I was disappointed to read the Victorian Labour Hire Authority’s newly published Guide to Engaging Workers as Independent Contractors.
You can read a copy of the Guide here. But I’m not sure I’d bother.
Remote road with sign post directing traveller into a clump of cactus.
The Guide, though referencing the FWO’s and ATO’s more extensive material, selectively lists only six of the ten key characterisation factors identified by the FWO as necessary to distinguish employment from independent contracting. Significantly, the Guide makes no mention whatsoever of the importance of the intention of the parties.
It fails to mention the fact that the very tests that it does indicate, together with the multi-factorial approach, are presently the subject of two appeals which have been heard by the High Court and are awaiting judgment.
It fails to mention that the Full Bench of the FWC, cognisant of those two appeals and of the approach adopted by the High Court in Rossato, considered that the traditional approach to characterising independent contracting relationships is now clouded by such uncertainty that it put the important case of Deliveroo Australia Pty Ltd v Diego Franco on hold until the High Court decisions are handed down.
It’s worth noting what the Full Bench had to say about that:
 We have decided that the appropriate course is to defer the determination of this appeal until the High Court has heard and determined the appeals in Jamsek and Personnel Contracting. This appeal is a matter of some importance, given that it is likely to have significance for the whole of Deliveroo’s workforce and perhaps also for the “gig” sector of the economy more broadly. We agree with Deliveroo that the decision in Rossato (particularly at ) has, intentionally or otherwise, called into question what principles are to be applied in determining whether a relationship is one of employment or independent contracting and the status of Hollis v Vabu in that respect. In all likelihood, the High Court’s decisions in Jamsek and Personnel Contracting will provide authoritative guidance as to these issues.
Nevertheless, the Victorian Labour Hire Authority, confident of the authority of its own view, presses ahead with what it claims is a guide to ensure that, when engaging workers as independent contractors, you:
- comply with your legal obligations
- do not engage in sham contracting
- keep your labour hire licence.
You can make your own mind up about how much guidance it provides… and in what direction it is steering you.
The best that can be said about it is that it errs on the side of caution.
But it errs, nonetheless.
Andrew C. Wood