This extract from a recent unfair dismissal decision of the Fair Work Commission deals with the contemporary legal principles which are engaged when determining whether a person is an employee or a contractor.
“Consideration
Was the applicant an employee?
[14] Section 15 of the Act provides:
15 Ordinary meanings of employee and employer
(1) A reference in this Act to an employee with its ordinary meaning:
(a) includes a reference to a person who is usually such an employee; and
(b) does not include a person on a vocational placement.
Note: Subsections 30E(1) and 30P(1) extend the meaning of employee in relation to a referring State.
(2) 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.
[15] The method by which the ordinary meaning of the terms ‘employer’ and ‘employee’ is to be ascertained for the purposes of the Act is now set out in s.15AA. Section 15AA of the Act was inserted by the Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024 (Cth) and commenced on 26 August 2024. It applies to a relationship entered into before that commencement date that is in existence as at that date1 which is the case here. Section 15AA provides as follows:
15AA Determining the ordinary meanings of employee and employer
(1) 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.
(2) For the purposes of ascertaining the real substance, practical reality and true nature of the relationship between the individual and the person:
(a) the totality of the relationship between the individual and the person must be considered; and
(b) 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.
(3) Subsections (1) and (2) do not apply to the following provisions of this Act:
(a) Divisions 2A and 2B of Part 1-3;
(b) Part 3-1, to the extent that Part 3-1 applies only because of the operation of section 30G or 30R.
[16] Section 15AA(2) requires a consideration of the totality of the relationship which involves a consideration of, amongst other things, the terms of the contract between the parties and an assessment as to how the contract is performed in practice. The approach to a consideration of the totality of the relationship under s.15AA is guided by the common law principles established by cases such as Stevens v. Brodribb Sawmilling Co. Pty Ltd2 and Hollis v Vabu Pty Ltd3 and involves a reversion to the multifactorial test that was well known and widely applied prior to the High Court decisions in CFMMEU v. Personnel Contracting4 and ZG Operations v. Jamsek.5
[17] The common law approach has been set out in numerous decisions of the courts and in decisions of this Commission. In Jiang Shen Cai trading as French Accent v. Do Rozario6 the Full Bench summarised the approach to the determination of the employee/contractor issue including whether the worker is the servant of another in that other’s business or whether the worker carries on a trade or business on his or her own behalf, the nature of the work performed and the manner of its performance, the identification and application of the relevant indicia to the circumstances, and the terms of the contract between the parties.7
[18] In the same decision, the Full Bench identified the various indicia that are ordinarily considered in an assessment as to the nature of the relationship. They include the actual exercise, or the right to exercise, control over the putative employee, whether the worker performs work for others, or provides 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.8 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.”
[19] Having considered the totality of the relationship, including how the contract was performed in practice, I am of the view that the real substance, practical reality and true nature of the relationship was one of principal and independent contractor. In undertaking this assessment, I consider that there is only very limited assistance that can be drawn from the terms of the contract itself and the legal rights and obligations created by it, given the state of the evidence about the terms of the contract in this case.
[20] It is significant however, and beyond dispute, that the applicant exercised considerable independence as to both when the work was performed and how it was performed. The respondent exercised little if any control over the way the applicant conducted himself in his discussions with clients and aside from a general requirement to be logged on for a minimum period, did not issue directions to the applicant about his work. In fact, there was very little evidence of any contact at all between the applicant and the respondent over the entire course of his engagement. As Ms. McDonnell described it, when the applicant was given access to the platform he received a test call from the respondent and then he was ‘on his own’. In other words, there was little control by the respondent as to what the applicant was to do or how he was to do it.9 The respondent also had no substantive control or right of control over where the applicant was when he performed the work.
[21] There was also no dispute that the applicant generally determined when he was to work and when he did not. This obviously had some bearing on the applicant’s earning capacity and earnings. The applicant’s own performance as a reader would also have had an impact on his earnings. If he were successful with clients, he would presumably have received repeat calls, referrals or recommendations from clients. It was accepted that the applicant was paid for the time spent on calls rather than a periodic wage referrable to a particular period of time. These are factors which weigh in favour of a conclusion that the applicant was conducting his own undertaking as an independent contractor.
[22] I also note that the applicant was provided with only login details and the details of a particular number which he would enter into his own phone so that he would know that the call was coming from a client. The applicant was not provided with a mobile phone from the respondent to conduct the calls. The main item of equipment used to conduct the work was supplied by the applicant himself.
[23] I have taken into account the fact that the applicant may have appeared to third parties to be an emanation of the respondent’s business, since they were sourcing the applicant’s services through the respondent’s website, but I do not think that this outweighs the other factors pointing to a conclusion that the applicant was an independent contractor.
[24] I have weighed the totality of the evidence described above and conclude that the applicant was an independent contractor and not an employee of the respondent. The applicant was not dismissed by the respondent. It follows that the respondent’s objection to the application is upheld and the application must be dismissed.”
Dawe v Psychic TV Pty Ltd – [2025] FWC 2794 delivered 18 September 2025 per Roberts DP
comprehensive or exhaustive and the weight to be given to particular indicia will vary according to the circumstances.”
[19] Having considered the totality of the relationship, including how the contract was performed in practice, I am of the view that the real substance, practical reality and true nature of the relationship was one of principal and independent contractor. In undertaking this assessment, I consider that there is only very limited assistance that can be drawn from the terms of the contract itself and the legal rights and obligations created by it, given the state of the evidence about the terms of the contract in this case.
[20] It is significant however, and beyond dispute, that the applicant exercised considerable independence as to both when the work was performed and how it was performed. The respondent exercised little if any control over the way the applicant conducted himself in his discussions with clients and aside from a general requirement to be logged on for a minimum period, did not issue directions to the applicant about his work. In fact, there was very little evidence of any contact at all between the applicant and the respondent over the entire course of his engagement. As Ms. McDonnell described it, when the applicant was given access to the platform he received a test call from the respondent and then he was ‘on his own’. In other words, there was little control by the respondent as to what the applicant was to do or how he was to do it.9 The respondent also had no substantive control or right of control over where the applicant was when he performed the work.
[21] There was also no dispute that the applicant generally determined when he was to work and when he did not. This obviously had some bearing on the applicant’s earning capacity and earnings. The applicant’s own performance as a reader would also have had an impact on his earnings. If he were successful with clients, he would presumably have received repeat calls, referrals or recommendations from clients. It was accepted that the applicant was paid for the time spent on calls rather than a periodic wage referrable to a particular period of time. These are factors which weigh in favour of a conclusion that the applicant was conducting his own undertaking as an independent contractor.
[22] I also note that the applicant was provided with only login details and the details of a particular number which he would enter into his own phone so that he would know that the call was coming from a client. The applicant was not provided with a mobile phone from the respondent to conduct the calls. The main item of equipment used to conduct the work was supplied by the applicant himself.
[23] I have taken into account the fact that the applicant may have appeared to third parties to be an emanation of the respondent’s business, since they were sourcing the applicant’s services through the respondent’s website, but I do not think that this outweighs the other factors pointing to a conclusion that the applicant was an independent contractor.
[24] I have weighed the totality of the evidence described above and conclude that the applicant was an independent contractor and not an employee of the respondent. The applicant was not dismissed by the respondent. It follows that the respondent’s objection to the application is upheld and the application must be dismissed.”
Dawe v Psychic TV Pty Ltd – [2025] FWC 2794 delivered 18 September 2025 per Roberts DP