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[2022] FWC 2656
General information, not legal advice.
Fair Work Commission
2022-10-05
Original judgment source is linked above.
s.394 - Unfair dismissal
Application for an unfair dismissal remedy - whether applicant an employee - jurisdictional objection upheld.
[1] This decision concerns an application by Ms Lucy Helft under s 394(1) of the Fair Work Act 2009 (Cth) (Act) for an unfair dismissal remedy.
[2] The respondent, Samri Development Pty Ltd trading as Top of the Town is an adult services venue.[1] Ms Helft commenced working with the respondent as a sex worker at its Melbourne premises on or around 29 August 2019.[2] Ms Helft contends that she was engaged by the respondent as a casual employee.[3] The respondent's position is that Ms Helft provided services as an independent contractor conducting her own business.[4]
[3] The respondent objects to the application on the basis that Ms Helft was not an employee of the respondent and therefore was not "dismissed" within the meaning of s 386(1) of the Act.
[4] It is not in contest that the definition of "dismissed" in s 386(1) takes as its predicate the prior existence of an employment relationship. Accordingly, the application was the subject of a jurisdictional hearing before me to determine whether Ms Helft was an employee of the respondent.
[5] For the reasons that follow, I find that Ms Helft was not an employee of the respondent. It follows that I uphold the respondent's jurisdictional objection and Ms Helft's application for an unfair dismissal remedy is dismissed.
[6] The respondent operates as a "brothel" licensed under the Sex Work Act 1994 (Vic) (Sex Work Act).
[7] The term "brothel" is defined as "any premises made available for the purpose of sex work by a person carrying on the business of offering or providing sex work services at the business's premises."[5] The term "sex work" means "the provision by one person to or for another person (whether or not of a different sex) of sexual services in return for payment or reward."[6]
[8] The Sex Work Act contains strict monitoring and compliance requirements for the sex work industry. The Business Licensing Authority oversees and manages the licencing of sex work service providers and brothels and, in doing so, ensures that specific conditions are met.[7]
[9] The respondent's licence covers 11 booking rooms at its in Melbourne.[8] The respondent says that it provides booking, introduction, accommodation and related support and statutory services to sex workers, who in turn provide sex work services to customers in the conduct of their sole trader business activities.[9]
[10] The respondent's position is that Ms Helft is a service provider who provided sex work services as an independent contractor.[10] The respondent contends that Ms Helft is not a person protected from unfair dismissal within the meaning of s 382 of the Act because she is not an "employee" as that term is defined in s 380.[11] Accordingly, it seeks that Ms Helft's application for an unfair dismissal remedy be dismissed on the basis that it is beyond jurisdiction.
[11] Ms Helft contends that she was employed by the respondent as a casual employee.[12]
[12] Ms Helft has worked in the sex work industry since she was 18 or 19 years of age.[13]
[13] In around August 2019, Ms Helft telephoned the respondent and said she "was interested in working there."[14] Ms Helft was invited to attend an interview.
[14] Ms Helft gave evidence that cannot recall who conducted the interview or what was said. While she recalls signing a contract "and was then able to work straight away,"[15] Ms Helft was unable to produce a copy of this document, or any written contract, to the Commission and does not recall the terms of any such contract.[16]
[15] The respondent's director, Mr Robert Webb has operated the business since 2015.[17] Mr Webb gave evidence that the respondent conducts interviews with all sex workers who wish to utilise the respondent's services. Mr Webb said that the respondent relies on a document titled "Service Provider Interview Form" which provides the framework for such interviews. The Service Provider Interview Form is accompanied by a seven-page summary of the respondent's business, titled "Top of the Town Melbourne's Iconic Brothel" (Booklet). The Booklet provides that, "[T]his booklet briefly explains the standards, policies and procedures Top of the Town currently has in place." Mr Webb gave evidence that the Booklet was in existence when he commenced in 2015 and a copy is handed out to every sex worker engaged by the respondent. However, Ms Helft denies being provided with a copy of the Booklet.
[16] The Booklet contains a section titled "What is my relationship with Top of the Town?" It provides the following:[18]
"Service providers at Top of the Town are independent operators. There is no financial relationship between you and Top of the Town.
You are paid by the client for services performed.
You are provided with all the supplies, materials and equipment to complete your services.
As a self-employed Service Provider, Top of the Town does not have to keep any financial records relating to a Service Provider. The Service Provider is responsible for any tax obligations.
Payment - the client pays the brothel the cost of the room hire and for the cost of the services provided. The money is handed discretely to the Service Provider. It is the Service Providers responsibility to hold their money and for this reason lockers are provided.
A service provider is free to exercise their discretion on who they provide services to, which services they provide and how services are performed."
[17] The Booklet otherwise sets out information concerning (a) "service process" including how clients are greeted, and how payment may be negotiated and effected, (b) "house rules" including the requirement for safe sex, shift start times and late procedures, a dress code, no smoking, alcohol or drugs, and zero tolerance for bullying, (c) "your safety" including how to manage clients, and (d) "condom breakages" and the steps to be taken in the short to medium term.[19]
[18] Mr Webb gave evidence that if the parties agree to proceed, it is a mandatory requirement "for their relationship, and rights and obligations, to be then committed to a contract in the terms of a Non-Exclusive Agency Agreement" (Agency Agreement).[20] Mr Webb says that the Agency Agreement is considered necessary for the parties to "establish and undertake their respective business activities in a legal manner." In the absence of an Agency Agreement, Mr Webb said that the respondent could be "liable to claims that it is in breach of the [Sex Work Act]," and lose its licence.[21]
[19] The Agency Agreement produced by the respondent is not signed by Ms Helft. Mr Webb gave evidence that Ms Helft requested a copy of her "signed agreement," but that the executed version could not be located by the respondent following recent renovations at its Melbourne premises. In any case, Mr Webb's evidence was that it is a requirement for all sex workers to sign a copy of the Agency Agreement before they are permitted to use the respondent's facilities. Mr Webb said that in those circumstances, Ms Helft would have signed a copy of the Agency Agreement.
[20] The Agency Agreement in evidence before the Commission is pre-dated 2022 and provides the following preamble (where the sex worker is defined as the "Principal" and the respondent is defined as the "Agent"):
(a) The Principal is engaged in the business of providing Personal Services and desires to appoint a non-exclusive Agent upon the terms and conditions set out in this Agreement.
(b) The Agent wishes to provide a booking/introduction service for the Principal.
(c) The parties wish to set out the entire Agreement between them and their respective rights and obligations thereunder."
[21] With respect to the role of the respondent as non-exclusive Agent, the Agency Agreement provides, inter alia:[22]
"2.2 The Agent shall have authority to attract enquiry from customers to procure the Services of the Principal. The Agent will advise the potential Customer of the booking/introduction fee and advise the potential Customer that the Price for the Services must be negotiated with the Principal. The agent will make it clear to the customer that they are acquiring two different services from two different parties even though they will be making one single payment for those services.
2.5 The Principal reserves the right, at its sole discretion, to appoint other Agents."
[22] The obligations of the sex worker, as the Principal under the Agency Agreement, include informing the Agent "within a reasonable period of time of the acceptance or refusal of, and of any non-execution by it of, a commercial transaction which the Agent has procured."[23] Further, the Principal has the right "to refuse any Booking on any grounds but shall advise the Agent as early as is practicable of its acceptance or non-acceptance."[24]
[23] With respect to payments, the Agency Agreement relevantly provides that where the Agents fee is paid in cash directly to the Principal, the Principal "acts merely as facilitator for the Agent in collecting their fee."[25] Where the Principal's fee is paid in cash or by credit card directly to the Agent, the Agent "acts merely as facilitator for the Principal in collecting their fee."[26]
[24] By clause 10 of the Agency Agreement, the relationship between the respondent as Agent and the sex worker as Principal is "not partners or joint venturers. The Agent is not an employee of the Principal nor is the principal an employee of the Agent."[27]
[25] The respondent points to clause 10 of the Agency Agreement to refute the contention that Ms Helft is an employee. It further states that the respondent:[28]
(a) does not make any payments to the Principals for the services they provide to customers;
(b) does not receive any payment from the Principals arising from the conduct of their business activities;
(c) does not direct or control the Principals in the nature or conduct of delivering their personal services to their customers or in establishing their related fees;
(d) has no statutory liability to withhold employee pay as you go tax for the Principals;
(e) has no statutory liability to provide employer superannuation contributions under the Superannuation Guarantee (Administration) Act 1992 (Cth);
(f) has no statutory liability to maintain a workers' compensation policy and services for the Principals; and
(g) has no statutory liability to acquit payroll tax in respect of the Principals.
[26] The respondent submits that the absence of a signed copy of the Agency Agreement does not detract from the fact that it applied to Ms Helft. In circumstances where Ms Helft accepts that she signed a contract during her interview, the respondent says that the Commission can be satisfied that the document signed was the Agency Agreement.
[27] On or about 26 November 2021, Ms Helft suffered an injury which she considers was a consequence of the respondent's unsafe hygiene practices. Ms Helft was hospitalised between 20 November and 2 December 2021 and again between 12 December and 14 December 2021. When Ms Helft returned to work on 18 December 2021, she remained in pain and was unable to offer penetrative sex to her clients from this date.[29]
[28] Ms Helft submits that she became increasingly concerned about certain health and safety issues in the workplace. Ms Helft says that she raised these concerns with the head receptionist, Ms Kelly Petts, on multiple occasions.[30] On 25 March 2022, Ms Helft sent a text message to the staff phone number seeking to speak with the respondent's director, Mr Webb regarding her concerns, but she was redirected to Ms Petts.[31] Subsequently, Ms Helft and Ms Petts met to discuss Ms Helft's concerns over a meeting that lasted approximately two hours. Ms Helft submits that no action was taken in respect of the concerns raised.[32]
[29] On or around 10 or 11 June 2022, Ms Helft raised two issues with Ms Petts. The first issue involved Ms Helft requesting that teenage men be removed from the premises on the basis that they were making "rude, horrible jokes" when Ms Helft walked past them. Ms Helft contends that Ms Petts accused her of "setting them off" and blamed Ms Helft for not managing the situation.[33] The second issue involved the doormats in the booking rooms. Ms Helft contends that they were uncleaned and remained wet which created a black mould problem in the building. The doormats were removed the following week.[34]
[30] On or about 17 June 2022, Ms Helft says that she raised a concern with Ms Petts in relation to the towels it was providing for bookings. Ms Helft contends they were unhygienic. Further, Ms Helft says she raised issues in relation to improper condom storage, restricted condom distribution, improper ventilation in the booking rooms, dust clogging the air conditioning units in the booking rooms, the threatening and coercive manner in which management communicated, and the enforcement of shift lengths by the respondent. Ms Helft submits that she "demanded" that these issues were addressed.[35]
[31] Ms Helft submits that she felt "saddened, frustrated, stressed and concerned" by Ms Pett's response, which appeared dismissive of Ms Helft's concerns. Ms Helft says that she then enquired about why another sex worker had been recently dismissed. Ms Helft felt upset for her former colleague and called Ms Petts a "disgusting piece of shit." Ms Helft then said to Ms Petts "please don't do that to me" in reference to the respondent's recent decision to dismiss the other sex worker. Ms Helft contends that Ms Petts responded by saying, "we're not going to fire you, why would we do that."[36]
[32] It is Ms Helft's position that approximately two hours after this conversation with Ms Petts, on 18 June 2022 she received a text message from the staff phone number informing her that there were "no more shifts available at top of the town" for Ms Helft. When Ms Helft replied to the message to clarify if she was to complete her rostered shift that night, Ms Helft was advised that she had "no more shifts here," and could only attend to pick up her belongings.[37]
[34] The respondent submits that it terminated Ms Helft's services on the basis of Ms Helft's "unacceptable and threatening behaviour on site following discussions with the Approved Manager."[41] The respondent's position is that the termination was in accordance with clause 7 of the Agency Agreement, which provides that "[T]his Agreement shall continue until terminated by either party for whatever reason either party considers appropriate."[42]
[35] The circumstances in which a person has been unfairly dismissed is set out in s 385 of the Act as follows:
A person has been unfairly dismissed if the FWC is satisfied that:
(b) the dismissal was harsh, unjust or unreasonable; and
(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.
[36] The meaning of the term "dismissed" is set out in s 386 of the Act, which provides as follows:
(a) the person's employment with his or her employer has been terminated on the employer's initiative; or
(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.
(a) the person was employed under a contract of employment for a specified period of time, for a specified task, or for the duration of a specified season, and the employment has terminated at the end of the period, on completion of the task, or at the end of the season;
(i) to whom a training arrangement applied; and
(ii) whose employment was for a specified period of time or was, for any reason, limited to the duration of the training arrangement;
and the employment has terminated at the end of the training arrangement; or
(i) the demotion does not involve a significant reduction in his or her remuneration or duties; and
(ii) he or she remains employed with the employer that effected the
[37] Section 386(1) of the Act operates subject to the exceptions set out in s 386(2),[43] none of which are presently applicable.
[38] Section 382(a) of the Act relevantly provides that a person is only protected from unfair dismissal if the person was, at the time of the dismissal, an employee who has completed a minimum employment period with his or her employer. An "employee" is defined in s 380 of the Act to mean a "national system employee" being an individual so far as he or she is employed, or usually employed, as described in the definition of "national system employer," by a national system employer.[44]
[39] The issue to be determined in this application is whether Ms Helft was an employee of the respondent.
[40] The decisions of the High Court in ZG Operations Australia Pty Ltd v Jamsek[45] and Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd[46] emphasise the primacy of the contract between the parties in ascertaining the existence and nature of any relationship between them. When characterising a relationship regulated by a wholly written, comprehensive contract which is not a sham or otherwise ineffective, the question is to be determined solely by reference to the rights and obligations under that contract. It is not permissible to examine or review the performance of the contract or the course of dealings between the parties.[47] However where there is no written contract, in the determination of whether the relationship was one of employment or otherwise, it is necessary to identify by way of inference from the dealings between the parties what the terms of that contract were.[48]
[41] The respondent contends that there is a written contract between the parties and refers to the Agency Agreement discussed earlier in this decision at [18]-[25]. Mr Webb gave evidence that Ms Helft "should have" signed a copy of the Agency Agreement on the basis that it was, and remains, the protocol that the respondent's management is to follow when engaging sex workers. However, the respondent was unable to produce to the Commission a signed copy of the Agency Agreement it purports to have executed with Ms Helft, or with any other sex worker. Nor is there any evidence before the Commission from the interviewing manager as their identity is not known.
[42] Ms Helft recalls signing a contract in August 2019 but cannot recall the terms of that contract. Nor could Ms Helft recall who interviewed her, or any of the matters discussed during the interview.[49] Ms Helft gave evidence that her "understanding is that the requirement to sign a contract is something that all sex workers must do in order to work for a licenced brothel."[50] Notwithstanding this, Ms Helft's view is that there is an industry wide prevalence of engaging vulnerable sex workers on "dodgy" contracts, with a different "set of rules" applying in the venue.[51]
[43] In these circumstances, Ms Helft contends that there is no evidentiary basis for a finding that the Agency Agreement set out the rights and obligations of the parties.[52] I accept this submission. There is insufficient evidence which would allow a reasonable inference to be drawn that Ms Helft signed the version of the Agency Agreement that is before the Commission. I therefore cannot accept that Ms Helft signed a document which detailed the legal rights and obligations of the parties such that it might be decisive of the character of the relationship. Further, I do not consider there to be any evidence of the specific terms of the contract Ms Helft says she signed in 2019. It follows that on the evidence, no express terms of any agreement can be identified.
[44] Ms Helft does not dispute that she has a contractual relationship with the respondent.[53] Ms Helft contends that the "nature of the relationship, and the terms of the contract between the parties must therefore be determined by way of inference from the dealings between the parties, the manner in which the relationship worked in practice and the totality of the relationship."[54] Further, Ms Helft submits that "consideration of the reality of the relationship and the dealings between the parties must result in the characterisation of the relationship between the parties as one of employment."[55] While I have rejected that the Agency Agreement represents a valid contract between the parties, I note Ms Helft submits in the alternative that the Agency Agreement is a sham and the Commission should characterise the relationship by reference to the dealings between the parties and the reality of the relationship.
[45] In light of my conclusions at [43], I consider that the characterisation of Ms Helft as an employee or an independent contractor of the respondent can only be achieved by analysis in the manner prescribed by Ms Helft, irrespective of whether such a characterisation effectively represents the relationship pursuant to the contractual rights and obligations in any misplaced written agreement. Recent developments in the law suggest that such an approach is available in these c[56]cumstances,56 and it is consistent with the manner in which Ms Helft presented her case. In the circumstances described an assessment of the nature of the relationship in the manner requested is[57]ppropriate.57 The exercise therefore involves identifying whether the matters relied upon by Ms Helft amount to rights and obligations of[58]he parties.58
[46] Ms Helft submits that the terms of the contract between the parties were as follows:[59]
(a) Ms Helft was required to work at the respondent's premises.
(b) Ms Helft was expected to adhere to the respondent's rostering arrangements, including that Ms Helft was explicitly informed by the posters put up by the respondent in the staff areas that she was unable to cancel her shifts.
(c) Ms Helft was unable to delegate her work or shifts to others.
(d) Ms Helft was required to adhere to the respondent's dress code.
(e) The prices for Ms Helft's services were set by the respondent.
(f) Ms Helft was expected to comply with the respondent's instructions as to how she was to perform her work. These instructions included the following:
(i) Ms Helft had to physically sit and stand in the workplace, even when she was not completing client bookings.
(ii) Ms Helft could not use her personal phone on the "floor" when clients were present;
(iii) Ms Helft could only use certain equipment and/or supplies, and only in a prescribed manner or circumstances, for example:
- Ms Helft was not allowed to use oil in the rooms.
- Ms Helft was not allowed to use the respondent's towels and drop sheets on the floor.
(g) Ms Helft was expected to use equipment supplied by the respondent, including towels, condoms, lubricant, sheets and other hygiene and cleaning supplies, and abide by any limits on access to such equipment and supplies enforced by the respondent.
[47] The respondent has addressed specific components of this evidence, in addition to other aspects of Ms Helft's material that contribute to or supplement the matters set out at [46] above. I turn now to consider this evidence and, where appropriate, the parties' contentions before assessing the nature of the relationship.
[48] Ms Helft's evidence is that she worked regular six-hour shifts on Friday and Saturday nights at the respondent's Flinders Street premises, with the occasional additional shift.[60]
[49] The respondent submits that its approved licence relates to the premises in Flinders Street. The nature of the work involved Ms Helft performing services at the respondent's licenced premises. In considering the nature of the relationship, little significance can therefore be attached to the fact that Ms Helft worked at the respondent's Flinders Street location during each shift.[61]
[50] As noted above at [48], Ms Helft's evidence is that she worked regular six-hour shifts on Friday and Saturday nights at the respondent's Flinders Street premises, with the occasional addi[62]onal shift.62 Ms Helft was provided with a phone number to which she sent text messages regarding any work-related matters, including her availabi[63]ty to work.63 Ms Helft says that she was required to provide the respondent with her availability by each Wednesday for the fo[64]owing week.64 Repeated cancellations, no shows or early finishes would result in a sex worker being taken off the roster [65]r one week.65
[51] The respondent submits that approximately 130 sex workers have executed agency agreements, each of whom seek an opportunity to utilise the respondent's premises. The performance of work on Friday and Saturday nights is said to be particularly lucrative such that rostering arrangements are required to enable efficient administration.[66]
[52] Mr Webb gave evidence that (a) the Booklet sets out the respondent's intentions with respect to the working conditions applicable to sex workers, and (b) it has not been changed since at least 2015. Mr Webb's evidence in this respect was not challenged and I accept it. The Booklet identifies that the establishment is "busy" and has in place a room allocation system to avoid confusion.[67]
[53] In relation to the roster, the evidence reveals that there was a "waiting list." Sex workers were placed on the waiting list if no shifts were available and would be contacted in the event of a cancellation.[68] There is no evidence of Ms Helft or any other sex worker being placed on the waiting list, or how the waiting list functioned.
[54] There is evidence before the Commission of Ms Helft making ad hoc requests to work, absent being placed on a roster. Firstly, Ms Helft made an undated request by text message to work "tonight at midnight" which was readily agreed to. Secondly, Ms Helft made a request on Tuesday 22 March 2022 to work the coming Friday and Saturday night from midnight, and the respondent accepted that request the same day.[69] Each of Ms Helft's requests were acceded to, absent any reference to a roster.
[55] Ms Helft says that she was unable to cancel shifts once they were allocated.[70] Ms Helft relies on posters said to have been made visible to sex workers at the respondent's premises in support of her position. The first poster states, amongst other things, "consistent cancellations including cancelling on the day & No Shows will unfortunately NOT be tolerated. If the roster for the day is full we will ensure to put you on a waiting list incase [sic] there are any cancellations."[71] While Ms Helft's evidence is that she was unable to cancel a shift, it is apparent from the evidence before the Commission that Ms Helft did cancel a shift on 27 November 2021 around three hours before it was meant to commence and the response from the respondent was "OK babe feel better xx."[72] I therefore do not accept that the poster was indicative of the rights and obligations of the parties, as it appears instead that Ms Helft had the freedom to cancel her shift.
[56] The second poster is illegible in part and provides "Please be aware that if you CANCEL, NO SHOW, GO HOME EARLY too many times you will be taken off all perm [sic] shifts (if you have any) and you will be taken .....ster for 1 week."[73] There is no evidence before the Commission of Ms Helft being removed from a roster or not rostered by the respondent for any reason. I accept that the respondent had the right to exclude Ms Helft from a roster by not offering, or rejecting Ms Helft's offer, to undertake a shift. I observe, however, that no right or expectation to work any future roster is apparent of the evidence, and the arrangement is one of ad hoc offer and acceptance.
[57] Generally, the posters relied upon by Ms Helft do not specify that sex workers could not cancel a single shift. They refer to "consistent cancellations" or cancelling "too many times" not being tolerated. It is to be inferred from the reference to sex workers being placed on a "waiting list" that the posters were reflective of the respondent's desire to avoid consistent and repeated late cancellations.
[58] I find that the rostering system was a necessary operational requirement for the organisation of sex worker shifts, consistent with the respondent's licence which is limited to 11 booking rooms for a maximum of 18 sex workers at any time, amongst a wider group of, as submitted, 130 sex workers.[74]
[59] Ms Helft contends that she was required to work at least six-hour shifts.[75] Mr Webb denied that there is a minimum shift length but accepted that there may have been a poster distributed by the respondent to this effect.[76] I accept that the shifts worked were generally requested or implied to be a minimum of six hours.
[60] In large part, the respondent's operations involve the facilitation of sex work by making a limited number of booking rooms available for use by sex workers. The organisation of shifts into six-hour blocks is unremarkable in circumstances where the respondent has an operational need to manage the demand on its booking rooms.
[61] The respondent submits that when and how Ms Helft undertakes her work is a matter for her.[77]
[62] Ms Helft gave evidence of a conversation with Ms Petts where she was coarsely pressured into continuing a shift when Ms Helft wanted to go home.[78] Further, Ms Helft contends that Ms Petts would "bribe" sex workers with lollies and cookies to continue their shifts beyond the end time.[79] However, Ms Helft gave evidence of her understanding that all receptionists received a monetary bonus if there were over 100 bookings per shift, and she believes that this is why sex workers were often pushed to stay for the duration of their shift or longer.[80]
[63] Ms Helft's evidence is not inconsistent with a right to leave a shift early, or to perform sex work or related work at her discretion throughout a shift. The evidence reveals that some pressure may be exerted by Ms Petts as a means to encourage sex workers into working shifts of six hours or more. However, I consider that the incentive structure explains why pressure may have been placed on sex workers to work longer shifts.
[64] I find that the respondent had an expectation that sex workers would work a six-hour shift. This reflects an agreement as to the rights between the parties. However, the evidence before the Commission does not persuade me that Ms Helft could be compelled to work longer when the respondent encouraged her to do so. Nor am I satisfied that the respondent held a right to discipline Ms Helft for any failure to work the minimum shift length, or extended shifts upon request.
[65] Ms Helft submits that she was unable to delegate her work or shifts to anyone else.[81]
[66] Ms Helft said that where clients wish to see her, she is unable to delegate that work to another sex worker. When pressed on this matter during cross examination, Ms Helft accepted that sex work is unlikely to be capable of delegation. I accept this evidence.
[67] Further, there is nothing before me that suggests that Ms Helft could delegate a shift. Rather the respondent's rostering system reveals that "shifts" were interchangeable between sex workers and that there was a waiting list in the event of a cancellation. It was therefore the respondent that retained the choice as to who would fill a shift if a sex worker cancelled, and not any particular sex worker.
[68] Ms Helft submits that she was required to adhere to the respondent's dress code. In this respect, the Booklet states relevantly as follows:[82]
"Dress code is sexy, sassy and sophisticated. Confidence is the key to looking great. Make up, hair and nails add to the experience. Hygiene and being well groomed at all times is expected."
[69] Mr Webb gave evidence that sex workers could not be naked in the lounge or common areas. Ms Helft also gave evidence that she was not allowed to "be naked."[83] To the extent that the respondent put parameters on sex workers being naked or having their nipples or genitals visible when not in the booking rooms,[84] such boundaries amount to mere courtesies and are not of themselves demonstrative of any rights and obligations between the parties.
[70] The high watermark of Ms Helft's evidence as it relates to a dress code imposed by the respondent is that she was "typically" required to wear lingerie and high heels, "or a dress if we wanted to."[85]
[71] I consider that there was freedom afforded to Ms Helft with respect to the dress code, provided that it met the vague expectations extracted from the Booklet. Relevantly, Ms Helft could elect to wear a dress or lingerie and there appears to be no other conditions with respect to the dress code apparent on the evidence.
[72] Ms Helft gave evidence that the respondent placed her profile on its website and identified Ms Helft on its "Who's Available" roster when performing a shift.[86] It is noted that Ms Helft did not specifically identify this evidence as inferring a term of the contract indicative of an employment relationship.[87]
[73] During cross examination, Mr Webb denied advertising for Ms Helft, but agreed that the respondent placed Ms Helft's profile on its website. The parties did not otherwise explain what this type of profile was, who controlled the various elements of the profile, and whether it was mandatory for all sex workers to maintain in order to perform shifts at the respondent's brothel.
[74] Given the deficiencies in the evidence as to relates to advertising, I do not consider that the evidence gives rise to any inference as to the terms of an agreement identifying the rights and obligations of the parties.
[77] During the hearing, Mr Webb gave evidence that the poster contains the prices for each service which are reflective of industry standard. The poster explains the amount payable for the room fee and for the sex worker, being two different amounts. However, Mr Webb explained that the sex workers are free to negotiate prices with each individual client. This is consistent with the information in the Booklet which states: "negotiate services before arriving at reception," "[r]eception will not negotiate services for you" and "[i]f you are doing additional services with your client it is your responsibility to collect the monies charged for these extra services."[92]
[78] I am satisfied that Ms Helft had the right to negotiate the type of services she provided and the price for those services with any client.
[79] Ms Helft contends that the respondent set prices for her services. The respondent would collect cash payment from the client, withhold 40% of the fees paid representing the "room fee," and provide the balance to Ms Helft.[93] A specific request by a client for Ms Helft by name would yield a $20 bonus from the respondent.[94] Ms Helft says that she does not hold an Australian Business Number (ABN).[95]
[80] It is not in dispute that the client pays the respondent the cost of the room hire. Further, while it is not in dispute that Ms Helft was paid in cash for services rendered, there is some inconsistency in the evidence as to the manner in which Ms Helft received the cash payment for services rendered.
[81] Ms Helft's contention during the hearing was that the client's cash payment is handed to her by reception and not by the client. Ms Helft produced a series of invoices[96] which evidence payments made by clients in cash. It is not evident from these invoices whether the cash payment was provided by the client directly to Ms Helft or handed to Ms Helft by reception because they each attribute the entire sum to "room fee." However, Ms Helft's position is supported by the content of the Booklet, which provides:[97]
"Payment - the client pays the brothel the cost of the room hire and for the cost of the services provided. The money is handed discretely to the Service Provider. It is the Service Providers [sic] responsibility to hold their money and for this reason lockers are provided."
[82] Mr Webb gave evidence that the respondent does not have visibility over the cash paid directly to Ms Helft. The respondent's position is that the client pays the sex worker directly the agreed cost in return for services rendered. Mr Webb said that the respondent facilitates this process where a client seeks to pay by credit card by allowing a client to withdraw cash from the respondent's till at the time the room fee is paid. The invoice produced by the respondent[98] as well as various invoices produced by Ms Helft[99] demonstrate that in these circumstances, the client transacts directly with the respondent to pay the room fee and, where necessary, withdraws money so as to enable the payment of cash to the sex worker.
[83] It is apparent from the following material that clients are advised by the respondent upon entry that they are required to pay fees for service directly to the sex worker. Firstly, each invoice contains a note which states "PLS NOTE: The fees are for the use of rooms and facilities only. All payments for personal service that may be required are to be paid directly to the service provider."[100] There is no basis for Ms Helft's contention that this invoice is provided to sex workers only and that clients do not receive a copy. I therefore reject Ms Helft's contention to this effect.
[84] Secondly, the poster produced by the respondent[101] discloses the various room fees applicable for different services. For instance, the room fee for an all-day service exceeds the room fee for the deluxe service. In addition, the posters specify that "ladies charge you" a minimum rate which differs by reference to the service sought.[102] I accept that this poster supports a conclusion that sex workers may charge an amount for services that is agreed directly with the client.
[85] Accordingly, as it relates to the mechanism for payment of services rendered by sex workers, I find that different approaches apply depending upon the client's preferred payment method. Where the client holds cash, the evidence supports a finding that transactions may occur directly between the client and the sex worker that are not visible to the respondent. This includes where, as contemplated by the Booklet, a sex worker is performing additional services with the client where the Booklet states: "it is your responsibility to collect the monies charged."[103] Where the client wishes to effect payment by way of credit card, the respondent provides a facility for this by allowing the client to withdraw cash from its till. In these circumstances, the cash may either be given directly to the sex worker by the client in return for services rendered or provided "discreetly" by reception to the sex worker.
[86] I find, on the evidence, that there is no financial relationship between Ms Helft and the respondent. The client pays the respondent the cost of the room hire and pays Ms Helft the agreed cost in return for services rendered. Whether the cash payment is provided directly to Ms Helft by the client or handed to her discreetly by the respondent is not relevant to the issues in this application. In either scenario, the respondent derives no material benefit from the transaction between the client and Ms Helft, and merely provides administrative assistance to ensure Ms Helft was appropriately paid by the client.
[87] Ms Helft submits that she was expected to comply with the respondent's instructions as to how she was to perform her work and identifies three matters in support of this position. At the hearing, the parties were in dispute about what constituted Ms Helft's "work." The following analysis considers the dispute as to what constituted "work" and the evidence with respect to any arrangements between the parties when Ms Helft was not completing client bookings ("service processes"), the restriction on mobile phone usage and the use of equipment in turn.
[88] Ms Helft contends that her work involved attending the lounge and introducing herself to clients upon their arrival.[104] The respondent's position is that it does not issue instructions as to how Ms Helft is to perform her work. It says that as a sex worker, Ms Helft's work was confined to the provision of sexual services to clients and did not include the "service processes."
[89] Ms Helft contends that the respondent imposed limitations on taking breaks.[105] Ms Helft says that she felt that the respondent deliberately sought to discourage the taking of breaks by making conditions uncomfortable for sex workers to take respite in the staff area.[106] Ms Helft further contends that she was compelled by the respondent to attend the lounge when clients were present.[107] Ms Helft gave evidence that the receptionist, Ms Petts or sometimes the assistant receptionist would "hassle" Ms Helft to return to the lounge despite Ms Helft being on a break.[108] There is no evidence before the Commission from Ms Petts or the assistant receptionist to refute this allegation and accordingly, I accept it.
[90] The Booklet contains information relevant to what is described as the "service process," which includes the process from when a client enters the lounge, payment, pre-service practices, negotiations, post-service practices and other matters.[109]
[91] Specifically, the Booklet describes how clients are to be greeted by sex workers in the lounge (sometimes referred to as "the floor.") The Booklet explains that "...ladies can introduce themselves and must be friendly. Please smile. If you do not wish to see a client, please be professional and excuse yourself from the lounge."[110] The Booklet further states that "when clients are in the lounge area all ladies are expected to be present in the front lounges. If you do not wish to be available for services please advise reception that you are on a break. Then advise reception upon your return."[111]
[92] It is not in dispute that Ms Helft performed sex work with complete autonomy. With the exception of certain statutory requirements,[112] I am satisfied that the respondent has no right or responsibility in requiring, controlling or supervising Ms Helft's sex work. Further, Ms Helft's evidence and the evidence in the Booklet is that Ms Helft could refuse bookings and felt safe to do so.[113]
[93] However, I find that the "service processes," as the Booklet explains, impose an "expectation" on sex workers to be present in the front lounge when clients attend the brothel. This stated expectation, coupled with the directions issued to Ms Helft to return to the lounge and refrain from taking a break, infers the existence of an agreement between the parties for Ms Helft to attend the lounge and introduce herself to clients upon their arrival, and to not take excessive breaks.
[94] I accept that Ms Helft's agreement with the respondent extended beyond the performance of sex work and included the "service processes" as described at [93].
[95] While not contended by Ms Helft, I would not be persuaded that the other parts of the "service processes" in the Booklet not otherwise addressed in this decision disclose the existence of a relevant aspect of the relationship. These matters are largely operational necessities and bear immaterially upon the characterisation of the relationship between the parties.[114]
[96] Ms Helft contends that she was not permitted to use a mobile phone while at the respondent's premises and was directed to remove it when a client was in attendance.[115] Consistent with this evidence, the Booklet specifies that "[m]obile phones, laptops and iPads can only be used if no clients are in any of the lounge areas."[116]
[97] I am satisfied that the respondent issued an instruction to Ms Helft to the effect that she could not use her mobile phone on the floor when clients were present. The respondent did not lead evidence or make submissions explaining its policy to prohibit the use of mobile phones in the lounge. I therefore accept that it formed part of the agreement between the parties.
[98] Ms Helft submits that she was expected to use equipment provided by the respondent such as towels, condoms, lubricant, sheets and other hygiene and cleaning supplies.[117] Further, Ms Helft says that she was to abide by any limits on access to such equipment and supplies enforced by the respondent.[118] Ms Helft relies on this evidence to support her contention that the respondent instructed her on how to perform her work, and as a standalone matter demonstrating the existence of an employment relationship.
[99] In the ordinary course, the provision of equipment to a worker is a factor that may be indicative of an employment relationship. However, in the particular circumstances of Ms Helft's engagement, this requires some qualification.
[100] The Public Health and Wellbeing Act 2008 (Vic) requires the respondent to provide clean linen and towels such that the provision of this "equipment," in addition to condoms and lubricant, is a legislative requirement.[119]
[101] Ms Helft contends that the respondent imposed a limit of three towels and one sheet per client,[120] and instructed sex workers not to use oil in the rooms which stains the towels.[121] The legislative requirement to provide clean linen and towels applies "for the use of clients,"[122] not sex workers. The respondent meets this obligation by providing clean linen and towels to clients in return for the payment by the client of a room fee. Mr Webb gave evidence that the respondent previously had some difficulty with its laundry service such that it imposed limits on the use of towels and linen for a period of time. Mr Webb said it no longer imposes these limits. This evidence is not challenged, and I accept it.
[102] The respondent's election to limit the number of towels and sheets to clients for a confined period is unrelated to the performance of Ms Helft's work and does not bear upon the inquiry before me. Further, I am satisfied that any request made by the respondent to refrain from using oil is to ensure compliance with its obligations to provide clean linen to clients in accordance with the requirements of the Public Health and Wellbeing Act. As a result of these requirements, I consider that the provision of towels and linen is a cost paid for by the client as part of the room fee and not "equipment" in the sense it is understood in the context of this type of dispute.[123]
[104] The request of sex workers in this respect is to be distinguished from the duties required by the cleaner who is specifically engaged by the respondent.[126] The Booklet provides that sex workers are to clean and disinfect the shower, as well as remove dirty linen, once a service was complete.[127] I accept that this was a relevant aspect of the agreement between the parties.
[105] The following analysis takes into account the factual findings above and proceeds on the basis that employment and contractor relationships are dichotomous.[128] Further, Personnel Contracting suggests that the "'own business/employer's business' dichotomy" shapes the characterisation inquiry. That is, while the central question is always whether or not the person is an employee, it is nevertheless useful to focus attention on whether a person is conducting his or her own independent business, as distinct from serving in the business of the putative employer.[129]
[106] I note that in undertaking this analysis, regard may be had to other decisions in which similar facts were considered.[130] However, the significance of considerations, and the weight to be afforded to any particular consideration, will vary significantly from case to case such that decisions with factual similarities have diminished utility.
[107] The right to control, while not necessary nor determinative of a relationship of employment in Australia,[131] has historically been the most significant indicia of an employment relationship.[132] In Personnel Contracting, the High Court affirmed this position, albeit with reference only to the putative employer's contractual right to control a person in their work.[133]
[108] The evidence as to the respondent's rostering system discloses that Ms Helft determined when she performed work by notifying the respondent of her availability to work her preferred shifts. There is no evidence of the respondent expressly inviting Ms Helft to work a shift. Further, there is evidence of Ms Helft making ad hoc requests to be placed on a shift each week outside of the specified rostering arrangements. Any rostering arrangement was subject to Ms Helft's right to decline to perform a shift, even following its allocation to her. Having regard my findings as to the necessity of the roster in the management of the respondent's operations, I am satisfied that the rostering system, which is predicated upon Ms Helft nominating when she sought to work, tells strongly against the respondent having the right to control the times at which Ms Helft performed work.
[109] Moreover, Ms Helft had the right to refuse bookings, and negotiate the prices and types of services with each client.
[110] I find that Ms Helft retained a right to control the fundamental elements of the relationship. In summary, I find that Ms Helft had the right to:
(a) request to undertake shifts at her discretion;
(b) decline to perform a shift at any point prior to its commencement;
(c) refuse to provide services to any client at any point; and
(d) charge different amounts and adjust her services for each client.
[111] I am satisfied that the respondent's expectation that Ms Helft would work a minimum six-hour shift establishes that the respondent had a right to control the length of a shift. However, I am not persuaded that this is a matter of significant weight in the assessment of the relationship between the parties. This is because I regard the respondent's preferred shift duration as reflective of a necessary operational requirement. The respondent's business seeks to make a profit from the use of its booking rooms in circumstances where there are statutory limitations upon the number of rooms for which the respondent is licenced. In these circumstances, a minimum shift streamlines the respondent's administrative arrangements such that the requirement to perform six-hour shifts is equally as indicative of the service specifications attached to a contractor relationship as it is to an employment relationship.
[112] There is an expectation on Ms Helft to present in the front lounge when clients attend the brothel, coupled with the directions issued to Ms Helft to return to the lounge and refrain from taking a break. These are matters which demonstrate a right of control on the part of the respondent over Ms Helft.
[113] However, the exercise of control exhibited by the respondent in respect of the matters identified at [112] is of marginal significance when compared to the rights of control retained by Ms Helft and set out at [110] above. I consider that the absence of any significant right of control by the respondent over Ms Helft indicates the relationship is one of independent contractor.
[114] There was no financial relationship between the respondent and Ms Helft. Payment was made separately to Ms Helft and to the respondent by the client.
[115] The room fee was always fixed, albeit dependant on whether the service was standard or deluxe (which was at the request of the client.) While there appears to be some collaboration between the respondent and Ms Helft as to the minimum fee for a particular service by way of the industry standards, Ms Helft had the right to negotiate prices with a client.
[116] I am satisfied that the evidence as to payment supports a finding that Ms Helft's sex work was undertaken for her own business. This weighs in favour of a characterisation of the relationship as independent contractor.
[117] Typically, the absence of a right to delegate work is indicative of an employment relationship and not of a contractor relationship.[134] However, in these circumstances, I do not consider that the absence of a capacity to delegate is indicative of the nature of the relationship. As discussed above at [92], Ms Helft retained the absolute right to refuse to provide her services at any point. It follows that Ms Helft provided sex work on an engagement-by-engagement basis. In circumstances where Ms Helft retained the discretion to perform the work, the absence of a right to delegate is not indicative of an employment relationship.
[118] I accept that there were rights and obligations between the parties with respect to the restrictions on the use of mobile phones, the dress code, cleaning of booking rooms after use and the restrictions on the use of oils in booking rooms. Further, Ms Helft was expected to use equipment supplied by the respondent, including towels, condoms, lubricant, sheets and other hygiene and cleaning supplies, and abide by any limits on access to such equipment and supplies.
[119] As found above, the requirements for towels, condoms and lubricant to be provided by the respondent to clients and sex workers are the express subject of statutory requirements and would therefore be required to be provided to a sex worker characterised as an employee or contractor.
[120] Further and in any event, even when considered at their highest and collectively, these matters are not indicative of an employment relationship or a independent contractor relationship, and are immaterial to my assessment.
[121] Overall, I consider that the relationship between the parties was not an employment relationship but rather an independent contractor relationship. I consider that the absence of control and of a direct financial relationship tells strongly in favour of this conclusion.
[122] Having regard to the above matters and the conclusions reached, I find that Ms Helft was not an employee of the respondent.
[123] It follows that I uphold the respondent's jurisdictional objection and Ms Helft's application for an unfair dismissal remedy is dismissed.
[4] Form F3 - Employer response to unfair dismissal application dated July 2022 (Form F3), 2.2 at [2]
[5] Sex Work Act 1994 (Vic), s 3
[8] Witness statement of Mr Robert Webb (final Webb statement) at [2] and [4]
[10] Form F3 - Employer response to unfair dismissal application dated July 2022 (Form F3), 2.2 at [2]
[11] CB 30 at [7]. See further ss 13 and 14 of the Act
[43] NSW Trains v Mr Todd James [2022] FWCFB 55
[44] Fair Work Act 2009 (Cth) ss 13 and 14
[46] [2022] HCA 1, 398 ALR 404, 312 IR 1 (Personnel Contracting)
[47] Personnel Contracting at [40]-[62] per Kiefel CJ, Keane and Edelman JJ; [172]-[178] per Gordon J; [203] per Steward J
[48] Chambers and O'Brien v Broadway Homes Pty Ltd t/a Broadway Homes [2022] FWCFB 129 at [91]; Personnel Contracting at [42] and [54] per Kiefel CJ, Keane and Edelman JJ; [177]-[178], [188]-[190] per Gordon J
[56] Personnel Contracting at [41]-[42] and [48]; [180]-[183] and [190]
[57] Fair Work Act 2009 (Cth) ss 577-578
[58] Stevens v Brobridd Sawmilling Co Pty Ltd (1986) 160 CLR 16 [24], [36]; see also Personnel Contracting at [56]
[61] Respondent submissions in reply dated 30 August 2022 at [9(a)]
[66] Respondent submissions in reply dated 30 August 2022 at [9(b)]
[74] Final Webb Statement at [4]; Respondent submissions in reply dated 30 August 2022 at [9(b)]
[77] Respondent submissions in reply dated 30 August 2022 at [9(a)]
[89] Respondent submissions in reply dated 30 August 2022 at [9(e)]
[91] Attachment 4 to the final Webb statement
[98] Attachment 4 to the final Webb statement
[101] Attachment 4 to the final Webb statement
[112] See, eg, Public Health and Wellbeing Act 2008 (Vic) Div 10 Pt 8
[118] CB 96 at [46](a), [46](h) and [46](i)
[119] Public Health and Wellbeing Act 2008 (Vic), ss 158 and 163
[120] CB 96 at [46](a); CB 98 at [49]-[50]
[128] Hollis v Vabu Pty Ltd [2001] HCA 44; (2001) 207 CLR 21 at [39] and [72]; Forstaff Pty Ltd v Chief Commissioner of State Revenue (NSW) [2004] NSWSC 573; (2004) 144 IR 1 at [70]- [73]
[129] Personnel Contracting at [62], [71] and [73]; WorkPac Pty Ltd v Rossato [2021] HCA 23; (2021) 95 ALJR 681 at 700 [101] citing R v Foster; Ex parte The Commonwealth Life (Amalgamated) Assurances Ltd [1952] HCA 10; (1952) 85 CLR 138 at 151
[130] Phillipa v Carmel [1996] IRCA 451
[131] Stevens v Brobridd Sawmilling Co Pty Ltd (1986) 160 CLR 16
[132] See, eg, Vacik Distributors Pty Ltd v Kelly (1995) 12 NSWCCR 30 at [34]
[133] Personnel contracting at [62] discussing WorkPac Pty Ltd v Rossato [2021] HCA 23; (2021) 95 ALJR 681 at 700 [101] citing R v Foster; Ex parte The Commonwealth Life (Amalgamated) Assurances Ltd [1952] HCA 10; (1952) 85 CLR 138 at 151; see also, Personnel Contracting at [88] and the cases cited therein
[134] ACE Insurance Ltd v Trifunovski [2013] FCAFC 3, (2013) 209 FCR 146, (2013) 235 IR 115 at [25]
Printed by authority of the Commonwealth Government Printer
Lucy Helft
Top Of The Town [2022] FWC 2656
(1952) 85 CLR 138
(1995) 12 NSWCCR 30
(2004) 144 IR 1
(1986) 160 CLR 16
(2001) 207 CLR 21
(2021) 95 ALJR 681
(2013) 235 IR 115
(2013) 209 FCR 146