The decision handed down in Jamsek v ZG Operations Australia Pty Ltd [2020] FCAFC 119 (Jamsek) is set to be heard by the High Court, as the next in a recent slew of employment matters being decided at the highest level.
Pointon Partners wrote about the original decision of the Full Federal Court, which involved two truck drivers who were found to be employees despite being engaged pursuant to independent contractor agreements for nearly 40 years.
The Jamsek appeal is slated to begin on 31 August 2021 and the High Court's decision is likely to have a significant impact on the way in which businesses engage contractors. This is the first time that the High Court has been asked to determine an employee v contractor dispute since Hollis v Vabu Pty Ltd (2001) 207 CLR 21 (Hollis v Vabu).
Importantly, the High Court also recently handed down a decision in WorkPac v Rossato & Ors [2021] HCA 23 (WorkPac v Rossato), which gave employers greater certainty in the realm of casual employment, by confirming that the characterisation of an employee as a casual is to be determined with reference to the employment contract.
Up until WorkPac v Rossato, the Courts have traditionally looked at the substance (rather than the contractual form) of the working relationship when determining whether an individual is a casual or permanent employee.
Significantly for the parties in Jamsek, this is consistent with the approach generally adopted by the Courts since Hollis v Vabu when asked to assess whether a person is an employee or an independent contractor at law. The Courts would examine the "totality of the relationship" between the parties, with the contract being relevant consideration, but not determinative in its own right.
It remains to be seen whether the High Court will reconsider Hollis v Vabu in light of the approach in WorkPac v Rossato. Although this seems undesirable from a policy perspective, Jamsek is likely to be the final word in employee v contractor considerations and may require businesses to review their existing contractor agreements and arrangements to mitigate the risk of suits or claims.
Pointon Partners will provide an update following the decision being handed down and have a wealth of knowledge and experience across employment and independent contracting matters.
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