20 B U S I N E S S T I P S The ‘Gig’antic changes coming our way - Deliveroo rider not an employee FOR AUSTRALIAN BUSINESSES, knowing who an employee is and, more importantly, when an employment relationship exists can be difficult. In the courts, these relationships are generally characterised as either principal-contractor relationship or employer-employee relationship and the ways the courts are viewing these arrangements is changing rapidly. It is important that businesses, their employees and suppliers clearly understand the nature of the business relationship, particularly as a wide range of businesses liabilities can arise when problems occur. For example, questions can arise regarding whether contractors are actually employees, creating issues with ending the commercial relationship. Two recent judgments in the High Court earlier this year (Personnel Contracting Case and Jamsek Case), show employers that judges’ views on these commercial relationships have changed. What has changed? The key question in these cases is whether an employment relationship exists. These questions often arise where businesses engage contractors and issues arise. The Courts then look at whether an ‘employment-like relationship’ exists. In these cases, the questions are broader than simply seeking if there was (or is) an employment contract in place. Previously a key fact the Courts would consider related only to the contracts (both written and implied) in place. In these situations, the performance of the contract and the conduct of each party to the contract (that is the business and the employee or contractor) were always the most relevant factors used when determining the nature of the commercial relationship. Due to the latest judgments, this is no longer the case. After the Personnel Contracting Case, judges are relying completely on the terms of any contract to determine the kind of employee or contractor relationship exists. That means that, where a written contract is in place, the Courts will only consider the rights and obligations under that contract to work out the kinds of commercial relationship that exists. What does this mean for Businesses? This means businesses needs to both make sure that appropriate contracts are in place and understand that the terms of the contract are now key to determining the relationship between the parties. Although the Courts will still consider subsequent conduct of the parties (how you acted after the contract was signed) to determine if the original contract has been altered by the actions taken, the written terms of any contract are now the key factor. Deliveroo Australia Pty Ltd v Diego Franco In a recent highly publicised decision, the Full Bench of the Fair Work Commission (the Commission) overturned an unfair dismissal claim by a Deliveroo rider, Mr Diego Franco, stating that he was not an employee. This had led many employers to expect that their contractors will not be viewed as employees in the Commission and Courts. This is not a prudent approach. The Full Bench distilled the four key criteria from the High Court decision in the By Warwick Ryan, Partner, Hicksons Lawyers Feds kick in $500 million for Sydney-Newcastle fast train CONTINUED FROM PAGE 20 Personnel Contracting Case, being; i. The terms of the Agreement indicated lack of control over the manner of performance of any work; ii. Mr Franco was to provide a vehicle – “substantial item of mechanical equipment” such that “the personal is overshadowed by the mechanical” (as relied in Jamsek Case); iii. The terms of the Agreement did not require personal service on the part of Mr Franco (delegation was not only allowed but required no prior approval from Deliveroo); iv. Payment of an administrative fee by Mr Franco for access to Deliveroo’s software and for Deliveroo providing invoices and other administrative services. Based upon these findings, the Deliveroo rider was a contractor and not an employee. How does this affect businesses? These judgments continue to impact the cases that are coming before the Commission. It is important for small and large businesses to realise that some common practices that businesses had relied on in contractor agreements may now be invalid. For example, the existence of a contractual right to control the activities of a worker (including how, where and when the work is done) is a major signifier of an employment relationship. Or the label that a business may add in a contract to define the nature of the relationship will no longer be able to be used to determine that the relationship is one of a contractor (for example). Now is the time for businesses to have their contractor arrangements reviewed by their solicitors to ensure that these arrangements in principle continue to remain the same arrangement as agreed upon. could potentially involve 15 years of planning and 30 years of construction, will cost north of $130 billion. The new statutory authority has been tasked with starting the major infrastructure project that, if realised, will deliver a fast train network connecting the eastern seaboard for the first time. A board made up of rail and infrastructure sector experts will oversee the longterm project, which will provide independent advice to governments on planning and delivery. It will also be the lead agency to co-ordinate the project with the states and territories. Transport Minister Catherine King said the authority would work with consortiums collaboratively and with transparency to investigate alternate funding and financing opportunities including value uplift for the “important nation-building project”. There has been very little action to progress high speed rail in Australia, until now,” King said. “This is a long-term project that will not only significantly reduce travel times but also unlock regional economies providing significant employment opportunities and supplying a remarkable economic boost in the medium and long term.” Th 64-page Discussion Paper is available online via the Greater Cities Commission website. CENTRAL COAST BUSINESS REVIEW OCTOBER 2022
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