Earlier this year we reported an important case in the High Court (“the Jamsek Case”) where the High Court departed from the long-held criteria in determining whether or not a worker was an independent contractor or an employee. In that High Court decision, it was determined that the Courts should examine the contract itself and the intent of the parties on the execution of the contract, rather than the multi-factorial test (ie determining levels of control and the ability to subcontract etc) when determining whether a worker is an independent contractor or an employee.
In a more recent case Deliveroo Australia Pty Ltd v Franco (“the Deliveroo case”) the Full Bench of the Fair Work Commission, applied recent decisions of the High Court to determine that a Deliveroo delivery worker, Mr Franco, was not an employee and was an independent contractor. Therefore, the Jamsek case principles have now been upheld by the FWC in the Deliveroo case. The decision in Deliveroo clarifies that the process is one of analysing the terms of the contract, without taking the further step of analysing how the parties subsequently conducted themselves.
Notwithstanding the outcome of these cases, it is important that any contracts that you have with independent contractors are properly drafted to ensure that there is a clear intent of a contractor relationship.
Whilst this may now appear to be settled in terms of precedent principles, it is also very clear that the Federal Government is likely to intervene and override these newly established principles via legislative or Regulatory changes.
If you require further information in relation to contracts for independent contractors, please contact us.
Greg Arnold – Director & Principal Consultant
Disclaimer: This article provides a summary only of the subject matter without the assumption of a duty of care by Effective Workplace Solutions. No person should rely on the contents as a substitute for legal of other professional advice.