# Report file for Re Porter; Re Transport Workers Union of Australia(1989) 34 IR 179

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\subsection*{Employee area}

\subsubsection*{Instant case}

The law distinguishes between a contract of service (between
employer and employee) and a contract for services (between
principal and independent contractor). This distinction
affects the terms that will be implied in the absence of an
express agreement, the liability of the employer to third
parties, the applicability of industrial awards, the
applicability of statutes which may affect workers'
compensation, occupational health and safety, long-service
leave, fringe benefits tax, etc.\par The terms employer''
and worker'' are used here to mean employer'' and
employee'' (in the case of a contract of service) or
principal'' and independent contractor'' (in the case of a
contract for services).

\medskip\noindent In the instant case,
the employer directed the manner in which the work was to be
done;
the worker was not allowed to use her/his own discretion in
doing an aspect of the work that was not specified
beforehand;
the worker was an integral part of the employer's business;
the worker owned the tools or provided the transport with
which she/he performed the work;
it is not known whether the employer would make a
profit/loss if the work performed by the worker cost
less/more than expected;
the work was not performed on the employer's premises;
it is not known whether the employer supervised or inspected
the work;
the worker was not in business on her/his own account;
the worker was not allowed to employ others to assist with
her/his work;
the worker was obliged to work only for the employer;
the worker was not required to work at specified times;
the employer paid the worker by time;
the money that the employer paid to the worker was not
stated to be a fee'';
the money that the employer paid to the worker was not
stated to be wages'' or salary'';
the employer deducted PAYE tax instalments from the worker's
pay;
the employer paid the worker neither sick pay nor holiday
pay;
the employer and the worker did not express any intention
that the relationship would be one of employer and
employee; and
the employer and the worker expressed an intention that the
relationship would be one of principal and independent
contractor.

\medskip\noindent In my opinion---following \frenchspacing
{\it Ferguson v. John Dawson and Partners (Contractors) Ltd\/}\nonfrenchspacing---%
the worker is an employee.

\medskip\noindent In \frenchspacing
{\it Ferguson v. John Dawson and Partners (Contractors) Ltd}\nonfrenchspacing,%
\footnote{[1976] 1 WLR 1213.}
a 1976 decision of
the English Court of Appeal,
Ferguson fell off a roof while removing some scaffolding
boards. He claimed damages against Dawson (the building
contractors) for breach of statutory duty relying on the
{\it Construction (Working Places) Regulations 1966\/}
(UK). This duty would only be owed if Ferguson was an
employee of Dawson.\par Megaw and Browne LJJ held that,
despite the fact that both parties labelled Ferguson a
self-employed labour only
subcontractor'',\footnote{ibid. at 1219 per Megaw LJ, at
1225 per Lawton LJ, at 1228 per Browne LJ.} the reality of
the relationship between them was that of
employer/employee.

There are several significant similarities
between the instant case and \frenchspacing
{\it Ferguson v. Dawson\/}\null\nonfrenchspacing:
the employer directed the manner in which the work was to be
done;
the worker was not allowed to use her/his own discretion in
doing an aspect of the work that was not specified
beforehand;
the worker was an integral part of the employer's business;
the work was not performed on the employer's premises;
the worker was not in business on her/his own account;
the worker was not allowed to employ others to assist with
her/his work;
the employer paid the worker by time;
the money that the employer paid to the worker was not
stated to be a fee'';
the money that the employer paid to the worker was not
stated to be wages'' or salary'';
the employer paid the worker neither sick pay nor holiday
pay;
the employer and the worker did not express any intention
that the relationship would be one of employer and
employee; and
the employer and the worker expressed an intention that the
relationship would be one of principal and independent
contractor.

However, the instant case is not on all fours with \frenchspacing
{\it Ferguson v. Dawson}\null\nonfrenchspacing.
In that case
the worker neither owned the tools nor provided the
transport with which she/he performed the work;
the employer would make a profit/loss if the work performed
by the worker cost less/more than expected;
the employer supervised or inspected the work;
the worker was not obliged to work only for the employer;
the worker was required to work at specified times; and
the employer did not deduct PAYE tax instalments from the
worker's pay.

Nevertheless, I believe that \frenchspacing
{\it Ferguson v. Dawson\/} \nonfrenchspacing
should be followed.

\medskip\noindent If \frenchspacing
{\it Ready Mixed Concrete (South East) Ltd v. Minister of Pensions and National Insurance\/} \nonfrenchspacing
is followed then the worker is an independent contractor.

\medskip\noindent In \frenchspacing
{\it Ready Mixed Concrete (South East) Ltd v. Minister of Pensions and National Insurance}\nonfrenchspacing,%
\footnote{[1968] 2 QB 497.}
a 1967 decision of
the Queen's Bench Division of the English High Court,
Latimer worked for Ready Mixed as an owner-driver''. He
was paid at mileage rates, and was obliged to buy the
truck through a financial organization associated with
Ready Mixed. The truck was painted in the company's
was obliged to meet the costs of maintenance, repair and
insurance of the truck (and the attached mixing unit,
which belonged to Ready Mixed). The Minister determined
that Latimer was employed under a contract of service and
therefore an employed person'' under s. 1(2) of the
National Insurance Act 1965 (UK), making Ready Mixed
liable to make weekly contributions.\par MacKenna J
examined the contract and held that the rights it
conferred, and the duties it imposed, between Latimer and
Ready Mixed were not such as to make it a contract of
service.

There are several similarities
between the instant case and \frenchspacing
the worker was an integral part of the employer's business;
the worker owned the tools or provided the transport with
which she/he performed the work;
the work was not performed on the employer's premises;
the worker was not in business on her/his own account;
the worker was obliged to work only for the employer;
the worker was not required to work at specified times;
the money that the employer paid to the worker was not
stated to be a fee'';
the money that the employer paid to the worker was not
stated to be wages'' or salary'';
the employer paid the worker neither sick pay nor holiday
pay;
the employer and the worker did not express any intention
that the relationship would be one of employer and
employee; and
the employer and the worker expressed an intention that the
relationship would be one of principal and independent
contractor.

However, there are several significant differences
between the instant case and \frenchspacing
In that case
the employer did not direct the manner in which the work was
to be done;
the worker was allowed to use her/his own discretion in
doing an aspect of the work that was not specified
beforehand;
the employer would not make a profit/loss if the work
performed by the worker cost less/more than expected;
the employer neither supervised nor inspected the work;
the worker was allowed to employ others to assist with
her/his work;
the employer did not pay the worker by time; and
the employer did not deduct PAYE tax instalments from the
worker's pay.
Note also that \frenchspacing
{\it Ready Mixed v. Minister\/} \nonfrenchspacing
is only a decision of
the Queen's Bench Division of the English High Court
and not as good authority as a case decided by
the English Court of Appeal%
---like \frenchspacing
{\it Ferguson v. Dawson}\null\nonfrenchspacing.

Consequently, there is nothing in \frenchspacing
{\it Ready Mixed v. Minister\/} \nonfrenchspacing
to warrant any change in my conclusion.

\subsubsection*{Instantiation 4}

It may be that the following is true of the instant case:
the employer would not make a profit/loss if the work
performed by the worker cost less/more than expected; and
the employer neither supervised nor inspected the work.

\medskip\noindent If that is so then in my opinion---following \frenchspacing
{\it Ready Mixed Concrete (South East) Ltd v. Minister of Pensions and National Insurance\/}\nonfrenchspacing---%
the worker is an independent contractor.

\medskip\noindent Details of \frenchspacing
{\it Ready Mixed v. Minister\/} \nonfrenchspacing
are summarized above.
There are several significant similarities
between the instantiated case and \frenchspacing
the worker was an integral part of the employer's business;
the worker owned the tools or provided the transport with
which she/he performed the work;
the employer would not make a profit/loss if the work
performed by the worker cost less/more than expected;
the work was not performed on the employer's premises;
the employer neither supervised nor inspected the work;
the worker was not in business on her/his own account;
the worker was obliged to work only for the employer;
the worker was not required to work at specified times;
the money that the employer paid to the worker was not
stated to be a fee'';
the money that the employer paid to the worker was not
stated to be wages'' or salary'';
the employer paid the worker neither sick pay nor holiday
pay;
the employer and the worker did not express any intention
that the relationship would be one of employer and
employee; and
the employer and the worker expressed an intention that the
relationship would be one of principal and independent
contractor.

However, the instantiated case is not on all fours with \frenchspacing
In that case
the employer did not direct the manner in which the work was
to be done;
the worker was allowed to use her/his own discretion in
doing an aspect of the work that was not specified
beforehand;
the worker was allowed to employ others to assist with
her/his work;
the employer did not pay the worker by time; and
the employer did not deduct PAYE tax instalments from the
worker's pay.

Nevertheless, I believe that \frenchspacing
{\it Ready Mixed v. Minister\/} \nonfrenchspacing
should be followed.

\medskip\noindent If \frenchspacing
{\it Ferguson v. John Dawson and Partners (Contractors) Ltd\/} \nonfrenchspacing
is followed then the worker is an employee.

\medskip\noindent Details of \frenchspacing
{\it Ferguson v. Dawson\/} \nonfrenchspacing
are summarized above.
There are several similarities
between the instantiated case and \frenchspacing
{\it Ferguson v. Dawson\/}\null\nonfrenchspacing:
the employer directed the manner in which the work was to be
done;
the worker was not allowed to use her/his own discretion in
doing an aspect of the work that was not specified
beforehand;
the worker was an integral part of the employer's business;
the work was not performed on the employer's premises;
the worker was not in business on her/his own account;
the worker was not allowed to employ others to assist with
her/his work;
the employer paid the worker by time;
the money that the employer paid to the worker was not
stated to be a fee'';
the money that the employer paid to the worker was not
stated to be wages'' or salary'';
the employer paid the worker neither sick pay nor holiday
pay;
the employer and the worker did not express any intention
that the relationship would be one of employer and
employee; and
the employer and the worker expressed an intention that the
relationship would be one of principal and independent
contractor.

However, there are several significant differences
between the instantiated case and \frenchspacing
{\it Ferguson v. Dawson}\null\nonfrenchspacing.
In that case
the worker neither owned the tools nor provided the
transport with which she/he performed the work;
the employer would make a profit/loss if the work performed
by the worker cost less/more than expected;
the employer supervised or inspected the work;
the worker was not obliged to work only for the employer;
the worker was required to work at specified times; and
the employer did not deduct PAYE tax instalments from the
worker's pay.

Despite the fact that \frenchspacing
{\it Ferguson v. Dawson\/} \nonfrenchspacing
is a decision of
the English Court of Appeal
(and better authority than a case decided by
the Queen's Bench Division of the English High Court%
---like \frenchspacing
there is nothing in \frenchspacing
{\it Ferguson v. Dawson\/} \nonfrenchspacing
to warrant any change in my conclusion.

\subsubsection*{Hypothetical 1}

Consider the instant case changed so that the following is true:
the worker was not obliged to work only for the
employer; and
the employer did not deduct PAYE tax instalments from the
worker's pay.

\medskip\noindent If that were so then I would be more strongly of the
opinion that---following \frenchspacing
{\it Ferguson v. John Dawson and Partners (Contractors) Ltd\/}\nonfrenchspacing---%
the worker is an employee.

\medskip\noindent Details of \frenchspacing
{\it Ferguson v. Dawson\/} \nonfrenchspacing
are summarized above.
There are several significant similarities
between the hypothetical case and \frenchspacing
{\it Ferguson v. Dawson\/}\null\nonfrenchspacing:
the employer directed the manner in which the work was to be
done;
the worker was not allowed to use her/his own discretion in
doing an aspect of the work that was not specified
beforehand;
the worker was an integral part of the employer's business;
the work was not performed on the employer's premises;
the worker was not in business on her/his own account;
the worker was not allowed to employ others to assist with
her/his work;
the worker was not obliged to work only for the employer;
the employer paid the worker by time;
the money that the employer paid to the worker was not
stated to be a fee'';
the money that the employer paid to the worker was not
stated to be wages'' or salary'';
the employer did not deduct PAYE tax instalments from the
worker's pay;
the employer paid the worker neither sick pay nor holiday
pay;
the employer and the worker did not express any intention
that the relationship would be one of employer and
employee; and
the employer and the worker expressed an intention that the
relationship would be one of principal and independent
contractor.

However, the hypothetical case is not on all fours with \frenchspacing
{\it Ferguson v. Dawson}\null\nonfrenchspacing.
In that case
the worker neither owned the tools nor provided the
transport with which she/he performed the work;
the employer would make a profit/loss if the work performed
by the worker cost less/more than expected;
the employer supervised or inspected the work; and
the worker was required to work at specified times.

Nevertheless, I believe that \frenchspacing
{\it Ferguson v. Dawson\/} \nonfrenchspacing
should be followed.

\medskip\noindent If \frenchspacing
{\it Ready Mixed Concrete (South East) Ltd v. Minister of Pensions and National Insurance\/} \nonfrenchspacing
is followed then the worker is an independent contractor.

\medskip\noindent Details of \frenchspacing
{\it Ready Mixed v. Minister\/} \nonfrenchspacing
are summarized above.
There are several similarities
between the hypothetical case and \frenchspacing
the worker was an integral part of the employer's business;
the worker owned the tools or provided the transport with
which she/he performed the work;
the work was not performed on the employer's premises;
the worker was not in business on her/his own account;
the worker was not required to work at specified times;
the money that the employer paid to the worker was not
stated to be a fee'';
the money that the employer paid to the worker was not
stated to be wages'' or salary'';
the employer did not deduct PAYE tax instalments from the
worker's pay;
the employer paid the worker neither sick pay nor holiday
pay;
the employer and the worker did not express any intention
that the relationship would be one of employer and
employee; and
the employer and the worker expressed an intention that the
relationship would be one of principal and independent
contractor.

However, there are several significant differences
between the hypothetical case and \frenchspacing
In that case
the employer did not direct the manner in which the work was
to be done;
the worker was allowed to use her/his own discretion in
doing an aspect of the work that was not specified
beforehand;
the employer would not make a profit/loss if the work
performed by the worker cost less/more than expected;
the employer neither supervised nor inspected the work;
the worker was allowed to employ others to assist with
her/his work;
the worker was obliged to work only for the employer; and
the employer did not pay the worker by time.
Note also that \frenchspacing
{\it Ready Mixed v. Minister\/} \nonfrenchspacing
is only a decision of
the Queen's Bench Division of the English High Court
and not as good authority as a case decided by
the English Court of Appeal%
---like \frenchspacing
{\it Ferguson v. Dawson}\null\nonfrenchspacing.

Consequently, there is nothing in \frenchspacing
{\it Ready Mixed v. Minister\/} \nonfrenchspacing
to warrant any change in my conclusion.

\subsubsection*{Hypothetical 2}

Consider the instant case changed so that the following is true:
the worker was allowed to use her/his own discretion in
doing an aspect of the work that was not specified
beforehand; and
the employer did not deduct PAYE tax instalments from the
worker's pay.

\medskip\noindent If that were so then my opinion would be
that---following \frenchspacing
{\it Ready Mixed Concrete (South East) Ltd v. Minister of Pensions and National Insurance\/}\nonfrenchspacing---%
the worker is an independent contractor.

\medskip\noindent Details of \frenchspacing
{\it Ready Mixed v. Minister\/} \nonfrenchspacing
are summarized above.
There are several significant similarities
between the hypothetical case and \frenchspacing
the worker was allowed to use her/his own discretion in
doing an aspect of the work that was not specified
beforehand;
the worker was an integral part of the employer's business;
the worker owned the tools or provided the transport with
which she/he performed the work;
the work was not performed on the employer's premises;
the worker was not in business on her/his own account;
the worker was obliged to work only for the employer;
the worker was not required to work at specified times;
the money that the employer paid to the worker was not
stated to be a fee'';
the money that the employer paid to the worker was not
stated to be wages'' or salary'';
the employer did not deduct PAYE tax instalments from the
worker's pay;
the employer paid the worker neither sick pay nor holiday
pay;
the employer and the worker did not express any intention
that the relationship would be one of employer and
employee; and
the employer and the worker expressed an intention that the
relationship would be one of principal and independent
contractor.

However, the hypothetical case is not on all fours with \frenchspacing
In that case
the employer did not direct the manner in which the work was
to be done;
the employer would not make a profit/loss if the work
performed by the worker cost less/more than expected;
the employer neither supervised nor inspected the work;
the worker was allowed to employ others to assist with
her/his work; and
the employer did not pay the worker by time.

Nevertheless, I believe that \frenchspacing
{\it Ready Mixed v. Minister\/} \nonfrenchspacing
should be followed.

\medskip\noindent If \frenchspacing
{\it Ferguson v. John Dawson and Partners (Contractors) Ltd\/} \nonfrenchspacing
is followed then the worker is an employee.

\medskip\noindent Details of \frenchspacing
{\it Ferguson v. Dawson\/} \nonfrenchspacing
are summarized above.
There are several similarities
between the hypothetical case and \frenchspacing
{\it Ferguson v. Dawson\/}\null\nonfrenchspacing:
the employer directed the manner in which the work was to be
done;
the worker was an integral part of the employer's business;
the work was not performed on the employer's premises;
the worker was not in business on her/his own account;
the worker was not allowed to employ others to assist with
her/his work;
the employer paid the worker by time;
the money that the employer paid to the worker was not
stated to be a fee'';
the money that the employer paid to the worker was not
stated to be wages'' or salary'';
the employer did not deduct PAYE tax instalments from the
worker's pay;
the employer paid the worker neither sick pay nor holiday
pay;
the employer and the worker did not express any intention
that the relationship would be one of employer and
employee; and
the employer and the worker expressed an intention that the
relationship would be one of principal and independent
contractor.

However, there are several significant differences
between the hypothetical case and \frenchspacing
{\it Ferguson v. Dawson}\null\nonfrenchspacing.
In that case
the worker was not allowed to use her/his own discretion in
doing an aspect of the work that was not specified
beforehand;
the worker neither owned the tools nor provided the
transport with which she/he performed the work;
the employer would make a profit/loss if the work performed
by the worker cost less/more than expected;
the employer supervised or inspected the work;
the worker was not obliged to work only for the
employer; and
the worker was required to work at specified times.

Despite the fact that \frenchspacing
{\it Ferguson v. Dawson\/} \nonfrenchspacing
is a decision of
the English Court of Appeal
(and better authority than a case decided by
the Queen's Bench Division of the English High Court%
---like \frenchspacing