Fair Work Act 2009

s.365 - General protections and s.394 - Unfair dismissal

Termination of employment - Application to deal with contraventions involving dismissal - Application for an unfair dismissal remedy - jurisdiction.

[1] On 1 July 2021 Mr Peter John Chambers (Mr Chambers) filed a general protections application involving dismissal under section 365 of the Fair Work Act 2009 (the Act). The Respondent is Broadway Homes Pty Ltd (Broadway or the Respondent).

[2] The same day Ms Jennifer O'Brien (Ms O'Brien) filed an application for an unfair dismissal remedy under section 394 of the Act. The Respondent was also Broadway.

[3] Broadway in its response to Mr Chambers' application objected to it on the ground that Mr Chambers was not a person who had been "dismissed", within the meaning of section 386 of the Act, which is a requirement of section 365. It was asserted that this was so because Mr Chambers was not an employee of Broadway.

[4] Broadway's response explained that its' position was Mr Chambers was an agent of Jamrok Pty Ltd (Jamrok) who had performed work for Broadway's benefit on Jamrok's behalf, pursuant to an agreement between Jamrok and Broadway dated 5 March 2020 (the Jamrok Agreement).

[5] Broadway also opposed the application on a range of other grounds.

[6] It was also asserted that Ms O'Brien was the sole Director and Shareholder of Jamrok while the Jamrok Agreement was in force.

[7] Broadway in its response to Ms O'Brien's application objected to it on the ground that Ms O'Brien was not a person protected from unfair dismissal because she was not an employee of Broadway.

[8] Broadway's response explained that its' position was Ms O'Brien was an agent of Jamrok who performed work for Broadway's benefit on Jamrok's behalf, pursuant to the Jamrok Agreement.

[9] Separately Broadway objected to Ms O'Brien's application on the grounds that she was not dismissed by Broadway but rather Broadway had terminated the Jamrok Agreement between itself and Jamrok.

[10] Broadway also opposed Ms O'Brien's application on a range of other grounds.

[11] Mr Chambers is Ms O'Brien's son. Collectively they will be referred to in this decision as the Applicants.

[12] The Commission noting the jurisdictional objections raised by Broadway referred both applications to myself for hearing and determination.

[13] Following a directions hearing, on 18 August 2021 the Commission issued a decision which amongst other things records the consent of the parties for these two applications to be case managed together and the jurisdictional objections to the applications to be heard concurrently.[1]

[14] Prior to the hearing there were a series of applications made by the Applicants and by Broadway for production of documents. The Applicants also sought a number of orders for witnesses to attend the hearing.

[15] There were a number of applications made by the Applicants for extensions of time to file materials and for relisting of the hearing to later dates.

[16] The Applicants filed a number of appeals of procedural decisions being C2021/6653 which was discontinued, C2021/745 which was dismissed by the Full Bench and C2021/7367.

[17] Five days before the jurisdictional hearing was to commence the Applicants filed a recusal application which the Commission listed for the first day of hearing of the jurisdictional objections which was to be 8 November 2021.

[18] This recusal application was then discontinued the day prior to it being heard.

[19] The hearing of Broadway's jurisdictional objections to the applications proceeded over three days being 8, 9 and 11 November 2021.

[20] At the hearing Mr Chambers and Ms O'Brien gave evidence on their own behalf. Witnesses ordered to attend at the request of the Applicants who gave evidence were Mr Rodney Hart (Mr Hart) and Mr Mark Basso-Brusa (Mr Basso-Brusa).

[21] The following witnesses gave evidence for the Respondent; Mr Michael Gangemi (Mr Gangemi), Ms Verity Phoenix (Ms Phoenix), Mr Peter Gobetti (Mr Gobetti), Ms Sharene Leatherbarrow (Ms Leatherbarrow), Mr Guy Singleton (Mr Singleton), Mr Barry John Honey (Mr Honey) and Mr Nicholas Parkinson (Mr Parkinson).

[22] As foreshadowed by the Commission at the conclusion of the hearing sometime after the hearing the High Court of Australia issued decisions in the matters of CFMMEU v Personnel Contracting Pty Ltd (CFMMEU v Personnel Contracting)[2] and a ZG Operations Australia Pty Ltd v Jamsek (ZG Operations v Jamsek)[3] both of which dealt with matters central to determining these applications. Consequently, the parties were directed to provide further written submissions in light of these High Court cases which the Commission has had the opportunity to consider.

[23] With respect to witness credibility, I found both Mr Chambers and Ms O'Brien under cross-examination at times to be evasive in their answers and their evidence often to be self-serving. They were both at times resistant to obvious propositions such as that it is inconsistent to, in these proceedings, argue they are employees of Broadway whilst in other proceedings initiated by Ms O'Brien in August 2021 in a separate jurisdiction it is claimed that Jamrok is a contractor that provided services to Broadway and to make claims directly to Broadway for monies purportedly owed to Jamrok.[4]

[24] The demonstrated collaboration between Mr Chambers and Ms O'Brien in the preparation of their witness statements raised further questions about their credibility.

[25] Mr Chambers' application as filed says he began working for Broadway on 30 September 2019.

[26] Ms O'Brien's application as filed says she first worked for Broadway on 28 October 2019.

[27] Both applications say the Applicants were dismissed by Broadway on 11 June 2021.

[28] Ms O'Brien's evidence in chief is that she operates Jamrok for the primary purpose of receiving pay from builders that operate independent contractor arrangements.

[29] Her evidence goes on to say that she has now discovered this to be called sham contracting.[5]

[30] Mr Chambers' evidence is that when the relationship with Broadway terminated his understanding of the sham contracting provisions of the Act changed and that is why he had never previously suggested he was an employee.[6]

[31] Various witnesses use the terms Building Design Consultant, Sales Representatives or Sales Consultant to describe the same role.

[32] Ms Phoenix is the Group Accounts Manager or the Group Accountant for the Delstrat Group (Delstrat).

[33] Delstrat is a group of building and construction companies including HALPD Pty Ltd T/A Affordable Living (Affordable Living), Ideal Homes Pty Ltd T/A Ideal Homes and Broadway Homes Pty Ltd T/A Broadway Homes.

[34] The accounts department which she manages make payments from Broadway to its contractors and suppliers. They make sure they have a current agreement on file for their contractors who sell building contracts for Broadway.

[35] Her evidence was that contractors who sell building contracts for Broadway are paid commission payments when a client they have secured for Broadway enters into a building contract with Broadway and there is a concrete slab laid down on their property. They are also sometimes paid bonus payments for the clients they secure.

[36] Broadway also sometimes advances money to contractors who sell building contracts for Broadway when commission payments or bonus payments are not yet payable. Those advances are a debt to Broadway and Broadway keeps records of what amounts have been advanced.

[37] When a contractor then is entitled to commission or bonus payments any previous advances are deducted by Broadway.

[38] Delstrat's accounts department generates invoices to Broadway on behalf of contractors who sell building contracts for Broadway. These are known as "Recipient Created Tax Invoices" or RCT invoices.

[39] RCT invoices must comply with requirements set by the Australian Tax Office (ATO) including that the party to whom the funds are paid under the invoice is a company registered for GST.

[40] She says that if someone is a sole trader or not registered for GST they cannot be issued with RCT invoices and they must prepare their own invoices.

[41] She explains it is more convenient for Delstrat to generate RCT invoices for sales contractors rather than wait for the contractor to issue them an invoice because before Delstrat would pay any invoice from a contractor it would need to confirm all the details of the commission payments, bonuses, deductions, advances or discounts.

[42] Her evidence was that from time-to-time Jamrok was a contractor to Affordable Living and to Broadway.

[43] She says from 2014 until around 2016, Jamrok was a contractor to Broadway and Mr Chambers and Ms O'Brien were the people who did the work on Jamrok's behalf.

[44] Ms Phoenix provided copies of over 20 RCT invoices from Broadway to Jamrok for the period 30 September 2014 to 30 September 2016.[7]

[45] Her evidence was also that from around 2019 that Affordable Living and Broadway paid commissions and bonuses to Jamrok.

[46] Ms Phoenix provided copies of RCT invoices from Delstrat, being Affordable Living and Broadway, to Jamrok for the period 31 August 2019 to 31 May 2021 for such commissions and bonuses.[8]

[47] Ms Phoenix provided a copy of a document headed "Sales Reps Details" which includes the details of Mr Chambers, the company name as Jamrok Pty Ltd, the ABN being 47 149 956 114, it being registered for GST and the address being 670A Beach Road Hammersley, WA 6022. The second page is headed "Sales Reps Bank Details" and lists the company name as Jamrok Pty Ltd with the same ABN, and the banking details for the account name Jamrok Pty Ltd. No personal bank details for Mr Chambers are listed.

[48] This appears to be signed by Mr Chambers and dated 10 October 2013.[9]

[49] Her evidence also included a copy of a document with a Broadway footer headed "Starter Pack Building and Design Consultant" the second page under the heading "Personal Company Details" shows Peter Chambers, the company name as Jamrok Pty Ltd and the same ABN and street address as for the 2013 documents above. The third page includes bank details for Jamrok Pty Ltd which are the same as for the 2013 documents above. No personal bank details for Mr Chambers are listed. This appears to have been signed by Mr Chambers on 5 March 2020.

[50] The next page includes emergency/medical information for the position of Sales Consultant and includes the personal details of Mr Chambers and identifies Ms O'Brien as the contact in case of emergency. This also appears to have been signed by Mr Chambers on 5 March 2020.

[51] Additional pages include rules regarding smoking, alcohol and other drugs on Broadway's premises and refers to staff members potentially being dismissed. This was also apparently signed by Mr Chambers on 5 March 2020. Finally, he has also signed an agreement to be a member of the non-profit social club and for deductions to be made for that purpose. This also appears to have been signed by Mr Chambers on 5 March 2020.

[52] The evidence in chief of Ms O'Brien is that she had worked with Broadway as a Building and Design Consultant in 2014. She confirms that commission payments were paid into her company Jamrok by way of RCT invoices. In 2014 there were two Directors of Jamrok, herself and Mr Massey. By 2019 she was the sole Director.

[53] Mr Chambers' evidence was that before accepting an offer from Mr Gobetti in late 2019 to join the Broadway team, he had declined similar offers from Mr Gobetti because he was then employed by another builder that paid him a regular salary rather than a full commission-based position.[10]

[54] Ms O'Brien's evidence in cross-examination was that in mid-2019 she had been providing services, on Jamrok's behalf, as a contractor on occasion to draw up floor plans for clients of GMAC Realty.[11] At the same time she was also working part-time as an employee for GMAC Realty.

[55] Mr Chambers' evidence in chief was that he held the position of Building and Design Consultant with Broadway from 23 September 2019 and then as Sales Manager from 16 June 2020 until he was dismissed on 11 June 2021.

[56] He says he originally reported to Mr Gobetti who was then the Sales Manager and once he became Sales Manager he reported to Mr Gangemi and Mr Singleton.

[57] He says he did not operate a company with an ABN and was not registered for GST.

[58] In September 2019 he says he accepted an offer from Mr Gobetti to join as a Consultant.

[59] He says he was never asked if he had a company or whether he was registered for GST or had insurance such as workers compensation or public liability.

[60] The only discussions about the terms were related to the percentage commission and bonuses he could potentially earn. He says he began at the North Beach display home on the weekend of 28/29 September 2019.

[61] He understood he would not be paid for a period because payments are generally not made until the slab is down which can be anywhere from 6 to 12 months from the initial sale of a home.

[62] His evidence was that he was not being paid until July 2020 "...at which point Broadway had begun paying regular sums to Jamrok Pty Ltd and in turn my wages could be covered."[12]

[63] There is no evidence that Broadway ever paid monies directly to Mr Chambers, such as to his personal bank account.

[64] He says he was expected to open a display home every weekend and public holiday from 1:00 p.m. to 4:00 p.m. He was provided with Broadway branded polo shirts that could be worn while he worked in their office or at the display home. He was provided with a Broadway email address for communications between himself and the office and clients. He was provided with Broadway business cards identifying himself as a Building and Design Consultant including his personal mobile phone number and the Broadway email address; including other Broadway company details.

[65] His evidence was he had access to Broadway's office with the alarm code, and keys for construction sites at their display homes.

[66] He says whilst he had access to the premises at any time the open plan nature of the office meant he was more productive outside normal office hours.

[67] He had keys and alarm codes for display homes to show potential clients through.

[68] He had Broadway stickers with his name and phone number to place on construction sites signs.

[69] He said he had access to Broadway's computer drives that contained relevant documentation and forms required. Broadway's IT department provided assistance to him on computer related issues.

[70] Broadway provided him a comprehensive Building and Design Consultant Guide he could refer to which explained in detail how to complete the various required tasks of a Consultant.

[71] He was a member of the ABI social club and attended regular events.

[72] He was invited along with the rest to Broadway staff to the annual Christmas party.

[73] Regarding Ms O'Brien, Mr Chambers says Mr Gobetti in October 2019 asked him whether his mother might be interested in a Sales Consultant role with Broadway. He replied that Mr Gobetti should speak to her directly. His evidence was he was not otherwise involved in her engagement.

[74] He doesn't recall when but sometime after he had commenced work with Broadway he was provided with a copy of the Jamrok Agreement.[13]

[75] He says he did not pay too much attention to the detail except that it provided the commission structure he had agreed with Mr Gobetti previously.

[76] The Jamrok Agreement is 11 pages in length. The front page is dated 5 March 2020 and says it is,

[77] The Jamrok Agreement is apparently initialled by Mr Chambers on every page and signed on the 10th page on 5 March 2020 by Mr Chambers as "The Consultant".

[78] It is signed by Mr Gobetti on behalf of Broadway.

[79] Page 2 says that it is agreed that,

"The Company agrees to employ the Consultant as a new homes Building & Design Consultant to negotiate and sell Lump Sum Building Contracts under the registered Builders License of the Company."

[80] The Jamrok Agreement is only personalised for Mr Chambers by limited handwritten insertions being on the front page, the date, then Mr Chambers' name as the Consultant and also Jamrok Pty Ltd as the Consultant's company name are handwritten in. On page 10 the date, Mr Chambers' name, signature and address and on page 11 the bottom of Schedule A - Rate of Remuneration his name and signature are all handwritten.

[81] Throughout the Jamrok Agreement the term "...he/she..." is used repeatedly.

[82] I am therefore satisfied, and Mr Chambers confirmed as much, that the Jamrok Agreement is a generic Broadway agreement for the engagement of Building and Design Consultants.[14]

[83] The Jamrok Agreement includes in summary, relevantly, the following terms.

[84] That the Consultant agrees that they will perform the conditions of the Jamrok Agreement and their duties to the highest professional standard, act loyally towards Broadway, undertake duties as assigned to them and discharge such duties by observing and complying with all directions given, be available for such hours of work as may be reasonably required by Broadway and attend training sessions and sales meetings.

[85] The Consultant at their expense shall provide, operate and maintain, a vehicle insured for business purposes and an after-hours telephone number, a mobile phone and a laptop computer, iPad or iPhone or any other communication equipment required by Broadway.

[86] The Consultant shall not without consent to Broadway be engaged directly or indirectly in any, trade business or occupation which interferes or is in conflict with Broadway's business or interferes with performance of their duties.

[87] The Company agrees that,

"(d) Due to the terms of this Agreement being a contractual agreement to subcontract under the Builders License, make all commission payments inclusive of GST. The Company shall not make Superannuation contributions on behalf of the Consultant as it is not required to do so."[15]

[88] A Consultant rostered for office duty agrees to be present at the Company's premises to receive sale enquiries. A Consultant rostered at an allocated display home agrees they shall adhere to the Company's hours of operation and arrive 15 minutes prior to opening hours to prepare the display home.

[89] The Company set sales budgets to a minimum target after consultation with the Consultant normally at a structured performance review.

[90] If the Consultant wishes to build a house a discount structure is available across the Company's brands but this discount will only apply if the Consultant is currently employed at the completion of construction.

[91] If the Company incurs a penalty or fine imposed by the Department of Consumer Protection or the Builders Registration Board as a result of a wrongful act or negligence of the Consultant, the Consultant shall pay to the Company or have deducted from monies owing the full amount of such penalty or fine unless this is covered by the Company's professional indemnity policy.

[92] In the event of any dispute arising between the parties relating to matters provided by the Jamrok Agreement or the rights obligations and liabilities of the parties hereto shall be referred to the Industry Arbitration Panel for adjudication.

[93] The following debts if incurred will be debited from the Consultant's commission,

• Personal business expenses in the name of the company such as advertising, printing, bulk postage, telemarketing, brochures and delivery of material etc other than expenses expressly approved by the Manager in writing.

• Advance payment of commission.

[94] The Consultant agrees that they are:

• Entitled to unpaid leave of 20 working days.

• NOT entitled to paid leave pertaining to holiday, personal (sick & compassionate), parental or long service leave.

[95] The Consultant will receive 4% commission payment of the lump sum building contract value, exclusive of site works and GST. The Consultant will receive a bonus commission payment of 0.5% if they achieve lump sum building contract value equating to $1 million or more including GST for a specified month.

[96] Sales bonuses due shall be paid when the final job has commenced to slab down on-site from the home sales that achieved bonus. Should a sale attributed to bonus for that month be cancelled and so the contract value has dropped below $1 million the bonus will be forfeited.

[97] Payment for both commission sales and commission sales bonuses will be made to the Consultant's respective registered company. The Company is not responsible for tax being withheld if you operate as a sole trader or a company. The Consultant will receive all commissions paid gross. It is the responsibility of the Consultant to make sure they pay the applicable tax, superannuation and GST as required by corporate law and the ATO.

[98] On the same day, 5 March 2020, that Mr Chambers signed the Jamrok Agreement he also signed a Deed of Acknowledgement (the Deed).

[99] Mr Chambers' evidence in chief regarding the Deed was that approximately five months after he started with Broadway, he requested an advance on the commissions he had earned as the financial position Ms O'Brien and he were facing was extremely tight.

[100] Mr Chambers says Broadway refused to pay any money until he had signed the Deed. He says it was a take it or leave it offer and he was not provided an opportunity to negotiate or alter the terms of the Deed.

[101] He says Ms O'Brien had been engaged with Broadway for approximately four months however she was not asked to sign the Deed even though she was the Sole Director of Jamrok.

[102] His evidence was that Jamrok is the company name that Broadway would pay their, his and Ms O'Brien's, commissions through.[16]

[103] The Deed's cover page shows the Deed is between, Broadway Homes Pty Ltd and Jamrok Pty Ltd and identifies Peter Chambers as the "Guarantor".

[104] The Deed says as follows,

"(A) Upon appointment of the Consultant the Builder agreed to advance the monies prior to receipt of the commission payment.

(B) The Consultant enters into this Deed to acknowledge that he/she/it is indebted to the Builder, pursuant to the outstanding full amount stated on their most recent monthly remittance, for or in respect of commission payment as further documented herein.

(C) The Guarantor agrees to perform the obligations of the Consultant under this Deed if the Consultant is a corporate entity."

[105] The Deed was executed with by Mr Basso-Brusa and Mr Carl Basso-Brusa each signing as a Director of Broadway.

[106] It is also signed by Mr Chambers, apparently signing it as a Director of Jamrok "...in accordance with section 127 of the Corporations Act 2001 by authority of its directors:".

[107] The Commission notes that on his own evidence Mr Chambers was not a Director of Jamrok.[17]

[108] In June 2020, Mr Chambers says he was offered the position of Sales Manager with Broadway.

[109] This was announced to staff in an email by Mr Singleton on 29 June 2020. He advised staff Mr Chambers was now the Sales and Marketing Manager. His email explained that not only will Mr Chambers continue to sell; a significant part of his role will be focused on supporting and leading the Sales Team.

[110] Around this time Mr Chambers was also involved in the process of preparing a new display on West Coast Drive.

[111] He says as Sales Manager the four remaining Building and Design Consultants reported to him. He also later recruited two additional Consultants.

[112] He provided the roster for display homes. He provided mentoring and helped to secure more sales for Broadway.

[113] Mr Chambers' evidence is that he was involved in a number of staffing changes. He was heavily involved in the general marketing for Broadway, proofing various items ranging from business cards to site signs and large format advertising signs.

[114] He says he created a script and was interviewed for two television segments for "Home in WA" as a Broadway representative.

[115] He says he improved the display home program for Broadway including negotiating with two interstate clients to rent their new homes back after completion so they could be used as display homes.

[116] Under cross-examination Mr Chambers agreed that he had been employed for a period by Jamrok. There were a series of payslips which demonstrate he was being paid a salary, which ranged from $80,000 per annum to later being $156,800 per annum, by Jamrok from August/ September 2020 to at least December 2020.[18]

[117] At no time during his relationship with Broadway did Mr Chambers ever query the nature of the relationship with Broadway nor how it operated in practice nor how he was paid through Jamrok.

[118] Ms O'Brien explained that she had previously worked for Broadway in 2014 but this ended when Mr Gobetti became aware she was also part-time employed elsewhere.

[119] In mid-2019 she was working as a Sales Consultant for Karma Resorts selling holiday packages in Bali.

[120] In late October 2019 she met with Mr Gobetti. He had a position for a Building and Design Consultant to share the Dianella display home with Mr Hart, another Consultant.

[121] She was not asked whether she had a company or was registered for GST or had any public liability or workers compensation insurance.

[122] The only discussion about the terms related to the commission structure and how much she would be paid per sale.

[123] She accepted the position with Broadway and commenced on 3 November 2019.

[124] Her evidence in chief was that she was not provided with an agreement nor an employment contract at any time during her period with Broadway.[19]

[125] She had told Mr Gobetti that she would be continuing with real estate on a part-time basis which he understood. Consequently, she was also undertaking home opens for GMAC Realty.

[126] She then contacted Mr Hart and they agreed on a mutually acceptable arrangement regarding sharing the Dianella display home.

[127] Her evidence was that real estate listings/sales were offered by her to Broadway clients as a "value added service" with reduced sales commissions. By offering reduced commissions on the sale of established houses this allowed to her to secure more building contracts for Broadway.

[128] There were six clients she identifies who needed to sell their properties or they would not have been able to enter into a contract to build with Broadway.

[129] Her evidence was she was expected to open the Dianella display home on Sunday and public holiday Mondays from 1:00 p.m. until 5:00 p.m.

[130] She was later asked by Mr Chambers to open the Jindalee display home on Saturdays and Wednesdays.

[131] On numerous occasions she was requested to open other Broadway display homes to allow other Consultants to take time off.

[132] She was expected to attend weekly sales meetings in the Broadway office.

[133] She was expected to attend the supplier meetings with Broadway clients, for example at a meeting with the tile supplier whilst the clients selected their tiles.

[134] She was expected to obtain design briefs from prospective clients and submit these to the Sales Manager for the design concept to be produced by Broadway's design department.

[135] She attended various Broadway staff social functions including a Christmas party.

[136] She had a Broadway email address and business cards. She was given access to Broadway's office with alarm codes, an access fob and keys to Broadway's construction sites and display homes.

[137] She had Broadway stickers to place on construction sites with her details.

[138] Broadway's IT department provided access to Broadway's drives from her personal laptop so she could access information necessary to do her job for Broadway.

[139] Broadway supplied her with the Building and Design Consultant Guide which was a how-to guide to complete all the tasks of a Consultant.

[140] Ms O'Brien's commission payments were paid to Jamrok, her company, by way of a RCT invoice.[20]

[141] There is no evidence that Ms O'Brien ever provided her personal banking details to Broadway.

[142] Her evidence was that in 2019 Mr Chambers was employed by Affordable Living and their method of payment of his commission was to be through Jamrok. Her evidence was that Delstrat produced a Deed of Acknowledgement to be signed by Jamrok. She says they were aware she was the Sole Director and she signed this Deed.[21]

[143] She says that when Mr Chambers moved from Affordable Living to Broadway unbeknownst to her a new Deed of Acknowledgement was produced and given to Mr Chambers to sign as a Director of Jamrok.

[144] Her evidence was that during her time at Broadway business expenses to do with her work for Broadway were paid from the remuneration from Broadway. She already owned her car and phone and her only expenses were for fuel, internet and phone usage.

[145] The evidence is that Ms O'Brien, the Owner and Sole Director of Jamrok, was at all times between late 2019 and the middle of 2020 intimately aware of the financial arrangements operating in practice between Broadway and Jamrok. She was directly involved in handling the transactions between Broadway and Jamrok, such as the regular RCT invoices concerning payments of commissions to Jamrok that resulted from sales that both Mr Chambers and herself had achieved for Broadway. She managed Jamrok's day-to-day financial affairs including banking, taxation, loan repayments, payments of Jamrok's operating expenses and payments from Jamrok to Mr Chambers and herself. Ms O'Brien also generated and issued Jamrok invoices to other businesses such as GMAC Realty and on occasion, when making financial claims against it, to Broadway.[22]

[146] At no time during her relationship with Broadway did Ms O'Brien ever query the nature of the relationship nor how it operated in practice nor the fact that her commission payments were made to Jamrok.

[147] It is not disputed that the only monies ever paid for commissions or bonuses earned by Mr Chambers, as a Sales Consultant and as the Sales Manager, and Ms O'Brien as a Sales Consultant (minus any adjustments or giveaways) was paid by Broadway to Jamrok. These payments followed the creation of monthly RCT invoices by Broadway and were inclusive of GST. No payments were ever made to the Applicants.[23]

[148] No superannuation was paid to Mr Chambers or Ms O'Brien's superannuation funds nor was paid leave granted to them.

[149] The evidence in chief of Mr Gobetti was that between 2007 and June 2020 his company Regalwise Pty Ltd (Regalwise) was contracted to Broadway.

[150] The services Regalwise provided to Broadway was to manage the Sales Team and for him to act as Sales Manager. Broadway engaged a number of contractors who are called "Sales Representatives" to follow-up on enquiries and to close deals with customers looking to build a new home. These Sales Representatives and himself made up the Sales Team in Broadway.

[151] The Sales Representatives manned the Broadway display homes which were generally open on Saturdays and Sundays and his evidence was he left it up to the Sales Representatives to work out amongst themselves who would be manning which display homes at what times.

[152] He usually reported and provided updates to Mr Gangemi, the Group General Manager on the Sales Team's performance.

[153] The Sales Representatives had written subcontractor agreements with Broadway. At different times he was involved in making changes to different versions of the subcontractor agreement.

[154] The Sales Representative contractors were only paid when they assisted a client to sign a building contract with Broadway and a concrete slab was laid for the client's home.

[155] Regalwise was paid for providing him as the Sales Manager, a commission based on the percentage of the total value of sales in Broadway.

[156] He says that during the time he performed work for Broadway on a number of separate occasions Mr Chambers was a Sales Representative for Broadway and other companies within Delstrat through the company which engaged him, which was Jamrok.

[157] His evidence was that Mr Chambers was keen to engage his mother, Ms O'Brien to work with him, he says as Mr Chambers' assistant.

[158] His evidence was that he remembers there were definitely subcontractor agreements signed by Mr Chambers for the periods that Jamrok performed work for Broadway.

[159] He did not recall whether Ms O'Brien signed a subcontractor agreement or not.

[160] He confirmed he and Mr Chambers signed a subcontractor agreement in 2014 which provides for Mr Chambers to provide services to Broadway, which he identified.[24]

[161] He also identified the Jamrok Agreement dated 5 March 2020 and agrees it includes his handwriting and signature.[25]

[162] He similarly confirmed that he signed the Deed dated 5 March 2020.[26]

[163] Under cross-examination he agreed he was neither a Director nor an employee of Broadway, but his evidence was he had a verbal authorisation to execute documents on behalf of Broadway. He took signing such documents seriously and believed he was authorised to do so at the time.[27]

[164] The evidence of Mr Basso-Brusa, one of the three Directors of Broadway, under cross-examination was that some contractors on behalf the Broadway have the authority to do certain things for the organisation which are approved by the Directors.[28]

[165] He identified the Jamrok Agreement as the document Broadway uses to engage a new Sales Consultant.[29]

[166] Mr Basso-Brusa's evidence under cross-examination was that in March 2020 when Mr Gobetti signed the Jamrok Agreement he had the role of Sales Manager and General Manager of Broadway.[30]

[167] Mr Basso-Brusa's evidence was that Mr Gobetti was not an employee of Broadway he was a contractor like the Sales Consultants.[31]

[168] Mr Basso-Brusa's agreed that Mr Gobetti would not have signed the agreements without having authority to do so.[32]

[169] Returning to the evidence of Mr Gobetti, his evidence was that Mr Chambers would have had to have had a proprietary limited company to have worked for Broadway.[33]

[170] Mr Gobetti under cross-examination said that Mr Chambers suggested to him that Ms O'Brien come back and work with them like the old days and he had replied that this was a good idea because they were a good team. He denies that he interviewed Ms O'Brien.[34]

[171] His evidence was that when Ms O'Brien began working with Mr Chambers he says they worked together as a team, there was no distinction between the commission payments for building contracts secured for Broadway as a result of Mr Chambers' or Ms O'Brien's work. Any commissions payable secured by either of them were paid to Jamrok.

[172] His evidence was that Broadway counted Mr Chambers' and Ms O'Brien's sales together when working out what bonus payments Jamrok was to be paid.

[173] He recalls that other Sales Representatives were annoyed with this arrangement because their bonus payments were only calculated on the sales they achieved individually.

[174] He says that in 2019 Mr Chambers contacted him and they discussed him coming back to Broadway.

[175] Later in 2019 he had another discussion with Mr Chambers who told Mr Gobetti that he would like to come back to Broadway. He says Mr Chambers also told him that Ms O'Brien would be coming back to work with him.

[176] His evidence was that when Ms O'Brien was engaged in 2019 it's possible he offered her an employment contract. His evidence was they had an agreement when someone came on board that was put together by Administration or Accounts and it had multiple documents in there. Generally, they were ABNs, company details and the requirements that he or Broadway wanted from a representative for the company selling houses.

[177] His evidence was it was possible Ms O'Brien executed one of those contracts he couldn't recall.[35]

[178] Evidence was given by Mr Hart. To the extent his evidence was relevant he confirmed that he had been working with Broadway for over eight years. He worked as a Sales Consultant. He is a Director of a company, Denver Management (Denver). This company has done a lot of things over the years but primarily, at the moment, is receiving his income from Broadway. Denver has a contract with Broadway.

[179] When Mr Hart started with Broadway, Broadway asked that there be a contract between it and Denver.

[180] Denver invoices Broadway for the work that he does as a Sales Representative.

[181] He agreed he took advantage of the corporate structure of his company to split his income with his wife and this was beneficial; being tax effective.

[182] If Denver wants to do other business than that it does currently with Broadway there is no reason it can't do this.

[183] Over the last year Denver generated approximately 90% to 95% of its income from Broadway.

[184] His evidence was the contract between Denver and Broadway provides him with flexibility to decide what hours he works, where he works and what days of the week he works.

[185] The evidence in chief of Ms Leatherbarrow was that she has worked in the real estate and building industry since 1998.

[186] Her company Heart Homes Pty Ltd was a contractor to Broadway from 2013 for approximately 12 months. In this role she followed up enquiries for potential clients who wanted to build houses with Broadway. She also referred potential clients from contacts she had in the building industry. She generated her own enquiries through selling house and land packages. She would contact potential clients and have designs prepared by Broadway to take up a building contract with Broadway.

[187] Her company was responsible for paying its taxes and other costs including preparing and filing business activity statements and tax returns.

[188] She worked her own hours and could come and go as she pleased. She attended weekly Sales Team meetings organised by Mr Gobetti who then was the Sales Manager for Broadway. She had a desk at Broadway's office and used a computer belonging to Broadway but could work from home or wherever she chose. She chose not to wear a Broadway uniform.

[189] Between December 2018 and December 2020, she was employed as a Sales Manager for Brian Burke Homes. Her role was to sell building contracts for that company. She was paid a base salary plus commission fees. Brian Burke Homes deducted tax from the amounts paid to her.

[190] Whilst employed with Brian Burke Homes she worked set hours and reported to her Manager and she took paid holidays, paid sick leave and paid personal leave.

[191] She left her employment with Brian Burke Homes and in January 2021 and her newly created company, SLB Consulting Pty Ltd, became a contractor for Broadway. Her evidence in chief was that she became a contractor for Broadway because she enjoyed working arrangements where she worked her own hours and could come and go as she pleased. She set her own working time and appointments. She could work at Broadway's office, work from home or wherever she chose.

[192] At this time, Mr Chambers was the Sales Manager. Ms O'Brien was also working as a Sales Representative at Broadway and her desk at Broadway was next to Ms Leatherbarrow's.

[193] She understood from Mr Chambers that Ms O'Brien was also working as a Real Estate Agent.

[194] Her evidence was that Mr Chambers told her a number of times that he and Ms O'Brien work together as a team. This was what she saw was happening in practice.[36]

[195] Under cross-examination she explained that Mr Chambers had interviewed her for the position of a Sales Consultant.[37]

[196] Her evidence was Mr Chambers provided her with documentation required to accept the position. It was emailed to her prior to starting at Broadway. However, she never signed the document.

[197] Her evidence was that this was not an employment contract.[38]

[198] Her evidence was that whilst she reported to Mr Chambers she also reported to a number of other Managers within Broadway. She asserted that she was a contractor providing a service to Broadway. She did not agree that Mr Chambers had authority over her or was her boss.[39]

[199] Her evidence was that if she wanted to, she could have employed someone to assist her under the banner of her company.[40]

[200] Mr Gangemi is the General Manager of three companies that build residential homes in Perth; one of which is Broadway. The three companies are within Delstrat. He has been in this position since 2005.

[201] He is a contractor to Broadway.[41]

[202] Mr Singleton is the Operations Manager and has been since around 2017 and is effectively the second in charge of Broadway. He is responsible for ensuring its contracts and buildings are completed and runs smoothly.

[203] Below Mr Singleton are various teams, Administration, Drafting, Design, Estimating, Scheduling and Construction.

[204] Mr Gangemi's evidence was that the Operations Manager and everyone in the Administration, Drafting, Design, Estimating, Scheduling and Construction teams, including the Managers, are employees of Broadway.

[205] He says these employees are paid a salary from which PAYG tax is deducted. They work set hours and Broadway's office and take paid annual leave and sick leave is approved.

[206] His evidence is that Broadway engages contractors, which are always companies, to negotiate and sell contracts to its clients for whom Broadway build homes. Within Broadway these people who provide these negotiation and sales services for those contractors are called Sales Representatives.

[207] Broadway also engages a contractor to oversee the activities of the Sales Representatives. The person who provides that service for this contractor is called the Sales Manager.

[208] The Sales Manager and the Sales Representatives are referred to as the Sales Team.

[209] Once there is 'slab down' which is when the concrete slab is laid at the building site, the Sales Representative is eligible to be paid a commission which is usually 4% of the value of the building contract.

[210] If a Sales Representative sells contracts of the value of $1 million or over in a month and those contracts reach slab down there is a bonus percentage of a further 0.5% of the total value of each of the contracts.

[211] The contractor providing Sales Manager services is paid for these services by an 'is override' when that contract reaches slab down. That override is a payment of 1.25% of the total value of each building contract secured by the Sales Representatives for Broadway.

[212] Across the three businesses, including Broadway, that make up Delstrat there are approximately 30 Sales Representatives.[42]

[213] Mr Gangemi's evidence was that the good Sales Representatives could generate $500,000 in commissions per year. He estimates the average would be approximately $250,000 commission per year.[43]

[214] Sales Representatives are not required to provide services at any set times or for any particular number of days. They work as much or as little as they want. They are however expected to advise the Sales Manager if they aren't going to attend the display home so another Sales Representative can be arranged to attend.

[215] His evidence is other than the Sales Manager and ensuring that leads are being followed up in a timely way Broadway does not keep track of how Sales Representatives work.

[216] They are offered a booth to work from the Broadway office but are free to work wherever they choose. They are required to pay for their own laptop and mobile phone and Sales Representatives provide their own vehicle and pay for their own petrol.

[217] Sales Representatives are not required to wear a uniform, but Broadway provides polo shirts if they like. They usually wear business clothes.

[218] His evidence in chief is that at different times Jamrok has been a contractor to Broadway in the work of negotiating and selling building contracts has been done by Mr Chambers and to a lesser extent Ms O'Brien.

[219] He confirms that in March or April 2020 Regalwise stopped providing services to Broadway. He had a discussion with Mr Chambers about the fact that Mr Gobetti was leaving and so there was an opportunity for Mr Chambers to take on the additional responsibilities of Sales Manager.

[220] After that Mr Chambers began providing Sales Manager services for Jamrok to Broadway and Jamrok was paid override payments of 1.25% in addition to commission payments and bonuses for the contracts it sold.

[221] In reply to the witness statements of Mr Chambers and Ms O'Brien, Mr Gangemi gave further evidence to the effect that Broadway does not restrict Sales Representatives from earning through other sources of income or doing other work unless it is in direct competition with Broadway.

[222] He says Sales Representatives are not required to get involved in the design process but may choose to, to assist their clients. They are paid the same level of commission no matter how much or how little they are involved in design.

[223] He says that some Sales Representatives like to be involved in the selections of fittings and colours by the client, but they are not required by Broadway to be involved in this or the pre-start process. Some Sales Representatives choose to be involved because they believe it may strengthen their relationship with the client and help the contract progress to slab down at a faster rate and so they will become entitled to their commission payments sooner.

[224] With respect to Ms O'Brien under cross-examination his evidence was that his understanding was that she was assisting Mr Chambers. His evidence was that Mr Chambers actually said that they were "working as one". He understood they worked as a team. He understood she was there to assist Mr Chambers and Jamrok.[44]

[225] His evidence was that Sales Representatives did not have PAYG tax deducted, were not paid superannuation, and did not have leave entitlements.[45]

[226] The evidence of Mr Parkinson which was not contested is that on 30 July 2021, the Respondent's solicitors wrote to Ms O'Brien in her capacity as the Director of Jamrok to inform her that the Respondent was ready and able to pay any commission payments due to Jamrok under the Jamrok Agreement and by reason of the applications to this Commission, the Respondent could not make those payments to Jamrok until the issue as to whom commission payments were to be paid was resolved; that is, whether the commission payments should be paid to Ms O'Brien and Mr Chambers in their alleged capacities as former employees of the Respondent, or to Jamrok as a former contactor to the Respondent.[46]

[227] Mr Singleton is the Operations Manager of Broadway.

[228] Part of his responsibility is to arrange the commission payments and bonus. Once a job achieves slab down, he will process the commission payments and bonuses.

[229] Mr Singleton provided copies of all commission forms submitted by Mr Chambers and Ms O'Brien from September 2019 until June 2021.[47]

[230] On 4 August 2021, Ms O'Brien wrote to the Respondent's solicitors wrongly purporting on a without prejudice basis[48] and in her capacity as the Director of Jamrok, attaching an invoice from Jamrok and demanding payment of that invoice. That invoice was for commission payments payable in relation to services rendered by Jamrok and was inclusive of GST.[49]

[231] On 12 August 2021, Mr Chambers and Ms O'Brien wrote to the Respondent's solicitors attaching a further invoice from Jamrok and demanding payment of that invoice. That invoice was for commission payments payable in relation to services rendered by Jamrok.[50]

[232] On 20 August 2021, Ms O'Brien wrote to the Respondent's solicitors in her capacity as the Director of Jamrok attaching the invoice referred to above and demanding payment of that invoice.[51]

[233] On 23 August 2021, Jamrok, through Ms O'Brien in her capacity as Director, filed a Form 2 - Application for Adjudication (the Adjudication Application) under the Construction Contracts Act 2004 (the CC Act). That application made a claim for payment of the invoice referred to at paragraphs above.

[234] The Adjudication Application was expressly made on the basis that Jamrok, pursuant to the terms of the Jamrok Agreement, provided professional services to the Respondent.[52]

[235] The Respondent commissioned an expert report from a Chartered Accountant, Mr Honey.

[236] Mr Honey had access to the following documents for the period relevant to these applications, Jamrok bank statements, Jamrok's GST bank statements, invoices generated by Broadway for Jamrok, records of payments made by Broadway to Jamrok, information provided by Jamrok concerning sums paid from Jamrok, Jamrok's PAYG and business activity statements and Mr Chambers' payslips from Jamrok.

[237] His opinion in summary is that the legal structure or relationship between Jamrok and Ms O'Brien and Mr Chambers was consistent with Mr Chambers being an employee of Jamrok who was remunerated by way of the payment of salary by Jamrok and Ms O'Brien being an Officer and sole Director of Jamrok who controlled how Jamrok disburses the funds it received from its customers and any other sources, including making payments for the benefit of or at the discretion of Ms O'Brien.

[238] The structure involved the provision of services through an entity, sometimes referred to as a contractor, controlled by the person or persons providing the services which is not uncommon in Mr Honey's experience.

[239] His opinion was that the financial benefits Mr Chambers and Ms O'Brien derived from the identified structure, compared to them being engaged directly by Broadway as employees relate to,

• The benefit of determining how best to apply the gross income from the provision of services,

• Both having the flexibility to agree among themselves how best to share the gross income,

• The capacity for Ms O'Brien to structure payments so that the amount she received were on the face of it of a capital nature rather than income, subject to income tax,

• The capacity to direct payments of the type described immediately above i.e capital immediately to Mr Chambers, and

• Various expenses being paid by Jamrok from the gross income received that would not typically form part of expenses paid by an employer directly.

[240] Mr Honey was cross-examined on his evidence and report. I accept the evidence of Mr Honey summarised above.

[241] The evidence of Mr Parkinson was that in August 2021 Ms O'Brien as a Director of Jamrok applied for adjudication under the CC Act. The premise of that application (being the Adjudication Application) was consistent with the terms of the CC Act under which a party may apply to have a "payment dispute" adjudicated.[53] Relevantly:

• a "payment dispute" includes, amongst other things, a dispute arising from a failure to pay an amount in a "payment claim";[54]

• a "payment claim" means "a claim made under a construction contract - by the contractor to the principal for payment of an amount in relation to the performance by the contractor of its obligations under the contract";[55] and

• "construction contract" is defined as[56]:

a contract or other agreement, whether in writing or not, under which a person (the contractor) has one or more of these obligations -

(c) to provide, on or off the site where construction work is being carried out, professional services that are related to the construction work by virtue of section 5(2).

[242] The CC Act does not apply to a construction contract to the extent that the contract contains provisions under which a party is bound to supply services related to construction work as an employee.[57]

[243] Despite initially claiming that he could not recall whether he had any specific conversations with Ms O'Brien about making the Adjudication Application Mr Chambers later admitted to having such discussions.[58]

[244] Mr Chambers' evidence was that he endorsed and supported the decision for Jamrok to bring the Adjudication Application[59] and the decision to maintain that application was as much his decision as it was Ms O'Brien's.[60]

[245] The applications before the Commission and the Adjudication Application concern substantially the same issue; what amounts are due and payable by the Respondent in relation to the Applicants performing work for the Respondent's benefit.

[246] The Respondent's solicitors have, on a number of occasions, asked Mr Chambers and Ms O'Brien to explain how Jamrok's demands for payment and its Adjudication Application under the CC Act are consistent with their applications in the Commission.

[247] When questioned at the hearing, Ms O'Brien initially could not recall whether she responded to those questions.[61] Later during her cross-examination, she conclusively confirmed that she had not responded to those inquiries.[62]

[248] At the hearing, the evidence of the Applicants was that they pursued the Adjudication Claim after they realised the Commission's process was not going to quickly allow them to gain what they believed they were owed.[63]

[249] The Applicants were not able to offer a valid legal basis for bringing the Adjudication Application, other than to say that they had been provided with 'advice'[64] and they were operating in 'different jurisdictions'.[65]

[250] Mr Chambers' evidence at the hearing was that even though he was involved in the decision to bring the Adjudication Application, and he accepted that the basis of the Adjudication Application (as a construction contract) was in fact the Jamrok Agreement which he says was an employment agreement between himself and the respondent,[66] that he understood himself to be an employee at the time the Commission applications were filed (which was before the Adjudication Application was filed)[67] he did not see any problems, nor dishonesty, in running both proceedings.[68]

[251] Mr Chambers and Ms O'Brien both attempted to downplay or ignore the inconsistencies between the Adjudication Application and the applications in the Commission.[69] When counsel for the Respondent put to Ms O'Brien that the Adjudication Application and the applications to the Commission were inconsistent, Ms O'Brien repeatedly stated that she "did not believe there's an inconsistency"[70] or that she "disagree[ed] there's an inconsistency".[71] Ms O'Brien also gave evidence that "we understood that (indistinct) action (indistinct) process (indistinct) and one jurisdiction couldn't be affected (indistinct) is what we understood to be the case"[72] and that she "understood that it could run separate to this jurisdiction...".[73]

[252] During their evidence, the Applicants were unable to provide consistent evidence as to who the parties to the contract giving rise to the Adjudication Application were.[74]

[253] Despite herself preparing the Adjudication Application[75], Ms O'Brien refused to accept that the contractual basis for Jamrok's claim was the Jamrok Agreement even though it was contained in the Adjudication Application itself.[76]

[254] It was only at the hearing that the Applicants, for the first time, raised that the relationship between Jamrok and the Respondent arose due to a 'history of payments'[77] which gave rise to a 'precedent'[78] or a 'contract by way of action'[79] in which there was an 'implied power'.[80]

[255] Ms O'Brien would not accept that Jamrok had stated in its Adjudication Application that the Jamrok Agreement was not a sham contract.[81] (Emphasis added)

[256] Mr Chambers gave evidence that the statement contained in the Adjudication Decision that "Neither party promotes that the agreement represents the work of an employee in this matter" was information that "we [the Applicants] willing gave the Adjudicator".[82]

[257] The Adjudicator delivered his determination on 16 September 2021.[83]

[258] In the course of determining the Adjudication Application, the Adjudicator found that Jamrok, by relying on the Jamrok Agreement as the basis for the Adjudication Application, took a "contrary position to that taken [by the Applicants] in the FWC".[84]

[259] Since that decision, Jamrok has continued to attempt to enforce its contractual rights to commission payments under the Jamrok Agreement by applying to the State Administrative Tribunal (SAT) to apply to review the Adjudicator's decision on the Adjudication Application.[85]

[260] At the time of her giving evidence in the Commission hearing, Ms O'Brien maintained that the application to SAT was on foot with the Jamrok Agreement as the basis of that application.[86]

[261] The parties have both made voluminous written closing submissions and it is unhelpful to repeat all of those here.

[262] In summary the parties respective positions are as follows.

[263] Having regard to the decisions of the High Court CFMMEU v Personnel Contracting and ZG Operations v Jamsek the Commission must have regard to the subsequent conduct of the parties because of the Applicants' claims that:

• the Jamrok Agreement between the Respondent and Jamrok dated 5 March 2020 was a sham; and

• the Jamrok Agreement was between Mr Chambers and the Respondent.

[264] Alternatively, and in any event, the terms of the Jamrok Agreement in relation to the exercise of control by the Respondent, unpaid leave and use of social media was varied by the subsequent conduct of the parties.

[265] Following the judgments in CFMMEU v Personnel Contracting and ZG Operations v Jamsek, the Commission must characterise the relationship between the parties by having regard to the rights and obligations of the parties in accordance with orthodox principles of contractual construction.

[266] In light of the principles in the two High Court decisions above and the manner in which the parties conducted their cases, the Commission must have regard to the subsequent conduct of the parties and other extrinsic evidence to determine whether:

• the Jamrok Agreement was a sham;

• Jamrok or Mr Chambers was a party to the Jamrok Agreement;

• Ms O'Brien provided services pursuant to the terms of the Jamrok Agreement; and

• the subsequent conduct of the parties varied the terms of the Jamrok Agreement.

[267] For the reasons previously articulated in the Respondent's submissions and oral opening address, the subsequent conduct of the parties establishes that the relationship between the Respondent and Jamrok was one of principal and contractor and there was no employment contracts or employment relationships between the Respondent and each of the Applicants.

[268] Further and in the alternative, a proper reading of the Jamrok Agreement in accordance with orthodox principles of contractual construction establishes that it was a contract between Jamrok and the Respondent for the provision of services by Jamrok to the Respondent.

[269] The Commission, having regard for CFMMEU v Personnel Contracting and ZG Operations v Jamsek should pay particular attention to;

• the continued claims, of the Applicants, that the Jamrok Agreement between Broadway and Mr Chambers was a sham, the Jamrok Agreement was not executed in accordance with basic contract law, and that neither Jamrok or Ms O'Brien had any written agreement with the Respondent;

• the common law indicia judicially accepted and utilised in the Office of State Revenue audit into the Respondents' businesses that found the Applicants to be employees, while also valuing the "own business/employer's business" dichotomy;

• all parties conducted themselves throughout the relationship as though the Applicants were representatives of the Respondent and not as principals or agents of their own business;

• the terms, that were comprehensively committed to writing, in the Jamrok Agreement between Mr Chambers and the Respondent that indicate the true nature of the intended relationship including the right to control, direct and an obligation for payment for Mr Chambers' work;

• The absence of any right to delegate work in the terms of the Jamrok Agreement to Ms O'Brien or any other person or company; the true parties to the Jamrok Agreement and any conduct of the parties that would suggest any implied agreements;

• any variations to these terms due to the subsequent conduct of the parties;

• the Applicants' personal labour outweighs any mechanical equipment or tools provided by the Applicants;

• the scale of mutual reliance and dependency of the parties;

• the Applicants could not sensibly be said to have been carrying on business of their own account;

• any previous engagements;

• Mr Chambers' Sales and Marketing Manager's role within the Respondent's Senior Management Team.

[270] The Applicants in these matters have continually maintained that;

• the Jamrok Agreement was a sham as a misrepresentation of the true nature of the relationship between the Mr Chambers and Broadway;

• there was no written agreement between Ms O'Brien and Broadway;

• there was no written agreement between Jamrok and Broadway;

• the Jamrok Agreement was invalid as an instrument to bind Jamrok, in that it was never properly executed or ratified by the Director (Ms O'Brien) of Jamrok;

• the Jamrok Agreement was made further invalid, in that it was never properly executed or ratified by the Directors of Broadway; and

• the Jamrok Agreement was not provided to Mr Chambers until five months into his employment with the Respondent unlike the circumstances in CFMMEU v Personnel Contracting and ZG Operations v Jamsek where the applicants in those cases, had no outstanding payments or entitlements when their agreements were reached. McCourt's agreement was signed prior to engagement, while Jamsek had all leave paid out prior to starting their new agreement.

[271] In comparison, the Applicants in these matters had been working for five months, without being paid, and had $103,679.64 of unpaid commission in Broadway's business before being given and asked to sign the Jamrok Agreement. The Applicants submit that this is not simply a superior bargaining power on behalf of the Respondent, but a strong use of leverage as no payments, of the commissions, would have been made without the Jamrok Agreement being signed.

[272] The opening paragraph of the Jamrok Agreement states,

"The Company (Broadway Homes Pty Ltd) agrees to employ the Consultant (Peter Chambers) as a new homes Building and Design Consultant to negotiate and sell Lump Sum Building Contracts under the registered Builder's License of the Company."

[273] This opening paragraph sets the scene for the relationship of employer and employee while the clauses that follow set out the rights and obligations within that relationship.

[274] It is submitted the clearly defined and succinct paragraph leaves no room for confusion or misinterpretation, "the Company agrees to employ" not engage or subcontract to, and more importantly it does not describe a principle/contractor arrangement that provides agents to work for "the Company".

[275] In fact, there is no mention of "agent, principal, contractor, delegation, nominated agent or even independent" throughout the entire Agreement. This further reduces the chance of misinterpretation that the agreement is setting out anything other than an employer and employee relationship.

[276] The Jamrok Agreement fails to categorically exclude that it is not an employment contract. In fact, in reference to Schedule A - Rate of Remuneration it states "[t]he Company is not responsible for tax being withheld if you operate as a Sole Trader or a Company". The proposition can therefore be assumed that if the individual operates as an employee, then "the Company" is responsible for tax being withheld.

[277] In regard to the Respondent's claim that Jamrok was able to provide "agents" to work for Broadway, the Applicants refer the Commission to clause 6(b) of the Jamrok Agreement that specifically states that Mr Chambers was NOT allowed to "reveal to any person(s) or company, any business information relating to the Company". This clause categorically refutes the Respondent's claim as Mr Chambers could not, and did not, reveal business information for the purpose of delegating his work or to provide "agents" to Broadway.

[278] Should the Respondent have intended, as they claim, to create a structure that allowed for Jamrok to provide agents to Broadway, their agreements would have been very different in that there would have been a Labour Hire Agreement (that allowed for multiple agents/labourers). However, this was not the case.

[279] The argument that the Applicants were agents (since there were two of them using the same payment vehicle) cannot apply to the vast majority of the Respondent's exclusive individually engaged Sales Representatives, that have signed agreements with identical terms. In essence, this argument could not be used to defend similar claims from their exclusive Sales Representatives and should not have any weight in these matters either.

[280] Numerous other clauses and terms that specifically refer to employment, rather than independent contractor, further reduce any ambiguity as to the true nature of the relationship and these have been previously examined in the Applicants' submissions.

[281] The judgements in CFMMEU v Personnel Contracting and ZG Operations v Jamsek provide further support to the Applicants claims that they had an employer/employee relationship with the Respondent.

[282] The Respondent conducted their case in a manner to disguise the true nature of the relationship by attempting to focus the Commission's attention on Jamrok and that it was engaged in sufficient enterprise. However, they failed to address the basic common law indicia, the rights, and obligations that the parties conducted themselves under and the sheer scale of the dependency of both parties on one another that provided a balance of evidence to characterise the relationship as one of employer/employee.

[283] Mr Chambers' application filed under section 365 of the Act identifies his employer as Broadway. In section 3.1 of his application as filed he states that on 30 September 2019 he accepted a Sales Consultant position at Broadway. He further states in his application that "On 5 March 2020, a written agreement was entered into between me and Broadway...".

[284] In his witness statement filed in the Commission on 12 October 2021 he says in September 2019 he accepted an offer of Mr Gobetti from Broadway to join the team. His evidence is that the only discussions about the terms of his employment related to the percentage commissions and bonuses he could potentially earn.[87]

[285] Notwithstanding his evidence that these were the only discussions about his employment his evidence in chief was that he understood that he would not be paid for a significant period because payments in the construction industry are generally not made until 'slab down' stage, which can be anywhere from 6 to 12 months from the initial sale of the home.[88]

[286] His evidence in chief was that he does not recall exactly when he was provided a copy of the Jamrok Agreement[89] however it was well after he had commenced with Broadway.

[287] He says he did not pay too much attention to the detail of the Jamrok Agreement except that it provided the same commission structure that had been agreed.

[288] His evidence in chief is that in late February 2020 he requested an advance on commissions but he says Broadway refused to pay him any money until he had signed the Jamrok Agreement and the Deed[90].

[289] His evidence was that Jamrok was the company name that Broadway would pay their commissions to.[91]

[290] On 5 March 2020, Mr Chambers signed both the Jamrok Agreement and the Deed and Broadway afterwards in accordance with the Deed paid him an advance on commissions as he had requested.

[291] The cover sheet of the Jamrok Agreement shows it is an agreement made on 5 March 2020 between Broadway and Mr Peter John Chambers, as Building and Design Consultant (the Consultant) OF Jamrok Pty Ltd. Each page is initialled by Mr Chambers and he signed the document on page 10 as the Consultant and signed Schedule A - Rate of Remuneration on page 11 as the Consultant.

[292] There is no doubt that the Jamrok Agreement is a contract with Broadway. The parties however dispute who it is that Broadway contracted with.

[293] Mr Chambers argues the Jamrok Agreement is a contract between Broadway and himself as an employee of Broadway.

[294] Opposing jurisdiction in this matter Broadway argues the Jamrok Agreement is a contract between Broadway and Jamrok and Mr Chambers performed work for Broadway as an agent of Jamrok.

[295] Recently the High Court in CFMMEU v Personnel Contracting considered the proper approach to determining whether a relationship between parties is one of employment or otherwise. In the decision Kiefel CJ, Keane and Edelman JJ held as follows,

"43. While there may be cases where the rights and duties of the parties are not found exclusively within a written contract, this was not such a case. In cases such as the present, where the terms of the parties' relationship are comprehensively committed to a written contract, the validity of which is not challenged as a sham nor the terms of which otherwise varied, waived or the subject of an estoppel, there is no reason why the legal rights and obligations so established should not be decisive of the character of the relationship.

59. Where the parties have comprehensively committed the terms of their relationship to a written contract the validity of which is not in dispute, the characterisation of their relationship as one of employment or otherwise proceeds by reference to the rights and obligations of the parties under that contract. Where no party seeks to challenge the efficacy of the contract as the charter of the parties' rights and duties, on the basis that it is either a sham or otherwise ineffective under the general law or statute, there is no occasion to seek to determine the character of the parties' relationship by a wide ranging review of the entire history of the parties' dealings. Such a review is neither necessary nor appropriate because the task of the court is to enforce the parties' rights and obligations, not to form a view as to what a fair adjustment of the parties' rights might require.

60. In this respect, the principles governing the interpretation of a contract of employment are no different from those that govern the interpretation of contracts generally. The view to the contrary, which has been taken in the United Kingdom, cannot stand with the statements of the law in Chaplin and Narich.

61. The foregoing should not be taken to suggest that it is not appropriate, in the characterisation of a relationship as one of employment or of principal and independent contractor, to consider "the totality of the relationship between the parties" by reference to the various indicia of employment that have been identified in the authorities. What must be appreciated, however, is that in a case such as the present, for a matter to bear upon the ultimate characterisation of a relationship, it must be concerned with the rights and duties established by the parties' contract, and not simply an aspect of how the parties' relationship has come to play out in practice but bearing no necessary connection to the contractual obligations of the parties." (References omitted)

[296] This approach was also accepted by Gordon J at [162] and [173] and by Steward J at [203] agreeing with Gordon J.

[297] The High Court's approach above is applicable to Mr Chambers' application because the Jamrok Agreement between the parties comprehensively set down the terms of their relationship.

[298] Notably in this case Mr Chambers has argued that the Jamrok Agreement was a sham.

[299] Gordon J in CFMMEU v Personnel Contracting at [177] considered the sham contract issue as follows.

"177. Of course, the general principle against the use of subsequent conduct in construing a contract wholly in writing says nothing against the admissibility of conduct for purposes unrelated to construction, including in relation to: (1) formation - to establish whether a contract was actually formed and when it was formed; (2) contractual terms - where a contract is not wholly in writing, to establish the existence of a contractual term or terms; (3) discharge or variation - to demonstrate that a subsequent agreement has been made varying one or more terms of the original contract; (4) sham - to show that the contract was a "sham" in that it was brought into existence as "a mere piece of machinery" to serve some purpose other than that of constituting the whole of the arrangement; and (5) other - to reveal "probative evidence of facts relevant to rectification, estoppel or any other legal, equitable or statutory rights or remedies that may impinge on an otherwise concluded, construed and interpreted contract". The relevance of subsequent conduct for the purposes of a particular statutory provision, legislative instrument or award was not in issue in this appeal."(References omitted)

[300] So it is that in relation to considering whether a contract was a sham the use of subsequent conduct of the parties is permissible.

[301] The meaning of the term 'sham' has been considered in prior High Court cases as follows,

Raftland Pty Ltd as trustee of the Raftland Trust v Commissioner of Taxation[92]:

"35. The term "sham" may be employed here, but as Lockhart J emphasised in Sharrment Pty Ltd v Official Trustee in Bankruptcy the term is ambiguous and uncertainty surrounds its meaning and application. With reference to remarks of Diplock LJ in Snook v London and West Riding Investments Ltd, Mustill LJ later identified as one of several situations where an agreement may be taken otherwise than at its face value, that where there was a "sham"; the term, when "[c]orrectly employed", denoted an objective of deliberate deception of third parties." (References omitted)

Equuscorp Pty Ltd v Glengallan Investments[93]:

"46. Each of these transactions was legally effective. None of the transactions that took place on 30 June 1989 could be said to be a sham. The primary judge was wrong to characterise them, as he did by his references to "artifice", "façade" and "charade", as shams. "Sham" is an expression which has a well-understood legal meaning. It refers to steps which take the form of a legally effective transaction but which the parties intend should not have the apparent, or any, legal consequences. In this case, debts were created and satisfied at all points in the chain until, at its end, Rural Finance owed JFM and FJA certain sums, and the respondents owed Rural Finance certain sums. And of most particular relevance to the present matters, in accordance with its obligations under the written loan agreements, Rural Finance had applied the money it lent in payment of the application moneys due from the respondents for the units being bought." (References omitted)

[302] In the second recently decided High Court decision, ZG Operations v Jamsek, Kiefel CJ, Keane and Edelman JJ held that,

"62. The circumstance that this state of affairs was brought about by the exercise of superior bargaining power by the company weighed heavily with the Full Court; but that circumstance has no bearing on the meaning and effect of the bargains that were struck between the partnerships and the company. To say this is not to suggest that disparities in bargaining power may not give rise to injustices that call for a legal remedy. The law in Australia does provide remedies for such injustices under both the general law and statute. Those remedies were not invoked in this case. As has been noted earlier, the respondents did not claim that the contracts with the partnerships were shams. Nor did they seek to make a claim under statute or otherwise to challenge the validity of the contracts that were made by the partnerships. In Australia, claims of sham cannot be made by stealth under the obscurantist guise of a search for the "reality" of the situation.

63. Even if this disguised submission of sham were to be countenanced, the reality of the situation is that the partnerships, and not the respondents individually, owned and operated the trucks. The partnerships contracted with the company and invoiced the company for delivery services provided by the operation of the trucks. The partnerships earned income from the company, incurred expenses associated with the ownership and operation of the trucks, and took advantage of tax benefits of the structure. It is not possible to square the contention that the respondents were not conducting a business of their own as partners with the circumstance that, for many years, they enjoyed the advantages of splitting the income generated by the business conducted by the partnerships with their fellow partners." (References omitted and underling added)

[303] Accepting this approach, Mr Chambers' claim that the Jamrok Agreement was a sham contract cannot be made by stealth under the guise of a search for the "reality" of the situation.

[304] There is no evidence before the Commission that Mr Chambers has sought to challenge the Jamrok Agreement as a sham under the general law or statute.

[305] The evidence is in fact that Ms O'Brien has sought to enforce the terms of the Jamrok Agreement through the Adjudication Application she made as a Director of Jamrok.

[306] The evidence of both Mr Chambers and Ms O'Brien is that it was only after they had ceased working for Broadway that they had come to understand that the Jamrok Agreement was, in their opinion, a sham. This demonstrates that when the Jamrok Agreement was entered into with Broadway (whether with Mr Chambers or with Jamrok) the parties were not taking steps, which took the form of a legally effective transaction, but which they both intended should not have the apparent, or any, legal consequences.

[307] Indeed, Mr Chambers' evidence was that there no real discussions with Broadway about the Jamrok Agreement or its terms when it was entered into. There is also no evidence that Broadway made any statement it knew was false to persuade or influence Mr Chambers to enter into the Jamrok Agreement.

[308] As the Respondent submits the reality of the situation on the evidence is that Jamrok did conduct a business of its own. Jamrok existed and operated prior to the Jamrok Agreement being made. It had previously undertaken business with Broadway and Affordable Living as early as 2014.[94] During the term of operation of the Jamrok Agreement, Jamrok provided services to GMAC Reality for which it received payments. As can be seen from its accounts, Jamrok received commission payments from Broadway, issued loans, paid a salary at times to Mr Chambers, made provision for PAYG tax, paid GST, operated a number of credit cards and bank accounts and took advantage of tax benefits from the structure.

[309] Considering the evidence, my decision is that there is no basis to find that the Jamrok Agreement was a sham.

[310] I accept as the Respondent submits that it is permissible to consider the parties subsequent conduct in relation to determining who the parties to a contract, in this case the Jamrok Agreement, were.[95]

[311] The cover page of the Jamrok Agreement was completed by Mr Chambers and says it is an agreement between Broadway and Mr Chambers, Consultant, of Jamrok.

[312] The only discussion Ms O'Brien had before she began working at Broadway, in late 2019, about the terms of engagement was in relation to the commission structure and how much would be paid per sale.[96]

[313] Ms O'Brien was never presented with an employment agreement.[97]

[314] The evidence is that in practice commissions and bonuses earned by Mr Chambers and by Ms O'Brien were the subject of invoices created by Broadway and the monies paid to Jamrok.

[315] No monies were ever paid to the personal accounts of Mr Chambers or Ms O'Brien. They never provided information regarding their personal banking details to Broadway.

[316] The evidence of a number of the Respondent's witnesses, which I accept, was that they understood Mr Chambers and Ms O'Brien worked together as a team to secure building contracts.

[317] The payments of commissions for securing building contracts did not distinguish between the work of Mr Chambers or Ms O'Brien. All commission payments were paid to Jamrok. Bonus payments were paid on Jamrok's sales, not separated into Mr Chambers' and Ms O'Brien's individual sales.[98]

[318] The RCT invoices generated by Broadway for Jamrok[99] which reflect the commission slips submitted individually by Mr Chambers and Ms O'Brien and the payment records from Broadway to Jamrok demonstrate that Jamrok claim to commission and bonus payments and Broadway paid these amounts as required by the Agreement.

[319] In some instances, Jamrok invoiced Broadway for commissions when both Mr Chambers and Ms O'Brien had been involved in the sale of the particular building contract.[100]

[320] After Broadway had advised that Jamrok had been terminated as a contractor in June 2021, Jamrok issued invoices to Broadway claiming payment for commissions and bonus payments for sales secured by Mr Chambers and Ms O'Brien. Invoices of this nature were issued by Jamrok in August and September 2021.

[321] In regard to amounts Mr Chambers said that he had earned prior to the Jamrok Agreement being terminated his evidence was that these monies are owed to Jamrok and his evidence was that he was an agent of Jamrok.[101]

[322] Mr Chambers recognised that it was only because Jamrok was a party to the Jamrok Agreement that Jamrok could and did make claims against Broadway. He agreed Jamrok was the contracting vehicle.[102]

[323] Ms O'Brien in her witness statement and in cross-examination agreed that Jamrok was the vehicle for payment.[103]

[324] Throughout the life of the Jamrok Agreement both Broadway and Jamrok engaged with each other consistent with that agreement.

[325] All the above conduct is indicative of Jamrok being the other party to the Jamrok Agreement with Broadway. It is not indicative of Mr Chambers, as an individual, being a party to the Jamrok Agreement. My decision is the parties to the Jamrok Agreement where Broadway and Jamrok.

[326] Having decided that the parties to the Jamrok Agreement were Broadway and Jamrok, rather than Broadway and Mr Chambers, that is sufficient to uphold Broadway's jurisdictional objection to Mr Chambers' application.

[327] There was no contract between Broadway and Mr Chambers. Therefore, Mr Chambers was not an employee of Broadway and consequently is unable to make this application under section 365 of the Act and so his application must be dismissed.

If Mr Chambers was a party to the Jamrok Agreement what was the nature of the relationship?

[328] For completeness however, if I am wrong on the point above and at law Mr Chambers was, along with Broadway, a party to the Jamrok Agreement then it is necessary to consider what was the nature of the relationship? Was the relationship one of employer and employee or was it a subcontract relationship?

[329] As the High Court has now determined in CFMMEU v Personnel Consulting reviewing the nature of the relationship between parties, where the contract is comprehensively reduced to writing, is to be conducted by reference to the rights and obligations under the contract. There is no occasion to undertake a review of the history of the parties' dealings. That is not to suggest it is inappropriate to consider the totality of the relationship between the parties by reference to the various indicia of employment that been identified in the authorities.[104]

[330] Mr Chambers' evidence in chief was that he requested an advance on commissions however Broadway refused to pay any money until he had signed the Jamrok Agreement and the Deed.[105] Mr Chambers signed both documents on the same day.

[331] Whilst Mr Chambers advanced his case on the basis that the Jamrok Agreement is a contract of employment between Broadway and himself I accept as Broadway submits that the Jamrok Agreement and the Deed having been signed by Mr Chambers at the same time should be considered together as being the contract between them.

[332] I will now turn to consider the relevant rights and obligations under the contract. Firstly those reduced to writing in the Jamrok Agreement in summary are set out below.

[333] The cover page states that it is an agreement made BETWEEN Broadway (the Company) AND Peter John Chambers (the Consultant) OF Jamrok Pty Ltd (Company Name ABN/ACN). There is no dispute that Mr Chambers on this page wrote by hand both his name and "Jamrok Pty Ltd".

[334] Relevantly page 2 says "The Company agrees to employ the Consultant as a new homes Building & Design Consultant to negotiate and sell Lump Sum Building Contracts under the registered Builders License of the Company."

[335] There are various requirements of the Consultant detailed such as, performing their duties to the highest professional standard, at all times acting loyally towards the company, undertaking duties "as the Company shall from time to time assign him/her and in the discharge of such duties to observe and comply with all directions given.", being available for such hours of work as may be reasonably required by the Company, agreeing to attend training sessions and sales meetings as required.

[336] Clause 3(g) of the Jamrok Agreement says the Consultant agrees they have a good knowledge of the New Homes Building Contract 1991 as amended from time to time in the regulation in force pursuant to this Act.[106]

[337] Relevantly page 3 of the Jamrok Agreement lists further requirements including, at his own expense holding a current driver's licence and providing an operating and maintaining suitable vehicle insured for business purposes and licensed, at his expense provide an after-hours phone number, mobile phone, laptop, iPad or iPhone, or any other communication equipment.

[338] Page 3 also includes a statement that not without consent of the Company shall he be engaged or interested either directly or indirectly in any capacity, trade business were occupation which interferes or is in conflict with or interferes with the performance of his duties as a consultant. Not undertake any act which may expose the Company to any loss or liability will reflect upon its ethics or integrity ordered tract from or injure the company's good name. Not authorise or enter into any commitment regarding expenditure guarantees, making purchases or granting indemnity on behalf of the company.

[339] Page 3 also includes things the Company agrees it shall do such as to advise the Consultant of alterations, additions or deletions to any company or industry related material, acts, regulations or any other matters relevant to the Consultant. Nominate a preferred finance broker whereby their services shall be recommended to clients and customers. Ensure the Consultant is remunerated in accordance with the Company's commission payment structure in Schedule A.

[340] Significantly clause5(d) on page 3 of the Jamrok Agreement states that the Company agrees that it shall;

"Due to the terms of this Agreement being a contractual agreement to subcontract under the Builders License, make all commission payments inclusive of GST. The Company shall not make Superannuation contributions on behalf of the Consultant as it is not required to do so."

[341] Page 4 of the Jamrok Agreement includes various matters the Consultant agrees to regarding confidentiality and intellectual property.

[342] Significantly at clause 7 on page 4 reads as follows,

"Office Duty - A Consultant rostered on any particular day for office duty agrees that he/she shall:

(a) Be present at the Company's office premises during office opening hours to receive sales enquiries via phone, email, or can and referral. Should the consultant need to attend to matters out of the office during this time, it must be arranged an alternative Consultant be present in the office in his/her absence.

(b) Be accessible to the office premises during after office hours should the Consultant be required..."

[343] Page 5 of the Jamrok Agreement details requirements to adhere to the Company's display home hours of operation and to arrive 15 minutes prior to opening hours and how to present the display home. Regarding sales, the Company sets budgets of a minimum acceptable target which may alter after consultation normally add a performance review.

[344] In terms of sales, page 6 of the Jamrok Agreement says the Consultant agrees to ensure conditions contained in PPA and lump sum building contracts are acted upon by the Company's clients at must liaise on all matters necessary to bring the transaction to a satisfactory conclusion, ensure receipt is issued for all monies received and ensure a sales check list is completed prior to PPA. The Consultant will also refrain from marketing or advertising without approval and from making statements or announcements to media without approval. The Company agrees to provide a discount to the Consultant should they wish to build their principal place of residence or an investment property with Broadway or related building brands.

[345] Page 7 of the Jamrok Agreement concerns penalties and disputes and says it is agreed that if the Company incurs any penalties as a result of a wrongful act on negligent by the Consultant the Consultant shall pay this or have this deducted from their monies owing. In the event of disputes between the parties relating to any matter provided by the Jamrok Agreement or the rights and obligations therein it shall be referred to the Industry Arbitration Panel for adjudication. If the Company reduces the standard margin in order to secure a building contract the Consultant may be asked to reduce their commission. The Consultant will have no claim for the reduced commission.

[346] It is agreed that the following debts will be debited from the Consultant's commissions, expenses incurred by the Consultant, personal business expenses delivery of material, training or membership of professional associations, gifts for clients, any advance payment of commission, any other costs agreed in writing.

[347] Page 8 of the Jamrok Agreement says the Consultant will receive a statement on request detailing gross commissions and deductions to create the Consultant's gross position. The Consultant agrees they are entitled to unpaid leave 20 working days with four weeks' notice and is not entitled to paid leave pertaining to holiday, personal (sick and compassionate) parental or long service leave. The Jamrok Agreement may be terminated by either party giving two weeks' written notice provided the Company may terminate the Jamrok Agreement on grounds professional/ethical misconduct or negligence.

[348] Schedule A - Rate of Remuneration of the Jamrok Agreement details the 4% commission payment on building contract value. Details regarding bonus commissions are specified. Significantly, payment for both commission sales and commissions sales bonuses will be made to the Consultant's respective registered company, and it is the responsibility of the Consultant to make sure they paid the applicable tax, superannuation and GST as required by corporate law and the ATO.

[349] I will now turn to consider the relevant rights and obligations set out in the Deed which in summary are set out below.

[350] The Deed is between Broadway as the Builder, Jamrok as the Consultant and Peter Chambers as Guarantor.

[351] The recitals begin by stating that upon appointment of the Consultant (Jamrok) the Builder (Broadway) agreed to advance the Consultant (Jamrok) monies prior to receipt of a commission payment.

[352] It goes on to say that the Consultant (Jamrok) acknowledges that it is indebted to the Builder (Broadway).

[353] The Deed then states the Guarantor (Mr Chambers) agrees to perform the obligations of the Consultant (Jamrok) under the Deed if the Consultant (Jamrok) is a corporate entity.

[354] Adopting the nomenclature used in the Deed it goes on to say that Jamrok authorises and permits Broadway to make commission deductions from any amount due from Broadway to Jamrok in order to secure full repayment of the advance debt.

[355] It continues that Mr Chambers guarantees payment to Broadway of the advanced debt and all other money due and payable to Broadway by Jamrok and guarantees the performance of all other obligations of Jamrok under or in connection with this Deed.

[356] The Applicants in their submission regarding Mr Chambers focus on those provisions in the Jamrok Agreement that arguably, in isolation, are indicative of an employer/employee relationship.

[357] There however are similarly other provisions in the Jamrok Agreement that arguably, in isolation, to the contrary are indicative of a relationship other than an employer/employee relationship.

[358] Bearing in mind the Jamrok Agreement was drafted by Broadway this mixture of provisions is consistent with Broadway's position that the Jamrok Agreement was between itself and Jamrok, a subcontractor, and that Mr Chambers was not personally a party to it. From this perspective the provisions in the Jamrok Agreement that suggest an employer/employee relationship were not directed at Mr Chambers as an employee who was on the other side of the contractual bargain but rather applied to him as an agent of Jamrok.

[359] Broadway's position also explains why the Jamrok Agreement provides no requirement for Mr Chambers to be paid by Broadway, and he wasn't. There is nothing in the Jamrok Agreement that entitles Mr Chambers to be paid by Broadway for his efforts. A contract that does not entitle a person to payment for their efforts lacks an essential characteristic of an employer/employee relationship.

[360] As set out above the Jamrok Agreement, clause 5(d) on page 3 states that Broadway agrees that it shall;

"Due to the terms of this Agreement being a contractual agreement to subcontract under the Builders License, make all commission payments inclusive of GST. The Company shall not make Superannuation contributions on behalf of the Consultant as it is not required to do so."

[361] This provision in the Jamrok Agreement is not a mere labelling by the parties of the relationship as one of subcontract which the Commission can ignore;[107] rather this is an unambiguous statement that the Jamrok Agreement is a "...contractual agreement to subcontract..." and includes specific rights and obligations that are a consequence of the subcontract nature of the relationship. Those consequential rights and obligations are that commission payments will be inclusive of GST and that no superannuation contributions will be made on behalf of the Consultant as this is not required.

[362] Consistent with this statement that the Jamrok Agreement is a subcontract contractual agreement it also expressly states that the Consultant is not entitled to paid leave pertaining to holiday, personal (sick & compassionate), parental or long service leave.[108]

[363] Mr Chambers and Broadway entered into a written contract which expressly was an agreement to subcontract and which includes rights and obligations that arise from the agreement being to subcontract and which are consistent with the nature of the relationship being that of principal and contractor rather than employer and employee.

[364] My decision is that if indeed Mr Chambers was a party to the Jamrok Agreement then considering all of the rights and obligations prescribed in the Jamrok Agreement the relationship between Mr Chambers and Broadway was not one of employee and employer.

[365] The terms of the Deed do not suffer from the same mix of provisions as the Jamrok Agreement. The Deed is straight forward and states that Broadway is owed a debt by Jamrok because on appointment of Jamrok (the Consultant) Broadway (the Builder) agreed to advance to Jamrok monies prior to receipt of a commission payment and Mr Chambers (the Guarantor) agreed to perform the obligations of Jamrok under the Deed. The Deed was signed by Mr Chambers purporting to be a Director of Jamrok.[109]

[366] Reviewing the nature of the relationship between Broadway and Mr Chambers by reference to the rights and obligations prescribed under both the Jamrok Agreement and the Deed, my conclusion is that the relationship was not that of employer and employee. Mr Chambers was not an employee of Broadway.

[367] For this reason, the Respondent's jurisdictional objection is upheld. Mr Chambers was not able to make this application under section 365 of the Act and so his application must be dismissed.

[368] For completeness I will consider the right of Broadway under the Jamrok Agreement to control the activities of Mr Chambers.

[369] In CFMMEU v Personnel Contracting the High Court held that the existence of a right of control over the activities of the worker serves to sensitise one to the subservient and dependent nature of the work of an employee. The issue however is the right to control not who actually exercises control.[110]

[370] There is no doubt that there is some prescription in the provisions of the Jamrok Agreement which are indicative of Broadway having some control over Mr Chambers. The Applicants have provided extensive submissions on these matters.[111]

[371] The context of course is important. The work of Mr Chambers was to negotiate and sell lump sum building contracts under Broadway's registered Builders License.

[372] The Jamrok Agreement refers to the Consultant having a knowledge of the Home Building Contracts Act 1991. This is the Western Australian state legislation which regulates contracts between consumers and builders for the performance of home building work and provides for home indemnity insurance and funds providing such cover.

[373] Self-evidently some of the provisions of the Jamrok Agreement such as Broadway retaining the right to accept or reject contracts delivered by the Consultant and requiring the Consultant to use particular forms and contracts as directed are essential to ensure Broadway complies with the state legislation. Broadway did have control over the form of the end product, being the building contracts being entered into with the client.

[374] There were requirements for the Consultant to be present during home open times which was also pointed to as an example of the right to control the Consultant. This under the terms of the Jamrok Agreement per allocated display home totalled approximately 14 hours per week. The evidence of the Respondent's witnesses which was unchallenged is that amongst the various Consultants engaged by Broadway there is a large spread of their annual earnings. This was explained to be because it was up to the individual Consultants how hard they worked and this was reflected in differential earnings.

[375] What is clear is that Broadway has little right under the Jamrok Agreement to control when, where and how Mr Chambers did his core work of negotiating with clients to sell them lump sum building contracts.

[376] It is clear that Broadway had some but limited rights to exercise control over Mr Chambers.

[377] The extent to which Broadway had rights under the Jamrok Agreement to control Mr Chambers activities is not, considered in the context of his work, indicative of him working in a subservient and dependent relationship.

[378] The issue of control in this case is not suggestive of the true relationship being that of employer and employee.

[379] My decision is that Mr Chambers was not an employee of Broadway and consequently is unable to make this application under section 365 of the Act and so his application will be dismissed. An Order [PR739605] to that effect will be issued.

[380] The position advanced in support of Ms O'Brien's application for an unfair dismissal remedy under section 394 is as follows.

[381] In the original closing submission filed 23 November 2021 at paragraph 20 it was submitted by the Applicants that, "...Ms O'Brien was independently engaged by the respondent, was not offered, and nor did she enter into, any independent contractor agreement or employment contract with the respondent."

[382] In the Applicants reply submissions filed on 9 March 2022 at paragraph 38 it was submitted that, "...Ms O'Brien was not mentioned in the agreement however, she worked under the guise, and assumed, that she had a similar implied agreement in place, as Mr Chambers. Broadway and Ms O'Brien acted and maintained the same rights and obligations is detailed within Mr Chambers agreement throughout the relationship...".

[383] At the following paragraph 39 this submission was repeated and it was submitted that, "...[t]he parties were bound by the same obligations and duties of direction, control and promise of payment outlined throughout this submission. The applicant submits that the positions set out for Mr Chambers on these submissions apply for Ms O'Brien with the necessary changes having been made."

[384] Where the Applicants refer to "...agreement..." in their above submissions this is a reference to the Jamrok Agreement.

[385] Broadway's position is that Ms O'Brien was aware of the arrangement her son, Mr Chambers, was working under when she agreed to work for Broadway in 2019.

[386] Broadway submits that there was no need for discussion with Ms O'Brien about work arrangements nor was there any need for her to sign any documentation because she was not being employed but rather taking up work as an agent for Jamrok under the terms of the Jamrok Agreement. She was familiar with the Jamrok Agreement as Mr Chambers and she had worked for Broadway previously under an agreement with the same terms in 2014 and at that time her business Jamrok had been paid commission payments by Broadway.[112]

[387] If the Commission was to accept the submissions put by the Applicants to the effect that Ms O'Brien and Broadway should be taken by implication to have agreed that the terms of the Jamrok Agreement was a contract they had agreed to, then my decision is the same as it was for Mr Chambers at [356] to [364].

[388] If M's O'Brien was a party to a contract with Broadway in the terms of the Jamrok Agreement, then considering all of the rights and obligations prescribed in the Jamrok Agreement the relationship between Ms O'Brien and Broadway was not one of employee and employer. Consequently, Ms O'Brien's application must be dismissed.

[389] I however do not accept the submissions by the Applicants that it should be taken as implied that Ms O'Brien and Broadway agreed to exactly the same terms as the Jamrok Agreement.

[390] The evidence is that in 2019 no written employment contract was entered into between Ms O'Brien and Broadway.

[391] Also there is no evidence that Ms O'Brien, separately from Mr Chambers, executed an agreement in the same terms as the Jamrok Agreement in 2019.[113]

[392] Mr Gobetti's evidence under cross-examination and evidence in chief was that Mr Chambers came to his office and Mr Chambers said he thought it would be a good idea if Ms O'Brien came back and worked with them and Mr Gobetti had said this was a good idea because they were a good team. He said he had a brief meeting with Ms O'Brien which was organised by Mr Chambers where they agreed she would come back and assist Mr Chambers but he says he did not interview Ms O'Brien.[114]

[393] Ms O'Brien says that whilst there were discussions about her working at Broadway. Her evidence was those discussions were minimal and the only detail was in regard to the rate of commissions.

[394] She told Mr Gobetti she would continue working in her real estate job if she worked for Broadway.

[395] She says he explained he had a position for a Consultant to share the Dianella display home with Mr Hart another Consultant. The hours required would be one day a weekend from 1:00 p.m. to 5:00 p.m. and either Monday or Wednesday from 2:00 p.m. to 5:00 p.m. plus any other hours used to convert leads into sales and attendance at some meetings.

[396] She says he also told her he needed someone to cover occasional leave days for other Consultants.

[397] She says she accepted the position with Broadway.[115]

[398] What is clear from this is that there was no written contract, whatever its nature, made between Ms O'Brien and Broadway.

[399] The contract, whatever its nature, between Ms O'Brien and Broadway was wholly oral.

[400] In CFMMEU v Personnel Contracting Kiefel CJ, Keane and Edelman JJ accepted, as below, that considering the totality of the relationship was still appropriate in cases where the parties had not committed the terms of their relationship to a written contract,

"56. In Stevens, Mason J said that "it is the totality of the relationship between the parties which must be considered". But this statement was made in the context of a discussion the point of which was to emphasise that the right of one party to control the work of another was "not ... the only relevant factor". It was not an invitation to broaden the inquiry beyond the contractual rights and duties of the parties. Importantly, Stevens was not a case where the parties had committed the terms of their relationship to a written contract. In this respect, Stevens stands in obvious contrast to cases like Chaplin and Narich - and the present case." (References omitted)

[401] Gordon J in CFMMEU v Personnel Contracting considered the remaining application of the multifactorial approach as follows,

"188. The multifactorial approach was applied not merely without any central principle to guide it but also by reference to a roaming inquiry beyond the contract. It allowed consideration of what had happened after the entry into the contract to characterise the nature of "the status or relationship of parties". That is not appropriate. Such an inquiry slips away from - slips over - the critical consideration that the relationship between the parties is the relationship established by contract. Conduct may be looked at to establish the formation, variation or discharge by agreement and the remaking of a contract. But evidence that is relevant to inquiries of those kinds is limited by the purpose of the inquiry. The evidence of what was done is relevant only if and to the extent that it shows or tends to show that a contract was made between the parties or a contract previously made between the parties was varied or discharged.

189. Following WorkPac, the multifactorial approach applied in previous authorities must be put to one side when characterising a relationship as one of employment under a contract. The approach in WorkPac seeks to avoid the difficulties just identified with the multifactorial approach and, in particular, seeks to avoid "employee" and "employer" becoming legal terms of meaningless reference. It focuses the task of characterisation by reference to established doctrine, rather than inviting an assessment of the relationship between two parties which is "amorphous" and "inevitably productive of inconsistency". The need for judgment is unavoidable, but this approach promotes certainty by providing identified and well established limits: admissible evidence to identify the formation and the terms of the contract and the established principles of contractual interpretation.

190. It is necessary to address other aspects of Hollis and Stevens. Unlike the present case, the contract in issue in Hollis was partly oral and partly in writing and the relevant contractual arrangements in Stevens were not "formalized". As explained, when an oral contract or a partly oral, partly written contract is in issue, recourse to conduct may be necessary to identify the point at which the contract was formed and the contractual terms that were agreed. In relation to the latter, "[s]ome terms may be inferred from the evidence of a course of dealing between the parties", "[s]ome terms may be implied by established custom or usage", and "[o]ther terms may satisfy the criterion of being so obvious that they go without saying". But in each of these cases, the question is whether the particular term "is necessary for the reasonable or effective operation of the contract in the circumstances of the case". In this way, even where the contract has not been reduced to a complete written form, the admissible evidence is limited to identifying those matters - formation and terms - objectively and for those limited purposes. Further, it must be recalled that Hollis and Stevens concerned vicarious liability." (References omitted)

[402] Consequently, I accept that in a case such as this matter before the Commission, where the contract in issue is wholly oral, having regard to the totality of the relationship is appropriate as is considering the conduct of the parties to identify the point at which the contract was formed and the contractual terms that were agreed.

[403] Returning to the relevant facts regarding Ms O'Brien working for Broadway. The evidence is that after her discussion with Mr Gobetti Ms O'Brien negotiated a suitable arrangement regarding home opens at Dianella with Mr Hart, another Consultant.[116]

[404] Ms O'Brien thereafter negotiated and sold lump sum building contracts to clients for Broadway. She completed commission slips detailing her sales and commissions due. Broadway generated RCT invoices for Jamrok that included Ms O'Brien's commissions and sometimes sales bonuses.

[405] Ms O'Brien's business Jamrok was paid for commissions earned by herself and Mr Chambers and she was aware of these financial arrangements because she actively managed the day-to-day financial affairs of Jamrok including managing the payments received from Broadway.

[406] Ms O'Brien was aware that at one point Jamrok was making payments to Mr Chambers of salary, as an employee of Jamrok.

[407] During the time she provided services to Broadway, Ms O'Brien continued to work as a part-time employee real estate agent in another business, GMAC Reality.

[408] Separately she also provided services as Jamrok, a contractor, to this real estate agency.

Jamrok's accounting and records reflect these various different arrangements Ms O'Brien was involved in.

[409] Prior to this involvement in 2019 with Broadway, Ms O'Brien had worked in the industry both as an employee and as a subcontractor.

[410] Her evidence was that only after the Jamrok Agreement was terminated by Broadway did she discover that operating Jamrok "...for the primary purpose of receiving pay from builders that operate independent contracting arrangements..." is called "...sham contracting."[117]

[411] The evidence is that Broadway has always engaged its Sales Representatives through independent contractors. This included the evidence of a number of other contractor Sales Representatives.

[412] The evidence of a number of other witnesses was that they understood Mr Chambers and Ms O'Brien worked as a team. I accept their evidence by note that Mr Chambers and Ms O'Brien denied this.

[413] The only payments to Ms O'Brien were in the form of commission and bonuses which were paid to Jamrok and were inclusive of GST.

[414] This proposition that Ms O'Brien worked with Mr Chambers as a team was reflected in the manner of payment of those commissions for building contracts sold by Mr Chambers and Ms O'Brien. There was no distinction as to which of them had obtained the building contract when Broadway made the payments to Jamrok.

[415] There was also no distinction between the individual sales of Ms O'Brien or Mr Chambers for the purposes of the bonus payments made to Jamrok by Broadway.

[416] No commission payments were ever made to Ms O'Brien personally. All payments were to Jamrok.

[417] Considering her work for Broadway, Ms O'Brien was not required to record her attendance at Broadway nor the number of hours she worked. No payments were made to Ms O'Brien on the basis of how many hours she had worked.

[418] The evidence is Broadway did decide whether it would accept or reject contracts delivered by Ms O'Brien and required her to use particular forms for the contracts. I accept that Broadway did have control over the form of the end product produced by Ms O'Brien, being the building contracts entered into by Broadway and the client.

[419] There were requirements for Ms O'Brien to be present during some home open times but the detail of this was determined by Ms O'Brien herself reaching an agreement with another Sales Consultant, Mr Hart, as to how they would share the Dianella display home open times.

[420] Other than attending the home opens Ms O'Brien worked as little or as much as she liked, whenever and wherever she liked, and Broadway was unaware of these details.

[421] It is clear that Broadway did not control when, where and how Ms O'Brien did her work of negotiating with clients to sell them lump sum building contracts.

[422] Ms O'Brien was involved in developing designs for some clients and attended a range of meetings that were part of the pre-start process before slab down was achieved. The evidence is this was not at Broadway's direction but is activity some Sales Consultants choose to be involved in to facilitate finalisation of the sale to the client.

[423] Considering all of the evidence, overall Broadway's right to exercise control over Ms O'Brien was limited.

[424] Ms O'Brien did not claim nor receive the benefits of paid annual leave or any other form of paid leave. She was not paid superannuation by Broadway.

[425] As the Applicants point out, Broadway does bear the high cost of building the display homes which significantly assist Sales Consultants, including Ms O'Brien, in their work of negotiating and selling building contracts.

[426] However at the level of the individual Consultant, Ms O'Brien was required to bear all the costs of her vehicle, laptop and mobile phone none of which were provided by nor the costs reimbursed by Broadway.[118]

[427] Broadway's evidence was that a vehicle, a laptop and a mobile phone were the tools of a Sales Consultant and the cost of providing and operating these were borne by their businesses.[119]

[428] The evidence also was that Ms O'Brien bore some business risk in the relationship with Broadway. If one of her client's projects did not reach slab down no payment for her efforts would be made to Jamrok. Also, in some instances Broadway and Ms O'Brien might agree to share the costs of a giveaway or a discount to encourage a client to finalise the purchase of the building contract, thereby reducing the commission she was to receive.

[429] All Ms O'Brien's payment of commissions by Broadway were inclusive of GST.

[430] Ms O'Brien as the Owner and sole Director of Jamrok in 2019 was responsible for the financial affairs of Jamrok and the evidence is Jamrok conducted itself as a business separate from Broadway.

[431] Ms O'Brien was involved in and aware of all the financial transactions between Broadway and Jamrok for the period she says she was employed with Broadway.

[432] During the period she says she was employed by Broadway, Jamrok did not make any payments to Ms O'Brien identifiable as being the result of her work at Broadway, however Jamrok did advance multiple loans to her.[120]

[433] Ms O'Brien as the Owner of Jamrok enjoyed some financial benefit from Jamrok being a subcontractor to Broadway and payments for her work being paid to Jamrok. For example,

• Jamrok received gross income for the outcomes achieved giving flexibility to Jamrok and it's sole Director, Ms O'Brien, on how that gross income was applied;

• The structure enabled Ms O'Brien and Mr Chambers to agree among themselves how to share the gross income;

• Based on Ms O'Brien receiving loan repayments from Jamrok as opposed to a salary Ms O'Brien was able to receive cash from Jamrok that was capital in nature rather than income that would be subject to tax;

• Similarly, Ms O'Brien was able to receive loan repayments (as opposed to salary) from Jamrok and direct amounts to Mr Chambers which meant that Mr Chambers was receiving cash from Jamrok that was capital in nature rather than income that would be subject to tax; and

• The arrangement enabled various expenses to be paid from Jamrok's resources that may have been of a personal consumption nature rather than business expenses; or, discretionary business expenses that would not typically form part of specific remuneration arrangements with customers or employers, which may provide some tax advantage to Ms O'Brien and/or Mr Chambers.

[434] At no time did Ms O'Brien query with Broadway why she was not receiving any payment directly for her work.

[435] At no time did Ms O'Brien provide Broadway with her personal banking details, as distinct from Jamrok's banking details.

[436] The conduct of the parties demonstrates that Ms O'Brien and Broadway had agreed that payments would be made for commissions and bonuses resulting from Ms O'Brien selling lump sum building contracts and that those payments would be made to Jamrok as a contractor, inclusive of GST.

[437] No agreement was made that Ms O'Brien would receive any employee type benefits such as paid leave or superannuation or reimbursement for expenses incurred in providing the personal tools to do her work.

[438] Ms O'Brien was not required to work particular hours nor paid for the hours that she did work. She was generally free to work when and how she liked to achieve the agreed aim of selling lump sum building contracts. Broadway had limited rights to exercise any control over her work.

[439] Considering all of the evidence and having regard to the totally of the relationship between Ms O'Brien and Broadway I am not satisfied that Ms O'Brien was an employee of Broadway.

[440] Accordingly, I uphold Broadway's jurisdictional objection to Ms O'Brien's application for an unfair dismissal remedy.

[441] Consequently, Ms O'Brien's application will be dismissed. An Order [PR739607] to that effect will be issued.

[1] [2021] FWC 5133.

[2] (2022) HCA 1.

[3] (2022) HCA 2.

[4] Transcript at PN2584 to PN2629 and PN3780 to PN3787.

[10] Exhibit A1 at paragraphs 13, 18 and 19.

[15] Exhibit A1, Attachment PJC-11 at page 3, clause 5(d).

[17] Ibid., at paragraph 69 of Mr Chambers.

[18] Transcript at PN2652 to PN2655 and PN3085 to PN3104.

[19] Exhibit A2 at paragraphs 31 and 104.

[25] Ibid., Attachment PJG-2 and Transcript at PN1367 to PN1369.

[27] Transcript at PN1083 to PN1090, PN1365 to PN1366 and PN1370.

[34] Ibid., at PN1204 to PN1205 and PN1336.

[36] Exhibit R8 at paragraphs 26 to 29.

[47] Exhibit R10, Attachment GJS-1 to GJS-39

[48] Exhibit R12 at paragraph 23 and Attachment NJP-11.

[49] Ibid., at paragraph 11 and Attachment NJP-4.

[50] Ibid., at paragraph 12 and Attachment NJP-5.

[51] Ibid., at paragraph 15 and Attachment NJP-8.

[52] Ibid., Attachment NJP-11 at page 61.

[55] Schedule 1, clause 5 of the CC Act.

[67] Ibid., at PN2549, PN2554 and PN2642.

[69] Ibid., at PN2584 to PN2755, PN3780, PN3786 to PN3787, PN4085 and PN4096.

[74] Ibid., at PN2506 to PN2510 and PN2744 to PN2750.

[75] Ibid., at PN3718 and PN3729 to PN3731.

[76] Ibid., at PN3697 to PN3715 and PN3750.

[78] Ibid., at PN3669 and PN3777 to PN3778.

[84] Ibid., Attachment NJP-1 at paragraphs 45 to 48.

[86] Transcript at PN3849 to PN3851 and PN3854.

[87] Exhibit A1 at paragraphs 14 to 17.

[92] [2008] HCA 21.

[93] [2004] HCA 55.

[94] Exhibit R4, Attachment VEP-3 and Exhibit A2, at paragraph 107.

[95] Gordon J in CFMMEU v Personnel Contracting Pty Ltd (2022) HCA 1 at [177].

[98] Exhibit R5 at paragraph 34 and Exhibit R1, at paragraphs 50 and 51.

[99] Exhibit R4, Attachment VEP-1 and VEP-2.

[104] (2022) HAC 1 at [59] to [61].

[105] Exhibit A1 at paragraphs 65 and 66.

[106] See Home Building Contracts Act 1991 (WA) which is an act for the regulation of contracts between consumers and builders for the performance of certain home building work, to make provision for home indemnity insurance and funds providing corresponding cover.

[107] See (2022) HCA 1 at [63] to [66].

[108] See clause 16 (b), page 8 of the Jamrok Agreement.

[109] Recitals (A), (B) and (C) of the Deed.

[110] (2022) HCA 1 at [73] and [74].

[111] The Applicants' reply submission dated 9 March 2022 at paragraphs 24 to 32.

[112] Exhibit A2 at paragraphs 104 to 108 and Exhibit R5, Attachment PJG-1.

[114] Transcript at PN1204, PN1205 and PN1336 and Exhibit R5, at paragraphs 42 to 44.

[115] Exhibit A2 at paragraphs 21 to 28.

[119] Transcript at PN531 to PN532 and PN541.

[120] See Documents 80 and 97 produced by the Applicants in compliance with the F52 Orders dated 18 August 2021.

Printed by authority of the Commonwealth Government Printer