Hall v Commissioner for Fair Trading

NCAT Occupational|2023-02-06

REASONS FOR DECISION

On 21 March 2022 James Phillip Hall (the Applicant) made an application to Service NSW for an Individual Contractor Licence (the licence) under the Home Building Act 1989 (the Act). He included a number of supporting documents with that application. On 3 June 2022, the Commissioner for Fair Trading (the Respondent) requested further information from the Applicant about his qualifications, experience, and referee statements. This was provided on 16 June 2022.
On 17 June 2022 the Respondent refused the Applicant's application for the licence under sections 12(c), 20(1)(a1) and 33C(1)(b)(i) of the Act on the basis that the Applicant had not gained the relevant experience as a bona fide employee, because he had been a subcontractor when he gained experience working for his nominated supervisor.
The Applicant sought internal review on 8 August 2022. The Respondent determined on 25 August 2022 (the Reviewable Decision) to vary the decision of 17 June 2022, refusing the licence application under sections 33C(1)(b)(i) and 33D(1)(b) of the Act on the basis that there was no evidence to support the Applicant having gained his experience as an employee, rather than as a subcontractor, and that the Applicant had insufficient experience to enable him to do or supervise building work in the construction of residential dwellings.
The Applicant sought review in this Tribunal on 19 September 2022 and an oral hearing took place on 6 February 2023. At the hearing the Respondent confirmed that there was no dispute that the Applicant held the appropriate qualifications for the licence. The Respondent conceded that the experience gained by the Applicant otherwise satisfied the requirements of the Instrument and Act, being a minimum of two years' relevant industry experience in a wide-range of building construction work, where the majority of that experience was obtained within 10 years of the date on which the application was made. The issue in dispute was whether the Applicant had been an employee at the time he obtained the relevant experience.

Legal Principles

The Tribunal has jurisdiction to review the Commissioner's refusal of the Applicant's application for a contractor licence under s 83B(1) of the Act, s 9 of the Administrative Decisions Review Act 1997 (NSW) (ADR Act) and s 30 of the Civil and Administrative Tribunal Act 2013 (NSW) (CAT Act).
In determining an application for an administrative review of an administratively reviewable decision, the Tribunal is to decide what the correct and preferable decision is having regard to the material before it: s 63(1) of the ADR Act.
A contractor licence authorises the holder to contract to do certain residential building work: s 21 of the Act; and an endorsed contractor licence authorises its holder to do (and to supervise) the same residential building work, or specialist work, as it authorises its holder to contract to do: s 28(1) of the Act.
On 5 July 2021, the Building Legislation Amendment Act 2021 was assented to, effecting amendments to sections 20(2) and 25(2) of the Act. Section 20 requires: 20 Issue of contractor licences The Secretary must refuse an application for a contractor licence if: … (a1) the Secretary is not satisfied as to the matters of which the Secretary is required to be satisfied by sections 33B and 33C, … 2) The Secretary may, by notice published in the Gazette, specify qualifications and experience, or additional standards or other requirements, required to be held or met by an applicant for a contractor licence. 3) The Secretary must refuse an application for a contractor licence if - (a) the Secretary is not satisfied that any such requirement would be met were the contractor licence to be issued, or (b) the Secretary is not satisfied with the applicant's proposed arrangements for supervision of the work which the contractor licence will authorise the applicant to contract to do, or (c) the Secretary is not satisfied that the applicant has complied or is able to comply with any requirements of Part 6 or any requirements of the regulations relating to insurance applicable to the doing of work of a kind proposed to be authorised by the contractor licence. … (5) A decision of the Secretary relating to the specification of qualifications and experience, or additional standards or other requirements under subsection (2) cannot be reviewed by the Tribunal in an application for an administrative review made under this or any other Act.
Section 33C(1)(b)(i) of the HBA requires that a contractor licence must not be issued unless the Secretary is satisfied that: …the applicant, if also applying for an endorsement of the contractor licence to show that it is the equivalent of a supervisor certificate, satisfies the requirements of section 33D for the issue of a supervisor certificate to the applicant.
Section 33D(1)(b) of the HBA relevantly provides: 33D Additional requirements for obtaining supervisor and tradesperson certificates (1) A supervisor or tradesperson certificate must not be issued unless the Secretary is satisfied that the applicant: … (b) has had experience of such a kind and for such a period as the Secretary considers would enable the applicant to do, or to supervise, the work for which the certificate is required, …
Under Schedule 1 of the Act, the "Secretary" means "the Commissioner for Fair Trading", the Respondent in these proceedings.
Clause 159, Part 27, Schedule 4 (Savings and transitional provisions) of the HBA provides: Part 27 Provisions consequent on enactment of Building Legislation Amendment Act 2021 159 Qualifications and experience required by licence and certificate applicants (1) For the purposes of section 20(2), a notice published in the Gazette before the commencement of the amending Act, specifying the qualifications and experience required to be held by an applicant for a contractor licence, is taken to have been validly made and to be valid on and from the date the notice was published. (2) For the purposes of section 25(2), a notice published in the Gazette before the commencement of the amending Act, specifying the qualifications and experience required to be held by an applicant for a supervisor or tradesperson certificate, is taken to have been validly made and to be valid on and from the date the notice was published. (3) In this clause- amending Act means the Building Legislation Amendment Act 2021

Experience required pursuant to the Instrument

When the Applicant lodged his licence application, the Instrument issued by the Respondent titled 'Qualification Requirements for an endorsed contractor licence or supervisor certificate for general building work' dated 23 December 2021 was, and to date has been, in force (the Instrument). The Instrument was published in the NSW Government Gazette on 14 January 2022.
The Instrument at Column 2 of Table A to Schedule 1 requires: At least two years' relevant industry Experience in a wide range of building construction work, where the majority of that Experience was obtained within 10 years of the date on which the application is made.
For a contractor licence to be issued, an applicant must therefore demonstrate: 1. a minimum of two years' relevant industry experience; 2. in a wide-range of building construction work; 3. where the majority of that experience was obtained within 10 years of the date on which the application was made.
The Instrument provides the following definitions: "Experience" means experience gained by the applicant as: (a) an employee of; or (b) a holder of a supervisor certificate and as a nominated supervisor for the contractor licence held by; or (c) a holder of an endorsed contractor licence contracted to; or (d) a holder of a supervisor certificate in the capacity of a nominated supervisor for a contractor licence held by an individual, partnership or corporation contracted to; the holder of a contractor licence authorising the holder to do the class of residential building work in which experience was gained ("the Work"), where the applicant, during the relevant period, was: - supervised and directed in the doing of the Work by the holder of an endorsed contractor licence or supervisor certificate authorising its holder to supervise the Work, and this is verified in the Relevant Application Form; and - received Remuneration in accordance with law for the Work which the applicant carried out; .... "Relevant Application Form" means the relevant application form for the Licence or Certificate that is being applied for, which is published on the NSW Fair Trading website, including the required attachments to that form. (Note - Applications are to be made in accordance with section 12 of the Licensing and Registration (Uniform Procedures) Act 2002)
Section 12 of the Licensing and Registration (Uniform Procedures) Act 2002 relevantly requires: 12 Procedure for making applications (1) An application may be made in writing or by means of electronic communication. (2).... (3).... (4) If made on writing, an application - (a) must contain such information as is required by the relevant application form or as is otherwise required by or under the relevant licensing legislation, and … (5) If made by means of electronic communication, an application - (a) must contain such information as is required by the relevant application form or as is otherwise required by or under the relevant licensing legislation, and …
In Commissioner for Fair Trading, NSW Department of Customer Service v Kalkan [2022] NSWCATAP 112 (Kalkan), the Appeal Panel stated at [36] that "[b]y cl 159 of Sch 4 of the Home Building Act, the Instrument is deemed to be validly made and to be valid from the date it was published, 17 April 2018". The Appeal Panel stated at [33] and [34]: 33 As a consequence of the amendment made to s 20(2) of the Home Building Act, the Secretary may "by notice published in the Gazette, specify qualifications and experience, or additional standards or other requirements, required to be held or met by an applicant for a contractor licence". Section 20(3) of the Home Building Act provides that the Secretary must refuse an application for a contractor licence if the Secretary is not satisfied that "any such requirement" being a requirement contained in a gazetted notice, "would be met were the contractor licence to be issued". The expression "any such requirement" in s 20(3) of the Home Building Act refers back to the immediately preceding provision, s 20(2) of that Act specifically, "the requirements specified in any notice published in the Gazette". 34 The Instrument is a "notice published in the Gazette", which specifies "qualifications and experience … required to be held or met by an applicant for a contractor licence"…
Having regard to the decision in Kalkan and s 20(5) of the Act I am satisfied that in this application the Tribunal is required to give effect to, and cannot review, the experience criteria specified in the Instrument.
However, as discussed at [21] to [26] of Issa v Commissioner for Fair Trading [2022] NSWCATOD 159 there is nothing limiting the Tribunal's consideration of what exactly the criteria of "a wide range of building construction work" means in the context of an applicant's past work experience. It is not a requirement that an applicant should have constructed a house from start to finish: Vitogiannis v Commissioner for Fair Trading, Department of Customer Service [2020] NSWCATOD 157 at [45]; Wilmot v Commissioner for Fair Trading [2021] NSWCATOD 43 at [90]; Tange v New South Wales Fair Trading [2013] NSWADT 201. Nor is it a requirement that an applicant has experience in all aspects of building work, provided the experience is sufficiently wide: Price v Commissioner for Fair Trading [2020] NSWCATOD 93; Locking v Department of Finance and Services [2013] NSWADT 239; Sollazzo v Commissioner of Fair Trading [2015] NSWCATOD 20.

Consideration

The definition of "Experience" in the Instrument (see above at [17]) is rather torturous. It seems to provide that experience gained by an applicant who doesn't otherwise hold a supervisor certificate or endorsed contractor licence is only relevant for the purpose of the Instrument in the following circumstances: 1. Where the applicant is an employee of the holder of a contractor licence: 1. Where the work is in the class of residential building work authorised by the contractor licence; and 2. The applicant was supervised and directed in that work by the holder of an endorsed contractor licence or supervisor certificate which authorises its holder to supervise that work; and 3. This is verified in the Relevant Application Form; and 4. The Applicant received "Remuneration in accordance with law" for the work.
It was undisputed that the Applicant has not at any time held a licence under the Act and therefore to comply with the Instrument's criteria must have gained his experience as an "employee".
The Applicant contended that he was an employee of Mr Deerness and was supervised by him. The Respondent disputed that the Applicant had worked for Mr Deerness as "an employee", submitting that the relationship was a subcontracting arrangement. It is the Tribunal's role to determine whether the Applicant's relationship with Mr Deerness and the work conducted under that arrangement falls within the meaning of an "employee" under the Instrument.
The term "employee" is not defined in the Act or the Instrument.
Referencing Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 384, SZTAL v Minister for Immigration and Border Protection (2017) 262 CLR 362; [2017] HCA 34 at [14], SAS Trustee Corporation v Miles (2018) 265 CLR 137; [2018] HCA 55 at [64], the Applicant submitted that regard should be had to the context of the word "employee" within the legislation, to the effect that the Tribunal should rely on a broader, more ordinary interpretation of "employee", consistent with the statutory purpose of the Act of licensing individuals with relevant qualifications and experience. This purposive approach to interpretation would result in a broader interpretation than that applied in taxation or employment law. Focusing on a narrow interpretation of whether someone was an employee, as contended for by the Respondent, was submitted by the Applicant to be inappropriate in those circumstances.
This Tribunal's predecessor considered in Zada v Director General Department of Finance and Services NSW Fair Trading [2014] NSWCATOD 16 (Zada) what approach should be taken to determine whether an individual was an "employee" in the absence of a statutory definition, in circumstances where the term "employee" was also undefined in the relevant Instrument to those proceedings. In Zada, Senior Member Frost stated at [36] and [37]: In the absence of a statutory definition of "employee" in the HB Act, the word must take its ordinary meaning - "a person working for another person or a business firm for pay" (Macquarie Online Dictionary). A simplistic distinction between an employee and an independent contractor (or subcontractor) is that the former works for another while the latter works for himself. In earlier times the main indicator of an employment (master/servant) relationship was the control exercised by one person over another, but nowadays it is "the totality of the relationship between the parties which must be considered": Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 29, cited with approval in Hollis v Vabu Pty Ltd (2001) 207 CLR 21 at 41. Supervision and direction are often very relevant to the enquiry. That is why it may be more instructive to start the enquiry by considering the level of supervision and direction provided by the licence holder rather than to focus on either the label used or the tax arrangements in place. The greater the level of supervision and direction, the more likely it is that an employment relationship exists. And if the worker is not closely supervised and directed, then he or she is not likely to reach the requisite level of "experience" in any event, no matter what label has been applied to the relationship.
I agree with that approach in the context of considering the current Instrument and would add further that included in the Tribunal's consideration of an individual's level of supervision and direction, would be the extent to which the individual can or did delegate their duties, as this is indicative of whether or not the individual actually did the work being relied upon for the purpose of "Experience" under the Instrument.
I also agree with the Applicant's submission that the term "bona fide employee" used by the Respondent in its reviewable decision is not the appropriate or applicable standard. It is not referred to in those terms in the Act or the Instrument and erroneously narrows the interpretation and application of the statutory scheme.
Taking a purposive approach to the interpretation of the Instrument, the requirement that an individual who does not otherwise hold a licence be an "employee" of a licence holder, in order for their experience to count towards the experience requirements in the Instrument, is to ensure that the work they are doing is adequately supervised and directed by the licence holder. It is not a requirement that the individual must be an employee in every legal sense of the word.
The Tribunal's approach is further bolstered by the definition of 'remuneration' in the Instrument: "Remuneration" means wages, salary and director's fees paid to an applicant on a regular basis but does not include bonuses, commissions, allowances or any other ad-hoc payments, including payments from a profit-sharing arrangement between the applicant and any another party, where such payments are the only payments made to the applicant for the Work which the applicant carried out.
The Instrument's definition of "remuneration" is not limited to wages, which are generally understood as payments made on an hourly rate, or salary, which is generally understood as a fixed payment per year (or other period). It includes "director's fees paid to an applicant on a regular basis", which are not paid to employees, but rather paid to the directors of companies. Considering what types of the payments the definition includes and excludes, there appears to be a clear delineation between payments made on a regular basis for work completed by an individual working for a company - salary, wages and regular director's fees; and payments which are occasional and often discretionary, connected to the income and profit of a company - bonuses, commissions, allowances or ad-hoc payments. Contextually this makes sense having regard to the purpose of the Instrument in the legislative scheme, which is to ensure that an individual has had sufficient experience to do the work for which they are being licensed.
The definition of "remuneration" in the Instrument thereby further demonstrates that an "employee" under the Instrument must be considered by its broader ordinary meaning, being "a person working for another person or a business firm for pay", rather than its narrower legal meaning. There was no dispute that the Applicant was working for Technique and Mr Deerness for pay. According to this broad understanding of "employee", the Applicant's work would therefore be considered valid "experience" within the meaning of the Instrument.

Employee v Subcontractor

Even if I am wrong, a consideration of the evidence with reference to the legal meaning of an "employee" results in this Tribunal finding that the Applicant was an employee, not a subcontractor. Defining for legal purposes whether someone is an employee or subcontractor is often a difficult task, as the recent High Court of Australia decisions in Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1 (CFMEU) and ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2 (Jamsek) make apparent. However, the recent decisions CFMEU and Jamsek can be distinguished by reference to there being no written contract of the arrangements between Mr Hall and Technique. As Kiefel CJ, Keane and Edelman JJ stated in CFMEU at [56], referring to Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 (Stevens): In Stevens, Mason J said that "it is the totality of the relationship between the parties which must be considered". But this statement was made in the context of a discussion the point of which was to emphasise that the right of one party to control the work of another was "not ... the only relevant factor". It was not an invitation to broaden the inquiry beyond the contractual rights and duties of the parties. Importantly, Stevens was not a case where the parties had committed the terms of their relationship to a written contract. In this respect, Stevens stands in obvious contrast to cases like Chaplin and Narich - and the present case.
Accordingly, in the absence of a contract or written agreement outlining the relationship between the Applicant, Mr Deerness and Technique Build Pty Ltd, this Tribunal must revert to the traditional common-law 'multifactorial' approach expressed in Stevens and Hollis v Vabu Pty Ltd (2001) 207 CLR 21 (Hollis), considering a number of non-exhaustive factors in the context of 'the totality of the relationship between the parties' to determine whether an individual is an employee or a subcontractor.
The Applicant first applied for an Individual Contractor Licence in 2014, accompanied by a declaration from a registered architect, Caroline Piddock, regarding her supervision of his experience. As a result of certain regulatory changes at that time, an architect's supervision was not sufficient for the purposes of the Act. The Applicant ultimately withdrew that application.
From 2015 to 2022 the Applicant gained further experience in building construction work under the supervision of Mr James Tainui Deerness of Technique Build Pty Ltd (Technique). Mr Deerness is the holder of Contract Licence Number 273283C.
The Applicant stated that he worked on a full-time basis for Technique as an employee. Under cross examination he explained that when he was working on projects for Technique it was on a full-time basis, but that he was also working for Hall Bowra when he was not working on Technique projects. Hall Bowra Architects Pty Ltd (Hall Bowra) is an architect firm in which the Applicant is the 'Hall' and his wife is the 'Bowra' named. Although qualified and registered as an architect, the Applicant had a passion for construction and preferred to focus on that work, which is why he had previously worked onsite as a labourer for a year for Mr Deerness.
As part of his application the Applicant included a letter written on Hall Bowra letterhead to the Respondent dated 16 June 2022 which listed his qualifications and building experience. It serves to set out that letter in full: Dear Zen, RE: (Ref.No A/1-8237899541/DOC22/120249ZW) Qualification Copies of the following documents have been lodged with SNSW as requested. I also attach a copy to this email for your records. • 1 x copy of Bachelor of Science (Architecture) qualification dated 22.03.2002 (1 page) • 1 x copy of Bachelor of Architecture qualification dated 22.04.2005 (1 page) • 1 x copy of The National Certificate of Architectural Practice - AACA dated 03.06.2008 (1 page) • 1x copy NSW Architects Registration Board - Registration Certificate dated 20.08.2008 (1 page) • 1 x copy of Certificate IV in Building and Construction (Building) CPC40108 - Certificate No 001380 dated 25.11.2011 (1 page) • 1 x copy of Certificate IV in Building and Construction (Building) CPC40108 - Transcript of results dated 25.11.2011 (2 pages) • 1 x copy of required units of study for the category of work - Hand mark up (2 pages) Building experience James Deemess of Technique Build PTY LTD to align with your feedback has provided a new referee statement. This has been updated as follows: • Onsite work beyond a 40/hr work week has been removed from the experience as it was interpreted as overlapping experience. • Paid tendering/contract negotiations prior to HBCF insurance being provided have been removed from the experience as requested. Please note HBCF insurance can only be taken out once the tender negotiations are complete. • Recent/ongoing experience added. As discussed, my current onsite building experience has been obtained whilst working with Technique Build Pty Ltd. The arrangement was as follows: • Full time employment as subcontractor between 04/09/15 - 14/09/15. 40hrs/week. • Part time employment as subcontractor between 01/03/16 - 31/08/16.16hrs/week. • Full time employment as subcontractor between 05.05.20 - 16.03.22. 40hrs/week. Working across two sites within that period. • Full time employment as subcontractor between 16.05.22 - current Please refer to my onsite building experience forms for further information. All works listed above were under a paid arrangement. I have contributed to my superannuation over this period as required. It was my understanding that being a 'registered architect' enabled me to lawfully subcontract to Technique Build to gain the 'onsite' experience required to obtain a builders licence. You have recently advised that my arrangement with Technique Build should have been as an employee to Technique Build. I request your special consideration in this case when reviewing my application as my required experience has been gained in full. If there is any additional information that you require, please do not hesitate to contact me. I thank you and look forward to hearing from you soon. Kind Regards Jamie Hall Architect NSW ARB 8046 Director
The Applicant's evidence of his qualifications and building work experience has not changed since that correspondence. The Respondent submitted that the Applicant's references to subcontracting in that correspondence indicated that the true nature of the relationship between the Applicant and Technique was not an employment relationship, and that the subcontracting references contradicted the Applicant's description of his relationship with Technique as set out in his written and oral evidence to this Tribunal. The Respondent submitted that the Applicant was now characterising himself as an employee because that is what the Instrument required, not because that is what he was.
Referring back to the employment law authorities as discussed above at [34] to [35], an individual's characterisation of his relationship as a contractor or as an employee - the 'label' he gives himself - is not determinative of whether, in fact, the relationship is one of employment or otherwise. The totality of the relationship must be considered, with consideration given to a number of non-exhaustive factors, as set out in Hollis. Those factors relevant to these proceedings are considered below.

Degree of control and power to delegate

The Applicant said that his arrangement with Mr Deerness was to work full time for him. Mr Deerness retained control of the allocation and direction of the Applicant's daily building tasks. Mr Deerness supervised the Applicant on all building sites, told him where to go and what to do. Mr Deerness closely watched, checked, and monitored all work undertaken by the Applicant at the building sites.
Under cross examination Mr Deerness agreed that he monitored, controlled and supervised all the people on the job site, whether they were employees or subcontractors. He said that no-one was left unsupervised. He described his relationship with the Applicant, who he had known since they were 6 years old, as collaborative - "we collaborate and work together and see where it will take us". He agreed that his supervision of the Applicant was because he was on a site Mr Deerness was responsible for, not because he was an employee. In re-examination he admitted that if the Applicant was told to redo a task on a building site, the Applicant would wear that cost, similar to a subcontractor. He admitted that he did not know what an employee was "in a legal sense".
The evidence demonstrates that Mr Deerness did not monitor, control, or supervise, the Applicant's work on building sites any more than he would any other subcontractor to Technique. It is unclear on the evidence whether Mr Deerness would have treated employees any differently on site in that respect.
The Respondent refers to gaps in the Applicant's employment history as evidence that he was an independent contractor, relevant to the ability of Mr Deerness to control the relationship: Without further explanation, it can be assumed that the Applicant had the ability to contract with other parties and undertake other work in the times he wasn't doing work for Technique Build. This indicates that the Applicant was not under the control of Mr Deerness or Technique Build and was a contractor.
I agree with the Applicant's submission that this approach is irrelevant and is not an established test. There is no requirement in the Act or the Instrument that the experience requirements involve two years on an uninterrupted, full time basis. As noted by the Applicant in evidence, it is common in the construction industry for there to be gaps between jobs. The Applicant said he was doing work for Hall Bowra during those gaps, which I accept, and which I do not consider to constitute his working for a competitor to Technique, which would suggest that he was free to contract with whichever building construction company he chose.
One aspect of 'control' in an employment relationship is the inability of an employee to delegate their work to another person (whether individual or corporation). In Hollis at [43] - [45] the Court considered relevant to 'control' how much control the employer has over the individual, how much individual enterprise the worker has, how much agency an individual had in his relationship and whether he was able to delegate tasks. The power to delegate is a factor that firmly indicates that the worker is an independent contractor rather than an employee: see Australian Air Express Pty Ltd v Langford [2005] 147 IR 240.
The Respondent submitted that a 27 November 2022 letter from Mr Peter Salt, who holds a NSW Builder's Licence 376820C, indicated that the Applicant operated separately to Technique, that the Applicant was able to contract in his own capacity and was not solely linked to Mr Deerness or Technique, and was able to be directly hired, separate to Technique. In that letter, Mr Salt wrote: James and Jamie have been working very closely in construction over recent years. I have directly hired both James and Jamie for additional labour when Technique Build has been between contracts. I have witnessed James working in a supervisory role towards Jamie.
On the basis of the final sentence in the quote above I do not think it is at all clear that the Applicant has been hired separately, in his own capacity, for construction work. It is more likely that Mr Salt has subcontracted Mr Deerness, who has his own licence, and the Applicant worked with Mr Deerness as his supervised employee. Without his own trade or construction licence the Applicant could not be hired independently by Mr Salt for "additional labour" and there is no suggestion that he was remunerated separately to Mr Deerness for that work by Mr Salt.
The evidence given by the Applicant and Mr Deerness indicated that the Applicant was on site for Technique at the relevant times to do the work himself, for the purpose of gaining experience. Delegating the work would defeat that purpose entirely. The Applicant did not pay any of the other Technique employees or subcontractors to do work for him. There was no suggestion by the Respondent that the Applicant could delegate his duties while working for Technique, nor ever did.

Provision of skilled labour

The Applicant submitted that with respect to the provision of skilled labour, unlike an independent contractor, he was not running his own building construction or trade business or enterprise. Although obviously skilled as an architect, the Applicant was providing physical labour to Mr Deerness on-site.
Mr Deerness' evidence was that the Applicant had: … a unique skill set… Jamie has architectural knowledge. My business is building architectural homes.
In Hollis at [47] - [48], the couriers' lack of skill demonstrated that the workers were employees rather than contractors, because they were unskilled and were unable to make an independent career or generate any goodwill. There is no doubt that the Applicant has a unique skill set but the evidence is that when he was working on-site for Technique he was not engaging that skill set to complete work. He was not working as an architect on site. He was providing physical labour and dealing with building construction trades under the supervision of Mr Deerness. As submitted by the Applicant, his experience in architecture would have been complementary to his residential construction experience for the purpose of the application, but this experience is distinguishable from the tasks he undertook for Technique in residential building construction. Whilst the Applicant may have been able to use his architecture skills to gain other architectural work, it is unlikely that this would have allowed him to gain other residential building construction work as a subcontractor, as he was not licensed to do this.

Representation as part of an employer's business

Whether a worker is seen as a representative or extension of the employer is another factor relevant to the worker's status as an employee or subcontractor. In Hollis the fact that the workers were required to wear uniforms bearing the employer's logo and that the workers' 'attitudes and appearance' were seen as 'a direct reflection of our organisation' (Hollis at [50]) indicated that the workers were employees.
In his affidavit of 31 January 2023 the Applicant provided the Tribunal with 4 photographs of him on site at one of Technique's project sites. In evidence he pointed out that these photographs displayed him wearing the Technique uniform, the logo of which is discernible in the final of the 4 photographs. He stated that he wore this uniform every day and represented himself on Technique work sites as part of Technique. The email address he used was a Technique email address. When he and Mr Deerness worked intermittently for Mr Salt, they each wore their Technique t-shirts. I accept that evidence and agree with the Applicant's submission that he presented to the public and to those using Technique as an employee of Technique.

Remuneration and scope to bargain

In Hollis, the superintendence of the workers' finances (at [54]) and the fact there was no scope to bargain for their rate of remuneration was an indication they were employees.
In his affidavit of 31 January 2023 the Applicant specified that he was paid an hourly rate by Technique on two project sites. In relation to the other three sites he had worked on for Technique which formed part of his relevant experience, he said "there was an agreed cost for works complete by way of a progress claim".
Under cross examination the Applicant said he was paid an hourly rate and was paid for the days he worked. His pay was direct deposited into his bank account. On the building projects which were paid by way of progress claim, he would issue invoices to Technique. He was always paid for a 40 hour week but each task had hourly rates attached to it, so he was not paid a set amount each week.
The Applicant said that he invoiced and was paid in this manner because his accountant advised him to do this, and agreed that the invoices he issued had "Hall Bowra Architects" on them. When he paid tax (rather than it being withheld by his employer) he did so through Hall Bowra Architects. He also received a wage from Hall Bowra Architects and paid tax as an employee of Hall Bowra Architects.
Mr Deerness gave evidence that there was an Enterprise Agreement made between two companies on the advice of their accountants. He agreed that the way he had paid the Applicant was not the normal way he would pay an employee, and stated that he had paid the Applicant through Hall Bowra invoices "because he was not an employee". According to Mr Deerness' evidence the Applicant was not paid or provided with sick leave or annual leave, but Technique's other employees were provided with sick and annual leave. The Applicant was not provided with payslips.
I accept the Applicant's evidence that he issued invoices on the advice of his accountant, as this is supported by Mr Deerness' statement that there had been an agreement made "on the advice of our accountants".
The Applicant stated that he was "aware superannuation has to be paid by an employee", and claimed he put money into his superannuation fund as an employee while he was working for Technique. Mr Deerness did not pay the Applicant superannuation. According to the Applicant this was because "that was our arrangement". Mr Deerness said that this was because "this was organised through his company because he was subcontracting".
The Applicant maintained various insurances between 17 July 2015 and 17 July 2023, in the name of James Hall and Hall Bowra Architects Pty Ltd. These policies included personal accident and sickness insurance, professional indemnity, public and products liability, and trade and services insurances. The Respondent submitted that the fact that the Applicant took out and maintained these insurance policies in his own name and his company's name indicates that he was operating as a contractor, not an employee, and that in normal circumstances an employee is not required to take out their own insurance. The Applicant submitted that he took out and maintained these insurances because architects are required to keep paying insurances in case a claim is made, and to maintain registration. In relation to the personal accident and sickness insurance, relying on Technique's employer insurance was "not the agreement James and I had" so he took out his own insurance.
The Tribunal was not provided with copies of the payslips, invoices, agreements or superannuation records to support the Applicant and Mr Deerness' evidence.
The indicia set out in Hollis regarding remuneration are clearly more easily applicable to low paid, unskilled or unsophisticated workers. They also assume that the company or employer is complying with their taxation and employment law obligations. The ability for an employee to set their own remuneration and manner of payment is not unusual in the context of an employment relationship between a company and a more sophisticated worker, especially where there is a previous professional or personal relationship with the individuals involved in those negotiations. Casual employees are generally not provided with sick or annual leave. It is also not unusual for a highly paid employee to take out their own personal insurances, irrespective of their employer's insurances. This is especially so in an industry where there is a predominance of casual employment, or where work is project based and there may be gaps in employment as a result.
In the circumstances I do not agree with the Respondent's submissions that the Applicant's remuneration is indicative of him being a subcontractor, rather than an employee. Considering the evidence with reference to the definition of "remuneration" in the Instrument (at [31] above), I further find that, as an employee, the Applicant was "remunerated in accordance with law". He was paid by Technique, for the work he did for Technique, on a regular basis.

Ownership of tools and equipment.

In Hollis, the workers' provided and maintained their own bicycles but this was seen as a relatively small cost and the bicycles were not tools 'inherently capable of use only for courier work' (at [56]). The Respondent submitted that ownership of a large amount of specialist tools would indicate a worker is a contractor rather than an employee, and relied on a detailed tool inventory provided by the Applicant to the value of around $69,209, which included a ute. The Respondent also relied on vehicle registration of the Applicant's ute to Hall Bowra Architects Pty Ltd to demonstrate that the Applicant was a subcontractor.
The Applicant gave evidence that he purchased and maintained a large collection of tools because of his work as an architect, as well as a sign of his significant commitment to obtaining his licence. He said: From the beginning I commenced purchasing tools. If you don't purchase tools, you won't get the work. I have always invested in my career and purchased tools.
The Applicant submitted that he had acquired the appropriate tools and equipment over many years, and that employers require employees to obtain their own vehicle and tools and do not always include a vehicle and tools as part of wages. Mr Deerness gave evidence that, other than apprentices, employees do not usually get a tool allowance.
I disagree with the Respondent's submission that the Applicant's tool inventory is particularly large or specialised, or indicative of a subcontracting relationship, particularly in the building construction industry. It is irrelevant what tools or equipment the Applicant has in his possession unless he was required to use them by Technique. The Respondent did not ask either the Applicant or Mr Deerness if the Applicant was required to bring his own tools and equipment to the Technique project sites and use them in his employment. In the circumstances I do not consider the Applicant's tools, or possession of a ute registered to hall Bowra Architects, to be indicative of a subcontracting arrangement with Technique. I accept the Applicant's evidence and submissions.

Whether an employee or subcontractor

Considering the totality of the relationship between Technique and the Applicant, having regard to the findings above at [36] to [69], I agree with the Applicant's submission that he was an employee of Technique, and not a subcontractor to Technique. This means that the experience he attributes to his employment with Technique is relevant for the purpose of determining whether he has complied with the experience requirements of the Instrument.

Conclusion

The Respondent conceded that the Applicant had met the qualifications requirements of the Instrument and that, should the Tribunal find that he was an "employee" under the Instrument, he had sufficient appropriate experience.
In the circumstances the correct and preferable decision is for the Tribunal to set aside the Respondent's reviewable decision and for the Applicant to instead be issued with an Individual Contractor Licence in the area of general building work under the Act, in accordance with these reasons for decision.

Orders 1. The Respondent's decision to refuse the Applicant's application for an Individual contractor licence is set aside. 2. In substitution for the Respondent's decision, the Applicant's application for an Individual contractor licence is to be granted. 3. The Respondent is to effect the grant of the individual contractor licence to the Applicant within 14 days of publication of these reasons.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 11 May 2023

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