An employer has been ordered to pay full redundancy entitlements to employees despite offering them other employment arrangements.

The recent decision of Lee Crane Hire Pty Ltd v Sneek and Ors [2020] FWC serves as an important example of when an employer will be required to pay redundancy entitlements to employees, despite offering them alternative means of employment.

What the Fair Work Act 2009 (Cth) Says:

Section 120 of the Fair Work Act provides a mechanism for employers to apply to vary the amount of redundancy pay owing to an employee (which may be reduced to nil) in circumstances where the employer obtains other acceptable employment for the employee (and they reject it) or the employer simply cannot pay the amounts owing. 

What is ‘Other Acceptable Employment’?

If an employer is able to prove that it offered an employee other acceptable employment and the employee rejected such employment and sought payment of their redundancy entitlements instead, an employer could request the Fair Work Commission reduce the redundancy pay potentially to nil.  

The onus of proving that the alternative employment is acceptable rests with the employer. There is a body of case law which has set the bar particularly high and involves consideration of a range of non-exhaustive factors including, pay levels, hours of work, seniority, fringe benefits, workload, job security, work location, continuity of service, accrual of benefits, probationary periods, as well as the employee’s skills, experience and physical capacity. The location of the other employment must also not be unreasonably distant from the employee’s original place of work. 

So What Happened in Lee Crane v Sneek?  

Lee Crane v Sneek is a prime example of how the Fair Work Commission assesses ‘other acceptable employment’ and is a cautionary tale for employers, particularly those who may wish to offer casual or far away employment to soon-to-be redundant employees. Here’s what happened:  

• Lee Crane Hire operates a mobile crane hire business in Gladstone and operates another depot at Biloela (121kms inland from Gladstone). There had been a downturn in business of the Gladstone Depot such that the business could no longer guarantee full time work to the employees based at the Depot. The owner of the business decided to close the Gladstone Depot and operate all his business through the Biloela depot.

• Employees Sneek, Wiemers and Kennedy worked at the Gladstone depot and were offered two alternatives to a redundancy:

1. 1. continue in the same role, but be based out of Biloela and Gladstone with the only Depot being in Biloela. This option would include payment for time spent travelling to work and accommodation, the same hours of work, a company vehicle supplied, the same salary and leave entitlements. Additionally, as the role was the same mobile crane operations role, the travel to different sites would be largely unchanged; or
   2. to take on casual employment for Lee Crane Hire in Gladstone, this would involve the employees performing the same work, however there would be no guaranteed hours of work.

• Sneek, Wiemers and Kennedy declined the above options and were terminated on the 31^st of March 2020.

• Lee Crane Hire filed an application in the Fair Work Commission seeking the redundancy pay of Sneek, Wiemers and Kennedy be reduced on the grounds that it offered them ‘other acceptable employment’.

• When assessing the alternatives offered to the employees, the Fair Work Commission viewed both alternatives in the negative, and stated: 

• • [29] It is the devil’s alternative: move to a new location some 121kms away and incur a practical detriment on a continuous basis or, keep your job, but as a casual with no assurance of work in an evidently declining market. This should not be classified as acceptable alternative work that would release the employer from their obligation to pay out a redundancy entitlement. In short, the travel to Biloela makes the options, in line with the authority cited, unreasonably distant.
  • [35] My considered view is that the two employment options offered by Lee Crane Pty Ltd are not ‘acceptable other employment’ for the purpose of s.120(1)(b)(i) of the Act.

Ouch.

• Lee Crane Hire were ordered to pay Sneek, Wiemers and Kennedy their full redundancy entitlements which equalled 16, 12 and 7 weeks respectively.

Triple ouch.

What’s the lesson?

Employers need to tread very carefully when navigating redundancies and further, they need to ensure that any offers for other employment are indeed ‘acceptable’ based on the Fair Work Commission’s assessment criteria. 

It goes without saying that if you are wondering if your redundancy process is correct or you are wishing you had some expert assistance to ensure your redundancy alternatives are not labelled “the devil’s alternative”, do not hesitate to contact our Principal Workplace Relations Team: 

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October is Safe Work Month and is an important time for businesses to review their Workplace Health and Safety procedures and processes and to reflect on the safety of their staff and workplaces.

Whatever the industry or workplace, every organisation can join Safe Work Month and take steps to keep people safe and healthy at work, including:  

• Being informed: Staying up to date with the laws, rules and regulations that apply and create the duties and responsibilities of employers, employees and contractors. It is vital that both employers and employees take steps to stay informed and up to date;

• Auditing Hazards and Risks and implementing risk/hazard mitigation strategies: Identifying hazards and risks is a key step for both employers and employees and involves finding thing or situations that may cause harm. Once a hazard or risk is identified, it is imperative that steps be taken to minimise or remove the risk or hazard. Risk and hazard assessments should be conducted regularly;

• Training and consultation: Employers and employees must all work together to ensure the safety and wellbeing of others and the workplace. It is vital that staff be trained and consulted with every step of the way and includes being involved when identifying hazards and assessing the risks that the work or workplace present and when proposing changes to the workplace which may affect WHS; and

• Being prepared for emergencies: Employers need to have plans and processes in place to appropriately respond to emergencies, injuries and incidents in the workplace. This includes (but is not limited to) having staff trained in fire and emergency management, having procedures in place for incident/injury reporting and return to work management;

• Keeping staff wellbeing front of mind: Employers and employees need to remember that safe workplaces isn’t just about injuries and incidents, it also includes staff health and wellbeing. It is important to remember that everyone’s physical and psychological wellbeing should also be a priority.

There are a wide range of free resources available through WorkSafe Queensland and Safe Work Australia and at Enterprise Legal, we have a dedicated Workplace Relations team that is here to assist and keep your workplace safe and informed.

If you would like to discuss how we can assist you with your Workplace Health and Safety obligations, contact EL's Principal Workplace Relations Advisor Amie Mish-Wills:

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If you’re party to a commercial lease that is coming to an end, whether you’re a landlord or tenant, it’s important that you be aware of any ‘make good’ obligations that are part of the lease.

If your lease has a make good clause, it’s important that you understand your obligations, whether it is limited to leaving the premises in good repair, or reinstating to a specific condition, and whether you can avoid the obligation by paying a sum of money, which can provide both landlord and tenant with flexibility. If a lease specifies that the condition of the premises in question ought to be reinstated, or made good, it is probably the case that you will need to comply.

Even in these circumstances, you may not be liable for the total cost if there isn’t a reduction in value of the premises. This is because pursuant to common law, the landlord is only entitled to recover any consequential reduction in value from failing to undertake the reinstatement.

Additionally, in Queensland, section 112 (1) of the Property Law Act 1974 provides that, where a lease requires a premises to be left in good repair at the end of a lease, any recovery is limited to the reduction in value of the premises.

It is especially important to make note and take photos of the condition of the premises at the start of the lease in these circumstances so that all parties can be satisfied of the initial condition, whether a tenant is or isn’t required to make good, it remains important.

The number one tip and consideration is to carefully negotiate the relevant make good requirements at the time of negotiating the lease. Parties are often so excited and focussed on the commencement of the lease, that they omit to take into consideration what the ‘end’ will look like, or they categorise it as a future concern. But when the time comes, if you are required to make good pursuant to the lease, it could impose a number of unintentional onerous conditions on you.

If you’re unsure whether you need to comply with any ‘make good’ conditions that may be in your lease, or want assistance to negotiate reasonably terms at the time of construction of the lease, the team at Enterprise Legal can help you determine the best course of action for you. For the best outcome, call us early in the process:

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If you’re building a house, you should be aware that the Queensland Building and Construction Commission (QBCC) may be able to provide assistance for any loss that is sustained in the event of defective or incomplete work through the Home Warranty Insurance Scheme.

The catch, however, is that you need to carefully follow the QBCC process and rules which can be very onerous at times, to ensure that your application is not excluded.

One of these conditions is that the relevant building contract must be properly terminated before a claim is made, otherwise it could result in the QBCC disallowing the claim. In a recent decision of Allen & Taylor v Queensland Building and Construction Commission [2020] QCAT 63 the importance of complying with the legislative pre-conditions were emphasised.

In that particular case, the question was whether the homeowners had properly terminated their residential building contract prior to making a claim under the Scheme, which is a condition precedent to being able to access the home warranty insurance. In this case, the builder entered into a contract with the homeowners in early 2016, but little progress was made at the time of termination. In November 2017, the homeowners served a Notice of Substantial Breach for a number of breaches, including failure to complete the standard of work required and terminated the contract.

The Tribunal decided that the contract was not properly terminated under clause 1.2 of the Scheme. This clause sets out that the QBBCC will only pay for losses sustained when the contract with the contractor has been properly terminated. While the homeowner’s contract gave them the right to terminate in the event of a breach by the contractor, the Tribunal held that there was no breach on the basis that:

• the defects that the homeowners alleged would have been capable of remedy following the completion of the house; and
• the contractor was ready, willing and able to complete the building project.

Given that the Tribunal felt that the builder was able to provide a response to the Notice to Show Cause, it was determined that the defects that the homeowners claimed were not substantial enough to justify their termination of the contract. As a result, it was held that they were not able to make a claim under the Scheme.

If you’re concerned about the progress or quality of your residential building project, it’s important that you act carefully if you want to ensure that you can make a claim under the QBCC Act.

If you think you may need to bring a claim, contact the team at Enterprise Legal to discuss your rights, obligations, and options to ensure that you aren’t barred from making a claim:

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In this digital age, many businesses are embracing all the new and exciting things technology has to offer including remote working, virtual meetings and electronic file sharing.

Whilst technology has indeed revolutionised a number of ways in which we work and communicate, the legal industry is still quite a ways behind and you will find yourself dropped into hot water if you do not do your research and check if your tech-savvy approach will be accepted by a court.

The case of McCarthy v TKM Builders Pty Ltd [2020] QSC 301 is an important example of when the use of Dropbox proved fatal to an application under the Building Industry Fairness (Security of Payment) Act 2017 (Qld).

What Happened?

The Building Industry Fairness (Security of Payment) Act 2017 (Qld) (“the BIF Act”) provides for, among other things, the adjudication of disputes over progress payments in building construction contracts.

Importantly, as part of the process of applying for an adjudication decision, the BIF Act requires that an applicant must give a copy of an adjudication application to the respondent. Quite literally, section 79(3) of the BIF Act states:

‘A copy of an adjudication application must be given to the respondent.’

In the case of McCarthy v TKM Builders Pty Ltd [2020] QSC 301, the applicant, Mr McCarthy and TKM entered into a construction contract for a building project at Bells Creek.

Later, TKM filed an adjudication application in the Queensland Building and Construction Commission and on 15 June 2020, they sent an email to Mr McCarthy, attaching the adjudication application form and a Dropbox link to their submissions. The email simply stated:

“Please find below link to correspondence and attached adjudication claim lodged with the QBCC today.
https://www.dropbox.com/sh/jt7427ejjhz70ik/AACVuiCVC1Ug2YG6X27CFBuca?dl=0”[1]

Of importance, the submissions could only be obtained by opening the Dropbox link.

Mr McCarthy’s solicitors prepared and submitted a response to the adjudication application and argued that Mr McCarthy had not been given a copy of the adjudication application in accordance with s 79(3) of the BIF Act and, as a result, the adjudicator did not have jurisdiction to deal with the application.

What Did The Adjudicator Say?

Upon examination, the adjudicator held that he did have jurisdiction to deal with the application, on the grounds that:

‘the fact is that it has been demonstrated that the respondent was in possession of a copy of the adjudication application and its supporting submissions. If a document has been received by the other party, the manner in which it was served is unlikely to matter.’

The adjudicator found in favour of TKM on the payment claim and Mr McCarthy paid the amount found to have been owing.

On Appeal - Was the Application “Given” to Mr McCarthy?

The matter was subsequently appealed in the Supreme Court of Queensland and overturned by Judge Martin J, who found that TKM had failed to appropriately give Mr McCarthy the adjudication application as required by section 79 of the BIFA Act.

His reasoning? Dropbox was simply not sufficient for the purposes of section 79 of the BIFA Act and section 39 of the Acts Interpretation Act 1954 (Qld) which also provides for the service of documents.  

In making his decision, Judge Martin referred to the decision in Conveyor & General Engineering Pty Ltd v Basetec Services Pty Ltd [2015] 1 Qd R 265 at 268 [22], where Justice McMurdo said:

“[37] Actual service does not require the recipient to read the document. But it does require something in the nature of a receipt of the document. A document can be served in this sense although it is in electronic form. But it was insufficient for the document and its whereabouts to be identified absent something in the nature of its receipt. The purported service by the use of the Dropbox facility may have been a practical and convenient way for CGE to be directed to and to use the documents. But at least until 2 September 2013 (when Mr How became aware of the contents of the Dropboxes), it did not result ‘in the person to be served becoming aware of the contents of the document’.”

Judge Martin held that Mr McCarthy was not given a copy of the adjudication application in accordance with section 79 of the BIFA Act and as a result, the adjudicator did not have the necessary jurisdiction to make the decision.

Lesson Learnt

It is pretty clear that if you are required to ‘give’ another party a document under the BIF Act, you should avoid using Dropbox. You will save yourself being dropped into some seriously hot water like TKM in this matter.

Whilst it might be tempting to use exciting new technology in every aspect of your business and dealings, how you share, serve and file documents in legal proceedings can make or break your claim and it is therefore vital that you get the right advice from the start before you take a wrong turn.

For advice and support with disputes and the construction industry, contact our Dispute and Construction division:

Sharne Lategan 
Principal Director & Legal Advisor – Construction & Disputes

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Article last updated 2 June 2023

We can all be forgiven for thinking that employee bonuses are and always will be, subject to the complete discretion of the employer, but what if you were told that that isn’t always the case?

The recent decision in Subasic v Hewlett Packard Australia Pty Ltd [2020] ACTSC 2 has continued to chip away at the ‘absolute discretion’ defence and confirmed that an employment contract that states a bonus is “in the absolute discretion” of the employer, doesn’t mean the employer has the unlimited power to change how the bonus is paid or withhold payment and in fact, such a decision will be a costly one.

So What Happened?

Melinda Subasic was employed by Hewlett Packard Australia Pty Ltd and her contract of employment included the payment of an incentive scheme that was “subject to change or cancellation at [the employer’s] discretion”.

Subasic’s performance was of such a high standard that she generated a significantly large incentive payment of $446,250.39 under the incentive scheme and when it came time to pay up, Hewlett Packard Australia Pty Ltd sought to implement a cap that would limit the amount that she would be paid to just $136,500.00. Understandably, the employee sued.

What Did the Court Say?

The Supreme Court of the Australian Capital Territory found that by changing the incentive scheme, Hewlett Packard Australia Pty Ltd breached the employment contract.

It also held that the discretion to change or amend the scheme was to be exercised “honestly and conformably with the purposes of the contract”, which was not evident in this case.  

The Court also found that the employer was not permitted to decide arbitrarily, capriciously or unreasonably that it need not pay an incentive payment where the set objectives had been satisfied.

Quite simply, Hewlett Packard Australia Pty Ltd did not have the discretion to simply impose new terms and decide to withhold the incentive after it was validly earnt.

The employee was awarded $309,750.39 plus interest in the sum of $61,568.19 and Hewlett Packard Australia Pty Ltd was ordered to pay costs.

The Lesson for Employers

The decision in Subasic v Hewlett Packard Australia Pty Ltd [2020] ACTSC 2 is a worthwhile reminder to employers that ‘absolute discretion’ isn’t actually absolute and employers should plan ahead and tread carefully when implementing and managing employee incentive schemes.  

It is also a worthwhile reminder that withholding employee incentives is a dangerous option as businesses look at ways to reduce costs in the wake of COVID-19 and it is vital to get sound legal advice before taking steps that could cost your business far more in the long run.

Enterprise Legal is aware that this case has been appealed however the appeal was dismissed and therefore the contents of this article remain current. 

If you would like to know more or you would like to speak to one of our Workplace Relations specialists, contact Enterprise Legal today for a free introductory consult:

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Think emojis don’t count when it comes to defamatory comments online? Think again!

Recently the District Court of New South Wales determined that an emoji could convey a defamatory meaning. In the case of Burrows v Houda [2020] NSWDC 485, proceedings were brought by Zali Burrows against Adam Houda in relation to posts made on Twitter in July 2019 and May 2020.

Ms Burrows made the claim that words and images in the tweets gave rise to defamatory imputations. One of Mr Houda’s tweets linked to an article in the Herald which reported a judge’s suggestion that Ms Burrows’ conduct be referred to the Law Society for potential disciplinary action, which received a number of replies. One of these replies stated “July 2019 story. But what happened to her since?” Mr Houda responded with a ‘zipper-mouth face’ emoji. 🤐

Ms Burrows asserted that the tweet conveyed a range of false and defamatory claims, including that she had been disciplined due to misconduct.

In determining the matter, her Honour Justice Gibson confirmed that:

“As is sometimes the case with social media posts, the meanings may be gleaned from pictures as well as words, and where liability for publication arises from more than one post, from the dialogue which ensues.”

Justice Gibson referred to the online dictionary Emojipedia and said that the zipper-mouth emoji means ‘a secret’ or ‘stop talking’ “in circumstances where a person impliedly knows the answer but is forbidden or reluctant to answer.” In the context of Mr Houda’s other tweets, the implication of the emoji that Ms Burrows had acted improperly was pretty clear.

Her Honour noted that “the ordinary reasonable reader of tweets derives the meaning of the imputation from the circumstances surrounding the tweet,” and was satisfied that most social media users would make adverse assumptions about Ms Burrows given that the tweets were accompanied by an article that had the effect that Ms Burrows had acted unsatisfactorily.

This decision is especially notable, not only as it set a precedent that an emoji alone can be defamatory, but also because it is the first instance where an Australian Court has considered an emoji in written communications. Given the increasing use of emojis in day-to-day life, it certainly won’t be the last.

The Burrows matter is a well-timed reminder to pause and consider before posting comments that could be construed as being defamatory on social media, even when comments are limited to an emoji.  

If you believe you have been subject to defamatory comments, with or without emojis 😆, the experienced team at Enterprise Legal can help you to weigh up your options.

Contact us today:

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Casual employment has been a hotly contested topic for quite some time, particularly following the controversial decision in WorkPac Pty Ltd v Rossato (‘Rossato’), which was handed down on 20 May 2020.

In a nutshell, the decisions of Workpac Pty Ltd v Skene [2018] FCAFC 131 and Workpac Pty Ltd v Rossato [2020] FCAFC 84 found that casual employees who work regular, consistent hours with a firm advance commitment to work, may be owed leave and other entitlements such as redundancy pay even where they have received a 25% casual loading (double dipping drama).

There will be no easing of casual employment controversy in 2021 as the Rossato decision is off to the High Court and further, the Australian Government recently introduced the Fair Work Amendment (Supporting Australia’s Job and Economic Recovery) Bill 2020 (the Bill) to Parliament.

If the Bill passes Parliament, it will bring about various changes to casual employment, including certainty to employees and employers regarding the rights and obligations of both parties and the definition of a casual employee is proposed to be amended to where an offer of employment is made on the basis that the employer makes no firm advance commitment to continuing and indefinite work according to an agreed pattern of work.

Relevant factors to whether there is a firm advanced commitment to work include:

• the ability to accept or reject work;
• whether the employee will work only as required; and
• whether a casual loading is paid;

assessed at the time the engagement is entered into.

If the Bill is successful and in good news for employers, employers will also have the ability to set off any claim for annual leave, personal leave and redundancy pay against the 25% casual loading in an attempt to reduce the potential for “double dipping”.

The laws are currently proposed to work retrospectively, however, there are no guarantees that this will be held to be valid. The Bill also proposes a number of changes to provisions regarding casual conversion, flexible work directions and enterprise agreements – important but less controversial topics.

It is recommended that employers continue to stay up to date with the developments in the casual employment sphere and be prepared for changes in the future. At this stage, the Bill is only proposed and may change before coming into force.

For advice and support with managing your casual workforce, contact our Workplace Relations team at Enterprise Legal today for a complimentary introductory consultation:

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The recent introduction of a new burger has stirred some rather large beef between two iconic fast-food giants, McDonalds and Hungry Jacks.

It began with an ad campaign launched by Hungry Jacks to promote their new ‘Big Jack’ burger, a name which most members of the general public immediately compared to McDonalds’ famous ‘Big Mac’. Facebook posts prior to the release of the TV ads also claimed, “There’s something… ‘special’ about our new Big Jack” followed by a winking emoji.[1]

While most found the advertising to be comedic, McDonalds was not “lovin’ it” and took significant issue with the new burger’s resemblance to the ‘Big Mac’ and filed a claim in the Federal Court against Hungry Jacks, alleging that the Big Jack infringed McDonalds’ intellectual property. They also argued that the registration of ‘Big Jack’ as a trademark was made in bad faith.

Undeterred, Hungry Jacks has since hit back at McDonalds in their next series of recent ads, acknowledging that ‘Someone’s suing Hungry Jacks,’ but that Australians were unlikely to get the Big Jack confused with ‘some American burger’, as they claimed the Big Jack was ‘clearly bigger’. They also defended the name of the burger, saying it was intended as a play on the name of the company and a link to Jack Cowin, the founder and current owner of Hungry Jacks.[2]

Sydney chain Rashay’s also decided to jump into the mix with their Big MacJac, and were swiftly handed a cease and desist letter from the golden arches.

It is a very amusing and interesting case and to prove trademark infringement to the Federal Court, McDonalds will have to argue two points. Firstly, they will have to show that Hungry Jacks’ ‘Big Jack’ trademark is substantially identical with or deceptively similar to McDonalds’ ‘Big Mac’ trademark under section 44 of the Trade Marks Act 1995 – which will hinge on whether consumers are likely to be confused or assume a connection between the two burgers. This could be difficult to prove given the well-known rivalry between the two companies; is the average person likely to believe that a collaboration is going on between the two, or that they are the same burger?

Secondly, under section 60 of the Trade Marks Act 1995, they will have to show that the McDonalds’ Big Mac trademark has acquired a reputation in Australia and because of that reputation, consumers are likely to be deceived. Proving that the Big Mac has a reputation will be easy enough; more difficulty may arise, again, with arguing that consumers will be confused.

In addition, McDonalds has also opposed the Big Jack trademark under section 62A of the Trade Marks Act 1995, arguing that Hungry Jacks registered the Big Jack trademark in ‘bad faith’ – alleging that they showed ‘flagrant and wilful disregard’ of McDonalds’ trademarks.

This is far from the first time McDonalds has filed a lawsuit over intellectual property. In 1994, San Francisco coffee shop ‘McCoffee’ was forced to change its name after McDonalds claimed they infringed on their trademark.[3] Similarly, a restaurant in the Philippines named ‘McJoy’ was required to change their name to ‘MyJoy’ when McDonalds made the decision to expand into the country.[4]

It’s not all wins though and in 1996, a Denmark-based hotdog vendor Allan Pederson, trading under the name ‘McAllan’, successfully defeated a claim filed by the fast food giant after the court ruled that consumers were unlikely to mistake a street food stand for a McDonald’s franchise.[5] Denmark was clearly not “lovin’ it”. 

So how will the matter of the Big Mac v Big Jack be settled? Presently, the judge presiding over the case, Justice Burley, has moved the case to mediation and given McDonalds’ history of litigation over trademarks, it’s unlikely they’ll agree to meat in the middle and this will continue to be an interesting case to watch in 2021.

Be sure to follow Enterprise Legal for further updates and if your business would like to know more about protecting your intellectual property then let's talk:

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Sources:

[1] https://www.news.com.au/finance/business/other-industries/mcdonalds-sues-hungry-jacks-for-big-mac-burger-lookalike-big-jack/news-story/1348c77e5ac6d698529af2355693526f

[2] https://www.smh.com.au/national/mcdonald-s-moves-to-supersize-lawsuit-against-hungry-jack-s-20201002-p561bx.html

[3] https://www.mcspotlight.org/media/press/littlepeople.html

[4] https://www.marketwatch.com/story/philippine-supreme-court-upholds-mcdonalds-trademark-rights

[5] https://web.archive.org/web/20151019134933/http:/www.mcspotlight.org/media/press/ap_4dec96.html

As discussed during our recent Workplace Relations Video, whether a private employer can direct its employees to get the COVID-19 vaccination is a complex issue, with the primary issue being whether or not an employer’s direction for staff to receive the COVID-19 vaccination is lawful and reasonable.

It is commonly understood that employers can direct their staff to do certain things as part of their employment and employees have a legal obligation to comply with their employer’s directions if those directions are lawful and reasonable.

What Makes a Direction Lawful and Reasonable?

A number of matters are considered when determining whether or not a direction is lawful and reasonable, including (but not limited to):

• the express and implied terms of the employee’s contract of employment;
• the nature of the employment;
• established custom and practice in the workplace, trade or industry; and
• the employer’s workplace health and safety obligations;
• the employer’s duty of care;
• the terms of relevant instruments (eg a modern award and enterprise agreement), and any applicable legislation.

Some examples of directions that might be given by an employer to an employee include a direction to:

• participate in a workplace investigation;
• undertake a medical examination for the purpose of assessing fitness for work;
• comply with work health and safety laws;
• stay away from work or work from home to prevent the risk of exposure to, or spread of a contagious illness;
• report misconduct;
• prioritise projects in a particular way; and
• adhere to a dress code.

In the case of a direction for staff to receive the COVID-19 vaccination, whether such a direction is lawful and reasonable will vary depending on the circumstances of the employer, employee, the workplace and the industry.

As discussed in our video, what is reasonable in the context of an aged care facility, will differ significantly from a marketing office and understandably, one size does not fit all.

Various factors may impact the lawfulness and reasonableness of a direction for staff to receive the COVID-19 vaccination, including:

• whether the employer’s genuine and reasonable work health and safety obligations dictate a particular response;
• whether the employee can reasonably perform the inherent requirements of their role without being vaccinated;
• whether the employer’s common law duties of care owed not only to the employee but their clients dictate a particular response; and
• whether there are legislated or government-issued directions in place that require compliance.

Employers also need to be mindful of whether or not the direction constitutes discrimination or an infringement on a protected human right.

What if it is 'Reasonable' and the Employee Disobeys?

Breach of the implied duty of obedience is by its very nature a breach of the contract of employment, and in principle will attract the normal remedies for breach of contract. More often, employers will consider the following options in response to a failure to obey lawful and reasonable directions:  respond to a breach by either:

• declining to take action;
• disciplining the employee.

Before taking disciplinary action against an employee for disobeying a direction, employers should always consider:

• Whether the direction lawful and reasonable;
• For directions contained in a workplace policy, was the employee required to read and acknowledge the policy? Was the employee trained in the policy and was it consistently enforced?
• Was the employee made aware of the consequences of failing to comply with the direction?
• Would the proposed disciplinary action be proportionate in the circumstances?
• Is the employee of long-standing with a good employment record?
• Can adjustments be made to the employee’s role or can they be suitably redeployed into a position where the vaccination is not required?

As you can see, the issue of whether or not an employer can direct staff to receive the COVID-19 vaccination is not straight forward and it is important employers navigate this issue with caution.

The issue has not yet been determined by the Fair Work Commission, and the matter of Glover v Ozcare [2021] FWC 231 may shed some much needed light on the issue if it proceeds to a formal decision as the employee, in this case, was dismissed after they refused to get the influenza vaccine on medical grounds.

Enterprise Legal's Workplace Relations team can assist with assessing whether or not such a direction is lawful and reasonable based on your workplace, employees and industry. Our team can also assist with issuing and managing the rollout of such a direction, assisting you every step of the way.

Reach out to us today:

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What’s your most visited website? If it’s Google or Facebook, you’re certainly not alone with Google accounting for more than 98% of search traffic originating from Australian mobile users in 2018. But as the discussions between the tech giants and the Australian Government over a proposed media code heats up, that all may be about to change. This week, Google has stepped up and threatened to pull Australian access to the search engine if the proposed revenue-sharing media laws go ahead. On the other hand, Australian Treasurer Josh Frydenberg has said that it is “inevitable” that tech giants Google and Facebook will pay for Australian news.

So what is actually going on?

The Legislation

The proposed law states that Australian media outlets can negotiate individually or collectively with Facebook and Google over payment for content used and shared on the tech giants’ sites, with other platforms potentially to be added over time. That’s right, the laws would require the companies to pay Australian media companies to link to the content in searches. Google says that this would “dismantle a free and open service that’s been built to serve everyone.”

ScoMo’s response? “We don’t respond to threats.”

But Why?

It’s no secret that traditional media companies in Australia have been struggling in recent years with hits to revenue streams such as subscriptions and advertising, and part of this is because of Google and Facebook. Shockingly, for every $100 spent on online advertising in Australia, excluding classifieds, nearly one-third goes to Google and Facebook.

In the course of their investigation, the ACCC found that news outlets lack bargaining power when it comes to negotiating with the tech giants over compensation for content publishing, in part because the outlets rely so heavily on Google and Facebook to reach readers.

What Does This Mean for Your Business?

If Google does say "cya" to Australia, it’s going to mean more than saying gday to a new search engine. It could have huge implications for your business.

Digital Advertising:

Many businesses (perhaps even yours) rely heavily on digital advertising through Google, with the digital advertising market for Google search in Australia valued at around $4.3 billion per year. Google now accounts for more than 51% of all online advertising. If Google is gone, the way that businesses advertise is going to have to go through a dramatic change. Your advertising dollars won’t stretch as far, as you’re going to have to channel advertising across multiple platforms.

Software and Hardware:

Do you use Android devices or Google Maps for your business? What about Google Docs or Google Drive? This added reliance on Google could leave your business stranded if Google decides to exit the Australian market.

Business Presence:

If Google were to exit the Australian market, you’re going to have to start over when it comes to establishing your online presence. Not only will you be unable to monitor Google’s content relating to your business, but you’re going to have to start over on other platforms. Think you know how to best optimise your keywords to work with Google? Well you may need to learn how the algorithm works on multiple other search engines.

New Opportunities

It’s not all bad news! If Google exits the Australian market, they will create space for new players to both enter the scene and increase their own business offerings. From developing new platforms to increasing existing business offerings to offer services that help in a new-Google-less world, the opportunities could very well be endless!

What Next?

At the moment as negotiations between the Australian Government,  Google, and Facebook continue, all parties are on a mission to win supporters. Google has raised the ante by including a message and link at the top of every page.

On the other side, the ACCC have announced that they may bring a third lawsuit against Google for misuse of market power in the advertising sector and breaching competition law and the Government have made it clear that they intend to continue the fight.

No matter what side you’re on, there probably will be huge implications for your business as the fight continues to ramp up!

In a first for Queensland, Mr Jeffrey Owen of Owen’s Electric Motor Rewinds has become the first individual to be charged with industrial manslaughter under the Work Health and Safety Act 2011 (Qld) (the 'Act').

Tragically in July 2019, a worker at the Owen's Electric Motor Rewinds site was fatally crushed by a portable generator that was being unloaded by a forklift. It is alleged that the forklift directly flipped as a result of Mr Owen overloading the forklift.

This is the first prosecution of an individual for industrial manslaughter in the state of Queensland and if convicted, Mr Owen faces a maximum penalty of 20 years' imprisonment.

The offence of industrial manslaughter was included in the Work Health and Safety Act 2011 (Qld) (WHS Act), as well as the Electrical Safety Act 2002 (Qld) and Safety in Recreational Water Activities Act 2011 (Qld) and is defined as negligent conduct that causes, or substantially contributes to, the death of a worker, and a prosecution may be brought against a body corporate or individual senior officer.

It carries a maximum penalty of over $10 million dollars for a company, or 20 years’ imprisonment for a senior officer and was introduced in 2017 following increased numbers of workplace fatalities.

Industrial manslaughter is subject to the same guidelines and standards as criminal manslaughter and criminal negligence under the Criminal Code (Qld) 1899 and the same defences for criminal manslaughter are also available, excluding the defence of ‘accident’.

Organisations and their most senior directors and supervisors will face severe consequences should one of their workers be fatally injured on the job and it is vital that appropriate steps are taken to ensure the safety and wellbeing of those in the workplace. This was highlighted in the Queensland District Court case of R v Brisbane Auto Recycling Pty Ltd & Ors [2020] QDC 113 where a fine of $3 million was imposed on a company for industrial manslaughter and his Honour Judge Rafter SC stated:

“The sentences imposed should make it clear to persons conducting a business or undertaking, and officers, that a failure to comply with obligations under the Work Health and Safety Act 2011 (Qld) leading to workplace fatalities will result in severe penalties.”

For guidance and support on Workplace Health and Safety compliance and prosecutions, contact Enterprise Legal’s Workplace Relations team today:

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So you have followed our top tips for entering into a commercial or retail lease, but things haven’t exactly gone to plan. How do you know what the next step is?
And how do you know when it is time to get expert lawyers involved?

At Enterprise Legal, it is our view that most disputes are best handled early on before little problems become big problems. Whether you are a landlord or tenant, the best way to resolve a lease dispute is to ensure that it is handled properly from the start.

The following are ‘red flags’ that indicate that it’s likely time to chat with the Enterprise Legal team:

1. A Notice to Remedy Breach Has Been Issued

If you are a tenant and have been issued with a Notice to Remedy Breach, stop what you’re doing and come chat to a lawyer! Breach notices need to be issued in a particular way to be valid under law, and the reality is that most landlords (and even some lawyers) don’t get this right. If a Notice is incorrect, it will likely be invalid. If you engage a lawyer at this point not only can you ensure that any issues with a Notice can be resolved, but you may also find that your lawyer can help you negotiate an outcome with your landlord.

If you are a landlord and need to issue a Notice, don’t go at it alone! It is so easy to make a mistake when preparing and issuing a Notice to Remedy Breach so it is worth engaging a lawyer so that you can ensure that everything is correct. If a Notice is not valid you will ultimately end up spending more time and money than you would have if you had a chat to a lawyer to begin with.

2. You Are Not Getting Along With Your Landlord/Tenant

While disagreements between parties may just seem like straightforward interpersonal concerns at first, we all know that these things can escalate quickly! By chatting to a lawyer early on, you may be able to resolve your concerns, put your mind at ease, and ultimately avoid a prolonged dispute. Sometimes a simple letter from a law firm can make a real difference. If it doesn’t, you will have a record of your concerns and can point to your attempts to resolve issues later on down the track, which will assist your prospects significantly!

3. You Have Been Locked Out (Or You Want to Lock Out Your Tenant)

Landlords - hold your horses! Locking out a tenant is pretty serious, and you need to make sure that you have followed the appropriate steps before you escalate matters. If you don’t, you are at a real risk of ‘repudiating’ the lease (which is bad!) and being liable for the tenant’s damages.

Tenants, if you are locked out, it is time to chat to a lawyer pronto! You do have options here, including obtaining an injunction to regain access to the premises. If you are unlawfully locked out, you may be entitled to claim damages from your landlord or claim that they have repudiated the lease. Either way it is imperative to make sure that you act quickly!

4. You Just Want to End Your Lease

If you want to terminate your lease early, there may be options available to you. If you want to terminate and minimise your risk, you’re going to want to speak with a lawyer first to work out how to properly terminate your lease, minimise your risk, and perhaps even resolve the concerns leading to termination of the lease.

5. Something Just Doesn’t Feel Right But You’re Not Sure What

Maybe something relating to your lease just doesn’t feel right and you want to get a sense as to whether it’s okay or not. The law is a confusing beast, and without the experience and expertise of a lawyer, it might not always be clear if something is okay and if you can proceed. If you are ever unsure, it may be a sign that it is time to chat to the Enterprise Legal team. If something is amiss, we will be able to quickly identify any issues and whether something can be done, or alternatively be able to set your mind at ease.

While you can’t always avoid a dispute, the best way to avoid significant costs and a lengthy legal battle is to act quickly. To resolve your concerns swiftly, engage the expert Enterprise Legal Disputes team to help you with your lease dispute.

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In February 2020, changes were made to the Corporations Act2001 (Cth) which significantly impacted the date on which Company Directors were deemed to have resigned. A 12-month transition period was implemented following these changes, which meant that as of 18 February 2021 these changes now apply in practice.

The timeframe for which a Company must notify ASIC of any resignation of a Director remains at 28 days after the resignation, however the new changes mean that if the Company does not give notice to ASIC (by lodging a Form 484) within that time period, the relevant Director will be deemed to have resigned on the date that ASIC actually receives the Form 484 (which could well be a date that is long after when the practical resignation took effect).

Prior to these changes, a failure to meet this timeframe resulted in the Company being required to pay a fee for the late notification, but didn’t negatively affect the resigning Director. In those circumstances, the task of notifying ASIC was generally left with the Company’s Accountant to carry out and the resigning Director didn’t usually have any cause for concern about whether the timeframe was met. This was because the Company was typically required to pay the late notification fee (not the resigning Director) and the resignation took effect in accordance with whichever date was specified in the notification (which means the resignation could be ‘backdated’ appropriately).

Moving forward, resigning Directors should now carefully consider what steps they can take, to ensure that notification is given to ASIC by the Company within the required timeframe. This will allow the resigning Director to ensure their resignation takes place on the relevant date, importantly ensuring that the Director does not unintentionally remain liable in their role as a Director of the Company.

Some recommended steps that a resigning Director could take, are to take on the onus of lodging the Form 484 (where practical) or to include additional clauses in share sale documentation (or other agreements which deal with the Director’s resignation) to impose a positive obligation on the Company to lodge the form within the required timeframe, with penalties, indemnities and releases to follow until such time as the Form 484 is submitted.

Do you need assistance with company restructuring or officeholder resignations? Contact our expert Business Law team, led by Principal Director & Legal Advisor, Peta Gray. 

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The Fair Work Amendment (Supporting Australia's Jobs and Economic Recovery) Act 2020 (Act) is now law, a watered-down version of the Federal Government's original IR Omnibus Reform Bill (the Fair Work Amendment (Supporting Australia's Jobs and Economic Recovery) Bill 2020 (Bill)) having passed through both houses of Parliament on the 22^nd of March 2021.

Whilst it won’t commence until it received Royal Assent, we thought we would summarise some of the key points relating to the big changes for casual employment.

Finally, a Definition of a Casual Employee

Excitingly, the Fair Work Act will now define a casual employee as an employee who accepts an offer of employment which makes 'no firm advance commitment to continuing and indefinite work according to an agreed pattern of work'.

This is very important and exciting as up until now, the Fair Work Act has not defined a casual employee and this has caused much contention and pain for employer, employees and the Courts.

To work out if there is a 'firm advance commitment' only the following factors can be considered:

• whether the employer can elect to offer work and whether the person can elect to accept or reject the work;
• whether the person will work only as required according to the needs of the employer;
• whether the employment is described as casual employment; and
• whether the person will be entitled to any casual loadings or a specific casual rate of pay under the offer of employment or a Fair Work instrument.

A regular pattern of hours does not of itself indicate a 'firm advance commitment'.

The question is to be assessed at the time of the offer and acceptance of employment, and without regard to any party's subsequent conduct during the employment.

Casual Conversion

Employers (other than small business employers (less than 15 employees)) will be required to offer to convert any casual employee to full-time or part-time employment if the employee:

• has been employed for at least 12 months; and
• for at least six of those 12 months, has worked a regular pattern of hours on an ongoing basis that, without significant adjustment, could continue to be worked as a part-time or full-time employee,

unless there are reasonable grounds not to do so.

Casual employees will also have a residual right to request conversion to full or part-time employment themselves. Employers can only refuse such requests on reasonable grounds (set out in the Fair Work Act) and must respond in writing within specified timeframes. In the event of a refusal, employers must consult with the casual employee before formally refusing their request for conversion.

There is a 6 month transition/lead time for employers to make offers of conversion to all existing eligible casuals, unless they have reasonable grounds not to.

New Information Sheet

Similar to the Fair Work Information Statement (which is required to be provided by employers to all new employees), employers will need to provide a copy of the Fair Work Ombudsman Casual Employment Information Statement to casual employees before, or as soon as practicable after their commencement. This information sheet is yet to be published and it will be interesting to see what it contains.

Incorrect characterisation and offset provision

If a court finds that a current or former employee has been incorrectly characterised as a casual, the court will be able to offset any identifiable casual loading paid to the employee against claims for certain entitlements.

Importantly, the employer must have properly attributed the loading as being paid for that purpose.

It is vital, now more than ever, to ensure employers have in place well drafted contracts of employment as they will be imperative in enforcing this provision – particularly with respect to carving out the casual rate of pay and loading and defining what the loading is in fact compensation for.  

Where to From Here?

Employers who have not yet taken steps to review their casual workforce, their rosters and contracts of employment should do so now.

For advice and support on how these changes may impact your workplace and to implements measures to support and safeguard your business, contact Enterprise Legal’s Workplace Relations team today:

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In the world of workplace injuries and workers’ compensation, there is one phrase that can make employers feel both at ease, and a little unsure and that is ‘in the course of employment’.

Whilst on its face the criteria for compensation for a workplace injury could be perceived as being straight forward, every now and again there is a case that leaves us feeling like anything is paw-sible (strap in for some dog puns, please fur-give me).

Along comes the decision in N. v Hydro Electric Corporation [2021] TASWRCT 2 where an employee was successful in a claim for compensation for an injury he sustained whilst out walking his dog whilst on-call.

So What Happened?

At the time of the injury, the applicant was employed by the Hydro Electric Corporation as a relief area coordinator and was staying at the employer’s Tullah accommodation for a 7 day period during which he was required to be on-call.

One evening, whilst on-call, the worker ventured out for a walk along the Tullah with his partner and his dog, when he slipped and fell on a wet log suffering a fractured left femur (oof, that’s ruff).

The issue before the Tribunal was whether the injury sustained by the worker arose out of or in the course of the worker’s employment with the employer.

The Law

In a nutshell, A worker will suffer an injury that ‘arises out of’ his or her employment if there is a causal connection between the injury and the work. An injury will arise out of a worker’s employment if the worker suffered it whilst performing work that he or she is retained to perform or other work incidental thereto.

Whether a worker suffers an injury ‘in the course of’ his or her employment is a more vexed question and less easily identified. It denotes a temporal connection.

The Decision

Finding in favour of the worker, the Chief Commissioner found that the worker’s injuries arose ‘in the course of his employment’. In coming to this decision, the Chief Commissioner Clues applied the test in Comcare v PVYW  and examined:

1. the meaning of ‘in the course of his employment’; and
2. whether the employer had induced or encouraged the worker to engage in the activity that led to the injury.

In this case, the worker conceded that his injury did not ‘arise out of’ his employment. He argued that he suffered the injury ‘in the course of’ his employment because it was sustained in circumstances possessing a sufficient connection to his work and Chief Commissioner Clues agreed.

The case really turned on the fact that the worker was walking along the Tullah lake house whilst he was required to: be on call for work after normal hours; be contactable within 15 minutes; and ready to commence work within 15 minutes of being contacted.

The worker was authorised to spend the time between periods of on-call work in any way he wished that was not inconsistent with him being contactable and able to attend work. The Chief Commissioner therefore held that the act of walking along the Tullah lake house was relatively an unexceptional activity and would have likely have been held by the employer to have been an acceptable activity.

The worker’s injury was subsequently held to have occurred in the course of his employment with the employer.

Where to From Here?

Whilst the decision is from the Workers Rehabilitation And Compensation Tribunal of Tasmania (and I’m writing this from my 691 m above sea level hill in Toowoomba) and you might think that we are fur-tunate that it wasn’t set in Queensland, it may still be considered as being persuasive here in Queensland and our very own Workers’ Compensation and Rehabilitation Act 2003 contains very similar provisions.  

Ultimately this decision highlights the fact that the concept of arising ‘in the course of employment’ is not a narrow one and that the circumstances of the employment are crucial to determining whether there is a nexus between the activities performed, the injury and the employment.

For advice and support on how to safeguard your business and mitigate the potential of similar claims, contact Enterprise Legal’s Workplace Relations team today and request a free initial consult:

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In a cautionary tale for all employers and occupiers (especially those with stairs!), the recent case of Julie Walker v Top Hut Banoon Pastoral Co Pty Ltd sets a stern reminder that steps need to be taken (pun intended!) to ensure that the workplace is safe and adequately maintained so as to avoid causing injury to others.

What Happened?

The plaintiff was employed by Shear Away Pty Limited, however, Top Hut Banoon Pastoral Co Pty Ltd was the occupier of Banoon station where she was attending as a shearers’ cook.

On 28 July 2015, whilst at Banoon station, the plaintiff put her foot on a step, and as she was bringing her other foot down, she felt it tilt and she was suddenly on the ground screaming out for help. She said that she noticed that the step had broken and one side had come “loose of the wood” and had torn completely off, the other side was “hardly attached but there”.

She sustained injuries to her lower back, right wrist, left ankle and right knee. She also suffered a psychiatric injury and an exacerbation of her type 1 diabetes mellitus. Her injuries were assessed to be a 15% whole person impairment.

The Law Generally

At law, it is well established that an employer has a non-delegable duty to take reasonable care. The duty is, of course, not absolute; it is the duty of a reasonably prudent employer and it is a duty to take reasonable care to avoid exposing the employee to unnecessary risks of injury.

The employer’s duty to adopt safe systems of work and to provide proper plant and equipment, will operate differently on its own premises and in circumstances over which it has full control, as compared with premises under the control of others and circumstances over which it does not have control.

The distinction in this case fell to fact that the employer did not have full control over the premises and therefore, in the opinion of District Court Judge Weinstein SC, there was no breach of duty on the part of the employer and the employer’s duty where there was a defect in the occupier’s equipment or plant was to do no more than cast an eye over the premises to ensure they appeared safe. The occupier alone was liable in negligence for not taking precautions against the risk of harm from the defect that caused the injuries to the plaintiff.

The Damages

Whilst the final orders on damages are still to be made, the plaintiff will be awarded approximately $1 million dollars for her injuries and Weinstein SC’s decision included a non-economic component of around $240,000, given the significant effect on the employee’s lifestyle and health following the fall.

It was held that she was no longer able to perform her role after the fall, and had to quit her job, which she had intended to keep till her late 60s.

Lessons Learnt

Whilst the employer in this case was held to not be liable for the injuries sustained by the plaintiff, this does not automatically mean that this will be the case for other employers in the future – no one case is the same! Employers still need to ensure they take reasonable care to avoid exposing employees to unnecessary risks of injury, so far as is reasonably practicable.

For occupiers, it is a stern warning that liability for injuries sustained will not automatically rest with the employer and there is the real risk that liability may fall on the occupier alone if the premises is not safe and not safely maintained.

For advice regarding your premises or for advice regarding your Workplace Health and Safety obligations, contact either the Enterprise Legal Workplace team or the Business and Property team today:

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It’s not exactly news that it’s important to be careful when posting on social media, especially when it comes to posting about other people or other businesses. It is, however, news that posting defamatory posts and comments on social media could cost individuals big time.

In the decision of Webster v Brewer (No 3) [2020] FCA 1343, the Federal Court of Australia awarded $875,000 in favour of Nationals Member for Parliament Dr Anne Webster, her husband, and their not-for-profit organisation as a result of defamatory materials posted online by Karen Brewer. Ms  Brewer posted a series of ‘vile’ and ‘heinous’ Facebook posts that linked Dr Webster to a secret criminal network of child abusers.

The Court considered the extent of the publication of the posts to be significant. The videos posted by Ms Brewer exceeded 1,000 views, and the published posts received more than 200 reactions, comments and shares. Given the population of Mildura is 54,000, the Court was left with little doubt that the posts had been widely published and were likely to have spread further throughout the local community.

It was determined by the court that the posts had a detrimental impact on the reputations of the Websters and Zoe Support and that the posts and videos had likely “been believed by a small but not insignificant segment of the Mildura community.”

Key Takeaways

In making the determination, Justice Gleeson noted that:

• the Court must consider the ‘grapevine effect’ and acknowledge that defamatory claims and materials can spread beyond the people to whom the materials are published;
• damages ought to be significant enough to convince an observer that the defamatory allegations are not true;
• damages must compensate for injured feelings, loss of self-esteem, and sense of indignity, particularly in circumstances where defamatory claims are particularly ‘vile’ and where a plaintiff has a particular reputation based on honesty and integrity;
• defamatory statements cannot be made about public figures solely because they are in the public sphere;
• the repetitive posting of the defamatory content was particularly relevant; and
• in circumstances such as this where the defamatory claims were particularly ‘vile’ or ‘heinous’, it could not be claimed that conduct was justifiable as a defence.

While it may go without saying that it is important not to post materials that are so obviously defamatory, Webster v Brewer (No 3) should serve as yet another warning to be careful before posting on social media. This case makes it clear that the Courts will award significant damages for serious, repetitive, and wholly baseless posts and comments that may damage another person’s reputation.

If you are seeking trusted legal regarding online defamation; talk to the Enterprise Legal Disputes team:

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For a long time now we have seen delivery giant Uber successfully fend off claims from delivery drivers claiming they were employees and not independent contracts.

This time, it was Deliveroo Australia Pty Ltd (Deliveroo) who was on the menu before the Fair Work Commission and in an explosive decision, the Commission ruled that a Deliveroo driver was an employee, rather than an independent contractor.

What Happened?

Mr Franco had worked for Deliveroo for approximately three years when he suddenly received an email notification from Deliveroo indicating his “supplier agreement” would be terminated on the grounds that he was too slow at delivering orders.

Mr Franco subsequently filed a claim for Unfair Dismissal in the Fair Work Commission, challenging his termination.

The hurdle – Was Mr Franco an employee or independent contractor?

Independent contractors are not protected by the Unfair Dismissal provisions contained the Fair Work Act 2009 (Cth) and therefore Deliveroo objected to the unfair dismissal application on the basis that Mr Franco was an independent contractor, rather than an employee.

When looking at the relationship between Deliveroo and Mr Franco, Fair Work Commissioner Cambridge (the Commissioner) affirmed the longstanding principle that determination of whether a person is an employee or independent contractor requires consideration of various identified indicia, with no single factor being decisive, to form a view about the overall impression of the relationship.

Some of the key points that turned in Mr Franco’s favour included:

• Contract was not king: Whilst the agreement between Deliveroo and Franco stated that the relationship between the parties was one of principal and independent contractor, it was given little weight; 

• Presentation as part of the business: Although not mandatory, Deliveroo expects its delivery riders (including Franco while he was engaged) to wear Deliveroo branded attire and use branded equipment. The Commissioner therefore formed the view that they in effect presented to the world as part of the Deliveroo business and was held to be a factor likened to an employee;

• Equipment: Mr Franco technically provided his own equipment, however this was limited to a smartphone and motorcycle and therefore the Commissioner held that, as he would use such equipment personally as well, this did not represent a ‘substantial investment in capital equipment’ and therefore it could not be relied upon to firmly establish a contractor relationship; 

• Control: Although Mr Franco had significant autonomy over the work he performed as he was able to log onto the Rider app and choose when and where he would make deliveries, Deliveroo still had the primary ability to exercise control through an online system, which required riders to book engagement sessions in advance and this system provided preferential treatment to those who met performance measures. Although Deliveroo had ceased using this system and this is likely going to be one of the many sticking points for when Deliveroo appeals the decision (which it has confirmed it will be), the Commissioner focused on the fact that it had the ability to reintroduce the system;

• Ability to work for others: Despite the fact that Mr Franco was actively working for competitors at the same time that he was engaged with Deliveroo, the Commissioner determined that this was not significant enough to prevent the finding of the existence of an employment relationship when considered in the context of the current gig-economy and digital world.

The Decision

Ultimately, the Commissioner formed the view that Franco was an employee and was not a contractor carrying on a trade or business of his own. Quite significantly, the Commissioner subsequently ordered Mr Franco be reinstated, which only happens in less than 15% of Fair Work Commission cases. Deliveroo was also ordered to pay Mr Franco for lost pay and his continuity of service was also not broken.

What Could This Mean For You?

Whilst Deliveroo have openly stated that they intend to appeal the decision, if upheld, the decision will have wide-reaching ramifications for gig workers and digital businesses who rely on a contractor and principal model.

It is becoming more and more important to ensure that businesses get the distinction between employee and contractor right as the misclassification of a worker can lead to significant unexpected liabilities including (but not limited to):

• Fines and penalties under the Fair Work Act
• Underpayment and back pay of wages
• Payment of unpaid superannuation entitlements
• Workplace Health and Safety liabilities

If you would like assistance with reviewing your current contractor arrangements, start a conversation with our dedicated Workplace Relations team:

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Employers need to ensure they are aware that the superannuation guarantee will increase from 9.5% to 10% on 1 July 2021 and then continue to increase incrementally by 0.5% each year thereafter until it reaches 12% by 1 July 2025.

Be sure to add the below dates and rates into your calendars to ensure your business stays up to date with the incremental increases that are on the horizon:

From 1 July 2021, businesses need to ensure that their payroll systems are appropriately adjusted to comply with the increased superannuation guarantee rate and a failure to do so will expose the business to potential charges, fines, interest and administration fees imposed by the ATO.

Employers also need to ensure that they review their current employment contracts and pay close attention to the remuneration they currently provide to employees. If their remuneration package is inclusive of superannuation entitlements, the increased superannuation guarantee may be able to be absorbed into the employees existing remuneration package, however, this will mean their take-home pay will reduce. If the employee’s wage is exclusive of superannuation, additional superannuation will need to be paid.

For workers who are already receiving superannuation contributions above 10%, it is unlikely that any adjustments will need to be made, however, employers should still perform a thorough review for the sake of completeness and to ensure compliance.

If you have any questions in relation to the superannuation guarantee increases or if you would like assistance with ensuring your business is compliant, contact Enterprise Legal’s Workplace Relations team today:

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