FWC dismisses unfair dismissal application by an independent contractor

FWC dismisses unfair dismissal application by an independent contractor

The Fair Work Commission has rejected an unfair dismissal application after reviewing the circumstances of the employment relationship and affirming the worker’s status as an independent contractor rather than an employee, and therefore unable to pursue a dismissal application.

The worker ‘CPH’ commenced employment with Detector Inspector Pty Ltd (Detector Inspector) on 4 April 2022 as a Smoke Alarm Technician on a four-day per week part-time basis. In addition to providing gas appliances and conducting electrical safety checks, Detector provides smoke alarm services to more than 350,000 rental properties annually across Victoria.

In January 2022, CPH responded to an advertisement on Seek for a “Smoke Alarm Technician (Contractor) -Bayside and Southeast Suburbs”. He contacted Detector Inspector’s Recruitment Consultant and asked a number of questions, including expected hours, days of work, the number of inspections expected and the rate per call.

Detector advised him that he had the option of filling an employee role or a contractor’s role. He chose the latter and entered into a Contractor Agreement under which he hired a work vehicle and the necessary tools from the employer. There was also a discussion that he would need to purchase a Detector Inspector uniform, provide an ABN, and was made aware of the employer’s invoicing arrangements.

The key obligations of a contractor, as set out in the Contractor Agreement, include the following:

  • being available to provide services upon acceptance of a shift in the roster;

  • being responsible for any damage caused while providing services;

  • possessing and providing an ABN;

  • providing and fully maintaining a vehicle; and

  • maintaining Public Liability Insurance.

CPH ceased employment with Detector Inspector on 6 May 2022 and subsequently lodged an unfair dismissal claim. The primary initial argument for Deputy President Janine to determine was whether CPH was, in fact, an employee of Detector Inspector, since if he was not, he had no recourse to unfair dismissal pursuant to s 386 of the Fair Work Act 2009.

In determining that CPH was not an employee, Deputy President Young highlighted the following factors pertaining to the contractor in the relationship:

  • Ability to delegate the services to be provided;

  • Control over when and how much he works;

  • Remuneration paid as a fee per service completed rather than hours worked;

  • Invoices on a monthly basis and is responsible for taxation;

  • Required to have an ABN and hold public liability and salary continuance/personal accident insurance;

  • Required to indemnify Detector Inspector for any claims, liabilities or costs resulting from damage caused by him to provide the services required, or alternatively, enter a hire arrangement for the vehicle with Inspector Detector, his delegate service provider;

  • Required to maintain a fully maintained vehicle to provide the services, or alternatively, hire a vehicle from Detector Inspector and arrange to have fees deducted from invoices.

As the Deputy President summarised,

“… it is clear that the nature of the relationship as expressed in the Contractor Arrangement is one of an independent contractor relationship. I do not consider any of the above terms to be consistent with a relationship of employment”.

Consequently, his application for an unfair dismissal remedy was dismissed.

CPH v Detector Inspector Pty Ltd – [2022] FWC 3087 | Fair Work Commission

For queries about employment relationships, independent contractors, termination, or other employment questions, please contact Dean Cameron at Workforce Advisory Lawyers – We Know Employment Law on 0417 622 178, 1300 WAL LAW or via email to dean.cameron@workforceadvisory.com.au

Disclaimer: This information is provided as general advice on workplace relations and employment law. It does not constitute legal advice, and it is always advisable to seek further information regarding specific workplace issues. Liability limited by a scheme approved under professional standards legislation.

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