Employee.cls
HIERARCHY
HC-5 "five justices of the High Court of Australia"
HC-4 "four justices of the High Court of Australia"
HC-3 "three justices of the High Court of Australia"
HC "a single justice of the High Court of Australia"
FCA-3 "three judges of the Federal Court of Australia"
PC "the Judicial Committee of the Privy Council"
CA "the English Court of Appeal"
KB "the King's Bench Division of the English High Court"
= QB "the Queen's Bench Division of the English High Court"
AREA Employee
OPENING "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)."
RESULTS
Employee "the worker is an employee"
Contractor "the worker is an independent contractor"
ATTRIBUTE % employer had control over manner in which work was done
QUESTION "Did the employer direct not only what work was to be done,
but also the manner in which it was to be done"
YES "the employer directed the manner in which the work was to be
done" Employee
NO "the employer did not direct the manner in which the work was
to be done" Contractor
UNKNOWN "it is not known whether the employer directed the manner in
which the work was to be done"
HELP "If the employer had a right of control over how the worker
did the work then the employer had the power to direct not
only what work was to be done, but also the manner in which
it was to be done."
ATTRIBUTE % worker had discretion as to how to do work
QUESTION "Was the worker allowed to use her/his own discretion in doing
an aspect of the work that was not specified beforehand"
YES "the worker was allowed to use her/his own discretion in doing
an aspect of the work that was not specified beforehand"
Contractor
NO "the worker was not allowed to use her/his own discretion in
doing an aspect of the work that was not specified
beforehand" Employee
UNKNOWN "it is not known whether the worker was allowed to use her/his
own discretion in doing an aspect of the work that was not
specified beforehand"
ATTRIBUTE % worker was an integral part of employer's business
QUESTION "Was the worker an integral part of the employer's business"
YES "the worker was an integral part of the employer's business"
Employee
NO "the worker was not an integral part of the employer's
business, but was accessory to it" Contractor
UNKNOWN "it is not known whether the worker was an integral part of
the employer's business or was merely accessory to it"
HELP "If the worker was ``part and parcel'' of the employer's
business then she/he was an integral part of the business,
not merely accessory to it."
ATTRIBUTE % worker used own tools or provided transport
QUESTION "Did the worker own the tools or provide the transport with
which she/he performed the work"
YES "the worker owned the tools or provided the transport with
which she/he performed the work" Contractor
NO "the worker neither owned the tools nor provided the transport
with which she/he performed the work" Employee
UNKNOWN "it is not known whether the worker owned the tools or
provided the transport with which she/he performed the work"
ATTRIBUTE % employer would make profit/loss
QUESTION "Would the employer make a profit/loss if the work performed
by the worker cost less/more than expected"
YES "the employer would make a profit/loss if the work performed
by the worker cost less/more than expected"
NO "the employer would not make a profit/loss if the work
performed by the worker cost less/more than expected"
UNKNOWN "it is not known whether the employer would make a profit/loss
if the work performed by the worker cost less/more than
expected"
ATTRIBUTE % work performed on employer's premises
QUESTION "Was the work performed on the employer's premises"
YES "the work was performed on the employer's premises"
NO "the work was not performed on the employer's premises"
Contractor
UNKNOWN "it is not known whether the work was performed on the
employer's premises"
ATTRIBUTE % employer supervised/inspected work
QUESTION "Did the employer supervise or inspect the work"
YES "the employer supervised or inspected the work" Employee
NO "the employer neither supervised nor inspected the work"
Contractor
UNKNOWN "it is not known whether the employer supervised or inspected
the work"
ATTRIBUTE % worker in business on her/his own account
QUESTION "Was the worker in business on her/his own account"
YES "the worker was in business on her/his own account" Contractor
NO "the worker was not in business on her/his own account"
Employee
UNKNOWN "it is not known whether the worker was in business on her/his
own account"
ATTRIBUTE % worker could sub-contract
QUESTION "Was the worker allowed to employ others to assist with
her/his work"
YES "the worker was allowed to employ others to assist with
her/his work" Contractor
NO "the worker was not allowed to employ others to assist with
her/his work" Employee
UNKNOWN "it is not known whether the worker was allowed to employ
others to assist with her/his work"
ATTRIBUTE % worker obliged to work only for employer
QUESTION "Was the worker obliged to work only for the employer"
YES "the worker was obliged to work only for the employer"
Employee
NO "the worker was not obliged to work only for the employer"
Contractor
UNKNOWN "it is not known whether the worker was obliged to work only
for the employer"
ATTRIBUTE % worker required to work at specified times
QUESTION "Was the worker required to work at specified times"
YES "the worker was required to work at specified times" Employee
NO "the worker was not required to work at specified times"
Contractor
UNKNOWN "it is not known whether the worker was required to work at
specified times"
ATTRIBUTE % worker paid by time
QUESTION "Did the employer pay the worker by time"
YES "the employer paid the worker by time" Employee
NO "the employer did not pay the worker by time" Contractor
UNKNOWN "it is not known whether the employer paid the worker by time"
HELP "The employer could pay the worker by time (e.g. by the hour,
or by the week) or by results."
ATTRIBUTE % payment was called a "fee"
QUESTION "Was the money that the employer paid to the worker stated to
be a ``fee''"
YES "the money that the employer paid to the worker was stated to
be a ``fee''" Contractor
NO "the money that the employer paid to the worker was not stated
to be a ``fee''" Employee
UNKNOWN "it is not known whether the money that the employer paid to
the worker was stated to be a ``fee''"
ATTRIBUTE % payment was called "wages" or "salary"
QUESTION "Was the money that the employer paid to the worker stated to
be ``wages'' or ``salary''"
YES "the money that the employer paid to the worker was stated to
be ``wages'' or ``salary''" Employee
NO "the money that the employer paid to the worker was not stated
to be ``wages'' or ``salary''" Contractor
UNKNOWN "it is not known whether the money that the employer paid to
the worker was stated to be ``wages'' or ``salary''"
ATTRIBUTE % employer deducted PAYE tax instalments from worker's pay
QUESTION "Did the employer deduct PAYE tax instalments from the
worker's pay"
YES "the employer deducted PAYE tax instalments from the worker's
pay" Employee
NO "the employer did not deduct PAYE tax instalments from the
worker's pay" Contractor
UNKNOWN "it is not known whether the employer deducted PAYE tax
instalments from the worker's pay"
ATTRIBUTE % employer paid worker sick/holiday pay
QUESTION "Did the employer pay the worker sick pay or holiday pay"
YES "the employer paid the worker sick pay or holiday pay"
Employee
NO "the employer paid the worker neither sick pay nor holiday
pay" Contractor
UNKNOWN "it is not known whether the employer paid the worker sick
pay or holiday pay"
ATTRIBUTE % expressed intention: employee/employer
QUESTION "Did the employer and the worker express an intention that the
relationship would be one of employer and employee"
YES "the employer and the worker expressed an intention that the
relationship would be one of employer and employee" Employee
NO "the employer and the worker did not express any intention
that the relationship would be one of employer and employee"
UNKNOWN "it is not known whether the employer and the worker expressed
an intention that the relationship would be one of employer
and employee"
HELP "For example, if the employer and the worker characterized
their agreement as being a ``contract of service,'' that
would be an expression of an intention that the relationship
would be one of employer and employee."
ATTRIBUTE % expressed intention: principal/independent contractor
QUESTION "Did the employer and the worker express an intention that the
relationship would be one of principal and independent
contractor"
YES "the employer and the worker expressed an intention that the
relationship would be one of principal and independent
contractor" Contractor
NO "the employer and the worker did not express any intention
that the relationship would be one of principal and
independent contractor"
UNKNOWN "it is not known whether the employer and the worker expressed
an intention that the relationship would be one of principal
and independent contractor"
HELP "For example, if the employer and the worker characterized
their agreement as being a ``contract for services,'' that
would be an expression of an intention that the relationship
would be one of principal and independent contractor."
CASE "Performing Right Society Ltd v. Mitchell and Booker (Palais
de Danse) Ltd"
"PRS v. Palais de Danse"
CITATION "[1924] 1 KB 762"
YEAR 1924
COURT KB
FACTS (YYYYNYYNNYYYNYNNNN)
RESULT Employee
SUMMARY "the defendant was the occupier of a dance hall. It
engaged a band to provide music in the hall. The agreement
provided that the band should not infringe copyright, and
that the band would be liable for damages and costs caused by
any such infringement. There was also a notice displayed in
the hall stating that ``[o]nly such music as may be played
without fee or licence is allowed to be played in this
Hall.''\footnote{ibid. at 764.}\par
The band performed several pieces of music, the copyright in
which was held by the Performing Right Society, without its
permission. The defendant did not know, and had no
reasonable grounds for suspecting, that the infringement was
to take place.\par
The PRS abandoned its earlier claim that the defendant had
``permitted'' the infringement under s. 2(3) of the Copyright
Act 1911 (UK). However, it claimed that the band members were
the defendant's employees, and so the defendant was
vicariously liable for the infringement.\par
McCardie J examined the agreement and found that it gave to
the defendant ``the right of continuous, dominant, and
detailed control on every point, including the nature of the
music to be played''.\footnote{ibid. at 771.} Hence the band
members were employees of the defendant, which was
liable for the infringement."
CASE "Cam and Sons Pty Ltd v. Sargent"
"Cam v. Sargent"
CITATION "(1940) 14 ALJ 162"
YEAR 1940
COURT HC-4
FACTS (YYYNYNNNYNNNNNNNNN)
RESULT Employee
SUMMARY "Sargent was the master of a ship. He entered into an
agreement with Cam and Sons that claimed that the ship was
hired by Cam and Sons to Sargent and his fellow contractors
(called ``the partnership''). However, it was doubtful
whether that agreement actually deprived Cam and Sons of any
control over the ship. The partnership was to use the ship
only to carry coal from Swansea to Sydney. Cam and Sons were
sole agents of the partnership for securing cargoes for the
ship, and for collecting money due to the partnership. The
partnership paid nothing for the ``hire'' of the ship, but
received a specified sum for each return trip of a certain
tonnage plus (in certain circumstances) 5% of the earnings,
the balance of which was retained by Cam and Sons. Cam and
Sons had to approve people employed by the partnership.\par
Sargent claimed that he (and others in the partnership) were
employed by Cam and Sons, and therefore came within the terms
of an industrial award. Cam and Sons claimed that members of
the partnership were independent contractors.\par
The High Court unanimously agreed with Sargent. Rich J came
to the conclusion that the agreement was an attempt to evade
the terms of the industrial award.\footnote{ibid. at 163.}"
CASE "Federal Commissioner of Taxation v. J. Walter Thompson
(Australia) Pty Ltd"
"FCT v. Thompson"
CITATION "(1944) 69 CLR 227"
YEAR 1944
COURT HC
FACTS (YNYNYYYUNNYNYNNNNN)
RESULT Employee
SUMMARY "the FCT claimed that payments made to radio artists by
Thompson were ``wages'' within the meaning of the
{\it Pay-roll Tax Assessment Act 1941\/} (Cth) and therefore
taxable. The artists were selected by a producer and paid to
appear in radio plays. They were paid a ``fee'' for each
performance, but were paid nothing for attending (compulsory)
rehearsals. Thompson claimed that the artists were presumed
to know their work and ``to render services in the same
manner as a professional man, such as a surgeon or an
architect, not being subject \dots\ to detailed control as to
the manner in which those services are to be
performed.''\footnote{ibid. at 231.} Hence, Thompson
claimed, they were independent contractors.\par
Latham CJ held that the radio actors were employed ``to
co-operate with others in a team under the control of the
producer to bring about a result, the details of which must
in great measure be determined by the
producer.''\footnote{ibid. at 232.} Hence the artists were
employed by Thompson; the fee they were paid was subject to
payroll tax."
CASE "Queensland Stations Pty Ltd v. Federal Commissioner of
Taxation" "Queensland Stations v. FCT"
CITATION "(1945) 70 CLR 539"
YEAR 1945
COURT HC-3
FACTS (NYNYNNYYYNNNNNNNYN)
RESULT Contractor
SUMMARY "agreements were entered into between Queensland Stations and
some drovers. The agreements stated that the drovers would
``serve'' Queensland Stations and take charge of a specified
number of cattle, and deliver them to a specified place. The
drovers were paid a specified rate per head of cattle
successfully delivered. Each drover was responsible for
hiring help, and paying for feed for the cattle. The drovers
were to ``obey and carry out all lawful instructions and to
use the whole of [their] time, energy and ability in the
careful droving of the stock.''\footnote{ibid. at 540.} The
FCT claimed that payments made to drovers were ``wages''
within the meaning of the {\it Pay-roll Tax Assessment Act
1941\/} (Cth), and that Queensland Stations was liable to
payroll tax.\par
The High Court held that the drovers were independent
contractors, so the payments were not ``wages.'' Rich J
pointed out that drovers were traditionally free from the
control of owners of cattle. ``The obligation imposed on the
drover to obey and carry out all lawful instructions is not a
reservation of detailed control and possession having regard
to the terms of the agreement as a whole.''\footnote{ibid.
at 549.}"
CASE "Humberstone v. Northern Timber Mills"
"Humberstone v. NTM"
CITATION "(1949) 79 CLR 389"
YEAR 1949
COURT HC-3
FACTS (NYNYNNNNYNNNNNNNNN)
RESULT Contractor
SUMMARY "Humberstone carried goods for NTM. He had originally held
himself out as a carrier, prepared to carry for anyone, but
for over twenty years he had carried goods solely for NTM
(although he would, infrequently, carry back-loads for NTM's
customers). Humberstone owned the truck, and paid for petrol
and repairs. He was paid weekly on a weight-mileage basis.
He was a licenced carrier, and had his name printed on the
side of his truck with the description ``carrier.''\par
On the way back from a job, he had a puncture. He went home
to change the wheel, but exerted himself so strenuously in
trying to remove the tyre from the wheel that he became ill
and later lapsed into a coma, from which he did not recover.
Section 3 of the {\it Worker's Compensation Act\/} 1928 (Vic)
had been amended about a year before Humberstone's death so
as to include independent contractors in its definition of a
``worker'' covered by the Act. However, the High Court held
that the amendment applied only to contracts entered into
after it came into operation. Further, the Court decided
that Humberstone was not an employee of NTM. Hence, he was
not a ``worker'' under the Act, and his widow was not
entitled to compensation under the Act."
CASE "Stevenson Jordan and Harrison Ltd v. Macdonald and Evans (1)"
"Stevenson v. Macdonald (1)"
CITATION "[1952] 1 TLR 101"
YEAR 1951
COURT CA
FACTS (NYNNYNUNNNYUUUUUYN)
RESULT Contractor
SUMMARY "Evans-Hemming was an accountant who had been employed (first
as a servant, then as an executive officer) by Macdonald and
Evans. Shortly after he left them, he wrote a textbook on
business management and submitted the manuscript to Stevenson
Jordan and Harrison (a firm of publishers). He died before
the book was published. Macdonald and Evans claimed that the
book was written while Evans-Hemming was their employee, and
so they owned the copyright in the work under s. 5(1)(b) of
the Copyright Act 1911 (UK).\par
The book was divided into five sections. The first section
consisted of the text of three public lectures that
Evans-Hemming had given while employed by Macdonald and
Evans. The Court of Appeal held that he had given these
lectures as an independent contractor. As Denning LJ said,
``under a contract of service, a man is employed as part of
the business, and his work is done as an integral part of the
business; whereas, under a contract for services, his work,
although done for the business, is not integrated into it but
is only accessory to it \dots\ The lectures were, in a
sense, part of the services rendered by Mr Evans-Hemming for
the benefit of the company. But they were in no sense part
of his service. It follows that the copyright in the
lectures was in Mr Evans-Hemming.''\footnote{ibid. at 111.}"
CASE "Stevenson Jordan and Harrison Ltd v. Macdonald and Evans (2)"
"Stevenson v. Macdonald (2)"
CITATION "[1952] 1 TLR 101"
YEAR 1951
COURT CA
FACTS (NYYNYNUNNNYUUUUUUN)
RESULT Employee
SUMMARY "Evans-Hemming was an accountant who had been employed (first
as a servant, then as an executive officer) by Macdonald and
Evans. Shortly after he left them, he wrote a textbook on
business management and submitted the manuscript to Stevenson
Jordan and Harrison (a firm of publishers). He died before
the book was published. Macdonald and Evans claimed that the
book was written while Evans-Hemming was their employee, and
so they owned the copyright in the work under s. 5(1)(b) of
the Copyright Act 1911 (UK).\par
The book was divided into five sections. The second section
was written in its final form while Evans-Hemming was
employed by Macdonald and Evans. The Court of Appeal held
that he wrote the second section as an employee, and hence
the copyright in the second section was in Macdonald and
Evans."
CASE "Zuijs v. Wirth Brothers Pty Ltd"
"Zuijs v. Wirth"
CITATION "(1955) 93 CLR 561"
YEAR 1955
COURT HC-5
FACTS (NYYNYYYNNNYYNNYNNN)
RESULT Employee
SUMMARY "Zuijs was an acrobat who fell during a trapeze act at one of
Wirth Brothers' circuses. He sought compensation under the
Worker's Compensation Act 1926 (NSW), claiming to be an
employee of Wirth Brothers. Wirth Brothers claimed that,
because of the high degree of skill and personal judgment
that he had to exercise in his work, Zuijs was an independent
contractor and therefore not entitled to compensation.\par
The High Court unanimously agreed with Zuijs. ``Even if
[one of the circus managers] could not interfere in the
actual technique of the acrobats and in the character of the
act, no reason appears why [Zuijs] should not be subject to
his directions in all other respects \dots\ There are
countless examples of highly specialized functions in modern
life that must as a matter of practical necessity and
sometimes even as a matter of law be performed on the
responsibility of persons who possess particular knowledge
and skill and who are accordingly qualified. But those
engaged to perform the functions may nevertheless work under
a contract of service.''\footnote{ibid. at 571--2 per
Dixon CJ, Williams, Webb and Taylor JJ.}"
CASE "Ready Mixed Concrete (South East) Ltd v. Minister of Pensions
and National Insurance"
"Ready Mixed v. Minister"
CITATION "[1968] 2 QB 497"
YEAR 1967
COURT QB
FACTS (NYYYNNNNYYNNNNNNNY)
RESULT Contractor
SUMMARY "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 colours, and he had to
wear a Ready Mixed uniform. Latimer 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 was 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."
CASE "Ferguson v. John Dawson and Partners (Contractors) Ltd"
"Ferguson v. Dawson"
CITATION "[1976] 1 WLR 1213"
YEAR 1976
COURT CA
FACTS (YNYNYNYNNNYYNNNNNY)
RESULT Employee
SUMMARY "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
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'', the reality of the relationship between them
was that of employer and employee.\footnote{ibid. at 1219 per
Megaw LJ, at 1228--9 per Browne LJ.}"
CASE "Massey v. Crown Life Insurance Co."
"Massey v. Crown Life"
CITATION "[1978] 1 WLR 676"
YEAR 1977
COURT CA
FACTS (YYYNYYNYYNYYNNNYNY)
RESULT Contractor
SUMMARY "Massey was the manager of a branch of Crown Life. He had
been an employee for two years, then he and Crown Life
entered into a new agreement whereby Massey continued to
perform the same duties as before, but was self-employed.
This arrangement had tax advantages for Massey. After a
further two years, Crown Life terminated the agreement and
Massey sought compensation for unfair dismissal under the
Trade Union and Labour Relations Act 1974 (UK). Compensation
was only payable if Massey was employed under a contract of
service.\par
Lord Denning MR stated that ``if the true relationship of the
parties is that of master and servant under a contract of
service, the parties cannot alter the truth of that
relationship by putting a different label upon
it.''\footnote{ibid. at 679.} However, Lord Denning (and the
rest of the Court of Appeal) held that the agreement was
genuinely intended to establish Massey as being
self-employed; he was an independent contractor."
CASE "Australian Mutual Provident Society v. Chaplin"
"AMP v. Chaplin"
CITATION "(1978) 18 ALR 385"
YEAR 1978
COURT PC
FACTS (NYYYNNNYYYNNNNNNNY)
RESULT Contractor
SUMMARY "Chaplin was a representative of AMP. A clause of the
agreement between them stated that the relationship was one
of ``principal and agent'' and not one of ``master and
servant.'' Chaplin claimed that he was employed under a
contract of service, and was therefore a ``worker'' under the
{\it Long Service Leave Act, 1967\/} (SA) and entitled to
certain benefits.\par
The Privy Council found that there was no reason to think
that the clause was not a genuine statement of the parties'
intentions. Examining the agreement, their Lordships
concluded that it provided for a contract of agency. The
fact that Chaplin was given the power of unlimited delegation
of the whole performance of his work was ``almost conclusive
against the contract being a contract of
service.''\footnote{ibid. at 391.}"
CASE "Price v. Grant Industries Pty Ltd"
"Price v. Grant"
CITATION "(1978) 21 ALR 388"
YEAR 1978
COURT FCA-3
FACTS (NYYYNNNNYNNNNNYNNN)
RESULT Contractor
SUMMARY "Grant Industries manufactured and sold wardrobes, which Price
(and others) delivered and installed. Price and each of the
other ``contractors'' (as Grant Industries called them) had
to provide and maintain a suitable truck to deliver the
wardrobes, and provide the tools required to install them.
Price sought an order that a penalty be imposed on Grant
Industries for breaching the Furnishing Trades (Consolidated)
Award 1975 by not paying him the appropriate rate of wages,
and not giving him annual leave. The award only applied to
``employees'' of specified employers.\par
The Federal Court examined the facts, and the provisions of
the agreement, and held that Price was an independent
contractor and, therefore, not subject to the award."
CASE "Australian Timber Workers Union v. Monaro Sawmills Pty Ltd"
"ATWU v. Monaro"
CITATION "(1980) 29 ALR 322"
YEAR 1980
COURT FCA-3
FACTS (YNYYNYYNUNNNNNNNNN)
RESULT Employee
SUMMARY "Wales was a tree feller who cut timber exclusively for Monaro
Sawmills. He performed his work in an area allotted to him
by Monaro Sawmills. He, and other fellers, were paid by the
amount of millable wood they cut. Wales provided his own
tools and transport, but was (with the other fellers)
covered by Monaro Sawmill's workers' compensation policy.\par
The union sought an order that a penalty be imposed on Monaro
Sawmills for breaching the Timber Industries Consolidated
Award 1974 by failing to pay Wales money in lieu of annual
leave. Monaro Sawmills claimed that Wales was an independent
contractor, and so was not subject to the award.\par
Sweeney and Evatt JJ examined the circumstances of Wales's
employment and held that those circumstances clearly pointed
to the existence of a relationship of employer and employee.
They could not see ``any sense in which it could be said that
Wales was conducting some sort of business of his
own.''\footnote{ibid. at 329.}"
IDEAL
FACTS (YNYNYYYNNYYYNYYYYU)
RESULT Employee
IDEAL
FACTS (NYNYNUNYYNNNYNNNUY)
RESULT Contractor
Other SHYSTER case law specifications: Finder, Authorization and Natural.
