T13075
TASMANIAN INDUSTRIAL COMMISSION
Industrial Relations Act 1984
s.29 application for hearing of industrial dispute
Wayne George McManus
(T13075 of 2008)
and
Jason Stevens trading as Aashcann Recycling
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HOBART, 12 February 2008 |
Industrial dispute - termination of employment; alleged breach of award or registered agreement – jurisdiction – employee/contractor – application dismissed
REASONS FOR DECISION
[1] On 8 January 2008, Wayne George McManus (the applicant) applied to the President, pursuant to Section 29(1A) of the Industrial Relations Act 1984, for a hearing before a Commissioner in respect of an industrial dispute with Jason Stevens trading as Aashcann Recycling (the respondent) arising out of his termination of employment; and alleged breach of award or registered agreement.
[2] The matter was listed for hearing (Conciliation Conference) at the Commonwealth Law Courts, 39-41 Davey Street, Hobart, Tasmania on Wednesday, 16 January 2008 at 11.30am However, at the request of the parties this was subsequently changed to 22 January 2008.
[3] The applicant was engaged by the respondent from, approximately, 15 March 2006 to 5 December 2007.
[4] The applicant was contracted to work four days per week in the summer and three days per week in the winter. He was paid $125 per day. There was no written contract, but the parties had a verbal agreement. The contract conditions outlined were agreed by both parties. In his application, however, the applicant asserted he worked between 40 and 60 hours per week.
[5] The respondent disputed the applicant’s estimation of the hours worked. He asserted he did not require records to be kept of the actual hours worked as there was no need since the applicant was paid by the day. He also stated that it was improbable that such hours would be worked over three or four days. On the applicant’s own evidence, it was common for him to cease work at 11.00 am, which would make it unlikely, even in a four-day week to accumulate anything approaching the hours he asserted he worked.
[6] The applicant worked on a “job and finish” basis; meaning once he finished allotted tasks for the day he was paid for that day and free to leave regardless of the time spent on the tasks. It was asserted the applicant could be finished work by 11.00 am. However, the applicant did complain that, on occasions, he was asked to do other work beyond his allotted tasks, which could take him until 2.00 pm to complete.
[7] The applicant did not keep time sheets, or submit any record of time to the respondent. The applicant did not directly submit invoices to the respondent as he did not have a facility to generate them. The respondent took it upon himself to generate the invoice for the applicant, with the applicant’s consent. The respondent would supply copies of the invoices to the applicant on an annual basis. Payment was made directly to the applicant’s bank account on a weekly basis.
[8] There was no evidence presented by the parties to suggest that the days worked, the payments made and invoices generated were not consistent.
[9] The respondent did not deduct income tax on behalf of the applicant; he did not provide workers compensation cover; nor did he pay superannuation.
[10] The respondent stated that he paid the invoiced amount to the applicant’s Australian Business Number account. The process of payment was confirmed by the applicant.
[11] The applicant described himself as a self-employed contractor. He asserted “It’s what Social Security classed it as because they couldn’t work out what I was actually classed at”.[1]
[12] The dispute arose over a period of three weeks. The respondent directed the applicant to do a particular task, which the applicant had allegedly carried out previously on numerous occasions at the Richmond Golf Club. On each occasion in the three weeks in question the applicant refused to carry out the task, he alleged on safety grounds. The respondent does not deny terminating the contract with the applicant as a result of his refusal to carry out designated work.
[13] The applicant stated that until the dispute arose, the parties had been friends.
FINDINGS
[14] Before hearing the merits of the matter and proceeding further, it was my view that the applicant’s employment status had to be established.
[15] The evidence prima facie, is that it was accepted by both parties that the applicant was an independent contractor, self-employed, working under a verbal contract. However, in hearing submissions I apprehended this was a convenient simplistic position adopted, without prejudice, by both parties.
[16] The applicant confirmed he was responsible for the payment of his own income tax. The respondent did not provide worker’s compensation cover, nor pay the superannuation contribution as would be required of an employer on behalf of an employee. The applicant worked under an Australian Business Number for the purpose of payment.
[17] It is my view that, technically, the applicant was paid on invoices generated for the work he carried out and in accordance with the verbal agreement, albeit the respondent generated the invoices on the applicant’s behalf.
[18] It was not disputed by the applicant that he was paid an agreed amount, translated into a daily rate, for completing designated tasks. It was also acknowledged that the applicant was not paid to perform tasks for a designated number of hours per day or per week.
[19] I have utilised the model set out in the Australian Taxation Office publication “PAYE Quick Reference Guide – Employee or Contractor?” – January 1999, as a crude method of assessing the applicant’s employment status.
Employee
Indicators that a worker is an employee may include that the worker:
· Received paid leave (eg sick, recreation, long service). (No evidence was presented to suggest the applicant received any form of paid leave.)
· Is paid for time worked. (This is not the case in the present matter.)
· Is not responsible for providing materials or equipment to do the job. (The major piece of equipment, the truck, was provided by the respondent.)
· Must perform the duties of his position. (The applicant performed tasks allotted to him as required, he did not have a specific position in the company.)
· Agrees to provide his personal services. (It was stated by the parties that this was the case.)
· Works hours set by an agreement or award. (The applicant took as long as he required completing tasks, although it is reasonable to assume the respondent set the commencement time of any task to coordinate with other work or workers. In the, main knock of time was under the applicant’s control.)
· Is recognised as part and parcel of the business. (The parties presented no evidence of this.)
· Takes no commercial risks and cannot make a profit or loss from the work. (There is no evidence to suggest the applicant took any commercial risk. His only means of profit or loss would have been in time spent on any given task. He could gain time and utilise it as he saw fit or lose time. Evidence indicated he did not lose any time.)
Contractor
An independent contractor is an entity that agrees to produce a designated result for an agreed price. In most cases, the contractor:
· Is paid for results achieved. (The applicant falls into this category.)
· Provides all or most of the necessary materials and equipment etc to complete the work. (The respondent provided the equipment and materials.)
· Is free to delegate work to other entities. (This was not tested, but I would consider it unlikely.)
· Has freedom in the way the work is done. (I believe this applies to the applicant.)
· Is in a position to make a profit or loss. (As noted above, the only profit or loss the applicant had control over was his time. However there was no restriction on the applicant using the time he had “saved” working on other endeavours for profit. Nor was there a restriction on the applicant utilising the days he did not work for the applicant in working for profit elsewhere. It is reasonable to assume that the applicant had the responsibility to complete any task properly, and rectify any unsatisfactory work, before knocking off.)
[20] Should an award apply, it would be the Carriers Award, No. 1 of 2007 (Consolidated).
[21] The applicant, having regard to the limited information proffered, most likely would be classified in the Grade 3 to 4 wage ranges. The amount of $125 per day paid to the applicant, assuming the award nominated 7.6 hours per day, gives him an effective rate of $16.45 per hour. Grade 4 rate is $15.61 per hour. It was agreed by both parties that the applicant worked a “job and finish” regime, not a specific 7.6 hour day. It was also acknowledged that significantly less than the “standard” hours per day were worked.
[22] The facts of the mode of engagement do not indicate wholly one way or the other if the applicant was an employee or an independent contractor. The fact that the applicant did not provide the major equipment is not fatal to the proposition that he was an independent contractor. The applicant was master of his own time and had control over how the tasks were performed, within reason. The absence of any fixed-time component of the employment relationship, in my view, is significant. On balance, it is my view the applicant is an independent contractor, and I so find.
[23] It is my finding that this Commission does not have jurisdiction to hear the application, therefore, pursuant to s.21(2)(c) of the Act, I dismiss the application, and I so Order.
James P McAlpine
Commissioner
Appearances:
Mr WG McManus for himself
Mr J Stevens for Jason Stevens trading as Aashcann Recycling
Date and Place of Hearing:
2008
January 22
Hobart