AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION
v Viewdaze Pty Ltd t/a Malta Travel
Vice President Lawler, Deputy President Hamilton,
14 May 2003 - Sydney
Vice President Lawler, Deputy President Hamilton, Commissioner
Introduction It is
a matter of concern to us that this is the fourth hearing in relation
to an application for relief made by Mr Abraham Abdalla under s 170CE of the Workplace Relations Act
1996 (Cth). These hearings have all related to a preliminary jurisdictional
objection taken by the respondent, Viewdaze Pty Ltd. What could be termed
the merits of the s 170CE application
and the alleged termination of employment have not yet been heard.
application was filed on 24 April 2002. On 12 July 2002 Foggo C dismissed
the matter on jurisdictional grounds. Mr Abdalla appealed that decision. On
24 September 2002 a Full Bench of this Commission allowed the appeal and
determined that the application would be directed to a member of the Commission
3 The matter was referred
to Drake SDP, who reheard the matter and handed down a decision on
10 December 2002 dismissing the s 170CE application
on jurisdictional grounds. Mr Adballa appealed against this decision,
and the appeal was before us on 17 February 2003.
first note that the Bench said in its 24 September 2002 decision that:
Each of the parties should give earnest consideration
to being represented at the rehearing by a person who will not be required
to give evidence in the matter. In our view, to do otherwise, may affect
the proper presentation of their cases.
this suggestion both parties continued to represent themselves in the
subsequent proceedings before Drake SDP and before us. This has in both
cases made the determination of the matter more difficult, and has hindered
the parties in the presentation of their cases.
is particularly the case given the nature of these proceedings. This matter
concerns a relatively new procedural provision of the Workplace Relations
Act 1996 (Cth) introduced in 2001, s 170CEA,
a provision which, in its application, raises particular difficulties
which perhaps have not been well understood. It also concerns a jurisdictional
objection which raised difficult issues of fact and law.
The decision under appeal
directed, Drake SDP heard the matter and on 10 December 2002 her Honour
delivered a decision just over one and a half pages in length finding
for the respondent and dismissing Mr Abdalla's application on jurisdictional
grounds. Her Honour's consideration of the evidence and analysis
of the issue for determination was as follows:
7. The case
presented by the applicant was rambling, and for the most part not relevant
to the issues in dispute, even making allowances for the fact the he was
self represented. The applicant focussed on the evidence of the respondent
as to the arrangements between them and whether or not those arrangements
amounted to a breach of the legislation governing the conduct of the licensing
of travel agents.
8. He submitted that any consultancy arrangement
between the respondent and himself as an unlicensed person would be a
breach of the relevant Act. Therefore he must be an employee.
the evidence of Mr Abdalla and Mr Vella differs in relation to the arrangements
between the parties I accept the evidence of Mr Vella.
10. I have
not attempted to determine whether or not the arrangements relied on by
Mr Vella breach any legislation relevant to the conduct of travel agents. I
am not persuaded that that issue is determinative of any matter before
11. I find that Mr Abdalla was a travel consultant who occupied
business space at the respondent's premises and was paid a commission
by the respondent arising from business conducted by him at those premises. Whilst
the contract between the parties is entitled "Employment Contract" (Exhibit
Vella 1) it defines the applicant's services at clause 1(c) as those
of any (sic) independent agent.
12. I find that the use of that
title "Employment Contract" simply reflects a careless or
non technical use of language. I accept that the day to day arrangements
between the parties are as described in paragraph 1(c) of Exhibit Vella
13. I could not identify any evidence that established to my
satisfaction an employment relationship between the applicant and the
14. However, had I been persuaded that Mr Abdalla had
an employment relationship with the respondent I would not have been persuaded
that any action taken by the respondent was responsible for the termination
of that relationship or arrangement.
15. I accept Mr Vella's
evidence and I find that the arrangement between the parties ceased as
a result of Mr Abdalla's refusal to accede to repeated requests by
the respondent and his financial representatives that he comply with the
legislative requirements of the goods and services tax.
The evidence before Drake SDP
Abdalla pointed to the following items of evidence in support of his oral
evidence as to his status as an employee of Viewdaze Pty Ltd:
- (1) A
contract of employment dated 1 July 1998 entitled "Employment Contract" in
the form of a letter as follows:
I have pleasure in confirming
your employment with Malta travel service.
Your employment with
this agency will be on the terms and conditions contained in this letter.
find this employment contract as agreed to prior to take over.
1. Position and Duties
- (a) your
commencing position ( Independent agent )
- (b) Your
duties and responsibilities are to meet the requirements of Malta travel
service as an independents agent.
- (c) Your
employment is ongoing from CIANTAR BROS PTY.LTD. to VIEWDAZE PTY LTD ACN
NO 056 984 000 licence no 32220 Trading as MALTA TRAVEL SERVICE.
- (a) you are not on
a gross weekly salary.
- (b) your remuneration
may be reviewed by this agency BY MUTUAL AGREEMENT.
- (a) You will be
paid a monthly commission based on the following formula:
- 80% of
gross commission sales created or listed by you.
- (b) except
insurances sales where you will pay 20% of your commissions to us.
Confirm that I accept the offer of employment by "MALTA TRAVEL SERVICE" in
the terms set out in this letter of agreement.
Signed: ............... Date:..............
Mr A. Abdalla
- (2) A
letter from the bookkeeper of Viewdaze Pty Ltd, dated 21 October 2002
in the following terms:
Prior to August 2000 Abraham Abdalla
was a casual employee being paid on a commission basis via the payroll
On Abraham's return in March 2001, we requested him,
on a monthly basis, to provide us with tax invoices with an ABN for processing. Until
he received his ABN we advanced him $1000 per month to assist with his
cash flow. The remainder was to be paid when commission was reconciled
and finalized by a tax invoice for 80% of total commission earnt,
the balance paid being 80% of total commission earnt less the advance
- [It should
be noted that this document was in fact tendered by Mr Vella on behalf
of the respondent.]
- (3) An Australian
Taxation Office employment declaration dated 20 December 1999 and signed
by Mr Vella on behalf of the "employer" Viewdaze Pty Ltd. This
document identifies Mr Abdalla as a casual employee.
- (4) A
group certificate issued by Viewdaze Pty Ltd for the 2000 financial year
which identifies Mr Abdalla as employee number 29 and records gross payments $22,422
with tax deducted of $4,640 (apparently as group tax deducted and remitted
by Viewdaze Pty Ltd).
- (5) A Malta Travel
Service business card identifying Mr Abdalla as "Corporate Manager".
- (6) Documents
suggesting that Viewdaze Pty Ltd had at one time being making superannuation
contributions on Mr Abdalla's behalf.
was common ground between the parties that Mr Vella did not receive a
wage but rather was paid by commission: the commission earned on bookings
placed by Mr Abdalla was split 80% to Mr Abdalla and 20% to
Viewdaze Pty Ltd. Relevant to the issue of Mr Abdalla's employment
status Mr Vella's evidence was short in compass:
MR VELLA: Your Honour, when I
took over the business name of Malta Travel back in 1 July 1998 Mr Abdalla
was working as an independent agent in that agency with the owners of
that company at the time. He was on an arrangement with this company. He
takes business to the office and he was receiving 70 per cent of the Commission. That
is me, 70 per cent of the total Commission received was being given to
Mr Abdalla and 30 per cent was being kept by the previous owners of that
When I came in on 1 July 1998 I spoke to Mr Abdalla prior
to taking over the business name, if he was happy to stay on and work
with our company, which of course he wanted to. So we came to an agreement
that I offered him 80 per cent of the Commission if he wants to keep bringing
business to that office. So Viewdaze Pty Ltd took over the business name
of Malta Travel and started operation in Melbourne 1 July '98. Mr
Abdalla was happy to work under that basis, that he was a freelance operator,
that he always has been and this was verified by himself, by the previous
owners, by the previous directors of the other company. One of them passed
away but his wife is still alive, which has just been verified that that
was the agreement that they had with him.
THE SENIOR DEPUTY PRESIDENT: So
are you saying you verified that prior to commencement of taking over
MR VELLA: Yes, correct. So what we did, it was a
very happy arrangement. It was very happy to stay and get 80 per cent
of his commission and an agreement was drawn up stating so, that I had
no control on his hours, he comes whenever he likes. He can go walkabout
for three months, two months, three weeks. The more business he brings
in the more money he makes. If he turns over $100 commission we keep $20. That
entitled me to $20 was to cover my faxes, my telephones, my computer systems,
my paperwork, which wasn't a really good agreement on my part but
we stand by that agreement all the way through. So we worked on a commission
basis - - -
VELLA: Commission. Everything is commission, your Honour. Now, our company,
we abide by what we are told by our accountants. If there is any changes
in law we have to abide to with whatever changes come in effect. On 1
July 2000 instructions were that an ABN number has to be produced. We
were told that any payments goes out as commission, they must be followed
by an ABN number, tax office, and this is why we are here today. The problem
is not whether Mr Abdalla was an employee or otherwise.
is there was an agreement in place, there have been new changes to the
company laws. We have to abide by the new changes, but Mr Abdalla refused
to change according to the new laws any the new laws state any commission
paid out we must have a tax invoice with an ABN number. Now, Mr Abdalla
gave us his banking details. He has got a business name by the Univoyages. We
are supposed to pay Univoyages and Univoyages gives us the tax invoice. It
hasn't been forthcoming. We have been trying, not so much myself,
my financial controller, my managers for a tax invoice at the end of each
10 Mr Vella tendered
a form entitled "Payroll Authorisation - Banking Details" completed
and signed by Mr Abdalla which nominates a bank account with the name "Univoyages" and
concludes with the declaration: "I hereby agree and authorise the
company to credit my Wages, Salary/Commission to my bank account each
day". It might also be noted that a schedule of payments was tendered
by the respondent (not apparently disputed by Mr Abdalla) which recorded
total payments of Mr Abdalla in the 6 months prior to his termination
of about $8500.
Leave to Appeal
appeal to the Full Bench lies only by leave of a Full Bench: s 45(1). A
Full Bench must grant leave to appeal if, in its opinion, the matter is
of such importance that, in the public interest, leave should be granted: s 45(2). Otherwise, a grant of leave is
governed by the conventional considerations for the grant of leave to
appeal by an appellate court which include whether the decision is attended
with sufficient doubt to warrant its reconsideration or whether substantial
injustice may result if leave is refused. However, "[t]hese "grounds" should
not be seen as fetters upon the broad discretion conferred by s 45(1), but as examples of circumstances
which will usually be treated as justifying the grant of leave" although "[i]t
will rarely, if ever, be appropriate to grant leave unless an arguable
case of appealable error is demonstrated. This is so simply because an
appeal cannot succeed in the absence of appealable error".
an appeal turns on jurisdiction the Full Commission will be inclined to
grant leave to appeal. The public interest demands that the Commission
uphold its jurisdiction where it exists and declines jurisdiction where
it does not exist. However, a grant of leave is not automatic in such
in Sammartino v Mayne Nickless a Full Bench, granting leave to appeal
from a decision finding that an applicant was not an employee, noted:
grant of leave to appeal in this case is not the product of an acceptance
that a grant of leave to appeal should be automatic merely because a question
of jurisdictional fact is determined in a section 170CE proceeding. The
appropriate principles for determining leave to appeal do not preclude
an Appeal Bench from taking the view that the grounds of appeal do not
sufficiently establish an arguable case that an error was made in the
determination of the jurisdictional point.
decision below makes no mention of any authority or principle by reference
to which the conclusion that Mr Abdalla was not an employee was reached. It
makes no reference to the evidence referred to in items (2), (3), (4), (5) or (6) in  above. In
the circumstances, we conclude that the decision below is attendant with
sufficient doubt to warrant its reconsideration. Accordingly, in the exercise
of our discretion we grant leave to appeal in relation to the grounds
directed towards the finding that was there was no employment relationship
between the parties, namely grounds 1, 6, 7, 10, 12, 14, 15, 16 and 17. We
address the remaining grounds below. Suffice it to say, we are not persuaded
that leave to appeal ought be granted in relation to those grounds.
Role of the Full Bench on Appeal
decision of the High Court in Coal and Allied Operations Pty Ltd v Australian
Industrial Relations Commission makes it clear that an appeal under s 45 "is
properly described as an appeal by way of rehearing", that the
powers under s 45(7) "are
exercisable only if there is error on the part of the primary decision-maker" and
that this is so "regardless of the different decisions that may
be the subject of an appeal under s 45".
Commission's jurisdiction under s 170CE of
the Workplace Relations Act 1996 (Cth) cannot be exercised unless the
application has been made by "an employee whose employment has been
terminated by the employer". The issue raised by
the respondent's motion under s 170CEA before
the Member below was one of jurisdictional fact. As such, the Full Bench
on appeal is concerned with whether or not the Member below reached the
right conclusion as to the existence or otherwise of the jurisdiction
fact, not simply with whether or not the decision was reasonably open
to the Member. Although, that task is to be undertaken
on the basis of the primary facts as found by the Member below (and any
findings as to credit) unless such findings are open to challenge on the
usual appellate principles.
relevant to determining whether an employment relationship exists
reading her decision, it is tolerably clear that her Honour's primary
focus was on the issue of control and the apparent lack of control implicit
in Mr Abdalla's approach to his work.
Treloar v Bearings Incorporated (Australia) Pty Ltd a Full Bench of this Commission
reviewed the relevant law at some length and concluded that, despite various criticisms, the Commission is
obliged to follow the approach laid down by the High Court in Stevens
v Brodribb Sawmilling Co Pty Ltd (Brodribb).
traditional approach to characterisation was to apply a control test. In
Brodribb Mason J, with whom Brennan J and
Deane J relevantly agreed, addressed
the factor of control, and issue of characterisation generally, in the
factor in determining the nature of the relationship between a person
who engages another to perform work and the person so engaged is the degree
of control which the former can exercise over the latter. It has been
held, however, that the importance of control lies not so much in its
actual exercise, although clearly that is relevant, as in the right of
the employer to exercise it: Zuijs v Wirth Bros Pty Ltd [(1955) 93 CLR 561, at p 571]; Federal Commissioner
of Taxation v Barrett [(1973) 129 CLR
395, at p 402]; Humberstone v Northern Timber Mills [(1949) 79 CLR 389, at p 404]. In the last-mentioned
case Dixon J said (at p 404):
The question is not whether in
practice the work was in fact done subject to a direction and control
exercised by an actual supervision or whether an actual supervision was
possible but whether ultimate authority over the man in the performance
of his work resided in the employer so that he was subject to the latter's
order and directions.
But the existence of control,
whilst significant, is not the sole criterion by which to gauge whether
a relationship is one of employment. The approach of this Court has been
to regard it merely as one of a number of indicia which must be considered
in the determination of that question: Queensland Stations Pty Ltd v Federal
Commissioner of Taxation [(1945) 70
CLR 539, at p 552]; Zuijs' Case; Federal Commissioner of Taxation
v Barrett [(1973) 129 CLR 395 at
p 401]; Marshall v Whittaker's Building Supply Co [(1963) 109
CLR 21, at p 218]. Other relevant matters include, but are not
limited to, the mode of remuneration, the provision and maintenance of
equipment, the obligation to work, the hours of work and provision for
holidays, the deduction of income tax and the delegation of work by the
J returned to the issue to state:
is not now regarded as the only relevant factor. Rather it is the totality
of the relationship between the parties which must be considered.
Honour also indicated that the power to delegate (in the sense of the
capacity to engage others to do the work) is an important factor in deciding
whether a worker is an employee or independent contractor.
21 In their joint judgment
their Honours Wilson and Dawson JJ said:
many, if not most, cases it is still appropriate to apply the control
test in the first instance because it remains the surest guide to whether
a person is contracting independently or serving as an employee. That
is not now a sufficient or even an appropriate test in its traditional
form in all cases because in modern conditions a person may exercise personal
skills so as to prevent control over the manner of doing his work and
yet nevertheless be a servant: Montreal v Montreal Locomotive Works [(1947) 1 DLR 161 at p 169]. This has led to
the observation that it is the right to control rather than its actual
exercise which is the important thing (Zuijs v Wirth Bros Pty Ltd [(1955) 93 CLR 561 at p 571]) but in some circumstances
it may even be a mistake to treat as decisive a reservation of control
over the manner in which work is performed for another. That was made
clear in Queensland Stations Pty Ltd v FCT [(1945) 70
CLR 539; 8 ATD 30], a case involving
a droving contract in which Dixon J observed, at p 552, that the reservation
of a right to direct or superintend the performance of the task cannot
transform into a contract of service what in essence is an independent
The other indicia of the nature of the relationship have
been variously stated and have been added to from time to time. Those
suggesting a contract of service rather than a contract for services include
the right to have a particular person do the work, the right to suspend
or dismiss the person engaged, the right to the exclusive services of
the person engaged and the right to dictate the place of work, hours of
work and the like. Those which indicate a contract for services include
work involving a profession, trade or distinct calling on the part of
the person engaged, the provision by him of his own place of work or of
his own equipment, the creation by him of goodwill or saleable assets
in the course of his work, the payment by him from his remuneration of
business expenses of any significant proportion and the payment to him
of remuneration without deduction for income tax. None of these leads
to any necessary inference, however, and the actual terms and terminology
of the contract will always be of considerable importance.
said that, we should point out that any attempt to list the relevant matters,
however incompletely, may mislead because they can be no more than a guide
to the existence of the relationship of master and servant. The ultimate
question will always be whether a person is acting as the servant of another
or on his own behalf and the answer to that question may be indicated
in ways which are not always the same and which do not always have the
many cases the application of the principles in Brodribb will not necessarily
yield a clear answer. Typically this will be because there are "indicia" present
which point both ways. The problem was acknowledged by Wilson and Dawson
JJ in Brodribb:
approach is, however, to have regard to a variety of criteria. This approach
is not without its difficulties because not all of the accepted criteria
provide a relevant test in all circumstances and none is conclusive. Moreover,
the relationship itself remains largely undefined as a legal concept except
in terms of the various criteria, the relevance of which may vary according
to the circumstances.
Sammartino the Full Bench of the Commission said:
 In considering
whether Mr Sammartino is an employee we are obliged to apply what an earlier
Full Bench has described as "the relatively well established body
of law setting out tests for the existence of a contract of service. The
determination of whether a contract of service has been entered into requires
a finding of fact based on the application of certain tests or indicia" (Re
Family Day Care Providers, per Boulton and Munro JJ and Donaldson, 5 April
1991, C Print J7216 at pp 2-4). In that decision the approach and indicia
extracted, in the main, from Stevens v Brodribb were stated in terms that
may be summarised as follows:
It must first be established
that work is being done by a person in performance of a contractual obligation
to a second person. The possession by the second person of a right to
exercise control over the way in which the work is carried out, and the
degree of such control, are then to be examined and applied as prominent
factors in distinguishing a contract of service from a contract for services.
is also clear that the totality of the relationship must be considered
in determining whether the relationship between the [parties] is one of
employer and employee or not [Stevens v Brodribb Sawmilling Co Pty Ltd
per Mason J (1986) 160 CLR 16 at 24]. ...
of the relationship is made by assessing and putting in balance the relevant
indicia. Consequently the decision making process requires reference to
criteria for which no relative weight has been authoritatively determined [op
cit; at pp 35-36 and p 49]. ... (Re Family Day Care Providers, ibid
at p 3)
We have revised the list of the headings and
matters to which that Full Bench had regard. In our view, the process
for characterising any relevant contract between Mr Sammartino and Mayne
Nickless requires findings to be made about the following matters as the
basis for the overall assessment:
- (1) the work
- (2) the existence of a contractual
relationship and the identification of the main contractual terms;
- (3) the
indicia of an employment relationship;
- (a) degree
- (b) mode of remuneration;
- (c) provision
and maintenance of equipment or resources;
- (d) obligation
- (e) delegation of work by
contractor or exclusivity of performance;
- (f) hours
of work and entitlements to leave;
- (g) provision
- (h) deduction of income
- (i) characterisation of relationship
for purposes of regulatory provisions such as superannuation and workers
Re Porter; Re Transport Workers Union of Australia Gray J observed perceptively.
A court determining whether a particular
relationship is that of employment or of some other kind can therefore
only resort to the process of balancing all of the factors, or as they
are called in Stevens v Brodribb Sawmilling Co Pty Ltd [(1986) 160
CLR 16] and other cases, the "indicia". In truth the
result may be a matter of impression. It is unfortunate that this is so. It
should not be necessary for people to obtain a decision of a court, in
order to know the true nature of their relationship. Unfortunate or not,
that is the case.
Treloar v Bearings Incorporated (Australia) Pty Ltd the Full Bench, after noting various
judicial and academic criticisms of the conventional approach to distinguishing
between employees and independent contractors, concluded:
Despite these criticisms we are obliged
to follow the most recent leading authority - namely Brodribb. This
requires us to have regard to a variety of criteria including the right
to control and matters of economic reality including the level of economic
dependence of one party upon another.
there is no reference in Brodribb to "matters of economic reality
including the level of economic dependence of one party upon another",
the subsequent decision of the High Court in Hollis v Vabu Pty Ltd may be seen as providing
the necessary content to which the notion of "economic reality" is
27 In Hollis v Vabu the High
Court was concerned with the vicarious liability of a city courier company
in relation to an injury caused by the negligent riding of one of its
bicycle couriers. The New South Wales Court of Appeal in earlier unrelated
proceedings had held that the Vabu couriers were independent contractors
rather than employees. The appellant in Hollis v Vabu (having accepted
at the intermediate appellate stage the binding authority of that earlier
Court of Appeal decision) had argued that the doctrine of vicarious liability
should be extended to agents. The High Court granted leave to the appellant
to argue that the Vabu couriers were employees. Gleeson CJ, Gaudron, Gummow,
Kirby and Hayne JJ in a joint judgment overruled the earlier Court of
Appeal decision and held that the bicycle courier was an employee with
the consequence that Vabu was vicariously liable for the negligence of
its employee. McHugh J was disinclined to overturn the finding that the
courier was not an employee. His Honour observed:
I am not in favour of extending
the classical tests or their application to make the couriers employees
of Vabu. To do so would be likely to unsettle many established business
arrangements and have far-reaching consequences ...
his Honour held that the doctrine of vicarious liability should be expanded:
Rather than attempting
to force new types of work arrangements into the so-called employee/independent
contractor "dichotomy" based on medieval concepts of servitude,
it seems a better approach to develop the principles concerning vicarious
liability in a way that gives effect to modern social conditions.
J concluded that in the specified circumstances Vabu was liable for the
negligent acts of the courier as an agent acting within authority. It
is important to note this approach because it highlights the apparent
extension of traditional principles for distinguishing between employees
and independent contractors implicit in the joint judgment.
is necessary to set out a lengthy passage from the joint judgment:
Mutual Life Assurance Society Ltd v Producers and Citizens Co-operative
Assurance Co of Australia Ltd [(1931) 46
CLR 41], Dixon J explained the dichotomy between the relationships
of employer and employee, and principal and independent contractor, in
a passage which has frequently been referred to in this Court: Kondis
v State Transport Authority [(1984) 154 CLR 672 at 691-692]; Burnie Port Authority v General Jones Pty
Ltd [(1994) 179 CLR 520 at 574]; Northern
Sandblasting Pty Ltd v Harris [(1997) 188 CLR 313 at pp 329-330, p 366]. His Honour explained that, in the
case of an independent contractor:
[t]he work, although done
at [the principal's] request and for his benefit, is considered as
the independent function of the person who undertakes it, and not as something
which the person obtaining the benefit does by his representative standing
in his place and, therefore, identified with him for the purpose of liability
arising in the course of its performance. The independent contractor carries
out his work, not as a representative but as a principal. (Colonial Mutual
Life Assurance Society Ltd v Producers and Citizens Co-operative
Assurance Co of Australia Ltd [(1931) 46
CLR 41 at 48])
This statement merits close attention. It
indicates that employees and independent contractors perform work for
the benefit of their employers and principals respectively. Thus, by itself,
the circumstance that the business enterprise of a party said to be an
employer is benefited by the activities of the person in question cannot
be a sufficient indication that this person is an employee. However, Dixon
J fixed upon the absence of representation and of identification with
the alleged employer as indicative of a relationship of principal and
independent contractor. These notions later were expressed positively
by Windeyer J in Marshall v Whittaker's Building Supply Co [(1931) 46 CLR 210 at 217]. His Honour said that
the distinction between an employee and an independent contractor is "rooted
fundamentally in the difference between a person who serves his employer
in his, the employer's, business, and a person who carries on a trade
or business of his own". In Northern Sandblasting [(1997) 188 CLR 313 at 366], McHugh J said:
rationale for excluding liability for independent contractors is that
the work which the contractor has agreed to do is not done as the representative
of the employer.
In Bazley v Curry [ 2 SCR 534 at 552-555], the Supreme Court of Canada saw two fundamental
or major concerns as underlying the imposition of vicarious liability. The
first is the provision of a just and practical remedy for the harm suffered
as a result of the wrongs committed in the course of the conduct of the
defendant's enterprise. The second is the deterrence of future harm (a
matter discussed in 1934 by Seavey in his essay, "Speculations as
to 'Respondeat Superior'"  Harvard Legal Essays
433, at p 448), by the incentive given to employers to reduce the risk
of accident, even where there has been no negligence in the legal sense
in the particular case giving rise to the claim.
In general, under
contemporary Australian conditions, the conduct by the defendant of an
enterprise in which persons are identified as representing that enterprise
should carry an obligation to third persons to bear the cost of injury
or damage to them which may fairly be said to be characteristic of the
conduct of that enterprise. In delivering the judgment of the Supreme
Court of Canada in Bazley v Curry [ 2
SCR 534 at 548], McLachlin J said of such cases that "the
employer's enterprise [has] created the risk that produced the tortious
act" and the employer must bear responsibility for it. McLachlin
J termed this risk "enterprise risk" and said that "where
the employee's conduct is closely tied to a risk that the employer's
enterprise has placed in the community, the employer may justly be held
vicariously liable for the employee's wrong" (Bazley v Curry  2 SCR 534 at 548-549). Earlier,
in Ira S Bushey & Sons, Inc v United
States [(1968) 398 F 2d 167 at 171], Judge Friendly had said that
the doctrine of respondeat superior rests:
in a deeply rooted
sentiment that a business enterprise cannot justly disclaim responsibility
for accidents which may fairly be said to be characteristic of its activities.
notions also influence the meaning to be given today to "control" as
a discrimen between employees and independent contractors. In Stevens
v Brodribb Sawmilling Co Pty Ltd [(1986) 160
CLR 16], the Court was adjusting the notion of "control" to
circumstances of contemporary life and, in doing so, continued the developments
in Zuijs v Wirth Brothers Pty Ltd [(1955) 93
CLR 561] and Humberstone v Northern Timber Mills [(1949) 79 CLR 389]. In Humberstone [(1949) 79
CLR 389 at 404], Dixon J observed that the regulation of industrial conditions
and other statutes had made more difficult of application the classic
test, whether the contract placed the supposed employee subject to the
command of the employer. Moreover, as has been pointed out:
control test was the product of a predominantly agricultural society. It
was first devised in an age untroubled by the complexities of a modern
industrial society placing its accent on the division of functions and
extreme specialisation. At the time when the courts first formulated the
distinction between employees and independent contractors by reference
to the test of control, an employer could be expected to know as much
about the job as his employee. Moreover, the employer would usually work
with the employee and the test of control and supervision was then a real
one to distinguish between the employee and the independent contractor. With
the invention and growth of the limited liability company and the great
advances of science and technology, the conditions which gave rise to
the control test largely disappeared. Moreover, with the advent into industry
of professional men and other occupations performing services which by
their nature could not be subject to supervision, the distinction between
employees and independent contractors often seemed a vague one. [Glass,
McHugh and Douglas, The Liability of Employers in Damages for Personal
Injury, 2nd ed (1979), pp 72-73]
It was against that
background that in Brodribb [(1986) 160 CLR 16 at 29] Mason J said that,
whilst these criticisms might readily be acknowledged:
common law has been sufficiently flexible to adapt to changing social
conditions by shifting the emphasis in the control test from the actual
exercise of control to the right to exercise it, "so far as there
is scope for it", even if it be "only in incidental or collateral
matters": Zuijs v Wirth Brothers Pty Ltd [(1955) 93
CLR 561 at 571]. Furthermore, control is not now regarded as the
only relevant factor. Rather it is the totality of the relationship between
the parties which must be considered.
So it is that,
in the present case, guidance for the outcome is provided by various matters
which are expressive of the fundamental concerns underlying the doctrine
of vicarious liability. These include, but are not confined to, what now
is considered "control".
Honours approached the position of the Vabu couriers in the following
In classifying the bicycle couriers as independent
contractors, the Court of Appeal fell into error in making too much of
the circumstances that the bicycle couriers owned their own bicycles,
bore the expenses of running them and supplied many of their own accessories. Viewed as a practical matter, the bicycle couriers were not
running their own business or enterprise, nor did they have independence
in the conduct of their operations. A different conclusion might,
for example, be appropriate where the investment in capital equipment
was more significant, and greater skill and training were required to
operate it. The case does not deal with situations of that character. The
concern here is with the bicycle couriers engaged on Vabu's business. A
consideration of the nature of their engagement, as evidenced by the documents
to which reference has been made and by the work practices imposed by
Vabu, indicates that they were employees. [Emphasis added.]
Honours then identified 6 aspects of the facts supporting their conclusion
that the bicycle couriers were employees including "the matter of
deterrence" referring to "the knowledge of Vabu as to the
dangers to pedestrians presented by its bicycle couriers and the failure
to adopt effective means for the personal identification of those couriers
to the public".
think it particularly significant that the joint judgment endorsed the
proposition that "the distinction between an employee and an independent
contractor is 'rooted fundamentally in the difference between a
person who serves his employer in his, the employer's, business,
and a person who carries on a trade or business of his own'". In  their Honours dealt with
the issue in the case before them by in essence asking whether, "viewed
as a practical matter" the workers in question were "running
their own business or enterprise" with "independence in the
conduct of their operations".
Summary of the law on
distinguishing employees from independent contractors
Hollis v Vabu, the state of the law governing the determination of whether
an individual is an employee or an independent contractor may be summarised
- (1) Whether a worker is an employee
or an independent contractor turns on whether the relationship to which
the contract between the worker and the putative employer gives rise is
a relationship where the contract between the parties is to be characterised
as a contract of service or a contract for the provision of services. The
ultimate question will always be whether the worker is the servant of
another in that other's business, or whether the worker carries on
a trade or business of his or her own behalf: that is, whether, viewed as a practical
matter, the putative worker could be said to be conducting a business
of his or her own. This question is answered by
considering the totality of the relationship.
- (2) The nature
of the work performed and the manner in which it is performed must always
be considered. This will always be relevant to the identification of relevant "indicia" and
the relative weight to be assigned to various "indicia" and
may often be relevant to the construction of ambiguous terms in the contract.
- (3) The
terms and terminology of the contract are always important and must be considered. However,
in so doing, it should be borne in mind that parties cannot alter the
true nature of their relationship by putting a different label on it. In particular, an express term that
the worker is an independent contractor cannot take effect according to
its terms if it contradicts the effect of the terms of the contract as
a whole: that is, the parties cannot deem the
relationship between themselves to be something it is not. Similarly,
subsequent conduct of the parties may demonstrate that relationship has
a character contrary to the terms of the contract. If, after considering
all other matters, the relationship is ambiguous and is capable of being
one or the other, then the parties can remove that ambiguity by the very
agreement itself which they make with one another.
- (4) Consideration
should then be given to the various "indicia" identified
in Brodribb and the other authorities bearing in mind that no list of
indicia is to be regarded as comprehensive and the weight to be given
to particular indicia will vary according to the circumstances. Where
a consideration of the "indicia" points one way or overwhelmingly
one way so as to yield a clear result, the determination should be in
accordance with that result. For ease of reference we have collected the
following list of "indicia":
- · Whether
the putative employer exercises, or has the right to exercise, control
over the manner in which work is performed, place or work, hours of work
and the like.
of this sort is indicative of a relationship of employment. The absence
of such control or the right to exercise control is indicative of independent
contract. While control of this sort is a significant factor is not
by itself determinative. In
particular, the absence of control over the way in which work is performed
is not a strong indicator that a worker is an independent contractor where
their work involves a high degree of skill and expertise. On the other hand, where there is a high level of control
over the way in which work is performed and the worker is presented to
the world at large as a representative of the business then this weights
significantly in favour of the worker being an employee.
is not whether in practice the work was in fact done subject to a direction
and control exercised by an actual supervision or whether an actual supervision
was possible but whether ultimate authority over the man in the performance
of his work resided in the employer so that he was subject to the latter's
order and directions. [B]ut
in some circumstances it may even be a mistake to treat as decisive a
reservation of control over the manner in which work is performed for
another. That was made clear in Queensland Stations Pty Ltd v Federal
Commissioner of Taxation, a case involving a droving contract in which
Dixon J observed that the reservation of a right to direct or superintend
the performance of the task cannot transform into a contract of service
what in essence is an independent contract.
- · Whether
the worker performs work for others (or has a genuine and practical entitlement
to do so).
- The right
to the exclusive services of the person engaged is characteristic of the
employment relationship. On the other hand, if the individual also works
for others (or the genuine and practical entitlement to do so) then this
suggests independent contract.
- · Whether
the worker has a separate place of work and or advertises his or her services
to the world at large.
- · Whether
the worker provides and maintains significant tools or equipment.
the worker's investment in capital equipment is substantial and a
substantial degree of skill or training is required to use or operate
that equipment the worker will be an independent contractor in the absence
of overwhelming indications to the contrary.
- · Whether
the work can be delegated or subcontracted.
the worker is contractually entitled to delegate the work to others (without
reference to the putative employer) then this is a strong indicator that
the worker is an independent contractor. This is because a contract of service (as
distinct from a contract for services) is personal in nature: it is a
contract for the supply of the services of the worker personally.
- · Whether
the putative employer has the right to suspend or dismiss the person engaged.
- · Whether
the putative employer presents the worker to the world at large as an
emanation of the business.
this will arise because the worker is required to wear the livery of the
- · Whether
income tax is deducted from remuneration paid to the worker.
- · Whether
the worker is remunerated by periodic wage or salary or by reference to
completion of tasks.
tend to be paid a periodic wage or salary. Independent contractors tend
to be paid by reference to completion of tasks. Obviously, in the modern
economy this distinction has reduced relevance.
- · Whether
the worker is provided with paid holidays or sick leave.
- · Whether
the work involves a profession, trade or distinct calling on the part
of the person engaged.
- Such persons
tend to be engaged as independent contractors rather than as employees.
- · Whether
the worker creates goodwill or saleable assets in the course of his or
- · Whether
the worker spends a significant portion of his remuneration on business
list is not exhaustive. Features of the relationship in a particular case
which do not appear in this list may nevertheless be relevant to a determination
of the ultimate question.
- (5) If
the indicia point both ways and do not yield a clear result the determination
should be guided primarily by whether it can be said that, viewed as a
practical matter, the individual in question was or was not running his
or her own business or enterprise with independence in the conduct of
his or her operations as distinct from operating as a representative of
another business with little or no independence in the conduct of his
or her operations.
- (6) If the result
is still uncertain then the determination should be guided by "matters
which are expressive of the fundamental concerns underlying the doctrine
of vicarious liability" including the "notions" referred
to in paras  and  of Hollis v Vabu (see above).
35 It is
useful to begin by summarising the various matters relevant to the characterisation
in the present case. The matters in favour of Mr Abdalla being an employee
of the respondent are as follows:
- · The various
references to "employment" in the letter of 1 July 1998 which
bears the subject heading "Employment Contract".
- · The
lodgement of an employment declaration, executed by Mr Vella on behalf
of Viewdaze, with the Australian Taxation Office, the deduction and remittal
of group tax and the issuing of group certificates in relation to Mr Abdalla
and the suggestion that Viewdaze had at one time made superannuation contributions
on behalf of Mr Abdalla.
- · The
letter from the respondent's bookkeeper dated 21 October 2002 recording
that "prior to August 2000 Abraham Abdalla was a casual employee
being paid on a commission basis by the payroll system".
- · Mr
Abdalla did not provide any business equipment but rather used the telephone,
facsimile, computer and office facilities of the respondent when he was
- · The provisions of the
Travel Agents Act 1986 (Vic).
- · Mr
Abdalla's inclusion as a "consultant" in the respondent's
entry in an industry directory and the existence of business cards identifying
Mr Abdalla with Viewdaze.
matters suggesting that the relationship between the parties was one of
independent contract are:
- · The characterisation
of Mr Abdalla's position and duties as one of "independent" agent
in the letter of 1 July 1998.
- · The
absence of control by the respondent over the work performed by Mr Abdalla
and his status as a "freelance operator".
- · The
payroll authorisation submitted by Mr Abdalla identifying an account styled "Univoyages" as
the account to which payments of commission were to be credited.
- · The
non-payment of salary or wages.
turn now to consider the terms of the contract and weight to be given
to the various factors. In so doing we note that Drake SDP made a credit
based finding that she preferred the evidence of Mr Vella where it conflicted
with the evidence of Mr Abdalla. We see no basis within the relevant principles
to interfere with that finding.
express written terms of the contract between the parties are contained
in the letter of 1 July 1998 bearing the subject heading "Employment
Contract". That document points in both directions. In favour of
the relationship between the parties being one of employment, the letter
refers to the respondent's "pleasure in confirming [Mr Abdalla's] employment
with Malta Travel Service" and refers to the "employment
with this agency" being on the "terms and conditions contained
in this letter" and to Mr Abdalla's "employment" being "ongoing" from
the previous owner of the business. On the other hand, the letter describes
Mr Abdalla's position as "Independent agent" and his "duties
and responsibilities" are "to meet the requirements of Malta
Travel Service as an "independents [sic] agent". These
references to Mr Abdalla being "independent" must be given
some meaning and content. On the evidence before Drake SDP, the only sensible
meaning to be given to that word is that the parties intended that Mr Abdalla had independence in the extent of work
that he performed and the manner in which he performed that work.
39 The key evidence
of Mr Vella in relation to control was that:
The absence of control indicated
by this and other evidence given by Mr Vella is a significant indicator
that the relationship between the parties was one of independent contract. Moreover,
it is consistent with the references to "independent" agent
in the letter of 1 July 1998.
I spoke to Mr
Abdalla prior to overtaking the business name, if he was happy to stay
on and work with our company ... So we came to an agreement that
I offered him 80% of the commission if he wants to keep bringing
business to that office. ... Mr Abdalla was happy to work under that
basis, that he was a freelance operator ... I have no control on
his hours, he comes whenever he likes. He can go walkabout for three months,
two months, three weeks.
Mode of remuneration
contract provides that Mr Abdalla was "not on a gross weekly salary" but
rather that he would be "paid a monthly commission". The
fact that Mr Abdalla did not receive salary or wages but was paid by commission
cannot be regarded as a particularly significant factor in the present
case (notwithstanding that, at least for a period of some months, Mr Abdalla
was paid a minimum amount of $1000 per month irrespective of sales). In
the modern economy many workers who can properly be characterised as employees
earn remuneration on the basis of commission. For example, the couriers
in Hollis v Vabu Pty Ltd received no wage or salary.
fact that Mr Abdalla nominated as an account for the payment of commission,
an account styled "Univoyages" (a business name which on
its face has travel industry connotations) points towards Mr Abdalla operating
on the basis that he was conducting an independent business.
Payment of Group Tax etc
lodgment of an ATO employment declaration, the deduction and remittal
of group tax and issuing of group certificates and the apparent payment
of superannuation contributions on Mr Abdalla's behalf are the strongest
features suggesting a relationship of employment. However, they cannot
be seen as determinative. A respondent may carelessly or mistakenly proceed
on the basis that a worker is an employee when on a true analysis the
relationship is one of independent contract. The lodging of an employment
declaration, the deduction of group tax and the issuing of group certificates
in such circumstances will simply be in error.
43 A number of the "indicia" referred
to in the authorities have no application or are neutral in the present
44 The fact that Mr Abdalla used
the respondent's office and facilities when he was working is a matter
of relatively minor significance given the nature of the work involved.
we agree with Mr Abdalla that the operation of the Travel Agents Act 1986 (Vic) is
a relevant matter to consider, it is a minor matter and does not weigh
strongly in favour of a conclusion that Mr Abdalla was an employee. We
are prepared to assume that Mr Abdalla is correct when he contends that,
given he held no license, it would have been an offence for him to have
acted as a travel agent otherwise than as an employee of another license
Mr Abdalla had himself drafted the letter of 1 July 1998 which creates
the appearance that he was an employee (possibly so as to avoid this very
exposure). Notwithstanding those appearances, the question before us turns
on a substantive consideration of the totality of the relationship between
the parties. Mr Abdalla's potential exposure under the Travel Agents
Act 1986 (Vic) has no bearing upon the presence or absence of other
46 Mr Abdalla's
inclusion as a "consultant" in the respondent's entry
in an industry directory and the fact of business cards identifying Mr
Abdalla as associated with the respondent adds little to the argument. We
note that the term "consultant" (the term appearing in the
industry directory) is ambiguous and is equally consistent with a relationship
of independent contract.
47 The assertions
by Mr Abdalla in his evidence that he was an employee carry no weight: they
are assertions of a conclusion of mixed law and fact and are not probative. The
bookkeeper's letter has little weight for the same reason. On its
face, that letter was prepared in contemplation of the proceedings and
can represent nothing more than the bookkeeper's (non-expert) understanding
or belief as to Mr Abdalla's legal status.
the assertions by Mr Abdalla in his evidence that the parties had agreed
he was an employee have little probative value in the present case. As
outlined above, the task of distinguishing between employment and independent
contract is one of characterisation turning upon matters of substance (including
substantive contractual rights and obligations) rather than form: labels
applied by the parties cannot alter the substantive character of the relationship.
49 In this case
the various indicia point in both directions such that the case falls
close to the ill-defined dividing line between employment and independent
contract. In our view, the absence of control emerging from the evidence
is a matter to which substantial weight should be attached in the circumstances
of the present case. On balance, the various factors to which we have
referred tend more strongly to a characterisation of independent contract. The
case is by no means clear cut and, accordingly, we must consider whether
it can be said that, viewed as a practical matter, Mr Abdalla was or was
not running his own business or enterprise with independence in the conduct
of his business operations as distinct from operating as a representative
of Viewdaze with little or no independence in the conduct of his operations. On
the evidence before Drake SDP, we conclude that, viewed as a practical
matter, Mr Abdalla was in substance running his own business enterprise
with independence in the conduct of his operations. He was entirely free
to work as little or as much as he liked. Consistent with a contractual
right to act as an "independent" agent, he was not subject
to any substantial measure of control by the respondent in relation to
his attendance at work or the manner in which he performed his work. The
evidence suggests that his work involved bringing his own business to
the respondent's agency (rather than transacting business allocated
to him by the respondent) and retaining the vast bulk of the commission
generated from that business. The primary purpose of the relationship
between the parties seems to have been to provide Mr Abdalla with a convenient
vehicle through which to transact the business that he generated through
his own sources and contacts with Viewdaze in return taking a small portion
of the commissions thereby generated. It follows that, on the evidence
before Drake SDP, the proper characterisation of the relationship between
the parties is one of independent contract.
grounds of appeal
50 In relation to the remaining
grounds of appeal we have determined that, in the exercise of our discretion,
leave to appeal should be refused. For the reasons that follow we are
not persuaded, in relation to those grounds, that the decision of Drake
SDP is attended with sufficient doubt to warrant its being reconsidered
by the Full Bench and we are not persuaded that substantial injustice
will result if his leave is refused. In our view, the matter is not of
such importance that, in the public interest, leave to appeal should be
granted pursuant to s 45(2) of
the Workplace Relations Act 1996 (Cth) in relation to those remaining
grounds of appeal.
Grounds 2, 3 and 21
- 2. The
Senior Deputy President erred in law in making a decision whilst proceedings
in the High Court of Australia (Case No M194/2002) issued and served by
the applicant were pending.
- 3. It
was improper and or unreasonable and or a breach of the rules of natural
justice for the Senior Deputy President to make a decision whilst High
Court Proceedings were pending.
- 21. That
it is not in the public interest in all the circumstances for the Senior
Deputy President to make a decision when she knew or ought to have known
that proceedings in the High Court of Australian relating to the case
the absence of a writ of prohibition or other order issued by the High
Court or the Federal Court of Australia prohibiting or restraining the
Commission from further hearing or determining a matter, the Commission
is obliged to discharge its statutory functions and to hear and determine
matters regularly brought before it. In the present case Drake SDP was
entitled to proceed to issue her decision. There is no substance in grounds
2, 3 and 21.
Grounds 4 and 11
- 4. The
Senior Deputy President was not impartial and is biased.
- 11. The
Senior Deputy President has prejudged the relationship and her reference
to clause 1(c) of the Employment Agreement in her decision confirms the
employment of the applicant with the respondent was ongoing and rolled
over from Ciantar Bros Pty Ltd.
regard the grounds alleging bias or apprehension of bias against the Senior
Deputy President as entirely lacking in merit. There is nothing in transcript
which would sustain a finding of apprehension of bias. The appellant was
unable to identify any specific matters which we would regard as making
out an apprehension of bias within the meaning of the authorities. We
have dealt with the contract above.
5 and 8
- 5. The Senior Deputy
President erred in law in not ordering the respondent to make available
all documents material and relevant to the case available to the applicant
and the Commission.
- 8. The
Senior Deputy President erred in law in allowing the respondent to continue
its case when it had wilfully and knowingly failed to comply with and
was in breach of the Summons to Witness to Produce Documents issued by
the Senior Deputy President on the 3rd October 2002.
applicant submitted a summons to the respondent requiring the production
of 20 listed categories of documents. The respondent did not produce documents
falling within many of those categories. In respect of some categories,
the respondent produced only some of the documents falling within the
categories. It is tolerably clear from the transcript that the respondent
objected to the production of documents under the summons on grounds that
equate to relevance (ie lack of legitimate forensic purpose) and oppression. The
Senior Deputy President went through each of the categories in the summons
and adjudicated upon the question of whether the respondent ought be required
to produce the documents in each category. The respondent subsequently
complied to some extent with the determination of the Senior Deputy President. When
a party to an application requests the issue of a summons the Commission
is usually not in a position to consider, at that time, whether the summons
is unreasonable, oppressive or otherwise liable to be set aside. The rules
do not provide a specific procedure for a challenge to a summons to a
person to attend and produce documents. The procedure to be adopted by
the Commission is its discretion: see s 110(2)(a). Given
that a summons is issued by the Commission it is within the power of the
Commission to absolve the recipient from the obligation to comply with
some or all of the summons. Ordinarily the Commission will entertain an
objection to production by the recipient of the summons and ordinarily
it would apply the principles generally applicable to the setting aside
of subpoenas in the Federal Court.
the present case, when the issue of compliance with the summons arose,
the Senior Deputy President formed a judgment in relation to each category
of documents as to whether or not the documents ought be produced or whether
a more limited category of documents ought be produced. It appears that
the respondent still did not produce all documents covered by the revised
categories. Insofar as the respondent failed to produce documents within
categories in the summons that Drake SDP ruled should be produced the
decision of the High Court in Commonwealth Bank of Australia v Quade is relevant. In that case the High Court unanimously
upheld a decision of the Federal Court ordering a new trial in a case
where it came to light after the verdict at first instance that the defendant
bank had failed to produce relevant documents pursuant to an order for
discovery and where it was assessed that the result "might" have
been different if the bank had produced those documents on discovery. The
High Court held:
neither practicable nor desirable to seek to enunciate a general rule
which can be mechanically applied by an appellate court to determine whether
a new trial should be ordered in a case where misconduct on the part of
the successful party has had the result that relevant evidence in his
possession has remained undisclosed until after the verdict. The most
that can be said is that the answer to that question in such a case must
depend upon the appellate court's assessment of what will best serve
the interests of justice, "either particularly in relation to the
parties or generally in relation to the administration of justice" (cf,
eg, McDonald v McDonald (1965) 113 CLR,
at pp 533, 542). In determining whether the matter should be tried
afresh, it will be necessary for the appellate court to take account of
a variety of possibly competing factors, including, in addition to general
considerations relating to the administration of justice, the degree of
culpability of the successful party (cf Southern Cross Exploration NL
v Fire & All Risks Insurance Co Ltd (1985) 2
NSWLR 340 at p 357), any lack of diligence on the part of the unsuccessful
party and the extent of any likelihood that the result would have been
different if the order had been complied with and the non-disclosed
material had been made available. While it is not necessary that the appellate
court be persuaded in such a case that it is "almost certain" or "reasonably
clear" that an opposite result would have been produced, the question
whether the verdict should be set aside will almost inevitably be answered
in the negative if it does not appear that there is at least a real possibility
that that would have been so.
our opinion this principle is applicable to proceedings in the Commission
where a party fails to produce documents covered by a summons and this
fact is not apparent at the time of the hearing. Where the non-production
of documents covered by a summons is apparent at the time of the hearing
the member conducting the hearing ought address that issue. Usually this
will involve requiring the defaulting party to produce the documents and
considering whether the interests of justice require an adjournment to
remedy any injustice which may arise from the other party not having had
an adequate opportunity to consider the documents together with an order
for costs against the defaulting party under s 170CJ(3). In
the present case it appears that the respondent did not produce all documents
covered by the summons as modified by Drake SDP and in failing to address
that issue her Honour erred. The principle in Commonwealth Bank v Quade
is applicable in such circumstances.
are not persuaded that there is a real possibility that the documents
which the respondent did not produce under the summons as modified by
Drake SDP would have altered the outcome of the matter. A consideration
of the categories in the summons and the assertions of the applicant in
the transcript demonstrates that those documents could only have afforded
further evidence that the applicant was treated as an employee for administrative
purposes, including payment of salary and associated benefits and in relation
to access to third party booking systems. Even assuming that to be so,
it does not alter the conclusion we have reached on the primary issue
of characterisation of the relationship between the parties.
- 9. The
Senior Deputy President erred in law in not allowing and or inviting the
applicant to cross-examine the respondent when she specifically
did so assist invite the respondent in the course of the hearing at transcript
57 The transcript
shows that the procedure adopted by the Commission was to swear the respondent's
representative, Mr Vella, and then permit him to "address" it (apparently
from the bar table) about whether or not Mr Abdalla was an employee or
not (PN 49). Mr Abdalla did not cross-examine Mr Vella. Ground
9 in the notice of appeal is directed to this aspect of the matter. In
this context it is appropriate to note that the Commission said the following
to the parties before any "evidence" had been given:
think I might say this, if you both of you wish to instead of having to
pop in and out of the witness box, you can at least make your opening
statement from where you are seated and if that is your evidence you can
before you do that swear to the truth of it, Mr Vella. Then if Mr Abdalla
wishes to ask you some questions you can take the witness box and he can
do so. Then, Mr Abdalla, if you wish to give some evidence you can take
an affirmation and give that evidence from the bar table and then if Mr
Vella wishes to ask you some questions you can take the witness stand
and he can ask you some question from there.
it is true that the Commission did not invite Mr Abdalla to cross-examine
Mr Vella, at the conclusion of Mr Vella's "address" (in
which a number of documents were tendered) it is clear from what is recorded
at transcript PN22 that Drake SDP had informed Mr Abdalla of his entitlement
to cross-examine Mr Vella. It is true that there was no clear termination
point to Mr Vella's evidence: it simply trailed into a series of
exchanges between the bench and the parties culminating in her Honour's
refusal to receive or take into account provisions of the Victorian Travel
Agents Act 1986 (Vic) which Mr Abdalla sought to invoke in aid of
his defence to the respondent's motion. However, on balance we do
not think that the Commission was in error in failing to remind Mr Abdalla
as to his entitlement to cross-examine Mr Vella (although it would
have been desirable for her Honour to have done so). This entitlement
had been made clear to Mr Vella at the commencement of the proceedings. On
the other hand, we do think that the matter illustrates again the general
desirability of requiring parties who appear in person in a case where
factual matters are contested to give their evidence from the witness
box so as to minimise the confusion between evidence and submissions,
facilitate the taking of objections and to make plain the opportunity
for cross-examination by the other party.
- 13. The Senior Deputy
President erred in law in allowing the respondent to give evidence of
cheque butts when only a sample were produced for a short period of time
and not all were produced as subpoenaed.
our opinion the cheque butts do not materially impact on the determination
of the primary issue before the Commission. We have proceeded on the assumption
that the further cheque butts if produced would have afforded further
evidence that the appellant was paid commission from which tax was deducted
as if he were an employee.
- 18. The
Senior Deputy President erred in law in not giving sufficient and or any
weight to the Applicants Submissions dated 15 November 2002 including
the request for a view of the workplace.
is no basis for concluding that the Senior Deputy President failed to
take account of the applicant's submissions dated 15 November 2002. The
Commission is not obliged to undertake a view merely because a party requests
that a view be undertaken. In the present case we have difficulty seeing
how a view could rationally impact upon the determination of the issue
in dispute. There was certainly no error in the present case in the Member
below declining to conduct a view.
- 19. The Senior Deputy
Presidents decision is inconsistent with good Travel Industry Practice
and and [sic] procedure.
travel industry practice" was not a relevant consideration in relation
to any of the issues before the Member below.
- 20. That it was improper,
unreasonable and denial of natural justice for the Senior Deputy President
to decide the lawfulness of the termination (cl 14 of the decision) in
the absence of evidence and not the subject of the jurisdictional hearing.
62 Paragraph  of
the decision amounts to a finding that if there was a relationship of
employment between Mr Abdalla and Viewdaze Pty Ltd then that relationship
had been terminated at the initiative of the employee because, as the
Commission explained in para , "the arrangements between the
parties ceased as a result of Mr Abdalla's refusal to accede to repeated
requests by the respondent and his financial representatives that he comply
with the legislative requirements of the Goods and Services Tax". In
our opinion this reasoning is flawed. No GST is payable by an employer
in respect of remuneration paid to an employee. The "repeated requests" made
by Viewdaze and its accountant related to information sought in order
to pay Mr Abdalla as though he were an independent contractor. If (contrary
to what we have found) Mr Abdalla was in fact an employee then those "repeated
requests" were misconceived and his "refusal to accede" to
them would have been entirely justified and cannot properly be characterised
as involving a termination of employment at the initiative of the employee.
having said this, the observations of the member below in paras  and  of
the decision were obiter and in no way material to her determination of
the jurisdiction motion before her. We have considered the subject matter
of that motion for ourselves and reached a conclusion adverse to the appellant. Accordingly,
paras  and  of the decision below become irrelevant.
- 22. That
by reason of the aforementioned it is in the public interest that leave
to appeal the decision of Senior Deputy President Drake be granted.
is not a proper ground of appeal.
65 The earlier Full Bench decision
in this matter stated (at ):
It refers to
the following authorities in support of that proposition: Cabay v Total
Fire Protection (per Polites SDP, Williams SDP and Smith C, 5 December
2000, Print T4143). See also Curran v Thomas Jewellers Australia Pty Ltd (Print
P6275, 28 October 1997) (Williams SDP); cited with approval in Egan v
Botanic Gardens Management Services Pty Ltd (Print S4512, 28 March 2000) (Ross
VP, Watson SDP and Holmes C). The earlier Full Bench continued:
A respondent bears the responsibility
of making out its case for establishing a jurisdictional bar to the Commission
proceeding to deal with an application under s 170CE of
the Workplace Relations Act 1996 (Cth).
a respondent disputes the existence of jurisdiction, that respondent is
required to lead evidentiary material or, at least, to put in a detailed
manner its case in substantiation of its contention.
the first of these propositions we understand the earlier Full Bench to
have been indicating that the respondent bears what might be referred
to as an "evidentiary onus" which
it must discharge in order to put the Commission's jurisdiction in
issue. That is, the respondent must lead evidence or make specific factual
submissions which, if accepted, would lead to the conclusion that the
Commission had no jurisdiction. Once that "onus" has been
discharged the "onus" passes back to the applicant who bears
the ultimate responsibility for establishing that the application is within
jurisdiction. Where, on an motion under s 170CEA,
the evidence before the Commission is insufficient to enable it to come
to a conclusion favourable to the mover of the motion on an issue which
has to be determined, the motion should be dismissed.
much appears from the authorities relied upon by the earlier Full Bench. Thus,
in Cabay the Full Bench stated:
words with underline emphasis come from the decision of Williams SDP in
Curran v Thomas Jewellers Aust Pty Ltd (Print P6275, 28 October 1997). That
same statement was adopted with approval by the Full Bench in Egan v Botanic
Gardens Management Services Pty Ltd (per Ross VP, Watson SDP and Holmes
C, 28 March 2000, Print S4512).
 In general,
a person who seeks to have the Commission exercise its jurisdiction bears
an onus of satisfying the Commission as to the existence of that jurisdiction. However,
in a matter such as this, where a respondent disputes the existence of
the jurisdiction on a ground prescribed by regulation, that respondent
is required to lead evidentiary material or, at least, to put in a detailed
manner its case in substantiation of its contention. [Curran v Thomas
Jewellers Australia Pty Ltd [Print P6275], 28 October 1997 (Williams SDP); cited
with approval in Egan v Botanic Gardens Management Services Pty Ltd [Print
S4512], 28 March 2000 (Ross VP, Watson SDP and Holmes C)] In this case,
there was detailed evidence from the respondent which supported its contention. It
is apparent from the decision of the Senior Deputy President that she
accepted that the respondent had fulfilled any obligation to provide appropriate
evidentiary material in support of its contention.
grant leave to appeal in relation to grounds 1, 6, 7, 10, 12, 14, 15 and
16 of the notice of appeal but dismiss the appeal. We refuse leave to
appeal in relation to the remaining grounds in the notice of appeal.
Wiliams SDP, Lacy SDP, Simmonds C, 24 September 2002, PR922818.
PN 54-57; PN89-90.
Wan v AIRC (2001) 116 FCR 481 at .
v AIRC (2001) 116 FCR 481 at .
See, for example, Leigh Carpenter v Corona Manufacturing (per
Williams SDP, Lacy SDP, Tolley C, 17 December 2002, PR925731).
v Mayne Nickless (2000) 98 IR 168 at .
Coal and Allied Operations Pty
Ltd v Australian Industrial Relations Commission (2000) 203
CLR 194 at . See also Re Commonwealth of Australia; Ex parte
Marks (2000) 177 ALR 491 per McHugh
J at .
s 170CE(1) of
the Workplace Relations Act 1996 (Cth).
Pawel v Australian Industrial Relations Commission
and Another (1999) 97 IR 392 at 395 (per
Branson and Marshall JJ); Administrative Clerical and Services Union v
Automated Meter Reading Services (AMRS) (Munro J, Kaufman SDP, Cribb C,
3 September 2002, PR022053).
Usefully summarised in Fearnley v
Tenix Defence Systems Pty Ltd (Ross VP, Polites SDP, Smith C, 22 May 2000,
Bearings Incorporated (Australia) Pty Ltd (Ross VP, Polites SDP and Foggo
C, 2 July 1999, Print R4924).
Stevens v Brodribb Sawmilling
Co Pty Ltd (1986) 160 CLR 16.
Brodribb at 47.
Brodribb at 49.
Brodribb at 24.
Brodribb at 29.
Brodribb at 36-37.
Brodribb at 35.
v Mayne Nickless (2000) 98 IR 168 at -.
Re Porter; Re
Transport Workers Union of Australia (1989) 34
Bearings Inc (Australia) Pty Ltd (Per Ross VP, Polites SDP, Foggo C, 2
July 1999, Print R4924).
v Vabu Pty Ltd (2001) 207 CLR 21; 47 ATR 559.
Hollis v Vabu
at CLR 49; ATR 578.
v Vabu at CLR 50; ATR 579.
v Vabu at CLR 38-41; ATR 569-72.
Hollis v Vabu Pty Ltd (2001) 207 CLR 21 at 41-42; 47 ATR 559 at
Hollis v Vabu at CLR 43; ATR 573-74.
v Vabu at CLR 39; ATR 570-71.
Hollis v Vabu at CLR 41; ATR
Marshall v Whittaker's
Building Supply Co (1963) 109 CLR 210 at
217 per Windeyer J approved by the majority in Hollis v Vabu Pty Ltd (2001) 207 CLR 21 at 39; see also Brodribb per Wilson
and Dawson JJ at 37.
Hollis v Vabu Pty Ltd (2001) 207 CLR 21 at 41-42, 45; 47 ATR 559 at 572-73, 575.
Brodribb esp Mason
J at 29.
per Wilson and Dawson at 37.
parties cannot create something which has every feature of a rooster,
but call it a duck and insist that everyone else recognise it as a duck" Re
Porter; Re Transport Workers Union of Australia (1989) 34
IR 179 at 184 per Gray J; Massey v Crown Life Insurance  2
All ER 576 at 579 per Lord Denning
approved by the Privy Council in AMP v Chaplin (1978) 18
ALR 385 at 389.
AMP v Chaplin (1978) 18
ALR 385 at 389.
v Vabu Pty Ltd (2001) 207 CLR 21 at
45; 47 ATR 559 at 575.
AMP v Chaplin (1978) 18 ALR 385 at 394.
Massey v Crown
Life Insurance  2 All ER 576 at
579 per Lord Denning.
Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16.
Flows from the reasoning of Mason J in Brodribb at
Brodribb esp Mason J at 24.
v Wirth Bros Pty Ltd (1955) 93 CLR 561 at
v Vabu Pty Ltd (2001) 207 CLR 21; 47 ATR 559.
Humberstone v Northern Timber Mills (1949) 79 CLR 389 at 404 per Dixon J.
Brodribb per Wilson
and Dawson JJ at 36.
Brodribb per Wilson
and Dawson JJ at 37.
per Mason J at 24.
Hollis v Vabu Pty
Ltd (2001) 207 CLR 21 at
41  see also 45 ; 47
ATR 559 at 572  see also 575 .
Mason J at 24.
Pty Ltd v Federal Commissioner of Taxation (1945) 70
CLR 539; AMP v Chaplin (1978) 18 ALR
385 at 389.
per Wilson and Dawson JJ at 36.
Hollis v Vabu at CLR 42 ; ATR
per Mason J at p 24; Wilson and Dawson JJ at 37.
Cf Brodribb per Mason J at 24.
to paid holidays, see Brodribb per Mason J at 24.
Brodribb per Wilson and Dawson
JJ at 37.
Brodribb per Wilson and Dwson JJ at 37.
Brodribb per Wilson and Dawson JJ at 37.
the objective sense discussed in Codelfa Construction Proprietary Limited
v State Rail Authority of New South Wales 149
CLR 337 per Mason J (with whom Stephen and Wilson JJ agreed) at
Vabu at CLR 30-31 ; ATR 564 .
the treatment of statutory regulation in Re Family Day Care Providers,
per Boulton and Munro JJ and Donaldson C, 5 April 1991, Print J7216.
Sections 4 and 6 of the Travel Agents Act 1986 (Vic).
Bank of Australia v Quade (1991) 178 CLR
Quade at 142-43.
Transcript PN 22.
In using the term onus
we are cognizant of the warning issued by the Full Bench in Coal and Allied
Operations Pty Ltd v Automotive, Food, Metals, Engineering, Printing and
Kindred Industries Union (per Munro J, Harrison SDP, Leary C, 20 June
1997, Print P2071): "It is doubtful how far the notion of onus of
proof is relevant at all to Commission proceedings. There is a respectable
basis for the view that, where there is a statutory requirement for the
Commission to be "satisfied" about exercising a discretion,
the notion of onus of proof imports legal doctrines that should have no
part in the Commission's procedural or decisional process. This is
especially so where a discretion, as in the case of section 127,
is exercisable on the Commission's own motion. In short, the Commission
is either satisfied that it should exercise the discretion, or it is not. It
matters little how the Commission arrives at that state of mind. Perhaps
no party can be said to bear an onus in a quasi-judicial proceeding
that is freed of legal technicality and is directed to the determination
of a statutory discretion. Even if that view be accepted, there are ingredients
of the principles associated with the notion of onus of proof that have
a useful role in any adversarial proceeding. In that context, a notion
of onus stems from the fact that an applicant is the party who usually
has the carriage of the application and who bears the risk of failure. The
applicant thus may be said to bear an onus of satisfying the Commission
that an order should be made. Where a matter commences on the Commission's
own motion, no party bears any direct onus but the Commission must be
satisfied that a proper basis for exercise of power in the matter is established". The
notion of "evidentiary onus" is convenient in the Commission's
unfair termination jurisdiction where the Commission is determining an
application inter-parties and cannot act of its own motion.
v Nepean Country Club (Hamilton DP, 31 March 2003, PR929453).