An employee or an independent contractor? a checklist

The AAT has given a useful decision, finely balanced on the facts and the law, that a person – Mr Roberts – was an employee of a company and not an independent contractor.

The decision was given in the context of the Department of Employment finding that Roberts was an independent contractor of Ignite Homes Pty Ltd, not an employee, the consequence being that he was not entitled to government assistance for unpaid entitlements under the Fair Entitlements Guarantee Act 2012 (Cth) when Ignite became insolvent.

Relevant factors – an employee or a contractor?

The AAT considered and discussed a series of factors – in the nature of a checklist – as being relevant to the assessment of whether Roberts was an employee or an independent contractor, summarised in this table.

Evidence Indicating Roberts was an … ?
Terms of contracts Independent contractor
Mode of remuneration Employee
Deduction of income tax Independent contractor
Steps associated with setting up a business – ABN etc Roberts’ ABN not used; employee
Putative employer’s control Employee
Entitlement to delegate work Employee
Actual work or entitlement to work for others Employee
Advertising of services to others Employee
Exclusive service obligations Employee
Whether Roberts is presented to the public as part of the putative employer’s organisation or a representative of it Employee
Rights to paid holidays, superannuation and sick leave Independent contractor
Whether Roberts had a separate workplace Employee
Provision of resources or equipment Employee
Whether worker required to bear expenses and indemnify the putative employer against losses Independent contractor

It is not a matter of adding up all these criteria one way or the other:

‘the totality of the relationship of the parties to be considered’.

The AAT concluded that

‘having regard to the totality of the relationship, the relationship between Ignite and Mr Roberts was that of employer and employee’.

 

Roberts and Secretary, Department of Jobs and Small Business [2019] AATA 64

 

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