A new section Employee or independent contractor has been added to 101 Employment Law Answers summarising and providing links to these important recent cases:

Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1; and

ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2

These appeals from the full Court of the Federal Court both turned on the question of determining the workers’ status as employee or independent contractor and were heard together. The High Court held that where parties have comprehensively committed the terms of their relationship to a written contract, which is not challenged as a sham or otherwise ineffective under general law, the characterisation of the relationship as one of employment, or otherwise must proceed by reference to the rights and obligations of the parties under that contract.

Only where there is no written agreement, or the agreement is ineffective, will the traditional multi-factorial test be required to determine the nature and conditions of the parties relationship.

Whether a worker is an employee or independent contractor is important for a number reasons including:

• vicarious liability – which generally extends to employees but not independent contractors;
• workers compensation insurance – who is covered and who is responsible for obtaining it;
• superannuation guarantee payments – whether they apply;
• unfair dismissal claims – whether a worker has recourse;
• taxation responsibilities – including whether PAYG tax is required to be deducted from worker payments;
• long service leave and other leave entitlements – whether they apply;
• availability of remedies for workers; and
• the jurisdiction of tribunals.

See 101 Employment Law Answers in the Reference materials folder on the Employment Law matter plan, and the Employment Law commentary for more information.