (Buchanan J). Such a connection is readily apparent from the facts alleged in the ASOC. Ms Haire has resided in Australia at all material times, and performed services for Filecoin in Australia first as a contractor and then as an employee of WorkCo. While the alleged contravention by Filecoin relates to the period following Ms Haire's termination by WorkCo, there is at least a real question to be determined as to the ongoing connection between Filecoin and Australia in relation to matters concerning Ms Haire's employment.
The fact that Ms Haire was not an employee of an independent contractor with Filecoin, but rather was employed by a company who had a contract for services with such an independent contractor, might present questions about the scope of s 342(1) in relation to adverse action allegedly taken by Filecoin against Ms Haire: compare Danthanarayana at [30], [34] (Jagot, Bromberg and Murphy JJ). Nevertheless, the application of Pt 3-1 of the FW Act to multi-layered contractual arrangements, such as those in the present case, is not necessarily straightforward. I consider that the construction and application of the FW Act should be addressed in the light of the findings made on the evidence at trial. On the material before me, it has not been demonstrated that Ms Haire has no reasonable prospect of success on these claims. I also note that one aspect of Ms Haire's adverse action claim against Filecoin includes an allegation that Filecoin refused to make use of, or to agree to make use of, her services after her employment by WorkCo was terminated, which would appear on any view to be capable of falling within item 4(a) of the table in s 342(1) of the FW Act.
Further, in deciding whether the claims against Filecoin for direct contraventions of Pt 3-1 of the FW Act should be summarily dismissed, I have taken into account that the accessorial liability claims will proceed to trial in any event. In exercising the discretion under s 31A of the FCA Act, "it may be relevant to consider whether there might remain some part of the case left to proceed to trial in the event that summary judgment is granted", although this consideration should not be given undue weight nor give rise to any predisposition against granting summary judgment: see ThoughtWare Australia Pty Limited v IonMy Pty Ltd [2023] FCA 906 at [57]-[59] (Derrington J). In the circumstances, summary dismissal of the direct contravention claims in whole or in part is unlikely to have a significant impact on the time and costs involved in the determination of the proceedings. This is an additional factor in favour of allowing those claims to go to trial in the ordinary manner.
In relation to the other criticisms levelled by Ms Klimen and Filecoin at the ASOC, I do not consider that the allegation that Filecoin contravened the FW Act is "conclusory". In so far as Ms Haire alleges that Filecoin determined that it would not engage her at all or on comparable terms, she is not required to plead the evidence that will be relied on to prove that allegation. In relation to the allegation that decisions of Filecoin were made or authorised by Ms Klimen, Ms Haire relies principally on allegations that Ms Klimen was the "operating mind and will" of Filecoin and that the decisions were made or authorised by her in that capacity. As well as establishing the liability of Filecoin as a body corporate under s 793 of the FW Act based on the conduct engaged in by Ms Klimen on its behalf and with her state of mind, this is also relied on to establish Ms Klimen's accessorial liability under s 550 of the FW Act for any contraventions by Filecoin arising from that conduct and state of mind.

Conclusion

For the reasons set out above, the interlocutory application by Ms Klimen and Filecoin must be dismissed with costs. I certify that the preceding one hundred and sixteen (116) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Horan.

Australia Fair Work Act 2009(Cth)ss 14, 338(1)(a), 338(1)(b), 340(1)(a), 340(1)(b), 342(1), 346(a), 346(b), 550(2), 793

Federal Court Rules 2011(Cth)rr 16.21, 16.41, 16.43, 16.45, 26

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