James Stanley Moore trading as Hastings Couriers v TNT Australia Pty Ltd

Industrial Relations Commission (NSW)|2006-05-25|Before: Haylen J

CITATION: James Stanley Moore trading as Hastings Couriers v TNT Australia Pty Ltd [2006] NSWIRComm 181

APPLICANT: James Stanley Moore t/as Hastings Couriers PARTIES: RESPONDENT: TNT Australia Pty Ltd

Unfair contract - Industrial Relations Act 1996 - s 106 - courier engaged effectively full time under arrangement with respondent - termination of courier contract due to loss of contracts by respondent - after deduction of legitimate running expenses total remuneration paid to applicant less than that payable to an employee under the applicable award performing the same work - arrangement unfair - nature of arrangement such that recognition should have been given to effective redundancy of applicant - no basis for the payment of annual leave or long service leave - arrangement declared void ab initio - order preserving payments already made and further order requiring respondent to pay equivalent of award wages CATCHWORDS:

Industrial Relations Act 1996 LEGISLATION CITED: Transport Industry (State)Award Transport Industry - Redundancy (State) Award

A & M Thompson v Total Aust. Ltd 1980 2 NSWLR 1 at 13-14 Durham & anor v Ireland (1981) 1 IR 67 CASES CITED: English v Aradlay Insurance Brokers Pty Ltd (2005) 145 IR 129 at [35] Hughes v Harrington 1973 AR 73 at 77 Spicer v Clifford 1969 AR 273 Williams v Calmex Products Pty Ltd 1971 AR 264

HEARING DATES: 01/05/06, 02/05/06, 03/05/06

APPLICANT: Mr M Perry of counsel SOLICITORS: Reid & Reid LEGAL REPRESENTATIVES:

RESPONDENT: Mr S Meehan of counsel SOLICITORS: Blake Dawson Waldron

INDUSTRIAL COURT OF NEW SOUTH WALES CORAM: HAYLEN J 25 May 2006

Matter No IRC 6282 of 2001 JAMES STANLEY MOORE t/as HASTINGS COURIERS v TNT AUSTRALIA PTY LTD. Application under s 106 of the Industrial Relations Act 1996 JUDGMENT [2006] NSWIRComm 181

1 In late 1992, James Moore entered into an agreement with entities controlled by TNT Australia Pty Ltd ("TNT") to conduct a courier service in the Wauchope area. There were two aspects to the arrangement with the first involving driving from Port Macquarie to Wauchope and back between 7.00 am - 9.30 am each weekday and again between 3.30 pm - 5.30 pm each weekday. This work involved picking up items at banks and the TAB in Wauchope and was known as the "Bank/TAB run". On Saturdays there were deliveries to the TAB occupying one and a half hours. The second aspect of the arrangement was collecting freight and deliveries from Port Macquarie airport and delivering around the airport and Wauchope area. This part of the work was performed at times other than when Mr Moore was required to perform the Bank/TAB run during the set weekday hours earlier referred to and the TAB work. There was also a growing amount of delivery work available during the middle of the day. 2 On entering into this arrangement, Mr Moore sold a business that he was then operating, purchased a new 1 tonne van for $24,000, and, registered the business name "Hastings Courtiers". 3 The formal arrangements were later contained in a written agreement entered into in mid-May 1993 and a further agreement signed in late September 1997. Late in August 2000, Mr Moore was informed, with others, of the loss of certain aspects of the TNT work from 4 September 2000, namely, work for Ausdoc. In late September 2000, TNT notified the need for it to re-tender for contracts with a number of banks in order to continue courier services for these clients. At that time, the banks represented some 25 per cent of revenue for courier services in the Port Macquarie area. When TNT was unable to renew these contracts, Mr Moore was notified in early November 2000 that his courier carrying contract would be terminated from 22 December 2000. The contract was duly terminated on that date and at a time when Mr Moore was 60 years of age. 4 In September 2001, Mr Moore commenced proceedings against TNT under s 106 of the Industrial Relations Act 1996. In an amended Summons for Relief, Mr Moore claimed that the total remuneration available under the agreement was less than the amount he would have received pursuant to the relevant award identified as being the "Transport Industry (State) Consolidated Award" and also the "Transport Industry - Redundancy (State) Award". In addition, certain conduct of TNT was alleged to have rendered the contract unfair, harsh and unconscionable because of the failure to honour the original figure accepted by Mr Moore to perform the work, the increased workload without a commensurate recognition in the rates paid for the work, the failure to consider Mr Moore for another courier run, holding out to Mr Moore that his position was secure under the proposed restructure of TNT when that was not the case, replacing Mr Moore with another courier while holding out that his position was secure and terminating the applicant without proper notice without considering the applicant's suitability for alternative positions. Further, the respondent failed to give the applicant an opportunity to realise his investment in the business. Every aspect of that claim by Mr Moore was contested by TNT. THE EVIDENCE 5 Mr Moore was educated to second year level at high school: he started but did not complete an apprenticeship as a boilermaker. He then worked as a coal miner until 1988 when he was retrenched. He moved to the Port Macquarie area in the 1990s. In 1992, he purchased a business called "Cargo Couriers" which operated in the Port Macquarie area. Cargo Couriers also performed courier services in the Wauchope area and had a sub-contract with a business operated by Mr Ross Turnham. Mr Turnham then had the sole agency for TNT Australia Pty Ltd in the Port Macquarie/Wauchope area. 6 In 1992, the area supervisor and representative of TNT Australia Pty Ltd, Mrs Newman, offered Mr Moore work in the Wauchope area intending to remove that area from Mr Turnham's run. He was offered the Bank/TAB run to Wauchope for $268 per week gross: in addition there would be the airport freight/deliveries run. Mrs Newman said there would be two parts to the work: the Bank/TAB run would involve driving from Port Macquarie to Wauchope and back between 7.00 am - 9.30 am each weekday and again between 3.30 pm - 5.30pm each weekday. The second part of the job would involve freight and deliveries from Port Macquarie airport to Wauchope and surrounding areas. Mrs Newman told him that deliveries to the banks were a priority after which he would then be able to do the air/freight deliveries. He would work for about one and a half hours on Saturdays for the TAB and he would be paid extra for air freight per consignment note if required on Saturdays. A few days later, Mr Moore rang Mrs Newman and accepted the offer as outlined to him to do this work. 7 Mr Moore purchased a new Mitsubishi one tonne van for $24,000 and registered the business name "Hastings Couriers". Not long after, he was contacted by Warwick Powditch, a "boss" of TNT Australia Pty Ltd at Bankstown who told him that TNT had offered too much for the bank run and now offered $236 gross per week, rather than the initial $268 gross per week offered. Mr Moore reminded him that they had agreed on the figure of $268 per week but Mr Powditch told him that if he was not prepared to accept the offer there were plenty of others who would do the job at that price. Mr Moore told him that it was "a big drop" but felt he had no other choice but to accept this new figure. 8 At about this time, TNT Australia Pty Ltd provided Mr Moore with a document entitled "TNT Express Couriers Agency Agreement" a document he signed and sent back to Mrs Newman. 9 The terms of this agreement noted that the agent wished to enter into the business of being a general sales and transport agent for the "TNT air couriers" division in the defined territory. The territory was described as being Wauchope. The company agreed to remunerate the agent by paying pick-up and delivery fees for all customers and freight movement in the territory handled by the agent at rates stipulated in a schedule. The company agreed that it would, on the appointment of the agent for the purposes of setting up the agent in business, provide initial sales and/or marketing promotion to assist the agent in establishing his business as the company's general sales and transport agent, provide uniforms for winter and summer as required and renew uniforms when necessary and would provide sign writing and advertising for the agent's premises as considered appropriate. 10 Business cards and company stationery would also be supplied. The agent was to meet and defray at his own cost all rent, staff wages and allowances, vehicle expenses and other overhead expenses incurred in connection with his appointment, duties and obligations under the agreement. The agent agreed to maintain properly equipped and sufficient premises and vehicles including replacement vehicles where necessary that were to be kept well serviced, clean and in a good state of order and repair. They were to be painted in the colour scheme and style and sign written as the company might from time to time direct and the business was to be staffed or operated by competent, courteous, well groomed and efficient personnel who were to be neatly attired when coming into contact with the public. The agent was to become a financial member of the appropriate State Road Transport Association or its equivalent and the applicable State branch of the Australian Road Transport Industrial Organisation or equivalent. The agreement was for the term of one year. One month before expiration of the term, the parties were to negotiate the possibility of a new agency agreement and until such time as a new agreement came into being the existing agreement was to continue to bind the parties. The agreement could be terminated by either party by giving one month's previous written notice other than by breach by the agent whereby the agreement could be terminated immediately. Termination of the agency or the agreement was not to prejudice the rights and remedies of the parties that had accrued or were accruing otherwise under or incidental to the agreement prior to the termination or in consequence thereof. The agreement contained a schedule of rates for delivery or pick-up of several types of freight carrying various rates from $1 up to $25. The bank rate was $47.20 per day. 11 Mr Moore stated that in 1997 he negotiated with Ms Prill an increase in the contract rates such that the pre-paid and freight consignment rate was increased from $1.25 to $1.80 per consignment note. 12 In late 1995, Mr Turnham died and his daughter took over and operated the business until November 1997. In November 1997, Mr Robert Harris became an agent for TNT Australia Pty Ltd in place of the Turnhams in Port Macquarie. Mr Moore enquired of Ms Prill why TNT had not offered the Port Macquarie agency to him and was told that TNT was looking for someone who could sell TNT to the area. About six or eight weeks after Mr Harris had started this work, Ms Prill held a meeting with Mr Moore, Mr Harris and other agents at the Comet office near Port Macquarie. At this meeting, Ms Prill said that if for any reason the couriers could not sell their agencies then Mr Harris would "pick them up". Soon after this, TNT Australia Pty Ltd appointed Mr Ian Smith as area manager for Port Macquarie answering to Ms Prill. 13 In July 2001, Mr Moore was advised that TNT Australia was to be restructured. Mr Moore spoke to Mr Smith telling him of his concerns about the restructuring and what was to happen to his business but was told by Mr Smith: "You are my number one man, James Stanley, I will look after you". Mr Moore then mentioned that Mr Harris had said that he was going to take all the work but Mr Smith said he knew nothing about it. At about this time Mr Moore sold his house and, rather than move to the Newcastle area, he and his wife purchased a "relocatable home" at Port Macquarie. 14 In late October 2001, Mr Moore received a letter from TNT Australia Pty Ltd stating that his contract would be terminated with effect from 22 December 2000. Up to that stage, no representative of TNT had expressed any dissatisfaction with Mr Moore's performance. 15 Over the life of the contract, Mr Moore stated that there had been no variation in remuneration although the rates for the Bank/TAB run was calculated on an expected four hour time frame when, in fact, due to delays by the banks and on the road, it took an average of five to six hours. Over time, fuel prices have increased from 79 cents per litre to $1.02 per litre and a further delivery and pickup (the Wauchope Ausdoc run) was added to the run without his approval. This was the position, other than the increase in 1997 of pre-paid freight consignment rates from $1.25 to $1.80 per consignment. 16 Mr Moore said that over the period of the contract he had to pay his own insurance, petrol, maintenance and repairs of the vehicle and provide his own clerical and administrative services. He had to pay a person to fill in if he was sick or on holidays. He was not paid holiday pay. 17 Just before the end of December 2000, Mr Moore became aware that Mr Harris had taken over some agencies including Mr Moore's agency. Mr Moore rang Mr Smith and told him that Mr Harris was taking over his agency but Mr Smith was unaware of that fact. In a later conversation, Mr Smith told Mr Moore that Mr Harris had been given the runs because he was "more professional". Mr Moore's contract with TNT terminated on 22 December 2000. He was not paid any redundancy pay or long service leave. During the contract he was not paid overtime, superannuation or annual leave nor was he able to work for anybody else. Apart from earning $110 gross a fortnight since February 2001 as a casual steward Mr Moore had not been employed. 18 In oral evidence Mr Moore said that he felt he had no other choice than to accept the lower rate offered to him at the beginning of the agreement in 1993 because he had sold his other business and the lower price was better than nothing. For a period, Mr Moore had another business called "Boronia Retreads", receiving tyres on consignment and delivering them from Tea Gardens to Coffs Harbour. He commenced this business some months after signing the May 1993 agreement with TNT and had the business for just under 12 months. Since business was taking up too much of his time he employed someone else to take that run so that he could concentrate on the TNT work with the banks in the morning and afternoon runs. He eventually sold the Boronia Retreads business 11 months after he bought it. 19 After about 12 months of doing the run, Mr Moore said his usual day commenced at about 7.30 am when he left home to go to the airport, the plane being due usually at 8.00 am. He would collect bags and freight to take to Wauchope for the banks and TAB runs. It was a drive of about 15 minutes to the airport and the drive to Wauchope was about 22 kilometres and would take about 20 minutes. Often the plane was late and he had to wait up to 10.00 am for the plane to arrive. Sometimes the plane landed at Taree and in winter there was fairly regular fog. The drive to Wauchope was not a problem in relation to traffic in the morning and he could get there between 8.00 am to 8.30 am. Traffic could be a problem on the return in the afternoon, especially with accidents, and on a number of occasions he was late at the airport. The plane left at 5.30 pm and he was required to be at the airport before the plane left. Originally, there were four banks to service at Wauchope but TNT lost one of the contracts although he could not remember exactly when. He was then required to drive 15 kilometres to the hotel at Beechwood hotel to drop off TAB documents. 20 At the airport, as well as the bank and TAB material, Mr Moore picked up other freight and parcels but priority was given to the banks and TAB material. When he finished the priority work between 9.30 am - 10.00 am (if the plane was on time) he could then attend to the delivery of other parcels. Often the drive back to Port Macquarie in the morning was not interrupted and he could usually get back by approximately 10.00 am except when the plane was late, leaving him still at the airport at 10.00 am. 21 In the afternoon, he would leave home at about 3.00 pm to pick up goods in Wauchope including banks and the Ausdoc bag (although this did not occur until 1997). Mr Moore thought that TNT originally had the Ausdoc work, lost the contract then regained it. Mr Moore would stop at the TNT depot approximately half way between Wauchope and the airport and pick up bags for the plane although he had to be at the airport by 5.30 pm. In the first 12 months of the contract he would leave the airport between 5.30 pm and 5.45 pm to drive home. 22 In the first 12 months of the contract not a lot happened in the time between 10.00 am and 3.00 pm and the manager of the Comet depot asked Mr Moore if he could do Comet work and he agreed to do so. That work built up to nearly a fully occupied day and this occurred in 1993. The Comet deliveries included delivering products from the Wine Society to homes and dealing with urgent deliveries. 23 In the period from 1994 to 2000, between 10.00 am and 3.00 pm he was working for the Comet part of TNT. Eighty per cent of his time was doing work for TNT. From time to time, there were other jobs performed for other companies and entities but most of his time was spent doing TNT/Comet work. For example, for a period, he did some work for Eastern Airlines delivering lost baggage but this was performed after 5.30 pm and did not occur very often - approximately 2 - 3 times a month. He did this work between 1995 and 1997 but did not do it thereafter. In the period 10.00 am - 3.00 pm, he would take a half hour break but would work for four and a half hours. The Saturday work was regular because of the TAB and involved driving from Port Macquarie to Beechwood, about 37 kilometres each way. This Saturday work took one and a half hours to complete. 24 When he was sick, Mr Moore's wife would engage a person on an hourly rate to do the work but when TNT express deliveries increased they were paid the contract rate. Hastings Couriers paid workers compensation coverage for persons engaged to do this work. In relation to the clerical and administrative services, Mr Moore's wife performed much of this work and attended to the books although they kept in close contact with their business accountant. 25 Mr Moore felt that he could not work for anybody else because the bank work was a priority and that work had to be completed. It was impossible to do anything else during the morning or the afternoon period when this work had to be performed. There was other work he could perform between 10 am - 3.00 pm but he was getting enough work in any event from TNT. He had purchased two vans during this period, with the second one being purchased second-hand. He sold his first van for a little over $4,000 and the next van cost $8,000. The first van was suffering because of its age and was not able to be used for private purposes as he and his wife had a family car. 26 In cross-examination, Mr Moore said that he was not aware of the terms of the award that should be applied to him but said that he had relied on his lawyers for advice. 27 When he entered the agreement in 1993, Mr Moore knew something of the TNT business structure and he knew TNT to be involved in Domestic and International deliveries. He regarded Comet Express as "part and parcel" of TNT Domestic and International services. Comet Air freight dockets and Kwikasair freight dockets were put through the TNT office at Newcastle. His morning business at that stage was done through what was known as Comet Air Express. Comet Road and Freight was a different set up and Comet became TNT Express at a later time. Mr Moore agreed that Comet became TNT Express but that was different from TNT Air Courier but became TNT D&I. Mr Moore understood that TNT Air Couriers had become TNT Express couriers and, as a result of a merger in 1997, had become TNT Domestic and International Division. In 1997-1988, Comet Express/Kwikasair had become TNT Express. In 2000, TNT Express and TNT Domestic and International Division had merged to become TNT Express. Mr Moore accepted that, under the TNT sales agency agreement, the work was performed for TNT Air Couriers and that, in addition to that work, from time to time, work was performed for Comet Express using a different consignment rate although the paperwork was processed through the Newcastle office of TNT. After 1997, he invoiced Comet Express or TNT Express separately for the work he performed each month for those entities. 28 During the relationship with TNT, the business had been operating as a partnership between Mr Moore and his wife. This business structure had been set up on the advice of Mr Moore's accountant: he had been advised that under this structure he was able to split his income from the business between himself and his wife. 29 When Mr Moore entered the 1993 agreement, he had read it carefully but did not take advice on it and believed to the best of his ability he understood it. He did not seek to have its terms varied except for the weekly payment of the work dealing with the banks. He did not ask for any redundancy arrangements because it had not crossed his mind. In addition to the administrative work performed by his wife, in emergencies, she would use the family car to deliver small parcels when Mr Moore was not available. This work was work for TNT. Mr Moore was not aware of the details of the tax benefit of splitting his income as a partnership with his wife, but relied upon his accountant. In relation to the gross returns for each financial year between 1993 and 2001, Mr Moore when cross-examined on these figures, believed them to be correct. He had assisted by providing documents but the information had been obtained from his accountant. 30 In 1997, when he negotiated his new agreement with TNT Mr Moore accepted that he then had considerable experience of the work and knew that TNT was reliant upon a large number of customers such as the banks, the TAB and Ausdoc. He also knew that customers occasionally tendered the work again and that TNT lost some contracts. He was aware that he could perform other work with the approval of TNT but he gave priority to TNT work. TNT Express kept him busy so he was not looking elsewhere for work. At the time of re-negotiating the agreement he did not seek other changes to the rates. 31 Mr Moore had engaged another person as a standby driver and he agreed that there was nothing in the TNT agreement that prevented this occurring. Mr Moore said that he needed a standby driver because the work was expected to be done and he needed somebody trained to "stand in". When this work was performed, Hastings Couriers was paid by TNT and Mr Moore then paid his standby driver. A standby driver was paid a cut of the TNT rate but was not paid as an award employee. The payment for this work was claimed as a business expense in the taxation returns of Hastings Couriers. The driver had been employed as a casual and therefore was not paid redundancy when the work stopped in 2000. 32 In June or July 2000, TNT had announced a restructuring and by August 2000 there was a meeting with other couriers when they were told of the details of the business restructure. Mr Moore said he was confident he had retained the roadwork for TNT Express although he was told on the grapevine that the bank work was lost. He was ultimately told in October 2000 that TNT had lost the bank work. Mr Moore thought the work between 10.00 am - 3.00 pm would survive, which would be sufficient for him: he would not require a standby driver and, as there was no bank work, he could take his time without the constraints of the early morning and afternoon run. He was aware that around this time some of TNT's work was under threat and that if TNT were unsuccessful in tendering for the bank work, for example, it would affect the business. Mr Moore felt assured because of the amount of road freight work that was being handled by Hastings Couriers. When he was informed in October 2000 that TNT had lost the bank work, he took no steps to sell his business or seek alternative work because he thought there was no point in doing so: there were so many courier businesses in Port Macquarie it was nearly impossible to get other work and he thought he would keep the TNT road freight work. 33 When he negotiated the 1997 agreement, he regarded the rates as reasonable and fair at the time. He raised no grievance about the rates in the schedule to the 1997 agreement. There was, however, no change to the consignment rate during the life of the arrangement. 34 Mr Moore said he understood the agreement he signed in 1993 covered the Bank/TAB run and that between 10.00 am - 3.00 pm each day there was nothing to prevent him from taking other work. He understood that the 10.00 am - 3.00 pm period was work separate from the agreement he had signed and that he could perform other work if it was available. The work he performed for Comet was work that TNT had performed by using employed drivers. Hastings Couriers were engaged to carry out work that the employed drivers were unable to deliver. The Comet work was never work that was insisted upon or required to be performed but it was offered and he took it when it was available. That work varied from time to time and the rate was set per consignment. 35 Mr Moore accepted that there was other than TNT work performed from time to time by Hastings Couriers although there was very little of it and he had forgotten the details of some of that work. Expenses were incurred by Hastings Couriers in performing that work. Those expenses were claimed as a tax deduction. During that period, Hastings Couriers also operated two vans to do the TNT work and both were the subject of depreciation in the tax returns of Hastings Couriers. 36 Mr Moore had asked about selling the Hastings Couriers business but was told by TNT that there was no goodwill available so he did not take any steps to sell the business as a going concern. Apart from the vans, the business had no assets apart from mobile telephones and an answering machine. 37 In relation to the work performed between 10.00 am and 3.00 pm for Comet, although he was aware he could carry out other work, he gave priority to that work because he had been offered the work and it seemed to him to be the right thing to do. 38 The applicant's case was supported by an affidavit of Mr Lee. He was a contract truck driver who had performed work for Mr Moore on the TNT Port Macquarie to Wauchope run. He often did the bank run especially when Mr Moore was ill. He gave similar evidence to Mr Moore about the delays experienced because of the plane arriving late due to fog, or delays caused by roadworks and road closures due to flooding. He also gave evidence of delays on the afternoon run because the banks were not ready with their bags. In his experience, the morning bank run took at least three hours and the afternoon run at least two and a half hours. 39 For the respondent, affidavit and oral evidence was called from three witnesses.

Ian Smith was Depot General Manager of the Port Macquarie depot in the TNT Express Division, a position he had held since November 1997. He had been employed by TNT since 1980 and, prior to 1997, was employed as the Depot General Manager at Wagga Wagga. As Depot General Manager, he was responsible for managing the TNT Express Division in Port Macquarie and surrounding areas and in that position managed 10-12 employees. 40 TNT Express was formed as a business unit in 1997 and comprised the previous businesses of Comet Express and Kwikasair. In July 2000, TNT was restructured to include the business formerly operated through a division called "TNT Domestic and International": this new business operated under the name TNT Express. Mr Smith assumed responsibility for managing that expanded business in the Port Macquarie region. Prior to July 2000, the Domestic and International Division comprised TNT Express Couriers (formerly TNT Air Couriers) and TNT Express Worldwide. Sue Prill, based in Newcastle, was responsible for managing the Domestic and International Division in the Port Macquarie area. In July 2000, TNT amalgamated the Domestic and International Division with TNT Express to form a single division under the name TNT Express. Ansett Airfreight which became wholly owned by TNT in 1999, also became part of this merged division. 41 Prior to the amalgamation in 2000, TNT Express and the Domestic and International Division provided distinct and separate types of courier services. Until July 2000, Domestic and International in the Port Macquarie area provided priority airfreight delivery and consignment services to several banks, the TAB, Ausdoc and other clients between Wauchope, Laurieton, Kempsey and Port Macquarie. Mr Smith described these services as "time-critical" which were performed by a number of agents, including Mr Moore who had the agency for the Wauchope area. Until July 2000, TNT Express was the division that provided TNT's road freight delivery service. TNT Express also provided pickup and delivery services for Ansett Freight as its agent until 1999, and was part of TNT thereafter. Prior to July 2000, TNT Express and Domestic and International operated side by side but were "largely independent" of each other. In the Port Macquarie area, TNT Express had a depot and sufficient infrastructure to provide its services by using mostly company-employed drivers driving company-owned vehicles. On the other hand, Domestic and International did not have a regional depot or locally based manager and thus provided its services in the area by engaging four agents, one for each of the Port Macquarie, Laurieton, Kempsey and Wauchope areas. Mr Moore was the Wauchope agent. 42 In Mr Smith's view, this mode of operation suited the nature of the Domestic and International work in the area, which consisted to a substantial extent of "bank runs" which were required each weekday morning and afternoon. The work involved the Domestic and International operative picking up bags from the airport each morning and taking them to local bank branches in the area before 9.30 am, and then taking bags from the bank branch each weekday afternoon after 3.30 pm The run also included a call into the local Document Exchange offices, being a contract Domestic and International had with Ausdoc. 43 In addition to the bank run, Domestic and International agents also did other airport related work under their agency agreements such as a delivery about three times per week (including Saturday mornings) from the airport to the local TAB. This regular morning and afternoon work left Domestic and International agents free to do other non-Domestic and International work during the day so long as they had cleared it with the TNT manager to whom they reported and so long as it did not interfere with their bank runs or other work for Domestic and International. 44 During Mr Smith's time as Depot General Manager, Mr Moore performed his Domestic and International work under his contract as an agent for TNT Express Couriers pursuant to an agreement made in September 1997. Mr Moore performed the bank run and was paid $47.20 per day for that run together with additional payments for the TAB work and any other freight deliveries work for Domestic and International: the rates for that work was set out in a schedule to the contract. 45 Every week, Mr Moore completed a worksheet recording his work for Domestic and International excluding the $47.20 he was paid for the bank run. That worksheet was forwarded by him to Domestic and International in Newcastle for payment. 46 Mr Smith had lived and worked in the Port Macquarie area since 1997 and, as a result of his work providing courier services in the area, he said that he was familiar with the distances between the places to which Mr Moore would travel for the Bank/TAB run. He estimated the morning and afternoon runs were approximately 18 kms, or 21 kms if Mr Moore stopped at the TNT Express on the way. Wauchope was not a big town and the banks and the TAB office were close to each other. In Mr Smith's experience, there were very few delays on the road used for the Bank/TAB run. In his view, Port Macquarie and, particularly Wauchope were small country towns where traffic delays were very unusual: there were alternative routes available. In his opinion, the work required of Mr Moore on the Bank/TAB run would take only about two hours in the morning and one and a half to two hours in the afternoon. 47 It was accepted by Mr Smith that, from the time he started, he was aware that Mr Moore regularly performed pickup and delivery work for TNT Express, being road freight and Ansett Air Freight business in addition to the Bank/TAB run. He would stop in at the TNT Express depot on the way to and from Wauchope and pick up TNT Express deliveries that were on his route. Occasionally, Mr Smith called Mr Moore at his home in the middle of the day to give him some TNT Express work if other Express drivers were not available. That work involved deliveries between Port Macquarie airport, the TNT Express depot, Wauchope and Lighthouse Beach. The TNT Express/Ansett Air Freight work was paid for as and when it was performed on a consignment basis. Those rates were set in negotiations between Mr Moore and Mr Smith's predecessor. Mr Moore submitted a weekly invoice for this work at the agreed rates per consignment. Worksheets thus compiled were sent to head office for payment. 48 From TNT's financial records, Mr Smith was able to calculate what was paid by Comet Express and, in particular, he looked at the period November 1998 to the end of June 1999 and July 1999 to June 2000 in relation to TNT Express. In the first period, Mr Moore had been paid nearly $20,500 and in the second had been paid just under $33,000. 49 In approximately mid-1999, TNT purchased the Ansett Air Freight business and TNT Express continued to provide the Ansett Air Freight services in the Wauchope area: those services were regularly outsourced to Mr Moore as they had been prior to TNT's purchase. In late 1999 or early 2000, TNT increased the rates being charged by Ansett Air Freight and the volume of work from that business decreased substantially. By late 2000, the Ansett Air Freight work was providing little business for TNT Express. TNT then ceased using the Ansett Air Freight brandname and the remaining business was absorbed under the name TNT Express. By the end of 2000, TNT Express, in relation to the previous Comet Express business, no longer needed to outsource work to Mr Moore because volumes had dropped to a level that could be dealt with by existing TNT Express depot employees. 50 According to Mr Smith, Mr Moore was free to undertake other courier work so long as it did not interfere with his work for Domestic and International Division. He recalled that Mr Moore had said in 1998 or 1999 that he was performing work delivering lost baggage for Qantas Link. 51 Between 1997 and December 2000, Mr Smith said he had an almost daily contact with Mr Moore who would drop in to the Depot once or twice a day to see if there was any TNT Express work available. If Mr Moore was needed during the day, Mr Smith would telephone. He found that he could usually contact Mr Moore at home on weekdays between 10.30 am and 3.00 pm. There were times when Mr Moore used another driver, Mr Lee, to do the work and this became more frequent in the period 1999 until December 2000. Mr Lee did not invoice TNT Express for the work and Mr Smith was unaware of the arrangements made between Mr Moore and Mr Lee. 52 In approximately June or July 2000, TNT announced a restructuring of its courier division within New South Wales: the Domestic and International Division, Ansett Air Freight and TNT Express were merged into a single division, TNT Express. According to Mr Smith, this involved no change to the way in which TNT operated the business and Mr Moore's association with it - Mr Moore's work continued as before and he continued to be paid separately for work performed in relation to the Bank/TAB runs and the other work performed for TNT Express. There were some reporting differences. 53 Mr Smith recalled that the announcement of the restructure caused some uncertainty amongst the Domestic and International agents, including Mr Moore. In August 2000, Mr Smith met with the four Domestic and International agents who now reported to him, including Mr Moore. The restructure was outlined by Mr Bowne and Mr Smith recalled stating words to the effect that there were no plans for any substantive changes to the businesses at that stage and that for the future the agents were to report to him in respect of all freight work, excluding the Bank/TAB work which was to be dealt with through Bankstown. Mr Smith had no recollection of any other discussion with Mr Moore about the restructure, nor did he recall saying to Mr Moore at any stage that he was Mr Smith's "No. 1 man" and that he would be looked after. 54 At the end of August 2000, Ausdoc terminated its contract with TNT and Mr Moore was informed of that development, as were the other agents. In early October 2000, the New South Wales country agents, including Mr Moore, received a letter from Mr Rowe, Regional Director NSW/ACT, TNT Express, concerning the loss of the Ausdoc work and the requirement for TNT to re-tender for the bank work. That letter notified the agents that, should TNT be unsuccessful in gaining or retaining the contracts, there would be an impact on the current work under the contracts as well as ancillary activity which would affect the amount of work available in the future. It was suggested that, in extreme cases where servicing of the banks was the sole or major ingredient of the earnings, the current work was likely to cease. Where the bank runs were only a part of the earnings, available work could be discontinued or reduced to a degree "ranging from significant to marginal". 55 In about October 2000, TNT's contract to provide courier services for the TAB was terminated with effect from December 2000. In approximately late October/early November 2000, Mr Smith was informed by Mr Bowne that TNT had been notified that it had lost its tender for the courier work for the Colonial State Bank, Commonwealth Bank and the NAB which work would cease from 22 December 2000. The loss of this work meant that it was no longer viable for TNT to perform its country bank runs for only the ANZ Bank - therefore, the Bank/TAB runs were terminated. This work was regarded as "the cornerstone" of the work undertaken by the former Domestic and International agents in the Port Macquarie area. A decision had to be taken about what was to be done with those agencies. In Mr Smith's view, Mr Moore's work was largely comprised of the Bank/TAB run. Mr Smith was consulted by Mr Nielson who he understood was responsible for assessing how the agencies in Port Macquarie would be affected by the loss of the work: Mr Nielson and Mr Smith agreed that there was no longer enough work to maintain either Mr Moore's agency or the agency of Miss Kidd. 56 On 8 November, Mr Rowe wrote to Mr Moore informing him that, due to the loss of the Bank/TAB work and other work, his agency would terminate from 22 December 2000. That letter stated that, given the loss of this, TNT had no choice but to rationalise its New South Wales network infrastructure to cope with the significant changes in volume and revenue anticipated following the changes. Shortly after that letter was sent, Mr Smith and Mr Moore had a conversation at the TNT Express Depot about what work remained for Mr Moore. In that conversation, Mr Moore said that he would not be able to continue to run his business on the remaining work available. 57 Since 22 December 2000, the work previously performed by TNT has been performed by Mayne Nickless/Wards Express. The remaining TNT Express work performed from time to time by Mr Moore has either been lost or absorbed within the capacity of the employed drivers working for TNT Express. The other two former Domestic and International agents in the area had continued to operate since December 2000 but with much reduced levels of work. 58 In cross-examination, Mr Smith agreed that the bank run and the Domestic and International service were priority runs and were considered to be time critical. 59 Mr Smith said that he would see Mr Moore sometimes twice daily at the depot and some days would keep him busy, but on other days there might be little for him to do. He was unable to say that on most days Mr Moore was "overwhelmingly busy". Mr Smith did not know why agents were engaged to perform this work: there were between five and six employed drivers at Port Macquarie. Because of the variation in work, sometimes there would be casuals used but there were also the five or six agents. Mr Smith agreed that it was expensive to keep employed drivers waiting at the airport and it was not economically viable to have employed drivers picking up at the airport because of potential delays. Mr Smith identified a security badge that had been supplied to Mr Moore which carried the TNT name and Mr Moore's picture. These badges had been issued to the employed drivers and agents. Mr Smith also confirmed that Mr Moore's contract was terminated because "the job was not there any more". 60 Mr Bowne was the respondent's Regional NSW/ACT Manager within the TNT Express Division, a position he had held since February 2002. Mr Bowne outlined the nature of the TNT business as it is presently operated and also dealt with the various divisions and entities that had merged and amalgamated during the period of Mr Moore's contract with the respondent. This evidence essentially was the same as that provided by Mr Smith. 61 In the period before 2000, the TNT Express work, being that formed by the merger of Comet Express and Kwikasair, was primarily express road freight delivery. At this time, in rural New South Wales, the business maintained a series of depots including one near Port Macquarie. Freight was carried between depots and then distributed from the depot, using mainly employed drivers driving company owned vehicles. In the Port Macquarie region, in the period prior to 2000, TNT employed 10 to 12 drivers to provide this service and they were based at the depot near Port Macquarie. 62 The Domestic and International part of the business was engaged in air freight courier deliveries. The business was organised differently to the Comet/Kwikasair business in rural New South Wales and there were no depots maintained, with the delivery of freight being organised from local airports to customers using a network of agents around the State: the agents delivered the freight to and from the airport under contract. Depending on the volume of business in any particular area, the local agent might be engaged "more or less full-time" in performing work for Domestic and International, or might only be engaged part-time in that work. For those that only had enough work to be engaged part-time, the agents were permitted to do and often did other work, including for competitors of TNT from time to time. 63 In Mr Bowne's view, from the mid-1980s and during the 1990s, the Domestic and International business in rural areas depended for its "bread and butter" work on undertaking freight courier services under contract for the larger regular users of freight. These users were principally the major trading banks, TAB and Ausdoc which operated the Document Exchange (or DX) network. These contracts were tendered on a State and national basis and TNT competed for them against other national express freight carriers. These contracts were usually for two to three years and were subject to re-tender periodically. Between 1985 and 1997, TNT held the contracts in New South Wales for each of the major banks but, in 1997, lost the work for the Commonwealth Bank and Westpac and was only partly able to replace that regular business by winning the tender for the Ausdoc business. 64 This regular business of TNT comprised approximately 40 per cent of the total express freight revenues for the respondent in the 1980s. In addition, Domestic and International maintained and established its network of rural agents to carry airfreight and the network was also used for the carriage of other freight work in rural areas although that work was less significant and could not alone have justified the overheads involved in operating the network. In mid 2000 Domestic and International had around 95 rural agents in New South Wales including Mr Moore. The agents were engaged under a contract in a standard form except for the schedule that set out the area for which the agent was responsible and the rates of payment for that agent. Under the schedule applicable to Mr Moore he was remunerated with by way of a mixture of payments for items carried with an allowance for weekend work and also "per day" payments for what was described in the schedule as the "Bank PUD" ie pick up and delivery, commonly referred to as "the bank run". 65 In addition, agents often performed work for Comet/Kwikasair: that was prior to 1999 (as agent for Ansett air freight) and often used Domestic and International agents for Ansett air freight pick ups and deliveries in view of the fact that the agent would be going regularly to the airport in any event for the Domestic and International work. During 2000, the Ansett airfreight work dropped off considerably and was eventually absorbed into TNT Express: this work was usually done at consignment rates negotiated between the agent and the depot manager for the local TNT Express. Agents were commonly permitted by Domestic and International to do other courier work outside TNT as long as it did not interfere with their work for Domestic and International. 66 Mr Bowne had reviewed the payroll details relating to Mr Moore and was able to say in relation to the Domestic and International rates paid, he had been given $1.35 for each delivery and $1.50 for each pick up between 17 May 1993 to week ending 24 May 1995; between 31 May 1995 and 24 September 1997 he was paid $1.50 for each delivery and pickup and between 25 September 1997 and the date of his termination he was paid $1.80 for each delivery and pickup. In addition to these payments, there were payments based on the number of pickups and deliveries performed by the applicant as follows: $236 per week for completion of the bank run (at the rate of $47.20 per day Monday to Friday); approximately $72.88 for the completion of the TAB run ($38 for the weekly run and $34.88 for the Saturday run); on-forwarding rates of 40 cents per kilometre for pickups and deliveries outside the Wauchope area; other payments relating to same day Saturday and Sunday deliveries for the consignment of excess freight. 67 Mr Bowne was involved in the TNT Express restructuring from early 2000. In mid to late August 2000, TNT was notified that one of its key clients for Domestic and International, Ausdoc, would no longer use its services for country deliveries effective from 4 September 2000. Agents and branch managers were advised of the loss of the Ausdoc work around the end of August 2000. Mr Bowne said the loss by TNT of its contract with Ausdoc had a significant adverse effect on the amount of work available to agents including Mr Moore. In Port Macquarie and surrounds, he estimated the loss of work represented approximately 3.5 per cent of the total revenue received by Domestic and International in that area. 68 In late September 2000, TNT was notified that it would need to re-tender for contracts with the Commonwealth Bank, Colonial State Mutual and NAB. The value of this work to Domestic and International was approximately $134,000 per week in New South Wales. In Port Macquarie and surrounds that work represented approximately 25 per cent of the total revenue received by TNT Domestic and International in that area. It became clear that if this work was lost it would have a serious effect on the viability of the agency network. In early October 2000, Mr Rowe and Mr Bowne drafted a letter to agents indicating that the work had to be tendered for again and what the consequences of the loss of that work. In late October and early November 2000, TNT was advised that it had lost the bank work. Further, in November 2000 TNT was advised that the TAB no longer required TNT's services. That left TNT with only the ANZ bank as supporting the network of agents in New South Wales and that network was no longer viable. TNT therefore advised ANZ that it would no longer be able to provide express courier services to it. In the light of the loss of these major clients, the substantial majority of the work that had been performed by the Domestic and International agents had been lost and it was no longer economically viable for TNT to maintain the agency network in its then existing form. A review of the structure was undertaken in which Mr Bowne participated. It was decided that there was a need to terminate a number of agencies that no longer had a Bank/TAB run. 69 As part of the process TNT reviewed the remaining freight volumes available to Domestic and International agents under their agreements and identified agents who would have little or no work as a result of the loss of those regular clients. Mr Moore was identified as one of those agents because a significant proportion of his Domestic and International work had been sourced from those major clients. It was assessed that this aspect of the work that had been lost represented on average approximately 64 per cent of Mr Moore's total revenue received under his agency agreement. The decision was made that TNT could no longer support Mr Moore as an agent. In New South Wales, 68 of the 95 agents were terminated because the volume of remaining work under their agencies was not sufficient to justify the continuation of their agencies. 70 In cross-examination, Mr Bowne stated that the Domestic and International division employed no country drivers although they did so in the city: there was no bank work in the city areas: that was unique to country areas. TNT had tendered for country work in this area only. Mr Bowne said that the bank work was worth just under $70,000 per week and agreed that it was a valuable contract to TNT. Mr Bowne confirmed that it was valuable work that was the subject of constant retendering every three years and that all the freighters were after that work. Mr Bowne accepted that TNT had looked at the costs and the viability of engaging employees to do the work done by agents having regard to the variety of costs to be incurred such as sick leave, workers compensation, long service leave, superannuation and equipment. Mr Bowne could not comment whether those decisions had influenced TNT years ago to engage agents to do the work rather than employees. 71 Mr Bowne's estimate that the Domestic and International work would probably take two to two and a half hours in the morning and probably an hour and a half in the afternoon did not take into account whether the plane was on time. He had never performed the run himself but had been in a vehicle with the courier when that run was done in the late 1980s. That had not occurred on a regular basis. The exigencies of plane arrival and other matters was something about which he was not aware. In relation to Mr Moore's work for Domestic and International, he did not know if in fact it was full-time work or not. 72 Mr Bowne confirmed that under the contract for the Bank/TAB, run there could be other air freight work that came in that would be paid for at the rates set out in the schedule to the contract with Mr Moore and that work was separate from the work that might be done between 10.00 am - 3.00 pm each day. Mr Bowne was of the view, from his experience, that in the Wauchope area that extra work would consist of some 10 to 15 deliveries some days and a number of pickups in the afternoon, perhaps two, three or five, all of which was an additional charge to the work that was done on the Bank/TAB run. 73 Mr Jonathan Koop was employed by TNT as the Finance Manager, Central region. He was a qualified chartered accountant with 15 years' experience and was responsible for financial planning, reporting, analysis and procedural control for TNT in New South Wales and the Australian Capital Territory. 74 Mr Koop had looked at financial records described as "prescribed payment summary" for each financial year in which Hastings Couriers performed work as agent for TNT Air Couriers. Those documents showed the gross amount paid by TNT Air Couriers each year and also manual payroll records detailing gross amounts paid to TNT air courier agents. By reference to the manual payroll records and the prescribed payment records, he was able to state that Mr Moore was paid the gross amounts as set out below: Period Amounts Paid (a) 17 May 1993 to 30 June 1993 $ 1,152.85 (b) 1 July 1993 to 30 June 1994 $11,294.73 (c) 1 July 1994 to 30 June 1995 $14,411.68 (d) 1 July 1995 to 30 June 1996 $26,209.00 (e) 1 July 1996 to 30 June 1997 $24,954.00 (f) 1 July 1997 to 30 June 1998 $24,548.00 (g) 1 July 1998 to 30 June 1999 $26,673.00 (h) 1 July 1999 to 30 June 2000 $26,114.00

75 Mr Moore was entitled to $236 per week for the bank run, but additional bank run amounts were not included on the manual payroll records which Mr Koop reviewed and on which the gross amounts were calculated in the table above. The additional amounts in respect of the bank run were as follows: Period Amounts Paid for Bank Run (i) 17 May 1993 to 30 June 1993 $ 1,416.00 (j) 1 July 1993 to 30 June 1994 $12,272.00 (k) 1 July 1994 to 30 June 1995 $12,272.00

THE SUBMISSIONS 76 As finally put, the essence of the applicant's case was that the arrangement with the respondent TNT Australia Pty Ltd provided a total remuneration that was less than a person performing the work would have received under the awards as an employee performing that work. In addition, the applicant claimed retrenchment under the relevant Transport Award and the payment of annual leave and long service leave. The parties had tendered a bundle of documents that included the applicant's tax returns for the period covered by the claim showing the costs and returns to the applicant and his wife in operating Hastings Couriers. The terms of the Transport Industry (State) Consolidated Award plus variations, and the terms of the Transport Industry -Redundancy (State) Award were also before the Court. 77 Using these source documents, counsel for the applicant clarified the claim with the disarmingly frank concession that much of the detail set out in the amended Summons for Relief and the Response was something of a mess. There was no issue between the parties as to the hourly rate for the performance of this work by Mr Moore if he was paid under the Transport Award. The respondent did not accept that the award applied to the work or that Mr Moore was an employee, and did not concede the relevance of the award but accepted as a matter of fact that, if the award rate was broken down to an hourly figure, then certain rates were available for the purposes of calculation and clarification of the claim. It should also be noted at this point that, although at various places in the pleadings and in the running of the case there appeared to be an element of the case seeking to establish that Mr Moore was in fact an employee who should have been paid in accordance with the award, ultimately, that argument was not pursued. It was accepted that Mr Moore was engaged as a contract courier, although the terms of the 1993 and 1997 agreements imposed significant controls upon the way in which the work was undertaken. Those controls included a requirement for Mr Moore to devote the whole of his energies and business time to the sale of the company's services in the execution of his duties, acting loyally and faithfully and being obedient to the company, not engaging or being interested directly or indirectly within the territory either as a principal, owner agent, consultant service or other functionary in any other business or trade without first obtaining the company's written approval, maintaining properly equipped and sufficient business premises and vehicles that were well serviced, clean and in a good state of order and repair, vehicles painted in a colour scheme and signwriting that the company may direct from time to time, having competent, courteous, well groomed and efficient personnel as staff when coming into direct contact with the public and becoming a member of certain transport associations. The far reaching nature of those controls was relied upon to explain that, as the arrangement worked out and as initially contemplated, there would be work from at least two divisions of the respondent performed at particular times of the day and in this case as the arrangement worked out the applicant was effectively a full-time courier engaged by the respondent. That combination of factors also impinged on the capacity and the desire of the applicant to seek other courier work. Ultimately, the applicant by his own estimate spent an average of 80 per cent of his working time from early in the morning until after 5.30 pm providing courier services to the respondent. It was pointed out that this was work that was otherwise available to be performed by employed drivers and in fact various entities within the respondent did have permanent drivers driving company owned vehicles to perform this class of work. 78 Having regard the award hourly rate arrived at as described above, and by reference to the source documents contained in the Court bundle of documents, the applicant then calculated that, as against the award rate, he had ultimately been paid less than that rate in the following years: (a) for the financial year 1 July 1994 to 30 June 1995 the applicant claimed that he was paid $10,556.71 less than the award rate; (b) for the financial year 1 July 1995 to 30 June 1996 the claim was for $14,853.76 as representing the amount paid less than the award; (c) for the financial year 1 July 1996 to 30 June 1997 the amount claimed was $10,923.32; (d) for the financial year 1 July 1997 to 30 June 1998 the amount claimed was $10,883.77; (e) for the financial year 1 July 1198 to 30 June 1999 the amount claimed was $6,218.93; (f) for the financial year 1 July 1999 to 30 June 2000 the amount claimed was $2,614.71; (g) for the period 1 July 2000 to 22 December 2000 (when the contract was terminated) the claim was for $5,563.31.

It was accepted by counsel for the applicant that the loss in 1993 of just under $300 was a de minimis amount and that in 1994 there was no loss incurred. The claim therefore focused on the period from 1995 until the end of December 2000. 79 The applicant's approach to these calculations was to start with the fact that the award rate was payable for a 38 hour week before overtime provisions applied, and that was 7.6 hours per day. The evidence of Mr Moore was that he worked each day from 7.30 am - 5.45 pm: allowing an hour for lunch that left a total working day of approximately 9.25 hours. Having regard to the applicant's evidence that he was working 80 per cent of that time and devoting that time to the respondent's work, and making a generous allowance the award rates were calculated by multiplying the hourly award rate by 6 hours per day by 5 days per week, then adding one and a half hours for Saturday as a penalty rate. 80 The annual leave claim for the entire period was calculated on the working hours referred to above, resulting in a total claim for annual leave of $15,588.42. The same approach was taken to long service leave with the claim being for the payment of $3,341.86. In relation to severance and redundancy under the award, a redundancy of 20 weeks was available resulting in a claim of $10,282.60 although, in the alternative, the applicant claimed notice or pay in lieu of notice at 39 weeks less 6 weeks actually provided which resulted in a claim for $16,966.29. This last claim, put in the alternative, was conceded to be at best a broad and general approach to a notice payment, having regard to general principles and possibly setting the high point for any claim under this heading. The last matter pressed, as raised in the amended Summons for Relief, was the unfairness said to arise from the figure of $268 per week offered to Mr Moore for the Bank/TAB run which he accepted and to which he then became committed, but which was then reduced to $236 per week. In addresses, it was calculated that this represented a loss to Mr Moore on the original agreement. 81 The final calculation in the claim as set out above was arrived at by deducting from the gross amounts paid to Hastings Couriers during the claim period all the costs of running the business that had been allowed by the Taxation Office. Counsel for the applicant submitted that there was no challenge to the appropriateness of these expenses and therefore they are to be regarded both as reasonable and representing what was required for Mr Moore to be able to perform this work as an agent for the respondent: the approach was also fair having regard to the fact that this very same work had been performed by or could have been performed by drivers employed by the respondent where the respondent would have had to pay for all of the same overheads of purchasing and running a vehicle for each driver as well as the administrative costs associated with running a business. 82 In relation to the work provided by different or separate entities operated by the respondent TNT Australia Pty Ltd, it was submitted on behalf of the applicant that the respondent's concentration on the mergers and which particular entity provided work at various times during the day to Mr Moore was irrelevant. The arrangement offered by Mrs Newman and accepted by Mr Moore was in two parts: one was the Bank/TAB run and any air freight that came in on the plane, while the second element of work was road freight available through Comet/Kwikasair in the middle of the day. Nothing turned on the fact of these aspects of the arrangement. Mrs Newman had not been called as a witness by the respondent and there was no challenge to the applicant's evidence as to the two aspects of the work that had been offered to him and which he accepted. 83 In relation to the redundancy claim, it was submitted that that claim was supported by the respondent's concession in the evidence that, at the end of December 2000, the respondent no longer wanted the work to be performed because of the significant diminution of the work available due to loss of contracts. 84 The respondent submitted that there was confusion in the amended Summons for Relief and that it appeared to attack and seek variation only of the written agreements entered into in 1993 and 1997 and therefore did not encompass the work performed for Comet/Kwikasair during the middle of the day. Further, there was no relevant attack on the 1993 agreement as to rates and the applicant had negotiated an increase for the 1997 agreement. In those circumstances, the applicant should not be permitted to alter his case in the running of it. Although the respondent had dealt with evidence on a wider basis, it was entitled to do so as a matter of caution but that did not permit the applicant to mount a case wider than that pleaded. Further there was no point in varying the 1993 agreement as to terms of notice and the like because that agreement had concluded with the applicant entering into a new agreement in 1997 and continuing to be engaged by the respondent. 85 The variation seeking to insert a provision for redundancy was also irrelevant in view of the fact that the 1993 agreement was followed by the performance of further work under the 1997 agreement. In any event there was no relevant redundancy because of the status of the applicant as a contractor. Mr Moore had made no claim for notice or redundancy provisions when he negotiated the 1997 agreement. In any event, the evidence showed that the applicant had been forewarned, and in that sense had been given a period of notice that the work was unlikely to continue in its present form or at all if all the contracts were lost. The evidence in this case was slight as to the effects of the loss of the work and it would not justify a claim for a lengthy period of notice, such as 12 months, or the alternative claim calculated on behalf of the applicant of 39 weeks. There was also inconsistency in the case pressed on behalf of the applicant: on the one hand award conditions including redundancy were pressed and, on the other hand, a claim was pursued for notice beyond the award standard and by reference to general principles. 86 Another difficulty for the applicant in relation to notice was that the evidence demonstrated that there was no further work for him after December 2000. A number of agencies were terminated because of the loss of work and the remaining agents were restructured to perform what was left. 87 In weighing the fairness of the contracts, it was important to consider the fact that it suited the applicant to contract with the respondent on the basis of a partnership with his wife. He had previously entered into business arrangements on that basis and had been advised by his accountant of the benefits of such an approach. It was also evident that Mr Moore quite deliberately chose to enter the relationship with the respondent as an independent contractor. 88 In relation to Mr Moore's conversation with Mrs Newman, it was submitted for the respondent that what was put by Mrs Newman was no more than a representation and that it was not contractual in nature. The written contract contained the terms that were ultimately agreed and little weight could be placed on the applicant's evidence that he had no other option but to accept the lower rate ultimately offered. 89 The evidence did not support a finding that Mr Moore had been offered security in his employment. Mr Moore gave evidence of a conversation with Mr Smith but Mr Smith was unable to recall such a conversation. It was not alleged that Mr Moore was untruthful in his evidence, but the combination the lapse of time and issues of memory were such that Mr Smith's evidence was to be preferred. In any event, this exchange took place when the business was under restructure and occurred before the further loss of business towards the end of 2000. To the extent that the Court was able to find that there was some representation made to Mr Moore about security of his employment, circumstances changed dramatically after that alleged conversation with Mr Smith. 90 The largest area of contention concerned the applicant's claim that the contract provided a total remuneration that was less than a person performing the work would receive as an employee performing the work under the awards relied upon. The respondent's submissions focused on the word "total" as it appeared in s 105 of the Act. The applicant, in clarifying his claim, did so by way of comparison not of a gross remuneration figure but by reference to an income figure relating to net business income declared to the Taxation Office. The applicant's counsel had conceded that on the gross payment there was no payment below an award rate. The claim therefore had to fail immediately: what the section required was a consideration of the total remuneration under the impugned contract and to compare that with what an employee would have earned by way of wages as an employee. The business records of the applicant showed expenses including non-cash matters like depreciation written off for taxation purposes. That was simply a book entry and a writing down of the value of the business assets in a way that the taxation law permitted - it did not amount to cash or income that was not received or otherwise spent that financial year. The calculation had started with a gross income and had then stripped that income of expenses including depreciation, vehicle running costs and wages paid to other people which was a wholly flawed approach. By stripping the gross amount received, payments made to people like Mr Lee were removed. Nevertheless, Hastings Couriers derived income from Mr Lee performing work for the business. It was accepted that running costs may be a legitimate deduction from the gross amount but items such as depreciation were not. It was said that claiming depreciation and including costs of others who generated that income for the business was an entirely fictitious way of performing an accurate calculation - the submission was put "no higher than that". Business expenses were also incurred for doing other work, yet the totality of the business expenses were deducted for the purposes of the applicant's calculation. 91 In relation to annual leave, Mr Lee apparently did fill in on occasions when Mr Moore took leave. When Mr Lee was working at that time he was generating income for the business and this had not been properly valued in the applicant's calculations. 92 In relation to long service leave, the applicant was engaged as a contractor and ultimately did not press for a declaration that the applicant was in fact an employee. Long service leave did not accrue under the terms of any relevant transport industry award and there was no adequate basis established by the applicant for the payment of long service leave. 93 In relation to the overall claim, it was important to recognise that the applicant had chosen to undertake this business in partnership with his wife on his accountant's advice and that there were income splitting taxation benefits from that arrangement. While it was conceded there was no evidence before the Court as to the quantification of those benefits, that was clearly the purpose of the partnership arrangement and had to be considered. DELIBERATION 94 It is appropriate to commence by dealing with the respondent's submission that the case for the applicant was to be confined to the two written agreements dealing with the Bank/TAB run and to treat the applicant's case as not extending to the work performed for Comet/Kwikasair. As was conceded by counsel for the applicant (apparently only recently briefed), there were aspects of the amended Summons for Relief and supporting documents that were unsatisfactory and messy but the nature of the case had been substantially narrowed and clarified by the time of the opening of the applicant's case. More significantly, a balanced reading of the amended Summons for Relief made it clear that the claim of unfairness had been framed starting from the terms originally offered to the applicant by Mrs Newman and then unilaterally altered after they were accepted by Mr Moore. While the Summons for Relief seeks certain variations to the written contract it also raises directly the work performed in the morning and afternoon on the Bank/TAB run and the work performed during the day: the applicant alleging that the contract he accepted, as offered by Mrs Newman, having two aspects to it - the first being the Bank/TAB run and the other being the road freight aspect. It was specifically pleaded that the conduct of the respondent rendered the contract unfair because of its failure to honour its agreement in 1992 to pay $268 for the Bank/TAB run and the alleged increased workload of the applicant with a failure to grant reasonable remuneration increases during the course of the contract. Further, as to the claim that the contract failed to return to the applicant total remuneration that would have been earned by an employee doing the same work, the calculations contained in the Summons for Relief were clearly based upon the whole of the days' work performed by the applicant for the respondent. The issue is readily concluded against the respondent's submission by the fact that, without objection, the respondent permitted the applicant to call evidence in relation to all of these aspects of the claim when technically (on the respondent's approach) the material was strictly irrelevant. Indeed, the respondent's counsel submitted that a cautious approach had been taken and all of that material had been met by the respondent. Thus, there is no suggestion that, in some way, the respondent has been caught by surprise or had not been given a proper opportunity to meet the applicant's wider case. The first issue raised by the respondent is therefore rejected. This was a significant aspect of the respondent's case, which focused heavily on the different entities within TNT that provided work to Mr Moore. 95 In relation to the representations made by Mrs Newman to Mr Moore, I accept the applicant's evidence that he was offered the Bank/TAB run at a rate of $268.00 gross per week and further work involving the delivery of freight from the airport. Although the terms of the contract seem to suggest that the work in the middle of the day was to be paid by reference to the schedule to the contract, it is likely that this work developed at an early stage after conversations with the depot manager. Indeed, it was the Comet/Kwikasair work that appeared to develop during the course of the contract with the respondent. Mr Moore's evidence that he had accepted that offer and had then moved to set up a new business to perform that work by selling his previous business and registering a new business is evidence that I accept. It may well be that he had not yet moved to purchase the new truck, but his evidence is uncontradicted on this point and I accept it. 96 The intervention of Mr Powditch, claiming that too much had been offered for the run and that the respondent was only going to pay Mr Moore $236.00 per week, was unilateral but also unsubstantiated, contrary to the agreement already reached with Mrs Newman, unjustified and therefore unfair. The evidence established that rates were individually negotiated with agents and while in certain circumstances, this might reflect the peculiarities of a particular part of the respondent's operation, it also suggested that there was no particular consistency in the rates offered for the same work although the work was performed under what was accepted as being a standard form of contract. A finding of unfairness against the respondent on this aspect of the case means that an amount of $12,613.00 should have been payable to applicant by the respondent during the term of the contract. How this sum is to be treated requires consideration of the overall claims of the applicant. I will therefore return to this matter after determining the other aspects of the applicant's case. 97 In relation to the extensive evidence as to the different entities within the respondent TNT Australia Pty Ltd that provided work for Mr Moore in circumstances where the written contract appeared to confine its operations to the TNT Express Couriers' run, I believe the Court is entitled to take a broad approach and deal with the overall arrangement between the applicant and the respondent. The applicant's amended Summons for Relief attacked the contract between the parties but in terms that clearly encompassed all aspects of the work. Section 105, which is essential to the operation of Ch 2 Pt 9 of the Act, defines "contract" to mean any contract or "arrangement". It is entirely understandable that the applicant's legal advisers framed the Summons for Relief having regard to that broad definition, clearly intending to put under scrutiny the entire arrangement by which Mr Moore performed work for the respondent. 98 I accept Mr Moore's evidence that, having been provided with this range of work and having regard to the terms of the contract which so tightly bound him to the business of the respondent, he felt an obligation to give priority to the respondent's work and to perform as much of that work as he could rather than looking for other work. As the arrangement developed, the evidence established that the work done from 10.30 am or so to 3.00 pm became quite significant, although I also accept that it was likely to vary from day to day. On his own assessment, which I also accept, Mr Moore was spending on average 80 per cent of that time between 7.30 am - 5.30/5.45 pm performing work for the respondent. The terms of the contract, imposing considerable obligations on the agent and giving considerable control to the respondent (including uniforms, logos and colours of the vehicles used), undoubtedly left Mr Moore with the feeling that he had significant ongoing work with the respondent, itself a very large operator in the transport industry, and that that work was secure. Having observed the applicant during the course of his evidence, I accept that he had a conversation with Mr Smith to the effect of which he deposed (and which Mr Smith could not deny but simply could not recall). That conversation may have added to Mr Moore's feeling of security, even though late in the course of the relationship between the parties and at a time when Mr Moore had already been doing a constant and continuing level of work for the respondent. 99 It is the combination of work substantially occupying the Mr Moore's time that lifts this arrangement above a bare agency arrangement to do certain limited deliveries for the respondent. The respondent's evidence suggests that there were couriers who were given permission to perform other work and that their agency work was likely to occupy only a portion of the overall work performed by the courier. Whatever might be made of those relationships, the present case is entirely different. Here, Mr Moore was all but performing full-time duties for the respondent in work that the respondent could have had performed by paid drivers using company vehicles: in some areas, the respondent did just that. Indeed, Mr Bowne stated that the volume of work might lead to a courier being engaged "more or less full time": that description fits Mr Moore's circumstances. The evidence of Mr Bowne also suggests that agents performing nearly full-time work may not be given permission by TNT to perform other work. 100 Consideration then needs to be given to the amounts claimed (amounting to $61,614.51) and the method by which that claim was calculated. There was no dispute that the two transport industry awards applied to the work as performed by employees and the hourly rate for that work: nor was there any dispute as to the award classification appropriate for this class of work. I am satisfied that the calculation of the claim as finally pressed by reference to the hourly award rate for six hours per week day represents an appropriate compromise and recognises the difficulty of being precise about all the work performed over a period of seven and a half years. I accept the applicant's evidence that he worked between 7.30 am until 5.30/5.45 pm Monday to Friday and worked an hour and a half on Saturday. The applicant's calculated claim deducts from that time an hour for lunch, although Mr Moore's evidence was that he took 30 minutes, and then rounds down the hours taking into account the applicant's estimate that he spent 80 per cent of this time performing the respondent's work. In calculating that there was, on average, no less than six hours per day worked Monday to Friday, I do not believe the applicant has overstated or exaggerated his case: indeed, the evidence suggests that he worked longer than 6 hours per day. I accept the evidence of Mr Moore and Mr Lee that the Bank/TAB ran alone would occupy at least five and a half to six hours per day. 101 The respondent submits that the claim as calculated should be reduced by amounts claimed in taxation returns for depreciation, amounts paid to Mr Lee and others to perform work for the business and generating income, and that account should be taken of the fact that there was a small amount of other work performed during the course of the contract which contributed to the overheads of Hastings Couriers and its running costs. Ultimately there is no complaint by the respondent that normal business costs such as the maintenance of the vans and necessary office support might appropriately be deducted to ascertain the actual remuneration received by Mr Moore. 102 I am not satisfied that the respondent's submission in this regard should be accepted in its totality. Section 106 (and its predecessors) was broadly drawn to permit justice to be done between the parties. One way a money order may be calculated is by reference to what an employee might have earned under an award for doing the same work that was performed by a contractor. That does not necessarily mean that the case should be conducted as the equivalent of an award breach, but the provision should give an indication of the standard of payment against which such a claim might be calculated. Having regard to the long history of this provision being applied to the sale of a truck and a run, in less sophisticated times, the general costs of the business have been deducted in order to determine whether the driver received a total remuneration less than that available under the award. 103 The terms of s 105(c) were designed to ensure that a person was in no worse position than an employee paid under an award performing the same work. In earlier cases, the Commission deducted the costs incurred to obtain and perform the work from the payments made under the impugned contract (see e.g Hughes v Harrington 1973 AR 73 at 77). In Durham & anor v Ireland (1981) 1 IR 67, Bauer J gave great width to the term "remuneration" in the equivalent section under the Industrial Arbitration Act 1940, so as to include all identifiable benefits available to the applicant as well as deducting the costs incurred in obtaining and performing the work. 104 There was no cross-examination or other evidence calling into question the appropriateness of the amounts claimed for depreciation of the vehicles used by the applicant in performing this work. Indeed, it was open to the applicant to claim the cost of the vehicles less their value at the end of the arrangement in 2000. In the circumstances, the allowable depreciation of the vehicles represents a legitimate business expense and is available to be set off against the amount paid to the applicant by the respondent in arriving at the applicant's "total remuneration". In relation to the costs incurred by engaging a standby driver, even though it generated income for the applicant, it is properly regarded as a legitimate cost of performing the contract. The income generated is included in the gross income from TNT and there is, thus, no failure by the applicant to account for what he received as well as what it cost him to earn the income from the respondent. 105 The benefit of income splitting with the applicant's wife is presumed by the respondent, but is not quantified in the evidence. The Court is left with no real information by which this assumed benefit might be calculated. It is therefore to be taken into account in a general sense. Similarly, the small amount of work performed for bodies other than TNT was not quantified as to the costs incurred by the applicant in performing this work. Again, this admittedly small amount should be taken into account in only a general rather than in a specific and quantified way. It should be noted, however, that the fact of the partnership and the income splitting available to the applicant does not call into question the methodology applied to the calculation of the applicant's claim - all the costs of the business are deducted from all the income received from TNT and I accept that exercise as giving a reliable indication of the applicant's loss. 106 While I reject the inflexible approach inherent in the respondent's submission, I believe it is appropriate to give some recognition to such elements in a much more general way, including the impossibility of being able to precisely state what work was done day by day over seven and a half years. Overall, I am satisfied that the total remuneration received by the applicant was unfair in failing to reach the amount that would have been paid to an employee over seven and a half years under the award. I am satisfied that the general approach in the applicant's calculations is correct and that being fair to both sides, an appropriate money order recognising the fact that the total remuneration available to the applicant was less than that available under the Transport Industry (State) Award, an amount of $57,500 should be ordered to be paid by the respondent in relation to this head of the claim. 107 Having reached this conclusion, I return to the amount of $12,613 that was not paid to Mr Moore out of the original arrangement and which in fairness should have been paid to him. Having regard to the way in which the applicant has calculated the claim, that has resulted in an amount of $57,500 being ordered by the Court to be paid by the respondent, I cannot accept that there should be added to that amount the figure of $12,613. In my view, that amount, while it is money that should have been paid to the applicant, may notionally be offset against the amount that might be regarded as a failure to pay at least the award rate. This result flows directly from the nature of the relief pressed and how it was calculated by the applicant. 108 In relation to annual leave, it appears that there is a potential for double counting. The calculation of the underpayment of award wages proceeds on the basis that work was performed 52 weeks a year. In that way, four weeks' annual leave has already been included in the calculation and it would be unfair and inappropriate to require the payment of another four weeks for every year of service. In those circumstances, there will be no separate order relating to the payment of an amount calculated by reference to annual leave. The issue in relation to long service leave is different. Ultimately, it was not the applicant's case that he was in fact an employee and entitled to long service leave. The claim for relief has succeeded under the particular provisions of Ch 2 Pt 9 of the Act. Having regard to the totality of the arrangement, I do not believe that it operated unfairly to the applicant by not providing for long service leave. 109 Unlike long service leave, redundancy is provided for by the Transport Industry - (Redundancy) State Award. In the usual case, there might not be a proper basis established for a contract courier to be paid redundancy: much will depend on the particular circumstances of each case. Earlier, I have distinguished the arrangement between the applicant and the respondent by reference to the fact that, in operation, the applicant was all but indistinguishable from a full-time employee. It was because of that factor that he was entitled to have a certain degree of confidence about the security of his work and its ongoing nature. The terms of the agreement did not allow him to sell his business with any element in recognition of goodwill and, despite his investment in the business over more than seven and a half years, there was in effect no business left to sell by the time of the restructuring in mid 2000 and the termination of his contract in December 2000. It is in these particular circumstances that I believe there should be some element in recognition of the loss of the contract work, although I am not satisfied that it would be appropriate to grant the sum calculated on behalf of the applicant by reference to the award provisions for redundancy. Some recognition also needs to be given to the period of actual notice provided to the applicant although this aspect is of reduced value having regard to the inability of the applicant to take advantage of that notice to sell his business as a going concern, or to obtain alternative business as a courier. I accept the applicant's evidence in relation to these matters which was not seriously challenged. In my view, this element of the case would be appropriately met by a payment of $6,500.00. 110 The applicant' s alternative claim by reference to reasonable notice had no particular basis and there is force in the respondent's analysis that it was inconsistent with the focus of the case. I am not prepared to make an order for notice as put in the alternative on behalf of the applicant.

The respondent addressed on a number of matters raised in the amended Summons for Relief that, ultimately, were not pressed by the applicant. Those matters have not, therefore, been given further consideration in determining the applicant's case. 111 The respondent argued that the Court would not intervene in the contract entered into freely by the applicant against a background of his experience in operating a courier service immediately beforehand: the applicant chose to seek no advice on the terms of the contract and was capable of negotiating an increase in rates. This submission needs to be considered against the evidence of the applicant's modest standard of education and a work history taken up substantially by working as a miner. It was upon his redundancy as a miner that the applicant considered other work and eventually was attracted to the work of a contract courier - he did so with almost no business background but in a small venture. The rates offered by the respondent, a substantial business entity, were part of a standard form agreement. Commonsense and common human experience would suggest that the applicant was not well placed to negotiate terms beyond those offered by the respondent. From the very earliest days of the operation of this provision, the Commission has adopted the view that awareness of the nature of the contract would not be a bar to granting relief (see A & M Thompson v Total Aust. Ltd 1980 2 NSWLR 1 at 13-14); nor has the foolish or unbusinesslike action of the applicant provided a reason to deny a remedy (see Williams v Calmex Products Pty Ltd 1971 AR 264; Spicer v Clifford 1969 AR 273).

I am unable to find any aspect of this applicant's conduct that would operate to deny him access to any relief to which he may otherwise be entitled in the exercise of the Court's wide jurisdiction under Ch 2 Pt 9 of the Act. 112 The applicant's evidence was that the only work he had been able to obtain since the termination of his contract with TNT was casual employment from February 2001, returning him $110 gross per fortnight. The respondent made no submission as to how this sum should be treated when considering the principle of mitigation. As pointed out by the Full Bench in English v Aradlay Insurance Brokers Pty Ltd (2005) 145 IR 129 at [35], the principles of mitigation of damages are relevant but not decisive as to what order should be made.

The principle of mitigation only has relevance to the amount paid by way of notice and redundancy, an amount that has already been substantially compromised. I can see no basis to further reduce the amount proposed because of the very small amounts earned by the applicant in casual employment of a very different kind. 113 On the approach I have taken, I do not believe that it is appropriate to vary the terms of the contract or arrangement that has operated over a number of years and which has come to an end. The preferable course is to declare the arrangement as unfair and to further declare the arrangement void ab initio except to the extent of the payments made by the respondent to the applicant. The applicant is to prepare Short Minutes of Order giving effect to the orders proposed in this judgment. The matter will be relisted on Wednesday, 14 June 2006 at 9.45 am to deal with the formal orders.

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Judgment (19 paragraphs)

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