s.365 - Application to deal with contraventions involving dismissal

Tigeroy Pty Ltd (KWA Roberts Family Trust trading as Leadership Collective Australia)

Application to deal with alleged contraventions of Part 3-1 involving dismissal - objection that applicant an independent contractor and not an employee and not dismissed for the purposes of s.365 - s.15AA - real substance, practical reality and true nature of the relationship

• [1] On or about July 2023 the applicant in this matter, Ms. Jennifer Kelly (Applicant) commenced working for Tigeroy Pty Ltd (Trustee for KWA Roberts Family Trust trading as Leadership Collective Australia) (Respondent) in a role described as 'Membership Director'. The relationship came to an end in January 2025 in circumstances in which the Applicant alleged she was dismissed by the Respondent in contravention of Part 3-1 of the Fair Work Act 2009 (Cth)(Act). The application under s.365 of the Act which followed, was resisted by the Respondent on the basis that the Applicant was, at all material times, engaged as an independent contractor and not an employee and therefore could not have been "dismissed" within the meaning of that term in s.365.[1]

• [2] Before the Fair Work Commission (Commission) is able to exercise any of its functions under s.368 of the Act it must be established that an applicant has been dismissed as a matter of fact. It is not sufficient that an applicant simply alleges that a dismissal has occurred.[2] The question that arises for determination here is whether the Applicant was an employee who was dismissed at the relevant time or was an independent contractor whose contractual arrangements with the Respondent were brought to an end by the Respondent. For the reasons that follow I have concluded that the Applicant falls into the latter category and that the application can proceed no further.

• [3] The Respondent is a membership-based organisation that facilitates bi-monthly meetings or 'roundtables' of corporate executive officers who are members of the organisation to exchange information and provide those officers with mutual support in their respective roles. The meetings are chaired by a person engaged by the Respondent. The Applicant did not chair the meetings. The Applicant's role within the organisation was to sign up new members to the organisation and to follow up with members to see if they were satisfied with the programme that had been delivered through their membership of the Respondent. This work would involve the Respondent providing the Applicant with contact 'leads' to be followed up after an initial email distribution. The Applicant would contact those expressing an interest through a telephone call or online meeting to discuss the Respondent organisation and the services it provides and convince those persons of the benefits of membership of the Respondent.

• [4] The Applicant was engaged to work for the Respondent in 2023 after Mr. Roberts, the Respondent's Chief Executive Officer, approached the Applicant to take on the role of Membership Director.

• [5] At the time of the Applicant's engagement, the Applicant was the sole director and shareholder of a company called 079 162 904 Pty Ltd (Applicant's company). That company was the owner of an Australian Business Number (ABN) and a business name and was registered for the goods and services tax. The Applicant's company was set up in the mid-1990s. The Applicant is not unfamiliar with independent contractor relationships. The Applicant has provided services to others as a contractor through that company 'on and off' for some years since it was originally set up.

• [6] There was a dispute about what was said during the initial discussion between the Applicant and Mr. Roberts that resulted in the engagement of the Applicant's services. The Applicant asserted, and I accept, that nothing was said during this first conversation about whether the Applicant would be engaged as a contractor or employee. However, on 22 July 2023 Mr. Roberts emailed[3] the Applicant and provided further information about the position. The email proposed that the Applicant be engaged as a contractor and be paid an hourly rate in addition to a lump sum commission for each member that the Applicant signed up. A further lump sum commission was referred to for persons the Applicant signed up without the assistance of the Respondent. The Applicant ultimately negotiated a higher hourly rate with Mr. Roberts and thereafter commenced work for the Respondent.

• [7] The parties entered into a written contract dated 25 August 2023.[4] The contract was signed for the Respondent by Mr. Roberts on 20 September 2023. It was signed by the Applicant on 12 September 2023. The contract referred to the ABN owned by the Applicant's company and the Applicant personally in both the name of the contracting parties at the commencement of the contract and in the signature section at the end of the contract. It did not make reference to the Applicant's company. I am of the view that the Applicant as an individual was the contracting party.

• [8] Amongst other things, the contract entered into by the parties provided as follows:

(i) The position referred to was Membership Director;

(ii) The Membership Director was to have control over the work performed, including hours and work location;

(iii) The Membership Director was to supply and use their own equipment;

(iv) The Membership Director was an individual who is able to supply the agreed services;

(v) Work was to be paid for on an hourly rate basis with a lump sum commission bonus for each new member signed;

(vi) The Membership Director was engaged on a contract basis and was wholly responsible for income tax on fees received;

(vii) Fees quoted were exclusive of GST and GST needed to be added if applicable;

(viii) The Respondent did not accept liability to pay superannuation;

(ix) Fees would be paid in accordance with the Respondent's monthly payment cycle. An invoice was required for payment "(which if in your personal capacity will not include GST)";

(x) The Membership Director was responsible for insurances, including professional indemnity, public liability and workers' compensation;

(xi) The agreement was expressed as not constituting a relationship of "employer and employee, principal and agent or partnership" between the Respondent and the Membership Director.

(xii) The Membership Director was not to create any obligation on behalf of the Respondent other than in the normal course of the services provided by the Membership Director.

• [9] The Applicant submitted that the written contract was not appropriate to the role of Membership Director but referred to the duties of Roundtable Chair. However, the hourly rate and new member (non-referral) commission arrangements in the contract were consistent with the email of 22 July 2023 and the Applicant accepted that she had signed the contract and understood at that point that she was being engaged as an independent contractor. The references to the Roundtable Chair is an obvious error, but it does not negate the binding force of the contract that was entered into.

• [10] The evidence establishes that the Applicant generally worked for the Respondent from her home. On occasions, the Applicant attended meetings convened by the Respondent. The Applicant used her own desktop computer and mobile phone to perform the work. Mr. Roberts gave evidence, which I accept, that the Applicant paid for the servicing of her computer and generally paid her own travel costs. The Respondent reimbursed the Applicant for travel costs arising from her attendance at a Melbourne meeting on one occasion and reimbursed printing and postage costs on at least one occasion.

• [11] At all relevant times the Applicant maintained her own workers' compensation insurance.

• [12] The working hours of the Applicant were not fixed and the Applicant was generally able to arrange her working hours to suit her other commitments. Whilst the Applicant was working for the Respondent, she also performed work for another company as a contractor in an unrelated industry. The Respondent was aware of this arrangement. This arrangement was not prohibited by the terms of the contract referred to above.

• [13] The Applicant had regular meetings with Mr. Roberts on Mondays to discuss the work that was being undertaken. The Applicant submitted that the Respondent maintained control over the flow of work that she was required to perform and that there was ultimately some consistency and regularity in the number of hours she worked from week to week. The Respondent said that in the initial discussion with the Applicant, the Applicant was told that she would be provided with, in the order of 10 to 20 hours work each week, depending on the amount of work that the Respondent was able to provide but that there was no consistency in the Applicant's hours of work which fluctuated from week to week.

• [14] The invoices and covering emails to invoices that were in evidence show some variation in the work performed by the Applicant. The number of persons the Applicant would meet with each week could range from 1 to as many as 9. Often the Applicant would meet with 3 to 5 people each week. I accept Mr. Roberts' evidence that the Applicant was able to determine the order in which the 'leads' provided by the Respondent would be contacted and that the Applicant would, within limits, determine when those persons were to be contacted. It is also apparent from the evidence that the Applicant was required to regularly report to Mr. Roberts on the progress of her work and that Mr. Roberts required the Applicant to make contact with the potential members within a reasonable timeframe. I do not accept that, as Mr. Roberts put it, the Applicant had 'full control' over the number of hours worked in a particular week. The number of allocations from the Respondent would have had a significant bearing on the amount of work performed by the Applicant from week to week. Ultimately the number of hours worked by the Applicant varied from week to week depending on the flow of work.

• [15] The Respondent maintained that the Applicant also had the autonomy to generate her own work by seeking out potential members beyond those referred to her by the Respondent. The Applicant disputed this and said that the Respondent was unwilling to pay for time spent by the Applicant researching potential members whom the Applicant might contact. I accept the Applicant's evidence on this point. The covering emails to the invoices do not suggest that the Applicant was working on researching or following up persons of interest other than those referred to her by the Respondent. However, even though the Applicant may not have undertaken that work in practice, the contract provided her with the right to claim a fee for 'referrals', that is new members referred by the Applicant to the Respondent. It did not expressly limit the work for which the Applicant could charge an hourly rate to only work involving following up on contacts provided by the Respondent.

• [16] The Applicant invoiced the Respondent for the work she performed, initially on a monthly basis and later on a weekly basis. The invoices were for the most part, calculated on the basis of the agreed hourly rate. The invoices were issued by the Applicant's company. They included the ABN of the Applicant's company and required payment into an account styled 'Jennifer Kelly Pty Ltd'. GST was added to the amount charged on the invoice.

• [17] It was not disputed that the Applicant represented herself to those she contacted as someone who was part of the Respondent's business. The Applicant's email referred to Applicant as the Respondent's Membership Director. Mr. Roberts accepted that it was important that the Applicant was seen to be part of the Respondent rather than a 'broker' as this had an impact on the willingness of potential members to sign up. He accepted that the Applicant had the authority to present herself to potential members as part of the Respondent and someone who was advocating the benefits of that organisation and inviting them to join.

• [18] There was however a contest as to the extent to which the Applicant had autonomy in her interactions with those with whom she made contact. Mr. Roberts maintained that the Respondent provided some 'guidelines and templates' to the Applicant but that the Applicant had "full control over the emails and correspondence with members" and that in most cases, he did not ever see the correspondence between the Applicant and the people she was contacting. The evidence did not establish that the Respondent was regularly issuing directions to the Applicant about the way the work was to be carried out. The Applicant simply reported on the contact and progress made with the persons she had been in touch with.

• [19] The Applicant said that she was provided with template documents from the company, including the initial emails that were sent out to potential members. She said that although the initial emails were sent under her signature, the content of those emails was not determined by her, but by Mr. Roberts. I accept that to be the case.

• [20] The Applicant also gave evidence about the scope of her autonomy to conduct follow-up conversations with those who had expressed an interest in the initial email. She said that there were certain points that needed to be covered in the conversation and that she was required to be factual in the information that she provided. The Applicant agreed that there was certain information that she would deliver about the nature of the organisation, the programmes that it conducted and the commitment that was required if someone were to join. She accepted however that the flow of the meeting and content of the discussion would vary from person to person and that she was required to adapt during the meeting depending on what issues were raised by the person she was dealing with.

• [21] The evidence as to written material provided by the Respondent to the Applicant was limited. Mr Roberts' email of 22 July 2023 shows that the Applicant was given examples of a 'programme overview, a summary of the Respondent's programme, a typical agenda and member feedback'. The documents themselves were not in evidence. The Applicant was also referred to the Respondent's website by Mr. Roberts. As best as can be ascertained from the evidence, I conclude that aside from the initial contact email, which was supplied by the Respondent, there was no strict written formulation as to the way the Applicant was to perform the work. The Applicant had latitude in the way her work was performed and how she went about convincing contacts of the merits of the Respondent's offering. The objective however was straightforward and singular; it was to sign and retain members for the Respondent.

• [22] The Applicant was not entitled to any form of leave under the terms of the contract and as a matter of practice did not take leave. The Respondent advised the Applicant that the business would be closing down for a five-week period at the end of 2024 and the Applicant would not be given any work.

• [23] The Applicant performed the work for the Respondent herself and did not delegate the work to anyone else.

• [24] The Applicant complained about her personal interactions with Mr. Roberts in November 2024. The complaint was not dealt with. The Respondent advised the Applicant of the close-down period during December 2024. On 2 January 2025 the Respondent issued a notice terminating the relationship with the Applicant. The Applicant continued to perform some work during January 2025 and issued final invoices for work performed. The terms of these invoices were disputed by the Respondent. A resolution of the dispute was proposed by the Respondent in a document that described the reason for the contract termination as 'genuine redundancy'. Those terms were not agreed to.

• [25] Section 15 and 15AA of the Act provide as follows:

15 Ordinary meanings of employee and employer

(1) A reference in this Act to an employee with its ordinary meaning:

(a) includes a reference to a person who is usually such an employee; and

(b) does not include a person on a vocational placement.

Note: Subsections 30E(1) and 30P(1) extend the meaning of employee in r elation to a referring State.

(2) A reference in this Act to an employer with its ordinary meaning includes a reference to a person who is usually such an employer.

Note: Subsections 30E(2) and 30P(2) extend the meaning of employer in relation to a referring State.

15AA Determining the ordinary meanings of employee and employer

(1) For the purposes of this Act, whether an individual is an employee of a person within the ordinary meaning of that expression, or whether a person is an employer of an individual within the ordinary meaning of that expression, is to be determined by ascertaining the real substance, practical reality and true nature of the relationship between the individual and the person.

(2) For the purposes of ascertaining the real substance, practical reality and true nature of the relationship between the individual and the person:

(a) the totality of the relationship between the individual and the person must be considered; and

(b) in considering the totality of the relationship between the individual and the person, regard must be had not only to the terms of the contract governing the relationship, but also to other factors relating to the totality of the relationship including, but not limited to, how the contract is performed in practice.

Note: This section was enacted as a response to the decisions of the High Court of Australia in CFMMEU v Personnel Contracting Pty Ltd [2022] HCA 1 and ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2.

(3) Subsections (1) and (2) do not apply to the following provisions of this Act:

(a) Divisions 2A and 2B of Part 1‑3;

(b) Part 3‑1, to the extent that Part 3‑1 applies only because of the operation of section 30G or 30R.

• [26] Section 15AA commenced operation from 26 August 2024. It was not argued that s.15AA(3)(b) applies here and I proceed on the basis that Part 3-1 of the Act applies because of the operation of s.338 and not because of the operation of ss.30G or 30R which extend the operation of the Part in the case of referring states.

• [27] Section 15AA applies in this case because of s.116 in Part 17 of Schedule 1 of the Act. That section sets out the transitional provisions which apply to the operation of s.15AA. It provides:

116 Relationships in existence as at commencement or entered into on or after commencement

(1) Subject to this Schedule and sections 15AB to 15AD of the amended Act, section 15AA of the amended Act applies on and after commencement to the following:

(a) a relationship between an individual and a person entered into before commencement that is in existence as at commencement;

(b) a relationship between an individual and a person entered into on or after commencement.

(2) Despite section 40A, section 7 of the Acts Interpretation Act 1901, as in force from time to time, applies in relation to the amendment made by item 237 of Part 15 of Schedule 1 to the amending Act.

Note: Section 7 of the Acts Interpretation Act 1901 provides for the effect of amendment and repeal of provisions of Acts, including in relation to rights, liabilities, penalties and forfeitures etc. accrued or incurred before the repeal.

• [28] I am therefore required to determine the issue here by ascertaining the real substance, practical reality and true nature of the relationship between the parties. In doing so I must have regard to the totality of the relationship, including the terms of the contract and how the contract is performed in practice.

• [29] As is often the case in matters of this kind, there are some factors which weigh in favour of a conclusion that an employment relationship existed between the parties and others which point to a contrary conclusion. There is no single exhaustive list of factors to be considered and the considerations and the weight to be attached to them are likely to vary depending on the facts and circumstances of each case. The exercise involves an evaluative judgment beyond the mere mechanical ticking off of indicia on a checklist and adding up the results. In making the assessment, I have considered the evidence in its totality.

• [30] Although not determinative, the question of whether someone is conducting their own independent business as opposed to serving in the business of another can be a useful framework to guide the characterisation of the relationship.[5]

• [31] The Applicant was conducting a business to the extent that she was providing services as a contractor through her corporate entity to another organisation at the same time as she was working for the Respondent. That was work of a different nature to the work the Applicant performed for the Respondent. As to the relationship with the Respondent, even though it does not appear that the Applicant availed herself of the opportunity, the contract provided scope for the Applicant to increase her earnings by seeking out and 'referring' new members on her own initiative. To this extent, the legal capacity to seek out those additional opportunities is consistent with the Applicant conducting as business as an independent contractor. However, as a matter of practice, there was little entrepreneurship exercised by the Applicant. For the most part, the Applicant simply dealt with the work that she was allocated by the Respondent.

• [32] There are aspects of the arrangement which suggest the Applicant was integrated into the Respondent's business. Those aspects are supportive of the view that an employment relationship existed, but they are not determinative. The Applicant was presented to third parties as an emanation of the Respondent. Mr. Roberts acknowledged that this was a conscious decision to ensure that those who were to be approached, were seen to be approached by the Respondent directly and not through an agent. The work of the Applicant was integral to the Respondent's operation in the sense that the Applicant was often the initial point of contact for prospective members and was tasked with providing the basic information about the service that the Respondent provided to its members and seeking to persuade those contacts to join the Respondent. On the other hand, aside from weekly meetings with Mr Roberts and a colleague engaged in similar work in Melbourne, and broader organisation meetings, there was insufficient evidence to conclude that the Applicant regularly performed her day-to-day work as part of a group of fellow workers for the Respondent. The Applicant's day-to-day work was largely carried out by the Applicant independently of others.

• [33] The right to control the work of a person is an indicator of an employment relationship.[6] The substance of the right to control was described by Wilson and Dawson JJ in Stevens v. Brodribb[7] as whether the contractual arrangement "subjects the person engaged to the command of the person engaging" not just as to what shall be done, but how it shall be done.[8]

• [34] Some of the evidence supported a conclusion that the Respondent exercised control over the work carried out by the Applicant. This includes the standard form emails that were sent under the Applicant's signature, some of the basic information that the Applicant was to convey to prospective members and the regular reporting to Mr. Roberts on the progress of work. However, any legal right of control conferred by the contract was very limited and there was insufficient evidence to conclude that the Respondent exercised significant control as to how the Applicant actually performed her work. The Applicant had latitude both as a matter of contract and as a matter of practice in the conduct of her discussions with prospective members. In terms of the control of when the work was performed, the contract conferred on the Applicant the right to determine the time in which she made contact with the people she contacted and the hours and days in which she performed her work.

• [35] I note and accept the Applicant's unchallenged evidence that the Respondent did not have a fixed work premises and everyone worked remotely. However, the contract also gave the Applicant the right to determine her work location, a right which she exercised as a matter of practice.

• [36] The contract provided that the parties to the contract were the Respondent and the Applicant and even though the Applicant's company's ABN is stated, the Applicant's company is not referred to. Nonetheless the terms of the contract entered into were generally supportive of a relationship of principal and independent contractor. The contractual right to control how the work is performed and determine hours of work was reserved to the Applicant. This weighs in favour of such a conclusion, as does the supply of equipment by the Applicant.

• [37] The contract also said that nothing in the agreement constitutes a relationship of employer and employee. The plurality in Personnel said that generally speaking, the opinion of the parties on a matter of law is irrelevant and that it is erroneous in point of principle to use the parties' description of their relationship to resolve uncertainty.[9] I regard this term as having little weight in the overall analysis.

• [38] The Applicant was required by the contract, and did as a matter of practice, take out relevant insurances, including for work-related injury. In circumstances where the Applicant was conducting a business by working as a contractor for another entity at the same time as she was working for the Respondent, this is less likely to be a reflection of the mere labelling attached to the relationship by the parties and more likely a practical consequence of the need for the Applicant to make provision for her independent contracting working arrangements more generally.

• [39] The remuneration and invoicing arrangement is indicative of an independent contracting relationship. The invoices submitted were in the Applicant's company name and required payment to a company account. GST was included in those amounts. There was no evidence that the Respondent was withholding taxation remittances on behalf of the Applicant, and it appears that the parties had accepted that as a matter of practice, and in accordance with the terms of the contract, that the Applicant would be responsible for the taxation obligations, including GST, related to her earnings from the Respondent. This is consistent with the relationship between the parties as originally conceived by both of them. The Respondent offered the position as a contractor position on 22 July 2023. The Applicant accepted the position on the understanding that she was to work as an independent contractor. From the outset the Applicant, through her company, issued invoices to the Respondent, including a GST component.

• [40] In EFEX Group Pty Ltd v. Bennett[10] (EFFEX) the Full Court of the Federal Court of Australia was considering circumstances in which a person had established a trust for the purpose of performing sales work for a company and had issued invoices for the work performed. The Court held the person to have been engaged as an independent contractor. Katzmann and Bromwich JJ said:

45....in the present case, the taxation arrangements were a consequence of the terms of the contract from the outset. They formed part of the earliest pre-contractual discussions. They went directly to contract formation, and can properly be seen to be a design feature of that contract as a core term or condition, albeit not reduced to writing. They were not just manifestations of opinion, nor set up later for incidental financial advantage, such as by some kind of artificial or at least questionable income splitting. At the very outset, before Mr Bennett commenced work for EFEX, he set up a trust for the very purpose of the impending commencement of work under the contract with EFEX, so that payment could be made in that way for the services he performed.

46. The inescapable conclusion is that Mr Bennett held the fruits of the contract with EFEX in his capacity as trustee of the Bennett Enterprises Trust, benefited from the tax arrangements attendant on that fact, and this was known and agreed to by EFEX. Indeed, the contract was offered on that express basis....

47. Mr Bennett's submission that regard to the trust structure and tax arrangements must follow characterisation of the relationship is misplaced in a context where these were foundational terms of the contract. For the reasons already discussed, the establishment of the trust was not just an expression of the parties' opinion about Mr Bennett's relationship with EFEX. It was not really an opinion at all. It was a manifestation of the very nature of the contract that was agreed upon and entered into. The post-contractual conduct of issuing invoices in the name of the trust, of receiving payment into the trust bank account, and of paying expenses out of that bank account was conduct that was consistent with the nature of the contract itself as one of principal and independent contractor.

• [41] The Court in EFEX was determining the status of the respondent in the wake of the High Court's decisions in Personnel and ZG Operations Australia Pty Ltd v. Jamsek,[11] and prior to the commencement of s.15AA. Necessarily, the focus of the analysis was on the nature of the rights and obligations created by the terms of the contract rather than on an ascertainment of the "real substance, practical reality and true nature of the relationship", by having regard to matters including those terms. Nonetheless there are some parallels that can be drawn from that matter. There was no dispute that the parties had set out to create an independent contracting arrangement. The contract was offered and accepted on that basis and a contracting arrangement was generally reflected in the terms of the contract that was entered into. The post-contractual conduct of invoicing for the work that was carried out through the Applicant's existing corporate entity and receiving payment, including GST, into the account of that entity, was entirely consistent with the notion that the parties were conducting themselves on the basis of a relationship of principal and independent contractor. The Applicant's contention was that over time, the substance of the relationship changed and that at a certain point, the circumstances were such that the relationship had become one of employer and employee. I do not think the relationship changed so fundamentally. The terms of the contract did not change. The invoicing and payment arrangement did not change. The Applicant continued to provide her own equipment throughout the term of the relationship. The Applicant continued to exercise a considerable degree of independent discretion as to how, when and where the work was performed. Viewed as a whole, I conclude that the real substance, practical reality and true nature of the relationship was and remained that of principal and independent contractor.

The Respondent's objection is upheld and the application is dismissed.

By Video using Microsoft Teams at 10:00am AEST on Tuesday, 20 May 2025.

[1] See ss12 and 386.

[2] Coles Supply Chain Pty Ltd v. Milford [2020] FCAFC 152; (2020) 279 FCR 591.

[5] CFMMEU v. Personnel Contracting Pty Ltd [2022] HCA 1 at [35].

[7] (1986) 160 CLR 16.

[8] JMC Pty Ltd v. Commissioner of Taxation [2023] FCAFC 76 at [91].

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