This decision of the Fair Work Commission analyzes if a person is an employee or a contractor.

“Was the Applicant an employee?

The first issue is whether the Applicant was an employee or an independent An application for an unfair dismissal remedy can only be made by a person who has been dismissed from employment. Subsection 386(1) of the Act sets out the circumstances in which a person is taken to have been “dismissed” for the purposes of s. 394. A person can only be dismissed when their employment comes to an end in one of the circumstances described in

386(1). In the absence of a relationship of employer and employee, there is no employment, and a person is not dismissed for the purposes of s. 394.

In final submissions Mr Greenland stated that he had run the business for 20 years and had always regarded the sex workers at Sirs to be independent He understood that all sex workers are independent contractors. This submission simply cannot be accepted. There are a number of decisions of courts and tribunal including this Commission where sex workers have been accepted to be employees.¹ In other cases they were found not to be.²

Each case will be determined on its own The test of what constitutes employment is set out in ss. 15 and 15AA of the Act. Section 15 and 15AA relevantly provide as follows:

15 Ordinary meanings of employee and employer

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

includes a reference to a person who is usually such an employee; and
does not include a person on a vocational

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

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

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

15AA Determining the ordinary meanings of employee and employer

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

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

[2025] FWC 2327

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

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

The note in s. 15AA refers to High Court decisions in CFMMEU v Personnel Contracting Pty Ltd [2022] HCA 1 (Personnel Contracting) and ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2 (Jamsek) where the High Court applied the principles of contract interpretation, which it described as the long-standing approach in determining the nature of the relationship between The Court criticised the multi-factorial approach that had been adopted following the decisions in Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 (Stevens v Brodribb) and Hollis v Vabu Pty Ltd (2001) 207 CLR 21 (Hollis) and went on to explain that Stevens v Drodribb and Hollis had not departed from the long-standing approach to contract interpretation that predated those decisions. In particular reference was made to the earlier cases of Narich Pty Ltd v Commissioner of Pay-roll Tax [1983] 2 NSWLR 597, approving the earlier decision in Australian Mutual Provident Society v Chaplin (1978) 52 ALJR 407. Narich and Chaplin stood for the proposition that where there is a written contract between the parties a court is confined, in determining the nature of that relationship, to a consideration of the terms, express or implied, of the contract in the light of the circumstances surrounding the making of it, and it is not entitled to consider the manner in which the parties subsequently acted in pursuance of such contract. In Personnel Contracting the Court said that Stevens v Drodbribb and Hollis did not alter the orthodox principle that courts are not concerned with what has actually occurred in a relationship, but rather were concerned with the obligations by which the parties were bound.³

By contrast section 15AA sets a statutory test for ascertaining the real substance, practical reality and true nature of the relationship between the parties by considering the totality of the relationship having regard to not only to the terms of the contract governing the relationship, but also to other factors relating to the totality of the relationship including, but not limited to, how the contract is performed in practice.

Consequently, for the purpose of the Act, in determining the issue of whether a person is an employee or independent contractor, the Commission is required to ascertain the real substance, practical reality and true nature of the relationship between the parties. This adopts the approach described in Hollis:

It should be added that the relationship between the parties, for the purposes of this litigation, is to be found not merely from these contractual terms. The system which was operated thereunder and the work practices imposed by Vabu go to establishing “the totality of the relationship” between the parties; it is this which is to be considered.⁴

Which is to say the approach to be taken under s. 15AA adopts the multi-factorial test that was eschewed in Personnel Contracting⁵.

The multifactorial test was summarised by a Full Bench of the Commission in Jiang Shen Cai trading as French Accent v Do Rozario [2011] FWAFB 8307 (Jiang Shen). There the Full Bench described the focus of the enquiry in Hollis as whether the person carries on a trade or business of his or her is working in the business of another; the nature of the work performed and the manner of its performance; and the terms of the contract between the parties.

While in Personnel Contracting the High Court’s focus was on the contract between the parties it still had regard to the control and business tests. In Personnel Contracting the Court said at [35]:

In this Court, the appellants submitted that the question whether a labourer is conducting his or her own independent business, as distinct from serving in the business of the employer, provides a more meaningful framework to guide the characterisation of the parties’ relationship. There is force in that submission.

The right to control as an indicator of an employment relationship was described by Wilson and Dawson JJ in Stevens v. Brodribb at [9] as whether the contractual arrangement “subjects the person engaged to the command of the person engaging” not just as to what shall be done, but how it shall be done.⁶

Returning to Jiang Shen, the Full Bench noted various indicia that may be considered. They include the actual exercise, or the right to exercise, control over the putative employee, whether the worker performs work for others, whether they provide tools and equipment, whether the work can be delegated, whether the worker is remunerated by periodic wages or salary or by reference to completion of tasks, and whether the worker is presented to the world at large as an emanation of the putative employer’s business.

The Bench also cautioned that no list of indicia is to be regarded as comprehensive or exhaustive and the weight to be given to particular indicia will vary according to the circumstances. Which is to say that in each case there will be some factors which weigh in favour of a conclusion that an employment relationship existed between the parties and others which point to work being performed under an independent contractor arrangement. There is no single exhaustive list of factors to be considered and the considerations and the weight to be attached to them are likely to vary depending on the facts and circumstances of each The exercise involves an evaluative judgment beyond the mere mechanical ticking of indicia on a checklist.
The Respondent contends that the Applicant was not employed as she operated as an independent contractor, providing personal services at her own discretion from rooms that she rented from the It contends that by signing the “Agreement of Policy and Procedures” the Applicant acknowledged that the arrangement was for room rental, and she managed her income through negotiations with clients. The Respondent also asserts that the Applicant signed the declaration which it asserted was provided with the other documents at the commencement of the engagement. I take this to be a reference to the fourth page of the template document that was provided by the Respondent during the proceedings. The Applicant denies seeing, let alone signing, that document. I noted earlier that the document did not refer to the Respondent but to another entity. The Respondent did not provide a signed copy of the document. I find that the Applicant did not sign the document and that it did not form part of the contract between the parties.

The documents that were seen and signed were the Application form, Agreement of Policy and Procedures and Additional Information Read together these documents indicate that the Respondent exercised significant control over the work performed. Reference is made in those documents to rosters being prepared, shifts being worked, weekend work being performed, and penalties to be paid by the Applicant when cancelling or being late for shifts. They included standards of appearance, dress codes, how clients were to be greeted, and room etiquette. Work tasks such as stocking rooms and cleaning rooms were specified. A two week notice period for leaving the business was specified. Reference was also made to reporting to managers and to employment being terminated if rules about charging clients were breached. All of these matters indicate the Respondent exercised control over the way the Applicant worked.

The Respondent relied on the references in the documents to rental payments being made by the I do not consider these references to take the matter anywhere. The way the contract was implemented suggests that these references were merely a means by which the Respondent determined how the revenue gained from the activities conducted in its business would be distributed between those performing the work and the business.

Section 15AA requires that the true relationship between the parties be determined by reference to the totality of the relationship between the Regard must be had not only to the terms of the contract governing the relationship, but also to other factors including, but not limited to, how the contract is performed in practice.

In practice, the Respondent exercised significant control over the Applicant’s work. Policies and procedures dictated appearance, shift times, room preparation, client interaction, and service Workers were required to arrive early, maintain immaculate appearance, and adhere to strict guidelines for client service and room cleanliness. Fines were imposed for late arrivals, cancellations, and leaving shifts early, further indicating control over the Applicant’s conduct.

The work was performed on the Respondent’s premises. The Respondent provided rooms, amenities, and other materials necessary for the The notion that the Applicant was renting a room is illusory. It was not a room that the worker had chosen or had possession of or control over.

The Applicant was presented as part of the Respondent’s business. The Respondent’s website described the masseuses as providing services at the establishment, and the Applicant was required to adhere to strict appearance and conduct standards that aligned with the business’s expectations. The Applicant could not delegate her work to others.

The Applicant was paid based on completed bookings, with no payment for time waiting to be selected for a booking during a Payments were calculated based on a fixed structure for base services with Sirs taking more than half of the payment made for those services describing its share as rent. Sirs also retained 25% paid for extra service fees. No taxes or superannuation were deducted, and the Applicant was responsible for her own insurance. The payment structure was set by Sirs, and it set the rates with a maximum imposed for the extra services. The Respondent directed me to its website that stated that payments to workers were

not part of the business’s income. However, the practical reality of the relationship, including the way the payments were set, collected and distributed contradicts this claim.

I accept the Applicant’s account and find that the work was performed in the following way. The services available on the premises were advertised by the Clients would visit the premises of the Respondent. The Respondent engaged a receptionist to greet them. The Applicant was required to work on shifts and be present and waiting on the premises. She and other workers greeted the client. The client might choose her to provide the services. The room used for each booking was allocated by the Respondent. The rate paid by the client for the massage service was set by the Respondent. Further discussion was had between the client and the Applicant as to the extent of extra services provided and there was some discretion with the Applicant about what she would charge for those services. The Respondent set a limit on those charges. Payment was made by the client to the Respondent. The Respondent controlled the funds, calculated the amount to be paid to the worker, and made payment at the end of the shift. The service was provided by the Applicant to the client. At the end of the booking the room was cleaned by the Applicant. The Respondent required that all bookings be recorded on a work sheet. The work sheet included all bookings for all workers on the shift and was used as a record for payment.

The Respondent argued that once the Applicant entered the room with the client she was in control of what happened. This may be the case, but the relationship between the Respondent and the Applicant was much more than each 30 to 60 minute It was about the workers being available at the Respondent’s premises to provide the services, being present for the duration of her shift, meeting the Respondent’s appearance and clothing standards, presenting herself in the meeting room to the clients, and then providing the service to the client.

Balancing all of these factors, I find that the relationship was an employment relationship. Despite some elements resembling independent contracting, including the ad hoc manner of the payments made and the taxation arrangements, the overall relationship involved the Respondent exercising significant control over the Applicant, the Applicant being integrated into the Respondent’s business, and the Applicant being dependent on the Respondent to gain work. The Applicant was, for all intents and purposes, working in the business of the Respondent. That business was to provide its clients with massage and sexual services on the premises known as Sirs. The Respondent advertised that those services were available and included on its website photos of the Applicant and others and indicated that they were available to perform the The Applicant was required to be in attendance at the premises and be available to provide the services during shifts that it allocated. The Respondent had dress regulations, appearance standards and etiquette guidelines the Applicant was required to meet. The Respondent set the price for the services, albeit allowing some flexibility associated with additional services sought and provided. The Respondent collected and controlled the revenue arising from the services and paid the Applicant from that revenue. Rooms were provided by the Respondent, and the Respondent allocated those rooms on a booking by booking basis for the Applicant to perform the services requested by the Respondent’s clients.

Did the Applicant complete the minimum employment period?

Section 396 requires the Commission to decide the issue of whether a person was protected from unfair dismissal before considering whether the dismissal was unfair.

Section 390(1)(a) of the FW Act provides that the Commission may order a remedy if the Commission is satisfied that the Applicant was protected from unfair dismissal at the time of being Section 382(a) provides that a person is protected from unfair dismissal if, at the time of being dismissed the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period. The minimum employment period is defined in s. 383 as 6 months unless the employer is a small business employer. The Respondent in this matter is not a small business employer.

The Applicant was notified that the employment was terminated on 12 April The Applicant contends that her employment with the Respondent commenced on 12 October 2024 when she contacted Sirs seeking work and was told to come in for a trial shift and not to work at another parlour in the meantime. I accept that the Applicant contacted the Respondent on 12 October 2024. I do not accept that that contact was sufficient to constitute the commencement of the employment. The Applicant did not commence employment until 19 October 2024, when she attended the premises, completed and signed the documents referred to above, and worked her first shift.

In those circumstances, the Applicant did not work for the minimum employment period of 6 months and was not protected from unfair dismissal. Had she worked a week longer and been protected from unfair dismissal I would have had no hesitation in finding that her dismissal was unfair.

Had the Applicant worked the minimum employment period, I would have concluded that here dismissal was unfair. Based on the material before the Commission, there is no indication that there was a valid reason for dismissal related to the applicants’ capacity or conduct within the meaning of s 387(a). The Applicant was also not provided with any procedural fairness as required by s. 387(b) and (c). The Applicant provided statements from colleagues which indicated that she was a diligent worker and was well regarded by her peers and by clients of the business.

Conclusion

For all the above reasons, I find that the Applicant was an employee however she was not protected from unfair dismissal as she had not completed the required minimum employment period.