s.394 - Application for unfair dismissal remedy

Application for an unfair dismissal remedy - whether employee or independent contractor - employment relationship found - whether dismissal was harsh, unjust or unreasonable considered - dismissal found to be unfair - remedy to be considered.

• [1] On 13th June 2025, Mr David Oldaker (the Applicant) made an application under s.394 of the Fair Work Act 2009 (the Act) alleging that he was unfairly dismissed from his employment with the Respondent and that his dismissal on 4 June 2025 was harsh, unjust or unreasonable.

• [2] Mr Oldaker's employer is Reece Young-Green (the Respondent), who runs a landscaping business known as RYG Excavation & Landscape in the western suburbs of Melbourne. Mr Oldaker worked for Mr Young-Green as a labourer. He started working for the Respondent in March 2023.

• [3] Mr Oldaker accepts that he started work as a sub-contractor for Mr Young-Green under his own ABN.[1] The terms of his engagement were that he was paid hourly for the work he performed based on invoices he provided every week. His evidence is that he otherwise worked for Mr Young-Green as directed, where he directed and that he was reliant on Mr Young-Green for both work and the tools to perform it. He accepts Mr Young-Green did not pay him superannuation or provide for his workers compensation insurance but submits he understood he would do so. Arguing that he understood he was employed by the Respondent and that he was unfairly dismissed because he filed a claim for WorkCover following a serious workplace incident.

• [4] The Respondent disputes Mr Oldaker has a right to make a claim for unfair dismissal. Their position is that as a contractor with no formal written contract of employment Mr Oldaker is not an employee and not entitled to make a claim for unfair dismissal under the FW Act.[2] Adding further, that Mr Oldaker would have been dismissed regardless of the workplace incident because of an unrelated business restructure.[3]

• [5] On allocation to my Chambers, directions were issued for a hearing on 2nd October to consider the merits of Mr Oldaker's application. In advance of proceedings, Mr Oldaker filed written submissions, supporting material and a sworn witness statement. The Respondent did not file any material, submissions or otherwise engage with the FWC.

• [6] On 1st of October, the Respondent provided medical evidence indicating he may be unable to participate in proceedings as programmed. On this basis, I determined to adjourn the scheduled hearing and listed the matter for a case management conference the following day. Mr Oldaker attended the case management conference; the Respondent failed to attend or provide any explanation.

• [7] Following this conference, directions were issued listing the matter for hearing on the 10th of October. Parties were advised they were required to attend or otherwise advise the reasons they were unable to do so. Neither party provided any reason why the matter should not proceed to determination.

• [8] The hearing proceeded as listed on Friday, October 10th. Mr Oldaker presented and provided sworn evidence to the Commission. The Respondent did not attend or provide any reason why they could not do so. In these circumstances, I considered it appropriate to proceed to determine the matter pursuant to section 600 to the FW Act.

• [9] Having considered all the submissions and evidence submitted by the parties, I have found that the circumstances of this case are such that Mr Oldaker was an employee of the Respondent within the meaning of the FW Act, who has been unfairly dismissed. Because of this, I intend to further consider whether an award of compensation should be made.

• [10] The reasons for these finding and details are set out below.

• [11] Section 396 of the Act requires that consideration as to whether a dismissal was unfair cannot occur unless the Commission is first satisfied that the provisions of s.396 have been met. In the present case, it is not contested, and I am satisfied that Mr Oldaker's application was filed on 13th June 2025 and is made within the required timeframe. It is not contested, and I am satisfied that Mr Oldaker was earning below the high-income threshold and is a person protected from unfair dismissal. It is not contested that the dismissal was consistent with the Small Business Fair Dismissal Code. It is also not asserted, and I am satisfied this is not a case of genuine redundancy.

• [12] As I have been satisfied that the requirements of s.396 are met, I am required to consider the merits of whether Mr Oldaker's dismissal was harsh, unjust or unreasonable.

• [13] The Respondent does not accept that Mr Oldaker is a person who has been dismissed within the meaning of the FW Act as he was a sub-contractor and not an employee. Mr Oldaker contends he was an employee within the meaning of the Act who has been unfairly dismissed who should be compensated.

• [14] Section 386 of the Act sets out when a person is taken to have been dismissed for the purposes of s.365. If relevantly provides:

(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.

• [15] It is clear from the above, in order for there to be a dismissal under this section (and, therefore, a valid application under s.394) there must be a relationship of employment between the parties[4] and the employment must be brought to an end by one, or the other (or potentially both) in circumstances described by s 386 subsections (1)(a) or (b).

• [16] Both Mr Oldaker and the Respondent have provided evidence and submissions to the Commission on both these issues to the extent of their abilities.

• [17] Mr Oldaker's written submissions, supporting materials and sworn oral evidence at the hearing is he was an employee the Respondent within the meaning of the FW Act. His evidence is that he was told by the Respondent that he was being employed. That he understood he would be paid hourly for the work he performed. That to be paid he was required to produce a weekly invoice of his total weekly hours worked. He did so and was paid for hours worked. Furthermore, that he understood he was being paid superannuation, had workers compensation insurance and that the Respondent provided him work tools, and directed where, when, how and if he performed work.

• [18] Mr Oldaker accepts that he had an ABN, invoiced for his hours and worked as a sub-contractor. His position is that despite these facts he was an employee for the purpose of the FW Act. In support of his position, Mr Oldaker provided evidence of his invoices and payments, along with several text messages between himself and the Respondent confirming the terms and nature of his engagement. In addition, he has also provided evidence of the Respondent affirming to his parole officer that he commenced employment with the Respondent on 4 March 2023.[5]

• [19] In its F3 response form, the Respondent submitted that Mr Oldaker was a contractor with no formal written contact of employment who was not classed as an employee under the Act and had no grounds to bring an application for unfair dismissal. The Respondent did not take these representations any further. They did not provide any additional information or submissions and despite being granted an adjournment request, failed to attend the hearing despite being on notice the matter would be determined in their absence.

• [20] The determination of the question of whether Mr Oldaker was an employee or independent contractor for the Respondent is not a straightforward task. It involves a detailed examination and overall assessment of the relationship between the parties and the application of the provisions in s.15AA of the Act. These provisions necessitate a detailed consideration of a range of different factors to determine the real substance, practical reality and true nature of the relationship. The totality of the relationship must be considered.

• [21] This approach draws the distinction as an employment relationship being when an individual provides their personal service (skill, time, effort etc) under a contract of service to be discharged by the individual personally. Whereas an independent contracting relationship is a contract for services where an individual is conducting their own independent business with a degree of control over how their services are provided.

• [22] To assist drawing this distinction, numerous decisions applying the common law, including of this Commission, has identified a multi-factorial test to be applied in ascertaining the true nature of the relationship. Key factors to be considered include:[6]

• The degree of discretion and control over how and when works is to be performed
• The degree of freedom to perform work for others
• The requirement to provide and maintain tools and equipment
• The mode of remuneration, including taxation arrangements
• The provision of clothing and livery and the extent of presentation within the business
• The provisions of leave and other entitlements usually associated with relationships of employment
• The opportunity for profit and risk of loss

• [23] I have considered the principles set out in these authorities to the circumstances of this case. It is not in contest that the terms of the agreement between the parties were not committed to writing. Mr Oldaker submits a valid claim that the real substance, practical reality and true nature of his relationship with the Respondent was one of employment. That he was paid hourly for his work, provided the tools with which to work, directed where to work, when to work and was reliant on the Respondent to be provided work supports this conclusion.

• [24] Mr Oldakers's evidence was uncontested. The supporting evidence he has provided to the Commission also supports a conclusion he was engaged by the Respondent as an employee. And while I have considered the submissions put forward by the Respondent in its response material they can be taken no further absent additional information or submissions.

• [25] Because of this conclusion, I am satisfied on the material before me that Mr Oldaker was an employee within the meaning of s.15AA of the Act. It follows, I am satisfied that he is a person entitled to make a claim for unfair dismissal.

• [26] Mr Oldaker submits he was involved in a serious accident that required him to be hospitalised for treatment. Once he left hospital, he made an application for WorkCover, filing a claim and submitting a certificate of incapacity for 30 days. He submits the Respondent initially discouraged him from filing a workers compensation application and that when he did, he was told by the Respondent to use his 30 days to find another job by text message. Adding further, that he has not been paid superannuation and other legal entitlements for his work with the Respondent.

• [27] The Respondent submits Mr Oldaker performed work for them from March 2023 to 18th May 2025 and was paid an average weekly wage of $1500 gross per week. Their position is that he was dismissed from these services with immediate effect from 18th May 2025. That he was a contractor and dismissed following a workplace accident. Moreover, that he would have been dismissed regardless of the incident because the business was being reorganised. The Respondent made no further submissions and did not provide any additional information or evidence to support its position.

• [28] Mr Oldaker provided sworn evidence in proceedings to support his position. I found his evidence persuasive and accept it. It is clear from this evidence that Mr Oldaker has been significantly impacted by both this termination and being injured at work from which he has yet to fully recover. Mr Oldaker's evidence was unchallenged in proceedings. In these circumstances, I now turn to consider whether he has been unfairly dismissed within the meaning of the Act.

Was this dismissal harsh, unjust or unreasonable?

• [29] While I have found the evidence in this case supports a conclusion Mr Oldaker was an employee whose employment ended because of the conduct, or course of conduct of his employer, it does not automatically follow that his termination was unfair. In making this determination, I must consider all the circumstances of the case along with the relevant authorities.[7] A dismissal may be unfair, when examining if it is 'harsh, unjust or unreasonable' by having regard to the following reasoning of McHugh and Gummow JJ in Byrne v Australian Airlines Ltd:[8]

"It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment may be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted."

• [30] Section 387 of the Act provides for the criteria for consideration whether a dismissal was harsh, unjust or unreasonable as follows:

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:

(a) whether there was a valid reason for the dismissal related to the person's capacity or conduct (including its effect on the safety and welfare of other employees); and

(b) whether the person was notified of that reason; and

(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

(e) if the dismissal related to unsatisfactory performance by the person--whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer's enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that the FWC considers relevant."

• [31] I am required to consider each of these factors, to the extent they are relevant to the factual circumstances before me.[9]

• [32] I have set out my consideration of each below.

s.387(a) Whether there was a valid reason for the dismissal related to the person's capacity or conduct (including its effect on the safety and welfare of other employees)

• [33] In order to be a valid reason, the reason for the dismissal should be "sound, defensible, or well founded"[10] and should not be "capricious, fanciful, spiteful or prejudiced."[11] However, the Commission will not stand in the shoes of the employer and determine what the Commission would do if it was in the position of the employer.[12]

• [34] In the present case, neither party argued that the reason for dismissal was because of Mr Oldaker's capacity or conduct. In short, Mr Oldaker argues he was dismissed because he lodged a workers compensation claim following a workplace incident where he was injured.

• [35] The Respondent does not dispute it ended Mr Oldaker's engagement with immediate effect on 18 May 2025. Nor does the Respondent dispute Mr Oldaker was involved in a workplace incident in which he was injured.

• [36] There is no evidence to dispute Mr Oldaker's submission that he was dismissed by text message after he made his employer aware he had made an application for workers compensation by filing a certificate of incapacity on 18th of May 2025. The text message exchange between Mr Oldaker and the Respondent on this day reads as follows:[13]

Mr Oldaker: "...Doctor gave me a month off however I am having a review earlier than that in 27/05/25 hopefully with clearance."

Respondent: "Use the month to find another job mate"

Mr Oldaker: "Cancel my employment cos I am going to put in work cover claim? And all outstanding money/bonus will be paid correct?"

Respondent: "No this was the nail in the coffin thought you better than that tbh mate"

• [37] The Respondent did not provide Mr Oldaker or the Commission any further reason or information. Because of this, I find the only reason the Respondent provided Mr Oldaker for his termination was related to his application for workers compensation and related workplace incident.

• [38] I am satisfied that this reason does not relate to Mr Oldaker's conduct or capacity. Nor am I satisfied that this was a valid reason for termination. I am, therefore, satisfised that this factor weighs in favour of the Applicant.

s.387(b) Whether the person was notified of that reason

• [39] Proper consideration of s.387(b) requires a finding to be made as to whether the Applicant "was notified of that reason". Contextually, the reference to "that reason" is the valid reason found to exist under s.387(a).[14]

• [40] Notification of a valid reason for termination must be given to an employee protected from unfair dismissal before the decision is made to terminate their employment,[15] in explicit,[16] plain and clear terms.[17]

• [41] As identified by the Full Bench in Crozier v Palazzo Corporation Pty Ltd:

"As a matter of logic procedural fairness would require that an employee be notified of a valid reason for their termination before a decision taken to terminate their employment in order to provided them an opportunity to respond to the reason identified."

• [42] Given that I am not satisfied there is a valid reason for dismissal related to Mr Oldaker's capacity or conduct, this factor is not strictly relevant in this case.[18] If I had found there was a valid reason for dismissal, I would have found that Mr Oldaker was not notified of the reason for his dismissal prior to a final decision being communicated to him. The evidence is this case is that Mr Oldaker was dismissed with immediate effect by text message.

• [43] Given these circumstances, I consider this to be a neutral factor.

s.387(c) Whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person

• [44] In the circumstances of this case, the reason for termination is not related to Mr Oldaker's capacity or conduct. This factor is, therefore, not relevant to this case, and I consider it to be neutral.

s.387(d) Any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal

• [45] This factor is not relevant to the facts of this case as there was no request or opportunity for this to occur in the circumstances of this case.

s.387(e) If the dismissal related to unsatisfactory performance by the person‑ - whether the person had been warned about that unsatisfactory performance before the dismissal

• [46] This factor is not relevant to the facts of this case as the ending of the employment relationship did not relate to unsatisfactory performance.

s.387(f) The degree to which the size of the employer's enterprise would be likely to impact on the procedures followed in effecting the dismissal and s.387(g) - Whether the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise impacted on the procedures followed

• [47] The Respondent has not made any submissions on the size of its business or the absence of a dedicated human resource specialist. It is clear, however, that the Respondent is a small business employer who has not sought to rely on the dismissal being consistent with the Small Business Fair Dismissal Code. In the circumstances of this case, I consider these factors are relevant to the way the Respondent dealt with the ending of Mr Oldaker's employment. Plainly, there is no evidence in this case the Respondent had any awareness of their obligations as an employer, let alone their rights. I, therefore, consider these factors should be weighed in neutral terms.

s.387(h) Any other matters that the FWC considers relevant

• [48] Neither party brought any other relevant matters to my attention that I consider relevant to the jurisdiction of the Commission with respect to the ending of Mr Oldaker's employment. That is not to say that there are no other relevant matters to this dispute between Mr Oldaker and his former employer. Mr Oldaker refers to his previous reliance on the Respondent for somewhere to live, not being paid his full legal entitlements and the impact of his injury after being injured at work. Following the hearing, colleagues to the Respondent also brought it to my attention the Respondent's principal Mr Young-Green had recently passed away.

• [49] I have carefully considered these matters.

• [50] Mr Oldaker refers to serious claims of underpayment and non-compliance with both the relevant award, taxation and related superannuation legislation. Mr Young-Green is now deceased.

• [51] I am satisfied that in these circumstances these other factors ought to be a neutral consideration.

• [52] I have considered all the relevant evidence and submissions of the parties in the circumstances of this case. Firstly, I found that Mr Oldaker is an employee protected from unfair dismissal who has been dismissed within the meaning of the FW Act.

• [53] I have considered if this dismissal was harsh, unjust or unreasonable as required. Relevantly, I have not been satisfied that there was a valid reason for the dismissal related to capacity or conduct and that this factor weighs in favour of the Applicant being unfairly dismissed. Having not being satisfied of a valid reason related to capacity or conduct I am satisfied this is not a relevant factor. I have made similar conclusions of relevance with respect sections 387(c), (d) and (e.). I consider factors (f) and (g) and (h) to be neutral considerations.

• [54] On balance, because of these findings, I am satisfied Mr Oldaker was unfairly dismissed within the meaning of s.385 of the FW Act.

• [55] Having been satisfied that the Applicant:

• - made an application for an order granting a remedy under s.394;
• - was a person protected from unfair dismissal; and
• - was unfairly dismissed within the meaning of s.385 of the Act;

I may, subject to the Act, order the Applicant's reinstatement, or the payment of compensation to the Applicant.

• [56] Under section 390(3) of the Act, I must not order the payment of compensation to the Applicant unless:

(a) the FWC is satisfied that reinstatement of the Applicant is inappropriate; and

(b)the FWC considers an order for payment of compensation is appropriate in all of the circumstances of the case.

• [57] I have found Mr Oldaker has been unfairly dismissed in the circumstances of this case. In the present case, before I turn to remedy, I consider it is appropriate for the Applicant and any representatives of the Respondent to be provided a further opportunity to make submissions to assist my consideration of the appropriate remedy. These circumstances arise because of the Respondent's principal having deceased.

• [58] Accordingly, I will provide the Applicant and any representatives of the Respondent a short period to provide me any relevant information to these matters. Directions will be provided to the parties to this effect. After this time, I will consider the material provided and finalise this component of my decision.

[1] Form F2 Application, Digital Court Book ('DCB') p.37.

[2] Form F3 Employer Response, DCB p.47.

[4] See for example Grass v Chinese Tennis Association Inc [2021] FWCFB 3443 at [11].

[5] Attachment 18, Statutory Declaration of David Oldaker, DCB p.33.

[6] For example, Hollis v Vabu Pty Ltd [2001] HCA 44; Stevens v Brodribb Sawmilling Company Pty Ltd [1986] HCA 1; Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1; ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2 among others.

[7] See Australian Hearing v Peary [2009] AIRCFB at [39].

[9] Sayer v Melsteel Pty Ltd [2011] FWAFB 7498 at [14]; Smith v Moore Paragon Australia Ltd PR915674 (AIRCFB Ross VP, Lacy SDP, Simmonds C, 21 March 2002, at [69].

[10] Selvachandran v Peteron Plastics Pty Ltd [1995] IRCA 333; (1995) 62 IR 371 at [373].

[12] Walton v Mermaid Dry Cleaners Pty Ltd [1996] IRCA 267; (1996) 142 ALR 681 at [685].

[13] Attachment to Form F2 Application, DCB p.40.

[14] Bartlett v Ingleburn Bus Services Pty Ltd [2020] FWCFB 6429 at [19]; Reseigh v Stegbar Pty Ltd [2020] FWCFB 533 at [55].

[15] Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137 at [151].

[16] Previsic v Australian Quarantine Inspection Services Print Q3730 (AIRC, Holmes C, 6 October 1998).

[18] Read v Gordon Square Child Care Centre [2013] FWCFB 762 [46]-[49]; also Rizvi v Salini [2023] FWC 3112 at [48]- [50], [56]-[57].

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