Construction, Forestry, Maritime, Mining and Energy Union & Anor v Personnel Contracting Pty Ltd [2021] HCATrans 138 (31 August 2021)

Last Updated: 1 September 2021

[2021] HCATrans 138

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Perth No P5 of 2021

B e t w e e n -

CONSTRUCTION, FORESTRY, MARITIME, MINING AND ENERGY UNION

First Appellant

DANIEL McCOURT

Second Appellant

and

PERSONNEL CONTRACTING PTY LTD

Respondent

KIEFEL CJ
GAGELER J
KEANE J
GORDON J
EDELMAN J
STEWARD J
GLEESON J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA BY VIDEO CONNECTION TO BRISBANE, SYDNEY AND MELBOURNE

ON TUESDAY, 31 AUGUST 2021, AT 10.05 AM

Copyright in the High Court of Australia

KIEFEL CJ: The record will show that Justices Keane, Edelman and I are sitting in Brisbane, Justices Gageler and Gleeson in Sydney, and Justices Gordon and Steward in Melbourne. I will announce the appearance of counsel appearing remotely.

MR B.W. WALKER, QC appears with MR M.A. IRVING, QC and MR T.J. DIXON for the appellants. (instructed by Construction, Forestry, Maritime, Mining and Energy Union)

MR J.B. BLACKBURN, SC appears with MR M.L. FELMAN for the respondent. (instructed by Hotchkin Hanly Lawyers)

KIEFEL CJ: Yes, Mr Walker.

MR WALKER: May it please your Honours. Your Honours, the figure of speech that has been adopted in relation to cases of a kind of which this one provides an example is to describe them as triangular. That is in danger of suggesting a similarity with tripartite contracts. That is not this case. It is triangular only in the sense that there is one contract between parties A and B, and another contract between parties A and C. That may not make a triangle, because there is not a contract between B and C.

In our submission, this is one of those cases which might be described as by far the most usual case where employment is the result of a contract and, as long‑established principle and judicial approach in this Court demonstrates, that requires, case by case, an investigation of the terms of the contact.

This is not one of those cases, again familiar from the method and authority of this Court, where that investigation involves variation of contract, whether by express terms or by terms or dealings implied from conduct. Nor is this case one where the investigation of the terms and effect of the contract includes such notions as sham and related ways in which the express terms of the contract are disregarded as those that bind between the parties.

However, this is a case that involves, again, an approach well familiar in the authority of this Court to what might be called a species of repugnancy between the express terms of a contract. As your Honours know, without developing it at present, we in particular call in aid the established need to distinguish between express terms which purport to apply a legal label, or to use legal technical nomenclature, for the relationship created by the contract itself as opposed to an examination of what I am going to call the operative terms imposing rights – granting rights and imposing obligations that operate between the parties. None of that is.....

Your Honours, may I start by recognising, as to look ahead, we will develop at paragraphs 8, 9 and 10 of our outline, that obviously the litigated dispute between these parties exists because of claimed statutory rights. However, those claimed statutory rights, for reasons that we will develop in 8, 9 and 10, are rights which turn upon the notion of employment, a matter which in this Court perhaps formerly could have been regarded as securely and, for all practical purposes, with exceptions that usually have no purchase, ought to be regarded as the modern equivalent of the rather grating expression “master and servant”.

Your Honours, it is for those reasons that we submit that one starts with the contract which is the source of the punitive employment, that is, the contract, the operation of which would have been held to have constituted Mr McCourt an employee of the respondent – whom I will mostly call Construct, its corporate title being Personnel Contracting.

They would have so held but for the discipline their Honours perceived themselves to be under not to depart from the West Australian Full Court decision in a materially very similar case involving Construct, given their Honours declining to regard the reasoning and outcome of that decision as plainly wrong, a matter which will not deflect your Honours from considering whether it was wrong.

The contract can conveniently be found in the reasons, starting in the core appeal book at page 102. There are, in our submission, and intending no great disrespect, some euphemisms and deflective language employed by those who drafted the contract, and your Honours ought not to regard that as likely to have included Mr McCourt on the drafting committee. Hence its description, as acronym, as the ASA, picking up the notion found in the recital:

1. Construct is an administrative services agency . . . liaising between builders . . . and self‑employed contractors –

and “self‑employed contractors” is the first of the exercises of nomenclature or labelling concerning the nature of a relationship, or the absence of a relationship to which my earlier opening remarks were directed.

Your Honours see that the commerce contemplated by the working out of this contract, in effect, is that it concludes with the provision of labour to builders. It is said also to be supplying financial and administrative services to the workers, to use a neutral expression for the tendentious expression “self‑employed contractors”. Those financial administrative services surely do not include receipt of what I will call wages, but do, on their face, include what I will call appropriate documentation with respect in particular to taxation.

The agreement, under the heading of “Construct’s Responsibilities”, includes an obligation in subclause 1(b) to:

Inform the Contractor when, and on what basis, an opportunity arises for the Contractor to supply labour to a builder -

the word “contractor” again standing for those earlier described as self‑employed contractors and that I will mostly neutrally use the expression “worker”. In clause 1(c), Construct’s responsibilities include liaison, regarding the means by which the worker supplies labour to such builders, including the duration, the place, the daily hours of work, et cetera. In other words, in that expression, bland or not very informative as it may be, “liaise”, lies the link that your Honours understand exists by another contract between Construct and builders, such as Hanssen in this case.

In clause 1(d) another deflecting word can be found as to Construct’s responsibilities. In return for performance by the worker of his obligations under this agreement – I stress “under this agreement” – Construct shall, as it is put:

underwrite payment to the Contractor -

Your Honours ought not to understand that anything grand is meant by the word “underwrite”. It means late payment, as can be seen by the terms to which I will come. The receipt of an invoice, as your Honours know from the facts in this case, is either regarded as fulfilled or treated as dispensed with as a requirement to receive payment on the part of the worker by the practice of records of hours worked recorded by a bundy system directly sent from the builder to Construct.

Clause 2 deals with Construct’s rights and in clause 2(a) there is an entitlement, as it is put, to:

Negotiate . . . a payment rate for the supply –

by the worker of labour. Were there no other terms than that, your Honours might see there suggestions of a formal agency, which we are not suggesting would be a realistic prospect, let alone one with fiduciary obligations. One sees again that, introduced by the perhaps clumsy phrase “subject to”, the closing words of clause 2(a) suggest that the payment rate, which might be increased, is subject to the contractor properly performing his obligations under this agreement. That presumably means in return for or upon satisfactory completion of - in other words, pay for work.

Your Honours see as well that the business model involves what I am going to call profit for Construct by reason of a negotiated rate called commission that one can see in clause 2(b) - it is called “remuneration” in clause 2(c) “of any increase”, by which there is what might be called a mark‑up on the price charged by Construct to a client such as Hanssen, the builder, for the supply of labour of a worker such as Mr McCourt.

Your Honours can see in a nutshell in those terms without proceeding further that the manifestation – to use a term from the authorities of the business of Construct – is in the supply of labour for financial return. To put it in a harsh fashion, the workers are the stock in trade of the labour hire firm. They are not incidental or collateral, they are central, and their work is the subject matter of that which is traded for profit by the labour hire company.

There is then in clause 3 something which your Honours may forgive me for not dwelling as to its terms because as to term 3 we say it lies in the future were we to succeed in this Court to ascertain what effect, if any, would be given to its terms. It suffices in this bristling array of promises in the form of warranty, so‑called, by the worker designed, as it were, to ensure that anything that could be found in Halsbury against the position of Construct is negatived by a promise, and some of those promises are, as it were, promises to maintain a fiction which may be none the worse for that, but in due course were we to win here depending upon issues joined and arguments presented may involve questions of the efficacy of such promises in the face of a statutory entitlement.

So then we come to that which is at the heart of our argument here, as your Honours will have seen from our written submissions, and that is in clause 4 which is appropriately and correctly headed “The Contractor’s Obligations”, the appropriateness and correctness being the word “obligations”, “contractor” being part of the neutral, that is, the party to this contract or tendentious, namely the so‑called self‑employed or independent contractor of the recital.

In 4(a) the nub of the matter, so far as we have advanced it below and here, is presented, and it is presented in terms which are perhaps intended to soften or blur what on any proper understanding that this is a contractual term imposing a so‑called obligation could have been rendered in plainer English. Nonetheless, the word “co‑operate” and the expression “in all respects” followed by the phrase combining constructor and the client builder makes it clear that the expression “in the supply of labour to the Builder” is referring to the work which leads us to call persons such as Mr McCourt a worker.

And co‑operating in all respects, in our submission, involves at the very least an obligation to do that which you are obliged to do in favour of Construct and also as an obligation owed to Construct and as contractual obligation owed only to Construct to co‑operate with the builder.

Now, looking ahead in a way that we do not need to go to in order to understand the question of the relationship created by this contract between Construct and Mr McCourt, one knows that there is a promise by Construct to its clients, such as Hanssen, which includes the “capacity”, to use a neutral expression, the capacity for the client to give directions to supplied labour, that is, workers such as Mr McCourt. His labour is supplied to a builder by Construct.

I do not need to dwell on those terms because no one has said, either in this case or in cases similar to it, that that has the effect of rendering the worker contractually obliged to the client builder, and we stress, one can confidently expect that Personnel Contracting trading as Construct would never embrace the proposition that contracts, let alone of employment, are created by the provision of labour by Construct to client builders such as Hanssen.

That co‑operation in all respects, with Construct and the builder, means, in our submission, that the means by which subordination of the worker for the doing of the work is created and is rooted by authority in the obligation owed by Mr McCourt, the worker, the so‑called contractor, to Construct, as opposed to ‑ ‑ ‑

STEWARD J: Mr Walker, could I ask you a question. How do you reconcile the selection of the words “co‑operate in all respects” with your contention that there is a relationship of subordination or, I think the word that Justice Lee used, subservience, which is a hallmark of an employee/employer relationship? Does not the word “co‑operate” suggest that there is reserved to Mr McCourt some level of independence in the way in which he shall fulfil his obligations?

MR WALKER: No, “co‑operate” is one of those words, weasel words, if you like, in this text. In ordinary idiomatic English, “co‑operation” suggests the relation of peers, each with discretion, or persons joined in what might be called a common endeavour, and in both commercial and legal usage that particular flavour is very often conveyed, familiarly, of course, in business organisations which are so‑called co‑operatives, but, in our submission, notwithstanding what we would submit is the obvious possibility that the word has been selected in order to deflect the characterisation of the requisite subordination for employment, properly understood, the only way in which the so‑called contractor, the worker, can co‑operate, is to do those things which are inherent and explicit in the work to be performed, which is, by definition, the work at the direction of the client.

It is for those reasons, in our submission, that there is no independence here, apart from the independence available to everybody, independent contractor or full‑fledged employee, namely either not to take the job or to terminate the contract, to resign.

There is, in our submission, for example, in 4(c), the obligation to attend at any building site as agreed with the builder, an expression followed by the phrase “at the time required by the builder”, which rather puts paid to the notion that there is anything contemplated in the nature of what might be called a contractual negotiation between the so‑called contactor and the builder.

No one says that there is a contract concerning attendance at a building site, notwithstanding the use of the word “agreed” in 4(c). That is merely a consensus, which is achieved upon what the contract calls the liaison by which opportunities are offered to the worker by Construct and that liaison with the builder is reflected, as your Honours have seen from the findings of fact, with what might be called the assignment so‑and‑so builder wants someone to do such and such a job and be there tomorrow at 6.30 am.

EDELMAN J: Mr Walker, I realise nobody is putting this submission, but is there any reason in principle why a worker such as Mr McCourt could not be an employee of both the labour hire company and the builder with the employment relationship between the builder arising not by clauses such as clause 4(c) but by conduct between the worker and the builder that evinces an agreement in similar terms to clause 4(c)?

MR WALKER: Your Honour, the answer is in two parts. There is nothing in the common law, we submit, that prevents as a possibility that which can be seen from time to time in commerce, namely so‑called joint employment. Now, I do not mean the true but trivial proposition that a partnership unincorporated – that means that there are numerous employers of the staff of the firm. I am not referring to that. I am referring to what is seen from time to time, particularly in corporate groups but not only in corporate groups.

EDELMAN J: But the common law goes even further than that, does it not? I mean, there are vicarious liability cases like Viasystems, which recognise that, for the purposes of, at least for vicarious liability, there can be two employers of a worker.

MR WALKER: Yes, is the short answer, and your Honour has gone to the second part of my answer. It is clear that this is a case‑by‑case question, as vicarious liability, being the most – the context in which the distinction between employment and independent contracting is most crucial, necessarily turns on the particular facts of each particular case. It is, above all else, circumstantial, which is one of the reasons there really cannot be a serious or true precedential effect in the holdings in one case, notwithstanding the employment of similar written terms.

However, when one looks at the nature, taken as a whole, phrases that are hallowed in this Court’s consideration of the matter, one will rarely, in our submission, see the spelling out of employment by the clients of a labour hire company, particularly in the case of casual employees, of those workers by the client of the labour hire company.

Now, that is not to say it cannot happen, and it is not to say that casual employees who turn out to enjoy sustained periods of what, in psychological and financial terms may be a stable way, might not, by dint of conduct, including the flow and exercise of authority in one direction and service in the other direction, produce a true relation of employment, query, a contract of employment, between the labour hired worker and the client of the labour hire company. That is not this case, of course, but one can envisage that occurring. It is familiar and unremarkable that such contracts and/or relationships which in the main will flow from a contract, can be spelled out by the implications conveyed by conduct, the way in which people conduct themselves.

Now, Justice Edelman has asked a question which is prefaced by noting that your Honours can proceed on the basis that none of the parties before you perceive it in their interests to urge the creation, in our case, simultaneously with the creation of a relationship between Construct and Mr McCourt of a contractual relationship of employment between Mr McCourt and Hanssen. The incentives are no doubt far more powerful, if less broad in their implications, for our opponent’s client.

But, in our submission, leaving aside what the parties before this Court do not wish to argue, for reasons that may appear self‑evident, there will in principle and in practice often be cases where there are serious circumstances tending strongly against the spelling out or discernment of such a relation between the labour hired worker and the client of the labour hire company including, in particular, for people whose work may be a day here, a week there, a month between different sites and the like, including wishing to avoid that whatever inconvenience, in particular their skilled workers may sensibly perceive in having to deal, at the end of the year, with a relatively large number of so‑called employers with respect to, among other things, tax obligations and the obtaining of benefits such as awards, enterprise agreements and statutory force that may give rise.

In other words, there is practical and therefore likely an implied strength or strength of implication in the nature of the tasks that a worker such as Mr McCourt offers to what I might call the market generally being marshalled by the provision of that work, that is his work, by someone who contracts to do so in favour of, as it were, anybody interested in obtaining such work from time to time.

Now, it is for those reasons, in our submission, that though there is no objection in law at all to what I will call simultaneous - or “concurrent” perhaps is a better word – concurrent relations of employment stemming from different dealings between A and C, both with B, that is not something which, as it were, ought to be treated as prima facie or the usual outcome of a labour hire arrangement such as is before the Court today.

The closer resemblance for a case such as today is surely with the extremely familiar model, not particularly modern, of the employer of what I will call gangs – I do not mean it disrespectfully; it is historical usage – whose work can be made available, say, to farmers or road makers or builders for relatively unskilled labouring such as digging ditches from time to time and place to place.

The employment of every member of the gang by the person who hires out, so to speak, or places their labour on particular sites for clients or customers of that labour hirer, would not, in our submission, ever require by ordinary implication the existence concurrently of ad hoc, perhaps relatively fleeting, employment by those clients of each member of that gang.

It is for those reasons, in our submission, that though that is of course a possibility that may arise according to the circumstances, this is a case where it is not available as an outcome by the court, (a) because no one argues for it, and (b) because the parties in making those forensic choices are not, with great respect, either of them, any of them, acting in any manifestly counterintuitive or legally inappropriate fashion.

GAGELER J: Mr Walker, can I ask a question that is, I suppose, conceptual about the way you use certain matters of fact in your argument. When you were taking us to clause 1(c) you spoke about the practice of bundying on and keeping records and when you got to clause 4(a) and (c) you referred to the contract between Construct and the builder. How do you say we should use those references? Are you inviting us to treat them as part of the matrix of the fact for the construction of this contract or do you point to them as societal facts about how one would expect a contract of this nature to operate in practice or is there some other conceptual basis upon which you draw attention to those facts?

MR WALKER: The two choices that your Honour expressed are not, of course, mutually exclusive. They are obviously concepts that can overlap. That is, a broader societal setting is not necessarily to be divorced from a contractual so‑called matrix. There is a third at least – I am not suggesting there is not more – there is a third possibility to which I have already made reference, namely, the way in which the relation, that is the work by Mr McCourt and the payment for it by Personnel Contracting, called Construct, actually turns out in practice, including by those dealings to which I refer that your Honour has noted, such as supplying the bundy records.

They familiarly are available in a case where parties make it an issue to examine whether or not a pre‑existing contract has been varied or a new contract has been made to be implied by conduct. When I say by conduct I do not mean dumb show only, there will often be words involved: we will send your bundy records directly to Construct, or as is more likely and happened in this case, Construct and Hanssen making that arrangement themselves. In other words, no requirement for invoice, indicated by no refusal to pay because of absence of invoice.

Now, whichever of those three ‑ and I am not suggesting there that exhausts the possibilities ‑ conceptual ways in which such material might be resorted to in an argument such as today’s, we ought to make this clear, we submit that in this Court under the various banners of reality or the real relation or the whole of the relation or the way in which things operated, and there are other phrases with which your Honours are familiar, whichever one of those or all of those that one is looking at the manner in which the terms of – the express terms of the contract are seen to be performed in practice can, in our submission, properly be called in aid for the characterisation question.

Now, I appreciate that that is very straightforward when one is talking about a variation case and we are not talking about a variation case, but it is either straightforward or not particularly remarkable to observe the ways in which parties to written agreement appear to act in apparent contemplation, each of them and both together, that they are performing their contract according to its tenor.

EDELMAN J: Mr Walker, does that mean that if on the proper construction of the contract at the time it is made and in all the circumstances in which it is made the relationship, let us say, is one of independent contractor and principal, then that relationship can change as time changes in the performance of the work and presumably can then change back again if the performance of the work changes again without any variation in the contract terms?

MR WALKER: No, probably not, your Honour, probably not. Your Honour has asked whether time could do that. On any view, it would need to be more than time, otherwise one would be committing the fallacy, for example, that you are not a casual employee because you have enjoyed casual employment with the same employer doing the same thing at the same place for a considerable period. Leaving aside so‑called statutory conversions, that is not, in our submission, entailed as some late‑arriving common law approach.

The obvious and proper first inquiry in a case where there is some temporal duration of consistent conduct that might be thought to give rise to such a possibility is to inquire whether there has been a variation and in particular one of the distinguishing features between independent contracting and employment has to do with the latter’s definitional requirement for what I will call subordination.

That does not mean that there are not things which resemble the general relation conveyed by the notion of subordination in independent contractors. It is, as is well known, a characterisation question that does not lend itself to bright lines, let alone lines of no breadth.

So it is clear, in our submission, that individual cases could yield the.....somebody has ceased to be an independent contractor and has become an employee. It is difficult to think how, in the absence of a variation implied by conduct, that would be carried out, unless, for example, the terms of the contract under which the worker was initially an independent contractor was so spare and open in their stipulations as to accommodate by usage that they change in the nature of the relationship.

We would hesitate to suggest how that might commonly happen, otherwise than by variation, and I, with some trepidation, throw up the obvious possibility for the operation of estoppels between parties to such contracts, which unquestionably might arise according to circumstances, were someone who has for years been requiring someone to work, for example, to a roster that they sign up to for months and months and months ahead, were to resort or revert to a position where, on two hours’ notice, all their service could be dispensed with.

Those are cases that will await factual investigation of a kind that has no real corresponding feature in this case. The facts were investigated in this case, but they do not show anything of that kind, of course. I hope that ‑ ‑ ‑

GORDON J: Mr Walker, may I ask a question? There seem to be three issues in play. One is the temporal question that Justice Edelman asked you, and Justice Gageler asked you. We then have the label problem, which you identified by describing in the contract someone as a contractor, and then we have a third question, and that is, in effect, looking at the substance of the relationship and how you assess that.

MR WALKER: Yes.

GORDON J: Given the way in which you have analysed the contract between Construct and Mr McCourt, I wonder whether or not, in effect, that triplet of ideas depends so very much upon, as you would, as I understand, put it, the nature of the business being carried out by Construct itself. It may very well be that those sorts of questions and those sorts of indicia take on a different weight, relevance, depending upon the nature of the business itself being conducted by the purported employer.

I say that for this reason. If you look at the clauses you took us to, in particular, I think, staying with recital A, but 1(c), 1(d), 2(a), 2(b), 4(a) and 4(c), and one asks what is the substance or nature of the relationship, it is a relationship where you have a business being conducted by a purported employer to supply labour, where that business is one which they negotiate, in a sense, the terms upon which this worker is going to turn up, they pay him, and all the other indicia that you would look at, but that sort of analysis is, of course, driven by reason of the nature of the work being carried out by the purported employer. It is a very different question for some other forms of relationship between purported employer and employee.

MR WALKER: Yes. This is a business model that, if efficacious according to the legal content of all the terms that are pleonastically piled up, not only in clause 3 but, for example, in the obligation in 4(h), if they operate according to their tenor, then it is certainly the case that anything which the law, from time to time, and that would include the common law as well as statute - it is statute that is in question in this case - in favour of an employee will not be available and if, as in this case, that involves paying what I am going to call a “wage” lower than the law would otherwise require, then there is manifest advantage to be gained from the operation of those terms for one of the parties to the contract.

The advantage is commensurate, case by case, with the disadvantage suffered on the other side of the transaction and, of course, the advantage has a – which is far greater than simply the aggregate of its parts, bearing in mind the business model involved.

Our point is this. The subordination that is one of the distinguishing features to be examined, no doubt, on something in the nature of a spectrum between independent contracting and employment is in this case well conveyed by the colloquial expression “labour hire”. The labour of Mr McCourt is that which Construct commercialises. It is what it offers to the market, to clients like Hanssen. I have called it the stock in trade. It is central, definitional, and is the main, really, only, manifestation of the commerce of Construct.

It is for those reasons, in our submission, that the promises by the worker, called the contractor, in clause 4 are absolutely necessary for that business model, as is well recognised from the recitals onwards in this contract. I do not need to go, and should not go, to another contract in that regard, because the co‑operation in all respects, with Construct and the builder in the supply of labour to the builder, is, in terms, the supply of subordinated service.

Clause 4(c) makes that clear with respect to who has to turn up and where, so not one of – not a member of the staff of this independent contractor, but the so‑called independent contractor, the worker, himself or herself. Then in 4(d), lest there be any doubt about what Construct is undertaking, it is to supply labour, and if the client is dissatisfied in the way which produces a claim for recompense, the worker is obliged, according to 4(d), to indemnify, in other words, will have breached his contract to Construct under 4(a) and 4(c).

GLEESON J: Mr Walker, does that mean that on the particular facts of this case it is not necessary to get into the complexities of external facts, it is just a matter of looking at the contract at the time that it is formed?

MR WALKER: I wish, your Honour, but they are not very complex. It is correct that in the main, which is why I have started here, it is the terms of the contract, properly or sensibly understood, without any distortion and raising an eyebrow, as it were, at much of the tendentious language of labelling, but it is the terms of the contract as to rights and obligations concerning the provision of work by Mr McCourt by dint of the commerce of Construct to customers or clients such as Hanssen that produces, in our submission, the outcome which, but for the Western Australian decision, is the outcome that all three judges in the Full Court regarded as the proper one, the alternative being counterintuitive.

STEWARD J: Mr Walker, can I ask a question – I am sorry. Is 4(d) really against your case? One does not ordinarily see an employee indemnifying their boss for their conduct at their client’s premises.

MR WALKER: No, it is not against us. That is precisely what could have happened but for legislation and what might be called social enlightenment. There is nothing to prevent an employer at common law from suing an employee for breach of the employment contracts, such as careful work.

STEWARD J: I understand that, but does one normally see an employee giving an indemnity to their boss?

MR WALKER: Your Honour, that is a sociological question to do with market observation and neither is particularly determinative of, we would respectfully submit ‑ ‑ ‑

STEWARD J: Does that mean 4(d) does not go one way or the other?

MR WALKER: No, it goes very strongly our way because it backs up the promises in 4(a) and (c). These are matters that subordinate persons in Mr McCourt’s position to the satisfaction of – that means truly ‑ including at the direction of Construct’s client who, with a grievance thought to be actionable, gets a claim against its supplier of labour, Construct, who, in 4(d), as it were, menaces financially by way of one of the sanctions for breach of 4(a) and 4(c). That is why we say unequivocally it is in favour of us.

STEWARD J: All right. Could I ask you this question while I am still unmuted, for the moment? Is it your case that you cannot enter into a labour hire arrangement with independent contractors? Is your case as broad as that?

MR WALKER: No, if I may say so. Long before business models like Construct’s or Odco became attractive to accountants advising entrepreneurs, if you will forgive my old language, there were talent agencies. I do not understand that Greta Garbo was anything other than an independent contractor and the talent agency model of what might be called bathetically “labour hire” is obviously very different from this case.

STEWARD J: All right, I accept that. Then the next question is, on your case, is Odco wrongly decided?

MR WALKER: Yes.

STEWARD J: So we will ‑ ‑ ‑

MR WALKER: I am too glib in giving your Honour a monosyllabic answer. Let me elaborate slightly. As I said earlier, it is critical not to go down the false path that accorded precedential value to the outcome of previous cases with their own facts ‑ not just with their own terms of contract but also with their own facts - when the law in question is the method by which a characterisation according to a legal category – in this case, employment or independent contracting – is the question at hand.

There will be a misleading of the exercise if the command basic to justice that like cases be decided alike is taken to, as it were, involve some spreadsheet comparison of the particular facts of particular cases. That is not to say there could not be or should not be guidance and an observance of what I might call the Zeitgeist judicially with respect to particular forms of conduct being characterised one way or another. Of course that will be so, but the question is always, in a particular case, what is the proper characterisation – in this case the question being employment or not – and it is for those reasons ‑ ‑ ‑

EDELMAN J: Mr Walker, I understand that is the sort of narrow basis upon which you put your submissions but there is also a broader basis, is there not, which is that the reasoning in cases like Odco is incorrect or wrongly decided because what might be called the multifactorial test has nothing to root it, no ultimate principle which the courts have enunciated as supplying the relative weight to various different factors or providing a means by which the relative factors can be assessed.

MR WALKER: I think the short answer is yes, but with trepidation can I explain? I confessed myself unable to offer what might be called in.....ultimate principle and I am not in terms of authority going to suggest that the grandiose and not very helpful expression “multifactorial” is not the law. It is the law, but we would tend to, with respect, reduce it simply to this utterly unremarkable mundane status, namely, this is a characterisation question which involves looking at everything relevant, there not being simply one test or indicator.

EDELMAN J: I understood your sort of ultimate grounding principle to be that all of these particular factors pointed to whether or not the worker was part of the enterprise of the labour hire organisation or the relevant principle.

MR WALKER: That is one of the ways that we invite but it is, of course, only one of the ways in which one can term the question: is this person an employee or, as what we submit is a definitional contrast, is he or she conducting their own business?

Now, this is not one of the cases where there is some hybrid analysis that would be appropriate on the facts. We can leave that until there is some really expert worker whose labour, so‑called, is supplied ad hoc for very special occasions to bill the clients by Construct where everything that this Court has engaged in familiarly in independent contractor employee contrasts can be called in aid - the bicycle worker, as opposed to, for example, the highly specialist tow‑truck operator.

Now, there is, in our submission, a question whether or not an ultimate question, to answer “employment or not” can be expressed as being, “are you or are you not conducting your own business?”. As your Honours know, that has been regarded as, probably not very helpfully proposed, as a test or step in the reasoning towards the conclusion, but rather a different way of expressing the same ultimate question, and that is because they are two sides of the one coin.

Now, this is not a case where we have facts or issues requiring exploration of, if you will forgive the nonsense, whether the coin has more than two sides. We do not have to go into those marginalia at all, this being a straightforward case in terms of the way the work was provided, the way the work was done, the way the work was paid for, the way the work was supervised.

GORDON J: Mr Walker, can I ask a question about that, just so I understand it. Is that to accept a proposition that the dichotomy between employment and independent contractor is not a dichotomy which is either clearly defined, and is something which, in the modern – especially in the gig economy, is probably an unhelpful, either step in the reasoning, or even a different way of putting the end proposition?

MR WALKER: I think the answer is yes. Can I elaborate? There are so many forms of modern relations about how people work that are, as I understand it, conjured up by the colloquial expression “the gig economy” that it would not be sensible, as a matter of a common law argument for the purposes of characterising a statutory term said to bear its ordinary meaning, as if there are templates that can be laid across the probably infinite variety of arrangements made, formally or informally, in a fixed or invariable form by people who work, people who benefit from the work, and people who clip the ticket.

In our submission, for cases such as the present, it does suffice to say that, for all practical purposes, the long‑established and substantively important distinction between employment and independent contracting is evergreen in its usefulness in approaching these cases.

Now, that does not mean, of course - this goes back to Justice Edelman’s question about what I will call identification of enterprise - that in that area of great substantive significance, vicarious liability, that persons who are not employees are automatically never to be considered as being the cause of vicarious liability being imposed on a person who is not their employer.

That has already been, as it were, worked out, not finally, I suspect, with great respect, in the necessary case‑by‑case approach that vicarious liability throws up, but in our submission, in the run of cases, that remains a particularly useful and normally dispositive contrast if employee, employer vicariously liable, if not employee, subject to exceptions that have no footing in our case, no purchase in our case, the person contracting with that independent contractor not vicariously liable.

Now, moving, then, away from vicarious liability to what Justice Gordon has asked me about the, what I am going to call, now manifest opportunities for doubts and uncertainties about how to characterise relations between a person who works and somebody who benefits from it, or who benefits indirectly, by commission, from it, in our submission, it is very important, as a matter of judicial method, that straightforward questions of a kind that one could imagine sensibly being submitted to a jury with sensible and practical directions, should be the hallmark of the Court’s preferred approach. It is the common law.

It is for those reasons, in our submission, that the question whether a worker is the employee of a putative employer does not become bereft of guidance in the cases, or in common sense, that the cases, with great respect, in general terms, seek to systematise. That is why, if I may call it, fashions, or fluctuating favour or disfavour of considerations like control, or the very closely related, slightly broader notion of subordination, or other matters such as identification with enterprise or enterprise organisation approach, or, converse of independent contracting, that is, that which is not possible if you simply do not have your own business at all, you are not conducting your own business, then, in our submission, those are matters which, in a familiar common law fashion, for mischaracterisation notwithstanding, they do not supply bright lines which, as it were, render it unimaginable that judges would ever be bothered with the decision, so clear that people in commerce can work it out.

Now, it is clear that this Court has appreciated those inherent uncertainties and marginal arguable cases as simply an attribute of the fact that the law calls for characterisation in terms which have to be sufficiently broad and encompassing so as to be useful. We are not in this case, at least to my knowledge, concerned with any of the common law consequences of this being employment rather than contracting, but we are concerned with something which proceeds in exactly the same fashion because of the statute’s choice, as your Honours have seen, to define the statutory criterion of entitlement, employment, by its so‑called ordinary meaning. The extensions and exceptions to that do not matter in this case.

That ordinary meaning is not just a reference to what I will call linguistic usage, which any lexicographer will say is both various at the same.....varies overtime. The common law can also, one hopes with a bit of an intellectual sea anchor, follow but not be simply buffeted around day by day by differences between individual’s linguistic usage, let alone differences over a short period of time.

So, with the slower moving changes the common law can adapt to things like, though I shudder to use the expression, “the gig economy”, and so the common law’s change cannot and should not be overnight, to put it mildly, and in our submission, this is an area above all other areas. One might think of social relations where parliamentary experimentation and regulation is made to measure as opposed to a judicial weathervane approach according to perceptions of social justice.

It is for all of those reasons, if you will forgive me, that this is a case where we ought to be looking in sufficiently general and plain jury direction terms for what are, to use the Latin, the indicia of employment or not.

KIEFEL CJ: In that regard, Mr Walker, you have taken, in your outline, as the starting point, the indicia of the right to control, direct, or command - as indicia of the relationship of employer/employee.

MR WALKER: Yes.

KIEFEL CJ: So, you obviously regard that as a very important feature of this case.

MR WALKER: Yes. I have used the word “subordination” and repeat again the old, not disconnected, notion of “master/servant” to distinguish in the same way as the legal cliché “contract of service/contract for services” is intended to point up an instructive and applicable contrast. It does not mean that one will always have everyone agreeing on which is true, but it does mean that you will, in nearly all cases, have a very large preponderance of informed opinion one way or the other.

That is why, when we come to one of the next tests that I am going to come to in the outline, which we tersely, but I hope forcefully, express in proposition 4 in our outline, that we accept that it may be unrewarding semantics to consider whether that is a step towards a goal or a test for an outcome, or whether it, as perhaps proposed by Justices Wilson and Dawson in Stevens v Brodribb 160 CLR 35, about point 8, meant when they commented upon the dictum, albeit in dissent, nonetheless influential and, in our respectful submission, correct, of Sir Victor Windeyer in Marshall v Whittaker’s 109 CLR 217. Sir Victor’s remark at a conceptual level about characterisation, that:

the distinction between a servant –

that is, an employee:

and an independent contractor “is rooted fundamentally in the difference between a person who serves his employer in his, the employer’s, business, and a person who carries on a trade or business of his own” –

Justices Wilson and Dawson suggested that, or stated that that was Sir Victor:

really posing the ultimate question in a different way rather than offering a definition which could be applied for the purpose of providing an answer.

The differences may not be greatly significant, but we, as your Honours know, draw on that approach, with great respect, commended to your Honours as a handy and useful approach because it emphasises the centrality, what we have been so bold in our proposition 5 as to describe as a determinative approach, that is, definitionally, if you are working in another’s business, as surely Mr McCourt was working in Personnel Contracting’s business, because he was the stock in trade, and you are not conducting a business of your own thereby or in connection with that, then, if it is necessary to add the presence of a contract, one adds the presence of a contract, which we have here.

It includes the consideration by way of remuneration, which would be called “wages” but for the predilection for tendentious deflections or euphemisms, then, in our submission, it is a dichotomous choice, then you are an employee. Now, apparently ‑ ‑ ‑

GORDON J: Mr Walker, may I ask a question? The reverse does not work though, does it? I can be an employee of Construct on a Monday but still run my own business and be an independent contractor in relation to someone else on a Tuesday.

MR WALKER: I think it is compulsory for Qantas pilots, your Honour.

GORDON J: It may be but, I mean, the proposition I put to you is a serious one. One can be in an employment relationship on a Monday but still have your own business being an independent contractor for somebody else on Tuesday. So, when the proposition you put in 5 as being determinative, it is determinative here on the facts, not determinative as a matter of proposition.

MR WALKER: I think by and large the answer is yes. Can I just qualify that? Undoubtedly, a bricklayer could be employed, say, four days a week, and because he or she would really prefer to get six days’ remuneration could ply the trade by classifieds in a local newspaper, if they still exist, which would obviously be independent contracting jobs for people who want a garden wall put up.

So exactly the same kind of work, exactly the same level of skill, the work provided as an employee during what I will call the four‑day job and as an independent contractor for whatever jobs are picked up for the other two days of the week, that would be, we suggest, an extremely common pattern of conduct, particularly where there are not, as it were, great trade advantages in the employer, the four‑day employer, preventing an employee from offering his or her services elsewhere to others.

So, where there is no trade secret or any competitive urge then that will be an ordinary mundane exercise. It is well and truly, in our submission, in the area of discourse that Sir Victor Windeyer was referring to. The four‑day job is manifestly as an employee, not carrying out your own business in the four‑day job, but you have a skill and you are at liberty to pick up whatever ad hoc assignments as an independent contractor where you are conducting your own business. Indeed, you may advertise your own business by reference to your employment with another.

KIEFEL CJ: Mr Walker, that might be a convenient time for the Court to take its morning break.

AT 11.19 AM SHORT ADJOURNMENT

UPON RESUMING AT 11.36 AM:

KIEFEL CJ: Mr Walker, before you proceed, there was a question raised I think by the CFMMEU parties, by which I mean appellant and respondent, as to whether or not they might have the opportunity to in effect reply to the ZG Operations submissions tomorrow. The Court does not really see the need for oral submissions. The Court takes the view that the parties in this matter are pretty well on notice as to what is being said in those other
proceedings, but if the parties in this matter would wish to put in a note in response, that might be the appropriate way to deal with the need for extra time. Do you see any difficulty with that, Mr Walker?

MR WALKER: None whatever if I may request that the note be limited to a very brief note.

KIEFEL CJ: So, having something like a note within five days?

MR WALKER: Yes, within five days and also of very brief length.

KIEFEL CJ: Within two pages.

MR WALKER: Thank you.

KIEFEL CJ: Mr Blackburn, are you content with that course? I think you might be on mute, Mr Blackburn.

MR BLACKBURN: I do not appear to be on mute from this end.

KIEFEL CJ: You are coming through now.

MR BLACKBURN: Thank you.

KIEFEL CJ: Are you content with that course ‑ any further note you may wish to make by way of comment on the argument tomorrow within five working days and no more than two pages in length?

MR BLACKBURN: Yes, your Honour. It is unlikely that we would need to, but we just sought that liberty as a precaution. So yes, thank you.

KIEFEL CJ: Thank you. There will be directions in those terms. Yes, Mr Walker.

MR WALKER: May it please your Honours. Could I, resuming the thread of some of the matters particularly in answer to a number of your Honours’ questions, remind your Honours of the considerations in Justice Lee’s reasons. I do not need to take you to them. The references are in paragraphs 50, 151 and 160 to matters introduced by the description that there are a number of other documents that shed light on the nature of the relationship.

Paragraphs 151 and 160 conclude with the proposition that the document called “Construct Contractor Solutions, Contractor Safety Induction Construction” is a very important part. You will find that in the respondent’s book of further materials starting at page 35 and I want to take you in particular to pages 36 and 44.

While your Honours are doing that, I am sorry, I misled you. The findings concerning these documents are found in the trial judge’s reasons, I am sorry, at 151 and 160. I have confused myself, your Honours. Could I just go to the book of further materials at 36? On the third paragraph of the introduction your Honours read the words about it being:

intended as a general guide to workplace safety and health . . . not a complete list of procedures and is not intended to replace instructions given on site by our clients, their supervisors, or other authorised persons.

Then the acknowledgment at 44 signed by workers like Mr McCourt:

2. I will follow all worksite safety rules and procedures given by the ‘host client’.

. . .

4. I will NOT conduct any work other than that which is specifically assigned to me.

5. I will NOT conduct any work . . . for which I am not currently qualified . . .

7. I will immediately advise CONSTRUCT if my job is altered by the ‘host client’.

Those are matters which are held to form part of the contractual arrangement. They are, in our submission, in accord with what I have already argued from clause 4(a) of the ASA, namely, that there is an obligation owed by Mr McCourt to Construct to work at the place notified to him – for the client notified to him, subordinated himself through and to Construct in order that Construct may provide its stock in trade, namely, his labour, to Construct’s client, namely, Hanssen.

It is, in that sense, in our submission, that – and this is proposition 3 of our outline – it is in that sense that this is, in our submission, a straightforward, not a complicated or complex, form of control, no different whatever from an employee of a gardening company requiring its employed gardeners to act in accordance with the preferences of the garden owner. In our submission, the notion that the gardener owner suddenly becomes the employee of the person requested to plant the daffodils is too silly for words and it confuses the critical concept of authority.

In our submission, “authority” has meaning only if one can name in juristic terms what it is that gives a direction or instruction or other conduct such as purported dismissal legal force and ‑ ‑ ‑

GAGELER J: Mr Walker, could I ask as a point of clarification about the point you just made in taking us to this contractor safety induction document. I may be wrong, but I do not read Justice Lee at paragraph 160 as ascribing contractual force to this document. He refers to it in context with the Hanssen induction form and Hanssen’s site rules as forming part of the totality of the relationship. So, he seems to treat the relationship with the builder as part of the totality of some broader relationship. There may be a finding that this has contractual force, but it is not obvious that you get it from that paragraph.

GORDON J: Mr Walker, I had understood that it was dealt with at paragraph 50 by Justice Lee on core appeal book 104 where he said that those documents “shed light on the nature of the relationship”, that in addition to the ASA there were the frequently asked questions, there was this induction document and then there was that wonderful diagram which was set out as annexure B to Justice O’Callaghan’s judgment.

MR WALKER: Yes. Your Honours, the safety induction manual, as one sees from it the paraphrase in paragraph 50 of Justice Lee’s reasons, is the document to which I have taken you, unless I am much mistaken. If it is not that document, it is a document that does the same thing and that is why the reference in 160, in answer to Justice Gageler - and I do apologise if I have been responsible for confusion. It is a defined term in paragraph 50. I had understood that to be the document I took you to.

What matters, however, is that what is described in 50 as the safety induction manual, in which he agreed inter alia to follow all safety rules, et cetera, contains the terms which are germane to my argument and that is what was held to be contractual in nature imposing obligations on Mr McCourt in paragraph 160 of Justice Lee’s reasons.

GAGELER J: I am sorry, Mr Walker, I do not want to dwell on this, but does that go also for the Hanssen induction form and the Hanssen site rules? Are they contractual in this sense?

MR WALKER: No, I do not understand that is what Justice Lee is saying in 160. They are simply, as it were, conduct of a kind which indirectly has the effect of imposing or supplying the content of a previous contractual obligation, no different from the employed gardener being told, “Do what the garden owner wants”. What the garden owner wants is not by force of the simple statement for any garden owner and gardener contractual, but it is by force of the anterior promise to do that which the garden owner wants.

The authority is given by the anterior promise. The anterior promise is basically 4(a) but it is provided somewhat in overlapping repetition, given further content with respect to matters as we all know that have considerable statutory ramifications in relation to safety in the safety induction manual held by the court below, not challenged as we understand it to be contractual, and as such to provide important character to the relation, which is the relation in our submission of subordination ‑ that is, obedience to directions.

The authority is supplied and supplied only by the contract between Construct and Mr McCourt, and it is for those reasons that it is shorthand, and for analytical purposes, inaccurate paraphrase, to say that the client is given authority. This is not an agency between the labour hire company and the client, the so‑called host.

There is a figure of speech that one could use in terms of devolved control, but these are just figurative language for what is, in contractual terms, a promise by B to A to do what C says from time to time. That does not make C the person with authority. It makes C a person whose word is given the authority of A.

Your Honours, proposition 4, I have, in our submission, sufficiently adumbrated already. Factually, that is, surely beyond contest, the case could not be a clearer one in that regard. That does not mean that the principles for which we contend, I am coming up to proposition 5, is not one which embraces, in an ordinary common law characterisation sense, the fact that there may be arguable marginal cases. That is not the point, and I note that I am coming up to questions of so‑called tiebreak or default.

In proposition 5, for the reasons we have put, particularly drawing on the strength of seeing Sir Victor Windeyer’s expression as being really a different way of stating the ultimate question, it cannot, in our submission, be doubted that in all cases of an ordinary kind, probably close to universal, but does not have to be, the determination, that is, the discernment that a person who is working for another person, that other person having its own customers or clients, and in so doing is not conducting the worker’s own business is, by reason of performing work, being paid and subject to directions, an employee.

In that course of reasoning, in our submission, the distinction remains a valuable, not merely informative, but in such cases will be determinative that such a person is, by dint of not conducting their own business, therefore working in another’s business, that being the ultimate way of describing a relationship of employment, that is, use by another, employment as opposed to independent contracting.

The fact that there may be highly skilled employees is a matter that will require its own factual consideration in a particular case, but it is, in our submission, conventional and unremarkable that even very highly skilled employees not conducting their own business pay well to bring their skills that the employer could not possibly hope to second‑guess as to actual manner of discharge, is nonetheless, because not conducting his or her own business, and nonetheless providing work for another, thereby an employee. It therefore covers a very large spectrum of relations, even if it does not cover all of the possibilities that may yet to be imagined, sufficient unto the day.

Now, as your Honours have seen, and with the given time I will simply refer generally to what we have written about this, we submit that it is nothing incidental or merely historical that the distinction in question, which needs to be practically expressed in such a way as both to lend itself to what I will call jury directions, but also a judicial characterisation of a familiar kind, stems from the need to indicate the imposition of vicarious liability or not. This is absolutely not the case to expatiate on the state of the law in this Court concerning vicarious liability, which both parties have addressed in detail in their written submissions. Our point ‑ ‑ ‑

EDELMAN J: Mr Walker, can I just ask what you mean by “vicarious liability”? Are you using the phrase in the sense of meaning an attribution of the acts of one person to another, the principal, or are you using it in the sense of the attribution of the liability of one person to another, the two senses being those which divided Justice Kitto and Justice Fullagar in Darling Island Stevedoring?

MR WALKER: I am going to use it in the latter sense, by which I mean the understanding, or the doctrine of the law by which a person, not themselves a wrongdoer, is liable for the wrongdoing of another by reason of what I am going to call, in general terms, the requisite connection between them and the conduct in question.

One of the problems about, it I may say so, without spending any time on it, if I may, of talking about the attribution of conduct, is that that can only ever be a step towards.....there for, which is the determination of liability, and particularly, when one comes to illegal or criminal acts, for which there can be vicarious liability, it seems unnecessary and gratuitous to describe that as the attribution of conduct. It is a question of responsibility in the eyes of the law.

Your Honours, in our submission, for the reasons that we think, with respect, both parties have, by what they have written about the case law, demonstrated, little reason for parties at least to essay the task of saying that the multifactorial approach requiring that they look at the entirety of the relationship established by and practised under the contract is no longer the law or should no longer be the law. What matters, in our submission, is that, of course, all the facts need to be looked at, and it would be very odd for there not to be some form of analysis, by which I mean the pulling apart of the whole of the picture, in order to understand what the assembly overall means.

But your Honours are very familiar with the figure of speech between adopted in terms of the whole picture. No one, we think, regards it as possible properly to appreciate a painting by sticking one’s nose up against a very large canvas and examining only a small portion of it. There were the days in which a criticism of a painting proceeded on how far back you had to stand in order to understand what the painter was trying to depict.

Leaving aside those matters of appreciation of figurative art, in our submission what is important from that figure of speech, what continues to have force is that there is a necessity always to examine not merely the parts which the lawyers’ habitual mode of analytical thinking will produce subject to the tension but also the all‑important synthesis and description in qualitative terms by way of what we call characterisation.

It is when one does that that, in our submission, the so‑called totality of the relationship simply cannot produce because we are not in some kind of checklist or spreadsheet or matrix system of scoring, it simply cannot produce the notion in serious literal terms of either a default or tiebreak approach to the express characterisation terms in the contract under examination. I say that because ‑ ‑ ‑

GLEESON J: Mr Walker, can I just clarify, are you there drawing a distinction between the characterisation of the relationship and the characterisation of the contract?

MR WALKER: I am not, but I should. It is the characterisation of the relationship, which is ultimately what matters for this reason. If I can descend to the particulars of our litigation, we wish Mr McCourt to be able to assert rights under statute arising from the nature of his relationship with Construct being a relationship of employee and employer.

EDELMAN J: Mr Walker, if the relationship is one under a contract which has not been varied in any respect, are there any other facts that are relevant to determining how to characterise the relationship other than the terms of the contract in all of their appropriate circumstances and contractual matrix?

MR WALKER: Only in the sense, your Honour, that I tried to supply in answer to an earlier question by Justice Gageler, namely that without urging variation nonetheless there may be, particularly when the terms of the contract are in as general terms as this case, “co-operate”, there may be an understanding that a man sent to sweep a building site is to be sent to do so not on his own initiative or as he sees fit but in an organised building site under requisite supervision, a matter which is surely, with respect to sweeping and removing garbage, rubbish, detritus, a matter that will automatically bring up real concerns about occupational health and safety as to which a contract ‑ ‑ ‑

EDELMAN J: I thought I understood your earlier submission to be that by providing that additional content to the open‑textured, co‑operative obligation, in effect that was a variation by conduct.

MR WALKER: Your Honour, the variation or a demonstration of that which the parties accepted, both of them without demur, fell within the contemplation the parties had concerning what those general words mean and no one, least of all a court, intent on disturbing that consensus between them does not matter, in our submission.

We did not argue this as a step‑by‑step incremental and varying pattern of variations, let alone every day on a building site, as to whether you sweep on the third floor or the fifth floor – third floor or fifth floor, or for that matter sweeping or other work is all within the general tenor of the contract that we characterise as a contract of employment, that is, the only contract Mr McCourt had with Construct.

We need to avoid the so‑called Watcham v East Africa Protectorate fallacy of construing a contract by reference to conduct done under it, but there is no contested construction here, in our submission, as to what, as to its centrality the notion of “co‑operation” means. It certainly does not include defying the directions of the builder, let alone defying the promise to Construct to co‑operate not only with Construct but also with the builder.

So far as concerns the notion of variation, I do not need to dwell on it in detail, but your Honours appreciate that we of course call in aid as still, in contemporary terms, a sharp observation concerning such matters that ought always inform examination of such lawyered documents as the ASA in this case, and your Honours appreciate I am referring to Foster 85 CLR at the famous passage in the reasons of Justices Dixon, Fullagar and Kitto - one could pick it up at halfway down 151.

I do not want to repeat to your Honours well‑known passages but highlighted phrases include the notion of what occurs in practice and what is tacitly accepted – those are words which might equally apply to variation, assuming one can spell consideration out, or, God forbid, in terms of ordinary persons, ordinary litigation estoppels.

But, in our submission, the examination of contracts such as the ASA with their general terms does not prevent any particular challenge. There is no need to call in aid alterations to express terms. There is no express term that comes anywhere near saying do not bother about what any foreman says at the worksite of our client company. It was to the contrary in express terms, general and express.

GLEESON J: Is it correct to understand that what you are bringing to the contract as well is the certain facts concerning the character of the contracting parties, and facts about the subject matter of the contract?

MR WALKER: Yes, and in our submission, in so doing, we are not being impermissibly radical, or liberal, or modern, or whatever epithet might be applied at all, that is the oldest of the propositions concerning the interpretation of the contract. Of course, to understand the subject matter is a major step towards the interpretation of terms, which are, if I may say so, relatively bloodless and general in the drafting of the ASA. Much of the ASA could have been expressed in shorter Anglo‑Saxon than has been adopted.

Now, at 151, your Honours are well aware of the reminder, the nudge, as it were, judicially, if I may say so, across the generations, to your Honours, at the foot of 151, to look at the reality of the relation in practice. Now, this is not just – this is not.....Platonic essence that one is looking for, it is a practical, hard‑headed understanding according to the actual facts obtaining, said to be governed by the terms of the contract in question, in order to carry out the characterisation question, an unavoidable, one would have thought, part of any such judicial exercise.

The passage that your Honours know that we rely upon with respect to characterising terms, which I might as well deal with now, a bit out of order, is, of course, the shorter paragraph towards the top of page 151, what might be called the “raised eyebrow” passage. Similar propositions can be seen spelled out in relation to a characterisation question, characterisation of a relationship created, in these cases, by a contract.

At 153, the second paragraph, there is a search for what is “in truth”, that has been the expression, is conjured up by words, and then at the very foot of that page, 153, there is contemplation not only, or, perhaps, even at all with respect to a sham possibility, about representing true relation:

nothing but an attempt, by means of a form, to escape industrial regulation is no new thing.

We can say, all these decades later, that it is an even older thing now. The conflict between form and reality is, of course, not at all an unfamiliar one, and it is not confined to so‑called industrial law. At 155, towards the end, a passage which, I must say, your Honours, I have always thought might have a misprint in the CLRs, though I might be about to find out I am wrong, in the paragraph commencing “The materials laid before this Court” your Honours will see the sentence commencing “In saying this”. I must say, where their Honours talk about:

their actual work, week in week out, is not in fact –

that perhaps it, and this may be my infirmity, perhaps that makes more sense if the word “not” is not there.

What I draw to attention in that sentence of course are the closing words, “whatever the agreement may say”. What we get from that is the importance of understanding that the endeavour engaged in describing a relationship where the relationship is of a kind that the law, dehors and regardless of the particular contract recognises as a category, then private parties will not be altering the law and it is the law that characterises.

This is not a case where we need to give much house room, if any, to the notion of tiebreaks or default position where everything is finely balanced or ambiguous. Those are expressions which, in our submission, involve a number of fallacies. The first one is that finely balanced, as the image of a jeweller with carats on either side, there is no equipoise here, equipoise being a quantitative concept, that is sensibly to be supplied in the judicial overall synthetic view of the entirety of a relationship created by a contract.

These are not given scores or weights on one side or the other and it is of course unremarkable in common law characterisation, as indeed in constitutional characterisation, that some matters are equivocal but do not thereby become useless in the overall exercise, but some kind of cancelling out approach of childish arithmetic, which would be inappropriate to the significant task of characterisation according to a legal category or not.

As to the notion of a tiebreak, that would be oddly to provide the kind of force to characterisation terms which the law of which Foster is a cardinal example, would ordinarily disdain and the notion that in.....

KIEFEL CJ: Mr Walker, we seem to have lost audio with you.

MR WALKER: I am sorry, your Honours.

KIEFEL CJ: That is better now, thank you.

MR WALKER: I do apologise. It is not being at a lectern but still moving my hands. It is my fault entirely. What I was saying was that it is wrong, in our submission, in some tiebreak sense to regard characterisation terms as having an effect, even a dispositive effect, in cases which have, as it were, produced continuing doubt in the judicial mind after everything appropriate to be considered has been considered.

Particularly that is a perverse approach when it gives to those characterising terms the very effect which the Court, on the authorities we have referred to, disdains. The Court will not be told that this is not an agency if the terms of the dealing in question means it is an agency.

The Court will not be told that this is not an agency if the terms of the dealing in question means it is an agency. The Court will not be told this is a partnership if the terms do not create a partnership. The Court will not be told it is not a fiduciary relation, if it is, on any view of it, exactly that kind of position. The same is true with respect to the question of a relationship of employment. It would be ‑ ‑ ‑

EDELMAN J: Mr Walker, does that mean that those authorities, probably more recently, that have referred to the labels by the parties as one factor to be considered, should be regarded as, to that extent, erroneous?

MR WALKER: Yes.

EDELMAN J: Because the description of the parties cannot dictate a legal result?

MR WALKER: No, that is right. Unless and until, I say this slightly facetiously, judges, as it were, regard themselves as bound not to disappoint parties, then, in our submission, it would be absurd to suppose that judges are breakers of bargains by finding, for example, that what people, and this is an everyday occurrence in courts, solemnly and sincerely, jointly regard as a contract, is not a contract. So, protestations that we had a contract, which I suppose one could laboriously call characterisation terms, are of no moment when it comes to the question is this dealing, in the eyes of the law, a transaction which we call a contract. It should be ‑ ‑ ‑

GORDON J: Can I just question that, then? So, the proposition you accepted from Justice Edelman that you should regard labels as one factor, those cases should be regarded as erroneous, probably goes too far, does it not, in the sense that it is a factor, i.e. because that is what the term of the contract says, but it is not determinative of the characterisation question?

MR WALKER: Your Honour’s prudence would suggest I should answer Justice Gordon yes, but I need to confess that by the argument that I - where I say it is not determinative, I am also saying they are of no help. If they are true, they get a tick. Sorry, if they are correct they get a tick, if they are incorrect they get a cross, but they do not ‑ ‑ ‑

GORDON J: Not the cases themselves, it is the principle I am asking about.

MR WALKER: Yes.

GORDON J: It is a question about whether or not the principle is one if, where the label is a label because it is in the terms of the contract, and so one has to have regard to it, it is just not determinative on your construction, or your analysis.

MR WALKER: But one has regard to it as something which does not add or detract from the outcome which the Court regards as coming from the terms other than the characterisation terms.

GLEESON J: Mr Walker, do you rely on questions of inequality of bargaining power in the weight to be assigned to a characterisation term?

MR WALKER: No, that would be an unprincipled approach unless there were engaged orthodox means of vitiating a contract on such grounds with a statutory or general law. That is not to say, however, that so‑called contracts of adhesion, the need to adhere often being a practical indicator of inequality of bargaining power, that call for the kind of healthy, ordinary scepticism that Justices Dixon, Fullagar and Kitto illustrate in Foster, which is not a newfound judicial attitude to the self‑interested drafting, evidently, of one party, to such a contract, but it is not because of inequality of bargaining power, it is because there is an overreaching in the enforceable effect sought by the insertion and the bargained adherence to such terms.

It is an overreaching as against the judges, or the jury, if there is a jury. It is emphatically not for parties to say whether they have a contract. They may or may not. It is equally emphatically not for parties to say this thing which looks like a duck is not a duck, and it is for those reasons that we respectfully submit that all the cases which talk about default positions or tiebreak are, properly understood, proceeding upon a fallacy, usually not articulated, but always immanent in that form of reasoning.

In further answer to Justice Gordon, yes, in a sense you always have to look at all the terms in a contract, both express and implied – there were no implied terms of this kind – and express terms which characterise a contract must be looked at. If they are really clever there will be such an intermingling of the characterisation element of such a term and what I will call an operative element, namely, imposition of right or obligation or permission or condition, so as to render the clear sight of the judge, a very important faculty, to be able to look behind form and discern substance.

Now, true it is the substance or content and nature of a relationship is ultimately a product of form in the sense that the terms of the contract are its form, but the judicial method in question simply does not attach appropriately any weight ‑ is what I am submitting ought to be the law – any weight to overt characterisation where the party is saying, if any judge is interested, this is a contract. If any judge is interested, this is not an agency. If any judge is interested, this is not employment.

GORDON J: Could I ask one final question about that topic, which is this question of labels and inequality of bargaining power. The statutory questions which are posed here under the Fair Work Act under sections 13 and 14, there are provisions in it within the Fair Work Act, including section 357, which records that, in effect, it is a contravention for somebody to represent that something is not an independent contract when they are actually a contract for services, which would seem to suggest that the Act itself recognises the inequality that Justice Gleeson is talking about or the fact that labels can in a sense not be accurate. Do we gain anything from that at all?

MR WALKER: No. If I could, I would put it, your Honours. It certainly shows a legislated policy perceiving a mischief in what I will call the imposition of labels, and I certainly accept that imposition of labels is one of the evils that comes from so‑called inequality of bargaining power. I say so‑called inequality of bargaining power, your Honours, because it surely must be a gross inequality that concerns the law. Offhand I do not know how many counterparties I have equal bargaining power with, but I certainly do not suffer from what the law would care about with respect to inequality of bargaining power.

So those are matters which are peculiarly legislative not judicial, unless and until the legislatures impose it on your Honours under legislation or the concern of chancery for conscience is evoked in familiar and well‑regulated ways by judicial precept.

Outside those areas, in our submission, it would be dangerous for me to propose that the characterisation in the eyes of the common law – and here it is particularly the common law of statutory interpretation, given that we are commanded to understand “employment” in its ordinary meaning – ought to be, as it were, with a thumb in the scales, so as to increase the number of people brought under the protective cloak of the.....example, just as it would be absurd to suppose that a tax statute should be interpreted so as either to reduce or increase the burden on a specified category of taxpayer or ‑ ‑ ‑

GORDON J: The reason I ask is that may be seen to be, at least on one view, the approach adopted by the UK Supreme Court when they were looking at things like the Uber and Autoclenz cases when they came to the question of statutory construction and the contract itself.

MR WALKER: Yes, and I do not urge it and in particular resist as unhelpful, for the reasons I have tried to explain, the notion that that is a laudable, purposive approach. The purpose of a contract can be unremarkably stated as recording and providing enforceability to the consensus of parties who need to be voluntary. Beyond that, one at one’s peril regards the notion of interpolating a purpose to bring or not to bring one within a legislated policy.

We know that the labels in question, as long ago this Court without any perturbation regarded as proper to observe when characterising relationships created by contracts, can include labels intended to prevent legislated industrial regulation. That, with respect, is neither sinister nor special but it is a good demonstration of why the characterisation called for by the statute, employment in its ordinary meaning, is absolutely not to be hog tied or even guided or even nudged by what contracts such as this apply by way of overt characterisation in doctrinal terms.

It is no accident. The terms with which your Honours are familiar say no agency or no fiduciary relationship or a partnership or, in this case, no employment. It is no accident. It is with a view to getting in or out of an undesired or desired category of effect normally legislative. Those are, in our submission, in principle matters to be noted and in that sense taken into account but not to contribute towards the characterisation which they would attempt by private consensus to foreclose.

Your Honours, that then brings me to something that your Honours may regard, in light of what I have just said, as tending in the opposite direction - not so, that is not how we intend our propositions 8, 9 and 10. It is clear that the Act is intended to bring within its ambit, for what might be called beneficial purposes, at least from the point of view of workers, and on any view of it, protective purposes. One sees that, I do not need to dwell on it, in our proposition 8, but the means by which that is done is this statutory device, this legislative device in drafting, of defining, explicitly in the statute, the pivotal criterion of being an employee by reference in the main to its ordinary meaning.

Now, there is something slightly frivolous about that drafting technique, because the common law of statutory interpretation already tells us, among other things, that in construing a statute, as in construing a deed or a contract, words are to be given their ordinary meaning, and then a very large pause, contextually understood. So, really, that is a statutory definition which labours the obvious. It is also a slightly frivolous approach, because it raises the totally indefensible proposition that words only have one meaning.

In any event, a statute cannot practically be understood or applied by this Court as meaning that there are as many meanings to the word “employment” as there are uses of that word in the community recorded by a lexicographer, all of which would be ordinary meanings, apart from those which are idiosyncratic. Rather, there will be one meaning, you will either fall within or without the category.

It is for those reasons that, oddly, the statutory definition, ordinary meaning is one which makes clear to demonstration that the judicial exercise involved in characterising a relationship for the purpose of discerning whether or not a statute is available to the plaintiff cannot be outflanked, outbid, cannot be foreclosed by the labelling nomenclature characterisation terms to be found in the contract which, in any particular case, is the source of the relationship in question.

EDELMAN J: Mr Walker, does “ordinary meaning” mean anything other than – sorry.

GAGELER J: I was perhaps about to ask the same question as Justice Edelman, so I will put it in my words and then he can possibly add something to it. The word, or the label, “ordinary meaning”, is often used in legal parlance in contradistinction to technical meaning or legal meaning. Are we to understand it in that way in the Act?

MR WALKER: Perish the thought, your Honour, because there are many ordinary meanings of the word “employment” which – this has to be a term of an art. It is found in the Fair Work Act. That context means that we are not talking about a relationship which might be characterised as a pragmatic use of someone or something. So, to take an ordinary meaning of the word “employment”, someone’s employment.....to do X, Y and Z, they have nothing to do with this statute.

The context obviously means that its ordinary meaning in the context of the term of legal art – it is not only legal art, but it is certainly legal art which describes a relationship as one of employment or not. It is not a coincidence or merely incidental that whether somebody is employed or not as a characterisation question is found discussed in the Commonwealth Law Reports and in many other law reports subordinate to them.

So, this is a term of art but that does not mean that it is not an ordinary meaning. Now, I hope I am not being solecistic in saying that we lawyers have our ordinary meanings too and this is – employment happens to describe in the context of this statute a familiar and ordinary way of describing a relation with respect to people, the work of one of whom is at the heart of the matter, and it is for those reasons that – which is if the word independent contractor had been defined to be its ordinary meaning then it is fair to say that there are very few people outside lawyers or industrial advocates who ever use that expression in ‑ ‑ ‑

EDELMAN J: Is that explaining or defining the term “ordinary meaning” in any way that is different from saying, for example, as this Court said in Aid/Watch that a word such as “charity” would bear its common law meaning as evolved from time – as it evolves from time to time, or are you saying it is something different from that?

MR WALKER: No, not really. I am not really saying any different from that. “Charity”, obviously, if it were defined as in its ordinary meaning, in a statute concerned with cy-près schemes, might safely be said to be charity in its ordinary legal meaning.

GAGELER J: Mr Walker, what do you get out of your paragraphs 8 and 9, if it all takes you back to the technical legal meaning?

MR WALKER: .....more than that ‑ ‑ ‑

GAGELER J: .....a contest ‑ ‑ ‑

MR WALKER: The same is true with 10. I need to make clear that there is a characterisation for an important statutory purpose. Are all these terms of the statute available for Mr McCourt? That turns upon, among other things, a relationship of employment, which is defined, if this can be understood as a definition, to bear its ordinary meaning. That makes crystal clear that it is for the Court, not the private parties, to decide whether somebody is an employee or not, and so characterising terms must be firmly put to one side, after being considered, of course. You would have to consider them in order to understand that is all they are purporting to do.

It is very important, as I hope your Honours appreciate by what does not appear in our outline, to appreciate that we are not calling in aid some influence from current forms of legislation to affect what the ordinary meaning of “employment” is. To put it another way, the way in which legislation affects the ordinary meaning of a word is to displace it, and to require the word to be understood as specially defined in the statue.

There is an element of that, we know, in the extensions one sees in the Fair Work Act, but this notion of “ordinary meaning” is the wooden stake in the heart of the notion that characterisation terms can have any influence on the task of the Court to decide whether what is before them, as is the description of “employment” or not.

To put it another way, there is no element, we would submit – this may be more assertion than demonstration – in the ordinary understanding of the ordinary meaning of “employment”, but it includes consideration of the label the parties have chosen to apply to their relationship.

KEANE J: Mr Walker, in relation to your reference to collective enterprise bargaining, do you get any comfort particularly in relation to the application of Sir Victor Windeyer’s proposition from the notion that the Act here places the notion of the enterprise at the centre of its provisions so that one starts - or one can see that the Act starts with the assumption that when it speaks of employment it is speaking of employment in relation to an enterprise and therefore distinguishing the contribution of the employee from the contribution of the person who operates an enterprise?

MR WALKER: Yes. That is an old word but it is used in a modern way that conjures up if not exactly congruently nonetheless very large overlap with the earlier use of the word in discussions of the policy of the law with respect to vicarious liability and in particular tracks fairly closely the notion involved in conducting a business of one’s own, “business” being closely interchangeable probably with “enterprise” in such an expression; “enterprise” being a particularly good way of understanding taking chances in a market for your own profit, et cetera, as opposed to working for wages.

I appreciate that that is a very simplistic duality and no longer complete. It probably has not been accurate or complete for much longer than people think but nonetheless, it is something which, in our submission provides a useful sanity check when undertaking the common law characterisation which would ordinarily come down to a dichotomous position. This is not a case which involves any possible consideration of a departure from a dichotomy. You are either conducting your own business or you are working in another’s - if the latter, an employee.

That solution – that is, a satisfying common law approach, common law of the statutory interpretation approach to an expression which has evident importance socially and will cover a multitude of different factual
situations, nonetheless all of them assimilated or not by belonging to a category or not of employment.

It is for those reasons, in our submission, that the relation here is by contract only between Mr McCourt and Construct. It is a relation which subordinates him by requiring him to do things on acceptance of assignments, in precisely the same way as any – in the different long‑triangle relationship, any casual..... May it please your Honours.

KIEFEL CJ: Yes, thank you, Mr Walker. Yes, Mr Blackburn.

MR BLACKBURN: Thank you, your Honours. I will begin at the second proposition in our outline, which is that the terms “employed” and “employee” out of the Fair Work Act have their common law meanings.....my learned friend finished on and it is our very strong position that meaning is not informed by the scope and purpose of the Act. I did not understand my learned friend to say in his submissions that they were calling the Act in aid in order to construe the meaning of “employee”, but that proposition does appear in their written submissions and so I think we need to deal with it.

There are two problems, we say, in this case that try to determine who an employee is by reference to the purpose and intended reach of the Fair Work Act. The first is that while in an ordinary case it might be correct to interpret the term in a statute having regard to the purpose and intended reach of the statute in which the term appears, in this case that is not possible because the Fair Work Act’s scope of operation is for the most part defined by reference to the word “employee” by reference to the very term it is to interpret.

So, any suggestion that one tries to define the term “employee” by reference to the purpose and intended reach of the Act becomes circular. It means that it is a similar problem to one that the Court encountered in ICAC v Cunneen. It is only after determining who is an employee that it is possible to identify the purpose of the Act and who it is intended to cover, so that is the first difficulty.

The second problem is, of course, that with the proposition that the meaning of the word “employee” should be influenced by the protected purposes of the Fair Work Act which is something that comes through the appellant’s written submissions, although as I indicated.....my learned friend seemed to step back from that, the second problem, of course, is it is contrary to the principle in Aid/Watch and in particular to the second part of that principle which your Honours would be very familiar, which is that where a general law comprises a body of doctrine with its own scope and purpose the development of that doctrine is not directed or controlled by a curial perception of the scope and purpose of the statute.

In other words, in the present case the common law meaning of “employee” in the Fair Work Act is not affected by the scope and purpose of the Fair Work Act. We have also indicated some cases that are in our written submissions at footnote 4 which further support the proposition that the word “employee” has its common law meaning and I note also that in R v Foster – that was an earlier decision to which we again referred in our outline – one of the points made there was that the term “employee” in the Conciliation and Arbitration Act was the old master/servant relationship. There was no material distinction between what was intended in the Act and the master/servant relationship.

Now, in saying that the meaning of “employee” in the Fair Work Act should not be affected by the scope and purpose of the Act, we are not ignoring its departing from statutory intention, we are giving effect to it, because the Parliament has chosen the undefined term “employee”, and it is to be taken from that that the term should have its common law meaning, and, in our submission, it would be contrary to that expressed intention and the principle expressed in Aid/Watch to seek to put a gloss on the common law meaning of “employee”.

I note that my learned friend again stepped back from the sort of propositions in Autoclenz and Uber where you take a sort of protective purpose approach to the interpretation of the statue, and we say that is contrary to the very clear statement by this Court in Aid/Watch.

As we have pointed out in our written submissions, further evidence for the proposition that “employee” is to have its common law meaning is in the Act itself, where the Parliament intended to capture workers other than employees it said so expressly. So, you have some provisions referring to independent contractors, some provisions referring to textile contract workers, some provisions referring to the persons, other provisions referring to workers.

That takes us into our third proposition, which I do not understand to be contested, which is that the common law test is not only multifactorial, but it is informed by a recognition of the purposes of vicarious liability. That appears to be common ground between the parties, and so I will move on to the question of the own business test.

Now, we say that whether a worker has their own business is certainly a factor to be weighed, but in this case it was outweighed, and clearly outweighed, by other factors, notably the absence of control by the respondent Construct, the absence of representation and integration into Construct’s business, and the written terms.

The appellants, in their written materials, at least, say that the own business test is decisive, and determinative and, in their written materials, not only is it determinative but for them it becomes the very question, so in effect they seek to replace the statutory question “is the worker an employee” with the new question, “does the worker have a business of their own”?

They posit in their written submissions what they say are two alternative approaches, an ultimate question approach and an organising conception approach, but from where we sit, the difference between the two is very much one of semantics. What they are really seeking to do is put forward a new test or a new question. If you call it a question, it is a test, it is still the same thing. What the appellants are really seeking to do is to define the independent contractor as someone who ‑ ‑ ‑

STEWARD J: Mr Blackburn, could I ask a question?

MR BLACKBURN: I am sorry, your Honour, yes.

STEWARD J: That is all right, no need to apologise. If you are an independent contractor, if you are really one of those sorts of people, how else are you to characterise what they are doing other than to say that they are running a business? What else are they doing?

MR BLACKBURN: Yes. They are working for themselves. We say the question of ‑ ‑ ‑

STEWARD J: That.....can it not?

MR BLACKBURN: I am sorry, your Honour?

STEWARD J: You can work for yourself and be in a business.

MR BLACKBURN: Well, no, we differ from that and to give an example, there are, for example, in taxation legislation in this country, personal services income provisions and the Commissioner of Taxation says if you have a personal service business then you are exempt from those personal services income provisions. This is a – but, at the same time, that legislation also provides that - there was a section in there, and I cannot recall the number of it at the moment, but it is at the start of the PSI provisions, and it is to the effect that even if someone does not have a personal service business, that does not imply, for any other law, that the person is an employee. In other words, the legislation accepts that someone may not have a personal service and business, and still be an independent contractor.

STEWARD J: Well.....of the 1997 Act has lots of deeming rules about when you are or not in that regime, but what about Joanna Stone. In Stone’s Case in this Court, she was working for herself, but she was found to be in a business.

MR BLACKBURN: Yes. Well, your Honour, the way we approach it is that the question is not whether someone is an independent contractor, the statutory question is are they an employee and that is to be determined by having regard to the relations between that person and the alleged employer. That is the primary question.

Now, because of the way that the law has said that the relations are dichotomous, it follows that anyone who is not an employee is an independent contractor, but the primary question here is are they an employee, and we say the focus needs to be on the relation between that individual and the alleged employer, and does that individual have sufficient independence from the alleged employer?

It is a way that Justices Dawson and Wilson put it in Stevens, where they reframed Justice Windeyer’s proposition in a way that did not refer to the running of a business. They expressly went to the trouble of reframing Justice Windeyer’s question, and the question was, is the person independent of the other party to the contract?

So, we say that we will develop the proposition that there is no defined term, no fixed definition of “independent contractor” in the general law, in the same way that there is no definition of an “employee” in the general law. I think Justices Wilson and Dawson said that in Stevens as well, and so it appears in our learned friend’s written submissions, where they say the term “employment” is undefined except by reference, “largely undefined” in the common law except by reference to the various criteria. They attributed the statement to Justice Mason, but it was Justices Wilson and Dawson.

So, if employment is largely undefined except by reference to the various criteria and the two relations are dichotomous in the sense they.....possibilities, then it follows that an independent contractor is similarly largely undefined except in relation to various criteria.

So when you apply that criteria to the employment question of whether someone is an employee and if there is not sufficient control, for example - and the cases we will come to will suggest that control is an essential element and a sufficient degree of control is an essential element – if there is not a sufficient degree of control then - and representation or integration and the written terms also point that way – then you will get, in our submission, to the conclusion that the worker is not an employee.

That is the primary question – are they an employee? Then in a dichotomous world they then fall into the independent contractor basket, both “employment” and “independent contractor” being largely undefined except in terms of the various criteria.

KIEFEL CJ: That might be a convenient time for the luncheon adjournment, Mr Blackburn. The Court will adjourn until 2.15.

AT 12.46 PM LUNCHEON ADJOURNMENT

UPON RESUMING AT 2.15 PM:

KIEFEL CJ: Yes, Mr Blackburn.

MR BLACKBURN: Thank you, your Honour. The section in response to Justice Steward’s question that I was referring to in the Income Tax Assessment Act 1997 is section 84.10, which says:

The application of this Part to an individual –

that is, the application of the PSI rules:

does not imply, for the purposes of any Australian law or any instrument made under an Australian law, that the individual is an employee.

In other words, just because the individual has not met the test that personal service is business does not imply that they are an employee for the purpose of any Australian law or instrument.

If I can continue on this proposition that the term “independent contractor” has no fixed meaning and that it is not possible to exclusively define an independent contractor as a person with their own business and then for the reason that because they do not have their own business they must be an employee, we say that proposition was rejected by Justice Mason, with whom Justices Brennan and Deane agreed in Stevens.

The appellants in their written submissions say that what Justice Mason was rejecting in Stevens was a different test from an organisation test. They tend to distinguish that from the test that is now put forward. So, it would be necessary to be clear about what was argued and discussed in Stevens, but before going to Stevens, by way of background I would like to refer to two English judgments.

The first is Ready Mixed Concrete, found in the joint book of authorities, volume 6, Part D, tab 41, at page 1407. The significance of this case is that it had been endorsed in recent years by the Supreme Court in the UK in both Autoclenz and in Pimlico Plumbers, as the classical exposition of the ingredients for contract of service. That exposition begins at the bottom of page 1407, in the very last two lines, where Mr Justice MacKenna says that:

A contract of service exists if –

and the first condition is that the servant must agree to provide work in return for consideration. So, it is an agreement to work and consideration; that is the first condition. The second, which is the important one for our purposes, is that the servant:

agrees, expressly or impliedly, that in the performance of that service he will be subject to the other’s control in a sufficient degree to make that other master.

So there needs to be a sufficient degree of control. The third condition is that:

The other provisions of the contract are consistent with its being a contract of service –

and it is that third condition in which the English courts bring in all of the usual indicia and control is again considered as part of that third condition.

But the first two conditions are essential conditions. There has to be a promise to work in exchange for consideration and there has to be a sufficient right of control. Mr Justice MacKenna makes the point at about point C on that same page that it is a right of control that matters, and he refers to the Australian case of Zuijs v Wirth Brothers. At the bottom of that page, page 1408 of the book of authorities, he says:

I can put the point . . . in other words. An obligation to do work subject to the other party’s control is a necessary, though not always a sufficient, condition of a contract of service. If the provisions . . . as a whole are inconsistent with its being a contract of service, it will be some other kind of contract, and the person doing the work will not be a servant.

Then there is authority for that proposition that is then given as Queensland Stations, an Australian case in which a drover was engaged under a contract which expressly said you should obey all lawful directions, and yet despite that express reservation of control the drover was found not to be an employee and was an independent contractor because there were all these countervailing factors. That is the proposition for which Queensland Stations is usually cited.

So, the position in England therefore is that control is an essential..... There needs to be a sufficient right of control before a contract of service can exist. But even if you have that sufficient right of control the contract might still not be a contract of service because there may be countervailing factors.

That is the law that obtains in England today and that is the law that has been applied in all those agency cases that we have referred to in our submissions, the English agency cases which are found, that there was no contract of employment between the worker that was sent to the client site because the agency did not exercise a sufficient right of control over the worker and that is the rationale for all of those cases and they are referred to in our written submissions.

The next case that I would like to refer to, just by way of background, as we move to Stevens, is the decision in Market Investigations of Mr Justice Cooke. This is volume 5, tab 37 at page 1218. In this case, Mr Justice Cooke began at about page 1228 of the joint book of authorities, he referred to Ready Mixed Concrete, which had been decided only less than a year before, and he said the first consideration in Ready Mixed, the consideration in which an agreement to work had been satisfied, and he then set about considering the question of control. He referred to Queensland Stations at the bottom of that page, which says:

it is a mistake to treat as decisive a reservation of control –

because there can still be other matters pointing to the contract not being one of employment. So, in that context, Mr Justice Cooke, over the page, goes on to say:

If control is not a decisive test, what then are the other considerations which are relevant?

Then he cites a passage from Montreal v Montreal Locomotive Works, which is a frequently‑cited passage, and in the last sentence of that passage, Lord Wright, which is at page 169 of Montreal, says, at about point E of the page:

it is in some cases possible –

So, it is not expressed as a universal test:

to decide the issue by raising as the crucial question whose business is it, or in other words by asking whether the party is carrying on the business, in the sense of carrying it on for himself or on his own behalf and not merely for a superior.

Mr Justice Cooke then refers to Bank voor Handel, and Lord Denning’s observation there and then, at about point G of the page, he says that these observations:

suggest that the fundamental test to be applied is this: “Is the person who has engaged himself to perform these services performing them as a person in business on his own account?” If the answer to that question is “yes,” then the contract is a contract for services. If the answer is “no,” then the contract is a contract of service.

That is the genesis of the so‑called fundamental test, as was expressed by Mr Justice Cooke in this decision, relying on Montreal and Bank voor Handel. Notwithstanding that ‑ ‑ ‑

EDELMAN J: The genesis might arguably be about 100 years earlier in the United States where the long line of vicarious liability cases has treated the same question as the touchstone of vicarious liability.

MR BLACKBURN: Yes. I must admit I am not sufficiently across the history of vicarious liability in the United States, your Honour. That may be but this is the case that is usually cited as authority for the proposition and is quite often referred to as the fundamental test and this is where it is expressed as the fundamental test. It was Mr Justice Cooke’s decision here in the paragraph at the bottom of the page to which I have just referred that was cited by the Privy Council in Lee Ting Sang in 1990, which is probably the high point of the test.

EDELMAN J: The leading United States case seems to be Braxton v Mendelsohn 233 NY 122 (NY 1922).

MR BLACKBURN: Thank you, your Honour. Interestingly, Mr Justice Cooke, despite having put the question that way, then went on to actually determine the matter in accordance with the three‑stage test advocated by Mr Justice MacKenna in Ready Mixed. Over the page at page 1230, at about D on the page, it says:

I therefore proceed to ask myself two questions: First, whether the extent and degree of the control exercised by the company, if no other factors were taken into account, be consistent with her being employed under a contract of service.

So, he asked that preliminary question first, with no other factors being taken into account. He comes to the conclusion on the following page at about point E, that control in that case was extensive indeed and so extensive as to be entirely consistent with the worker being employed under a contract of service.

With that background, if I can turn now to the judgment of Justice Mason in Stevens, which is volume 4, Part C, beginning at page 714 of the joint book of authorities.

KIEFEL CJ: What page is that in the Commonwealth Law Reports, Mr Blackburn?

MR BLACKBURN: It is tab 21, volume 4, Part C. Was that your Honour’s question?

KIEFEL CJ: No. Instead of the joint book of authorities page reference, could you also give us the report reference, the report page number?

MR BLACKBURN: Yes.

KIEFEL CJ: Thank you.

MR BLACKBURN: It is 160 CLR. Page 16 is where the decision begins, but if I can go to page 19 of the Commonwealth Law Report, at about point 6 of the page we see that one of the arguments put for the respondent, Brodribb, in the matter was that:

The concept of a person carrying on business on his own account is more useful than the control test or other indicia suggested by the cases.

The cases relied upon for that proposition were Montreal at page 169 and Market Investigations at page 184, which are the passages we just looked at. It was argued – this appears in the middle of the next page, page 20 of the Commonwealth Law Report – that because Stevens was said to be carrying on a business of his own account:

In those circumstances, control is not relevant, because no amount of control could make the contract one of employment.

So, the argument being put was that the only business test was decisive and control then became not relevant.

So, in Stevens, the significance of the own business test was put at the forefront of the respondent’s argument, and additionally appears from page 18 of the Commonwealth Law Report at about point 8 of the page. It was also argued by the appellant, Stevens, that Gray was the servant of the respondent, and Stevens sought to rely on the organisation test as well. So, both parties were relying on the test, and on the statement of Lord Wright in Montreal, albeit for different purposes, and no doubt it is because at that time it was a test which was thought to have some currency. Justice Mason began his assessment at page 26 of the law report at point 6 of the page, and he says:

it was submitted . . . that regard should be had to the –

what he calls the “organisation test”. He says:

The test seems to have had its genesis in a passage of Lord Wright in Montreal –

and he sets that passage out. So, while Justice Mason is referring to it as the “organisation test”, he means what Lord Wright had put in Montreal. Then he says:

A similar approach was adopted by Denning L.J. in Stevenson Jordan and Harrison Ltd. v. MacDonald and Evans, and Bank Voor Handel –

So, they are the two passages which Mr Justice Cooke relied on in Market Investigations. Then on page 27, Justice Mason.....consider the argument that Gray was part of Brodribb’s business. About point 6 of the page Justice Mason accepts what was said by Justice Starke below, that the control and organisation tests are not alternative tests but are both factors to be weighed. Justice Mason said:

This seems to be what Lord Wright had in mind in Montreal.

Then Justice Mason goes on to expressly reject the proposition that what he again describes as:

the organization test could result in an affirmative finding that the contract is one of service when the control test either on its own –

and that is significant, because he is allowing the control test on its own.....different result:

or with other indicia yields the conclusion that it is a contract for services. Of the two concepts, legal authority to control is the more relevant and the more cogent –

Now, it is clear there that Justice Mason was referring to the test as put forward by Lord Wright in Montreal, because he then goes on to say:

This comment applies with equal, if not greater, force to the competing view, expressed by Denning L.J. in Bank Voor Handel.

So, the initial rejection of the own business, of what Lord Wright had to say, is then followed by a rejection of the manner in which Lord Justice Denning put it.

GORDON J: Mr Blackburn, may I ask you a question. I had understood Justice Mason to be undertaking this kind of analysis in the context of what appears at page 24 and then is reiterated again at page 29, and that is that control is nothing more than just one relevant factor and he was adopting the totality of the relationship test.

MR BLACKBURN: Yes, thank you, your Honour. If we go to what Justice Mason said at page 24 - and what is interesting are the cases which he cites for that proposition. One of the cases he cites with approval is Marshall v Whittaker’s Building Supply which is at footnote 35 and it is page 218 of Marshall v Whittaker’s Building Supply in the decision of Justice Windeyer.

If I can take your Honours to Marshall v Whittaker’s Building Supply [1963] HCA 26; (1963) 109 CLR 210 in volume 3, tab 15. If we go firstly to page 217 of the report where Justice Windeyer at about point 9 of the page sets out his statement as to “the distinction between a servant and an independent contractor”, which has subsequently been referred to. Then he goes, however, in the same paragraph over the next page to say at about five or six lines down:

the legal character of the relationship . . . depends upon the total effect of its terms, and especially on whether the supposed servant was subject to the commands of the employer . . . Lawful authority to command, so far as the work to be done gives scope for it, is still the important test –

and he is there referring to Attorney‑General for N.S.W. v Perpetual Trustee and Zuijs and then:

If there be no right at all in the employer to give directions during the currency of the engagement, the relationship can scarcely be that of master and servant. But, on the other hand, “a reservation of a right to direct or superintend . . . cannot transform into a contract of service what in essence is an independent contract” –

Now, that is the same proposition that was advanced by Mr Justice MacKenna in Ready Mixed, that is a sufficient right of control is essential because otherwise the relationship can scarcely be that of master and servant. But even if you have that right of control that may not be enough to transform into a contract of employment, what is in essence an independent contract, and again, Justice Windeyer is referring to Queensland Stations which is the authority for that proposition.

So, we say that that is what Justice Mason was referring to at page 24 when he said control was one of the indicia. He was not intending to mean that control was not essential but simply that it was not of itself a sufficient test. You may have a reservation of control and yet the contract may not be one of employment, and that is emphasised in argument not only by the reference to Marshall and that passage from Justice Windeyer but also by the fact that Queensland Stations is referred to and stands for exactly that proposition. Zuijs does not say anything to the contrary, it simply says it is the right to control that matters and Federal Commissioner of Taxation v Barrett also in that passage does not say anything to the contrary and refers again to Queensland Stations.

So, while that paragraph on page 24 has been referred to, indeed by our opponents.....the proposition to control is not essential, we are saying that that is a misinterpretation of what Justice Mason is saying and he must be taken to have approved what Justice Windeyer said in Whittaker’s that without control there can scarcely be a contract of service.

So, our submission then, just concluding on Stevens, is that Justice Mason has rejected the proposition, going back to the own business test, that whether a person in business is in business on their own account is an alternative test, saying it is only a further factor and one which is not as cogent or relevant as control.

EDELMAN J: Mr Blackburn, you do not say that control is a binary thing, that either you have it or you do not have it, do you? I mean, is control not sort of a spectrum from a very small amount of control to a very large amount of control, with various different dimensions in which a worker can be controlled?

MR BLACKBURN: Yes.

EDELMAN J: So, it is very, very difficult to see how it is, sort of – it can be said to be a necessary criterion when the issue, really, is, what degree of control would be sufficient, together with other factors?

MR BLACKBURN: Yes, and that is how it is expressed, in the case, Mr Justice MacKenna referred to a sufficient right of control, and that is also supported by the decisions of Justices Wilson and Dawson in Stevens, where they said that the degree of control exercised by the mill operator and somebody else, a supervisor, was not sufficient, was not the requisite degree of control to give rise to a contractor service, and the control, in that case, was theoretical rather than actual.

So, we agree there needs to be a sufficient degree of control, but if there is not a sufficient degree of control, then we say there cannot be a contract of service. Even if there is a sufficient degree of control, there may still not be a contract of service, because, as in Queensland Stations, there may be other countervailing factors.

STEWARD J: Well, can I ask a question? I think Mr Justice MacKenna said sufficient control such that the person is your master. How would you express that in modern terminology?

MR BLACKBURN: Justices Wilson and Dawson, I think, referred to it as sufficient degree of independence for the person not to be – whether the degree of independence overall – this is at page 36 of the decision in Stevens:

whether the degree of independence overall is sufficient to establish that a person is working on his own behalf –

So again, there is this question of the degree, and that will be a question of fact, as to whether there is a sufficient degree of independence or control to enable a contract of service. But even if you get to that threshold level, then all of the other factors still have to be considered, to see whether they nonetheless point to the contract being an independent contract.

GORDON J: Can I ask about that, I also referred you to page 29 of Justice Mason’s judgment in Stevens, where at the top of the page his Honour quotes from Wirth Bros about the different kinds of control and about the changing social conditions, which picks up the question you were asked by Justice Steward. Do you take issue with what Justice Mason cites from there, and what he concludes at the end of that paragraph?

MR BLACKBURN: What we say about the statement that control is not now regarded or is now not regarded as the only relevant factor, it is simply that it is using it in the same sense it is used earlier. So, you may have a sufficient reservation of control, but it may still be outweighed by other matters. We do not take that, particularly given Justice Mason’s seeming approval of what Justice Windeyer had said in Whittaker’s, we do not take that passage as indicating that Justice Mason is indicating control is no longer necessary. The other point that ‑ ‑ ‑

EDELMAN J: But why is Justice Mason not saying anything more than the amount of control that will be sufficient will depend upon the totality of the relationship, including all of the other factors? So, the presence of a number of other factors might mean that lesser control than otherwise would be required would be sufficient?

MR BLACKBURN: Well, earlier, we have seen the passage where Justice Mason says that control may, on its own, yield the result that a contract is a contract for services, and is also clearly indicated, a view that control is the more relevant indicator. In the reference to Zuijs, in Zuijs there was extensive control. Zuijs does not stand for the proposition that no control is required. There had to be control, even if it could only be.....or collateral matters, there still needed to be control.

The acrobat in Zuijs was subject to considerable control in respect of all matters other than the short time he spent doing his routine. He was part of a travelling circus, and he was subject to control in many other ways, and these were set out in the decision, including in the grand parade, including in the day‑to‑day routine of the circus and its travelling and so forth. So Zuijs does not stand for any proposition that you do not need a right of control, only that, in some circumstances, actual control may not be possible, but you still need a legal right of control, and there must be some room for it.

So, in our submission, if we go back, also, to some earlier statements in this Court, including what Justice Kitto had to say in Attorney‑General (NSW) v Perpetual Trustee Co Ltd, which is volume 3, Part C - 85 CLR 237 at 299 to 300, Justice Kitto said that one of the elements of control that was required was:

obedience to orders –

and then he went on to say, over the page, at page 300, that:

without the obligation to obey orders there can be no meaning in the relationship, and it therefore cannot subsist.

That seems a logical proposition, because it is the master/servant relationship. It has never changed. We call it employer/employee now, but it is still the master/servant relationship, and you cannot be a servant without an obligation to serve, and you cannot be a master without some lawful authority to command. It is the very nature of the employment relationship. That is what Justice Kitto is saying there, and he goes on to make the point again, at page 303, where he says, at about line 4 of the page:

while an obligation of obedience to orders as to the manner of doing work is a sine qua non of the relation of master servant, it does not follow that the existence of such an obligation is conclusive that the relation out of which it arises is that of master and servant.

So, it is the same point again. Control and authority to control is a necessary element, but it may not be enough to give rise to a contract of employment. That was the same point expressed by Justice Windeyer later in Marshall, and he cited Justice Kitto and, of course, that was then, as I have indicated, referred to with approval by Justice Mason in Stevens.

There has been no subsequent statement of this in this Court which has denied the proposition that control is an essential element. We say nothing in Stevens denies the proposition and, in fact, Stevens endorses it by Justice Mason approving Justice Windeyer’s remarks.

Subsequent decisions - in Hollis the question did not arise because the couriers were subject to extensive control, both as to the manner and the performance of the work and not even being permitted to refuse work. So, whether control was essential was a moot point. In Sweeney v Boylan, whether a control was a necessary element does not appear to have been raised at all, probably because of the way the matter was argued.

In that case it was not clear whether it was even contested that the mechanic was a contractor. The appellant’s argument would seem to be that Boylan was vicariously liable for the mechanic’s negligence because the mechanic was its representative, relying on the Court’s decision in Colonial Mutual. So, there was no discussion of whether control was essential.

We say that the proposition that control is essential is expressed in decisions such as those of Justice Gitto and Justice Windeyer, picked up by Justice Mason, and it is entirely on all‑fours with the position which obtains today in the United Kingdom, being the position expressed in Ready Mixed.

If I could come back now to the own business test, which is a separate point. We saw that the own business test had been rejected in Australia by Justices Mason and Stephen and we say that nothing in Hollis departed from that. In Hollis the Court applied a multifactorial approach, taking several factors into consideration. I will not take your Honours to that decision. It will be firmly in everyone’s mind.

The first of those factors was that couriers were not running their own enterprise, but the inquiry did not end there because the Court then went on to consider a whole range of other factors such as control, deterrence and representation and tools and equipment, before concluding about nine paragraphs later that couriers were employees.

If the majority in Hollis had intended to say that the identification of business is now a decisive test, then they might have been expected to make that clear because that would have been a substantial departure from what had been said in Stevens. On the contrary, the majority in Hollis said they were applying an existing principle and they endorsed Stevens.

Similarly, in Sweeney v Boylan the Court did not accept the identification of a business as an alternate or deciding test. The Court referred to the fact that the mechanic had his own business. The fact that a person has their own business is, we accept, a strong indication that they are an independent contractor.

So, in a case where they have their own business the Court can be expected to point that out and that is one of the deciding factors, but it does not mean that if you do not have your own business you cannot be an independent contractor and you must be an employee. In Sweeney v Boylan the Court again took a multifactorial approach, they did not just limit themselves to whether the couriers had their own business and that can be seen at pages 48 to 49 of the Commonwealth Law Report in Sweeney v Boylan.

Now, in England the own business test suffered a swift demise after being endorsed by the Privy Council in Lee Ting Sang and it is now accepted in England and we cite the cases in our written submissions. We do not have time today to go through them but the cases are entirely consistent and it is accepted in England that – and they are all Court of Appeal decisions after Labour Force which is a High Court decision – but it is accepted in England that in a typical triangular case the worker will usually not be held to be an employee of the agency.

Indeed, it has been said it would be an exceptional case where there will be a contract of employment between the worker and the agency and that is because there is no control, or no sufficient right of control residing in the agency over the worker and the English courts have also cautioned against a finding that a person is an employee simply because they do not have a business of their own and those references are in our written submissions at footnotes 34 to 37. Indeed, I think it is fair to say that based on the state of the English authorities if this case was brought in England it would be quickly dismissed.

STEWARD J: Mr Blackburn, before you go on, can I just try and understand something about your case. If Mr McCourt was an independent contractor as you say, what is it about characterising what he did as his business that you resist or do not like? Leave aside.....just as a matter of principle.

MR BLACKBURN: Well, the usual – there are a number of tests for a business and Mr McCourt did not have – did not meet those usual tests: do they have goodwill, do they have their own premises, those sorts of things.

STEWARD J: You do not have to have goodwill to be in a business. You do not have to have these things. You do not have to have them.

MR BLACKBURN: No, we understand that.

STEWARD J: .....

MR BLACKBURN: I am sorry, your Honour.

STEWARD J: The main things are having regularity, periodicity, a system, the receipt of money. You do not even have to have a profit.....

MR BLACKBURN: Yes. Well, it was not part of our case below that Mr McCourt had a business, but we say we do not need to determine that because that is not the test. The test is whether he is an employee. The further difficulty that we have with the own business test, apart from the fact that it is contrary to authority both here and in England is that it is simply not apt, in a triangular arrangement such as we have now.

The Market Investigations was a bilateral case. Only a year later Mr Justice Cooke wrote the leading judgment in Labour Force, which is a triangular case on all‑fours with this one, and he expressly approved the test in Ready Mixed, and without referring at all to Market Investigations he found that the labourers working on the building site with a very similar arrangement to the present case were independent contractors. In fact, he said that if the court below had not found them not to be employees, then he might have found them to be sui generis, but nonetheless, he did not need to decide that because the question was were they employees.

So even Mr Justice Cooke did not regard Market Investigations and the own business principle as applying to a triangular arrangement, and in Hall v Lorimer, the Court of Appeal subsequently observed Mr Justice Cooke was not intending to lay down an all‑purpose definition of “employment”.

In Montreal, Lord Wright, when he framed that test, prefaced it by saying the crucial question is whose business is it. So, the test is expressed - is concerned not merely with whether the worker is in a business on their own account, but rather on the identification of the business on which to impose liability. The crucial question is whose business is it.

If you apply that test to the present case, the business in which the work was performed which created the enterprise risk, provided the tools, organised and controlled the work, was Hanssen Business. But of course, there was no contract between Mr McCourt and Hanssen, so the business sense breaks down.

Similarly, Justice Windeyer in Marshall, when he spoke of the difference in a person in service of the employer, and the employer’s business, and a person who carries on business of their own, in a triangular case the tests broke down because the worker may neither serve the employer in the employer’s business, nor carry on a business of their own. So, it is a test which is not apposite to a triangular arrangement such as.....

The test also assumes, as the appellants have assumed, that an independent contractor is someone with their own business. So, if you can just ask whether someone is an employee, you can answer that question by asking whether they have their own business, whether they are in a contract.

The problem, as I raised earlier in answer to a question from Justice Steward, was that the terms “employing an independent contractor” have no settled meaning under the common law. The relevant passage that I referred to is Stevens at page 35 - I will not take your Honours to it - where Justices Wilson and Dawson explain that “employment” is largely undefined as a legal concept except in terms of the various criteria.

So, the question of whether someone is an independent contractor has usually been a secondary question. It has invariably risen in the context of determining, as the primary question, whether the person was an employee, because either the question was whether, either for the purpose of imposing vicarious liability, or it may have been for the purpose of determining whether the person was entitled to benefits as an employee under a statute, or whether a putative employer was required to pay a levy under a statute, so the primary question is almost always, are they an employee?

Then the various indicia for employment are applied to that question, and if the worker is found not to be an employee, then they are described as an independent contractor. It really does not matter how they are then described, because it is enough that they are not an employee. In that way, the term “independent contractor” has become a catch‑all term to describe someone found not to be an employee. It is only in that context that the relationship of independent contractor and employee can be said to be truly dichotomous, in the sense of not only being mutually exclusive, but also covering all possibilities.

There are a couple of cases dealing with triangular arrangements in which the courts have considered whether a worker in Mr McCourt’s position might be sui generis. One was the UK decision of Labour Force and Justice Cooke in the end said we do not need to decide because it is about workers and not employees.

If the term “independent contractor” was to be given a fixed meaning as meaning only a person with a business, then the two terms would no longer be dichotomous and you could end up with people who were neither employees but also who did not fall within that fixed meaning of “contractor”. It is a bit like the PSI legislation where you may not have a personal services business within the definition of a “personal service business” in the Income Tax Assessment Act, but that still does not mean that you are an employee.

In that scenario, of course, we fix the definition of “independent contractor” as someone with a business but asking whether they are an independent contractor or whether they have a business still does not tell you whether they are an employee because they may be neither. It is difficult to define and it is impossible to define an independent contractor, in the same way that it is impossible to define an employee. One is the converse of the other. T

The most that can be said about the independent contractor is probably what Justices Wilson and Dawson had to say in Stevens, that someone with a sufficient degree of independence and the other party to the contract. In this case, if we look at the manner of those terms, Mr McCourt was independent of Construct. He had not agreed to be controlled nor was he controlled by Construct. He was not part of Construct’s organisation. He did not wear Construct’s uniform. He was not represented to Construct’s clients or to the public as a Construct representative. He had the right to refuse work and to work for others. So, we say that Mr McCourt was sufficiently independent of Construct to make him an independent contractor.

What the appellant seeks to do is to introduce this narrower definition of “independent contractor”, which is contrary to authority, and then to argue that anyone who does not fit that narrow definition must be an employee. In other words, they seek to treat the employee category as a catch‑all and that way they invert the inquiry.

The only question the Court needs to be concerned with is – this is a statutory question – whether Mr McCourt was an employee. It is not a case of shoe-horning Mr McCourt into one or other of the categories. If he is not an employee, that is the end of the inquiry. It is not a case of best fit. If Mr McCourt does not fit someone’s idea of the archetype independent contractor it does not matter because there is no fixed definition of an independent contractor.

The two further short points I am going..... The first is.....the appellant say well, we are not departing from principle; we are applying the multifactorial approach. That is so but they are only applying the multifactorial approach to a much narrower question. For example, it is not enough to consider the question of control solely for the purpose of asking whether a worker has their own business, which is the appellant’s approach.

Control is to be considered in asking whether as between Mr McCourt and Construct, the two parties to the contract, there is a necessary element of servitude on the one hand and lawful authority to command on the other for their relationship to be one of employment. Whether Mr McCourt has a business is an aside.

The true inquiry needs to be focused on the relation between Mr McCourt and Construct. Is that an employment relationship? That is the statutory question: is Mr McCourt an employee? It is not whether he has a business. Similarly, it is not enough to consider the question of representation.....integration solely for the purpose of asking whether the worker has their own business. That question also needs to be asked for the purpose of determining whether the worker is the representative of the other party to the contract.

So, what the appellants are doing by replacing the questions are narrowing and shifting the focus of the inquiry and, as Justice Mason said in Stevens, whether the worker has a business of their own is a factor to be weighed. It is not the question and it does not by itself provide the answer.

The last point we make in the own business sense in the hope perhaps it will save us having to write a note is just an observation about the Jamsek appeal. Now, the proposition is the appellants in Jamsek have argued that an independent contractor must have a business of their own. In our submission, that is not something that needs to be decided in that matter. The only question that arises in Jamsek is whether a person can be an employee if they are working in their own business or, to put it another way, whether if a person has their own business, they must be an independent contractor and cannot be an employee.

But even if a person conducting their own business is necessarily a contractor – we do not comment on that proposition – but even if a person who has their own business must be an independent contractor, it does not follow that every independent contractor must have their own business and that you can only be an independent contractor if you have your own business. So, we say that the question that arises – and this does not arise in Jamsek though they have advanced it as a point of principle - Jamsek is only concerned with whether the truckdrivers in that case were working in their own business and whether that precludes them from being employees.

Your Honours, if I can move now to proposition [6] in our outline and I have dealt with this largely already on the question of control. We say that the position here is the same as it is in England, in which there must be lawful authority to command “in a ‘sufficient degree’ for a contract of service to exist”. Even so, there was no basis for saying the position is different in a triangular arrangement which is what our opponents suggest.

While in a triangular arrangement such as the present, the worker performs a service for a third party. The question still is whether the contract between the worker and the agency is one of employment. That is still a bilateral contract that needs to be considered. There is no basis in principle or authority for suggesting it should be viewed differently. It is still the same question, albeit it is in a triangular arrangement.

KIEFEL CJ: Mr Blackburn, do you disagree with the proposition put by the appellants that in reality Construct commanded or directed Mr McCourt to obey the directions of the builder Hanssen?

MR BLACKBURN: Yes, we do, we do.

KIEFEL CJ: That is a matter of construction, is it, of the contract?

MR BLACKBURN: Yes, but also that raises two points for us, your Honour. One is – and this is a matter that you raised earlier, and that is whether it is enough in this case to look at the contract. We say no, Hollis says quite clearly that you look at the written terms and the practice – the practice and terms, and that is at paragraph 24 in Hollis. In this case, we say that the practice was entirely consistent with the written terms because when you look at the practice Construct did not exercise any control at all over Mr McCourt.

KIEFEL CJ: But the appellants have said that what “co‑operate” means, and reading the contract as a whole means, is that Construct effectively had the right to tell Mr McCourt, and did, to go to the worksite – turn up at the worksite, present yourself for work and obey the directions given by Hanssen, and that if you are looking at what followed that is in fact what happened.

MR BLACKBURN: Yes. Firstly, as to the construction of the contract, and we agree that the contract needs to be construed as a whole, the contract was expressed to be between Mr McCourt as an independent contractor and Construct, so the word “co‑operation” needs to be construed in that context, in a context where the parties have labelled their relationship as one of principle and independent contract. The word “co‑operation” therefore can be seen not to have the elements of control that one would find with an employment contract.

KIEFEL CJ: In the context of a tripartite relationship such as this what could it mean other than that Mr McCourt was to do what Hanssen required of him within lawful bounds?

MR BLACKBURN: Well, Construct did not need to control Mr McCourt, did not need a provision in a contract requiring Mr McCourt to obey every direction of Hanssen, because it was obvious that if Hanssen wanted workers, Construct found workers and referred workers, and then as Mr Leon van der Plas in his affidavit explained to workers and.....explain this, if the host is happy with you then you will probably keep going for the duration of the job, and if the host is not happy with you, you will probably finish up, which is a statement of the obvious. But that is how in practice the system worked. It did not need any element of control on Construct’s part. Construct is referring the worker to the builder and hopefully they will get on fine and the worker will continue on.....contract.

STEWARD J: Mr Blackburn, so can I just understand the way you put that. I will paraphrase it and you can tell me if I have understood correctly or not. Your point is that under this arrangement there is no need for a legal right of control because it is in Mr McCourt’s interest if he wants to earn money to turn up and consent to do what he is directed to do in the knowledge that if he did not the very next day he would turn up and Hanssen would not let him into the building site because he has no contractual relationship with Hanssen at all to be let in. Is that how it works, it is consensual rather than ‑ ‑ ‑

MR BLACKBURN: Yes.

KIEFEL CJ: Mr Blackburn, if Mr McCourt declined to do what Hanssen required of him, would he be in breach of his agreement with Construct?

MR BLACKBURN: He could well be. It depends on how, how the term “co‑operate” is construed. Now, the other point I would make, then is that ‑ ‑ ‑

KIEFEL CJ: Well, what do you say it means? Do you say that it means if not to carry out work as required by Hanssen?

MR BLACKBURN: It is no more than, we say, the implied duty to co‑operate, which is found in almost all service contracts, unless excluded. So, every independent contractor, unless it is excluded, will have an implied term requiring the parties to co‑operate with one another.

KIEFEL CJ: That is usually because the independent contractor is operating on the basis of something approaching equality with the person to whom he is providing the services. But you would not say that of a labourer who is acting under the direction of a builder, would you? He is not co‑operating, he is complying with directions and that is what it means in that context.

MR BLACKBURN: Well, there is nothing in that phrase which allows Construct to direct or control Mr McCourt. At most, it is a requirement of the contract that Mr McCourt co‑operate with Hanssen. It is not a provision which vests any right in Construct to control or issue directions to Mr McCourt. There is a passage in Zuijs, for example, which we have referred to in one of the footnotes of our written submissions, where the point is made that the independent contract could actually set out in great detail if the principal wished to avoid reserving a right of control, and a contract could set out in great detail how the work was to be performed. So, we say that there is nothing in that clause which gives Construct any right to control the work.

GORDON J: Mr Blackburn, it depends what you describe as “the work”. If you accept that clause 1(d) says that, subject to performance by Mr McCourt, if his obligations under this agreement, he will get paid by Construct, and you ask yourself, well, what are his or its obligations under this agreement, then are you not compelled to go to clause 4 and read not only is he compelled because he has contracted with Construct to do the following, co‑operate with Construct, number one:

in the supply of labour to the Builder –

that sounds like an obligation imposed upon him which he has agreed to:

Co‑operate in all respects with . . . the builder in the supply of labour to the Builder –

and then you go to (c), he has contracted with Construct to attend at a building site:

as agreed with the Builder –

so, he is under the control of, at least in those respects - those are his obligations that he has given up to Construct in exchange for payment.

MR BLACKBURN: Well, firstly, in terms of the agreement to attend at a given time, that applied, obviously, just to the first day, and it is no different to an agreement with any independent contractor to turn up at a particular time and at a particular place.

GORDON J: I do not know that that is right. I think that has to be read with clause 1(c). So, you have this – Construct running a business, where it arranges for people to turn up for certain durations as:

the builder requires such labour, the place at which labour is to be supplied, the daily hours of work –

and then the, what we might describe as the flipside of that obligation, in terms of the obligation that is created by the contract on the contractor, is that, in (c), that he will turn up, and he will turn up and supply labour for the duration required by the builder, being that which has been negotiated by Construct, at least, under 1(c).

MR BLACKBURN: Yes. Well, we come back to the point that the provisions of the contract need to be construed in the context that Mr McCourt is described as a self-employed contractor. So, the contract needs to be read conformably and any provisions that may otherwise impute.....in our submission would need to be read down in accordance with the fact that the contract is expressed to be one between contractor and principal.

The argument that is being put was also put in the English case of Bunce, which we have referred to in our materials. I should add that the primary argument in Odco was put when special leave was sought and denied and while it has no precedent value it, it is an expression of opinion by members of the court. But that was the exact argument that was put by the applicants for special leave in Odco, that the builder was exercising control delegated to it by the labour hire agency and special leave was denied on the basis that it enjoyed insufficient prospects of success.

In Bunce there was a much clearer provision in the contract. It is at volume 5, tab 28 of the authorities at page 936. It is [2005] EWCA Civ 490. The contract in that case – this is at paragraph 6 of the decision ‑ required the worker to:

Co-operate with the Client’s staff –

but not only to do that –

and accept the directions, supervision and instruction of any person in the Client’s organisation to whom he/she is responsible and conform to the Client’s rules and regulations -

So, the contract between the agency and the worker in that case went much further. The conclusion of the court was that that did not give rise to the type of control required to satisfy an employment contract. At paragraph 29, the conclusion of the Court is:

I cannot, however, accept the mere fact that the client’s day‑to‑day control originates, so far as the appellant’s obligation is concerned, in a term of the contract between –

the agency and the worker:

is enough to satisfy the requirement for control by –

the agency:

The law has always been concerned with who in reality has the power to control what the worker does and how he does it.

In that case, of course, that was the client. So even though in that case the provision in the agency worker’s contract was much, much clearer than the current one, the Court of Appeal said that is not – the type of control is sufficient, and we are interested in who, in reality, has the power to control. What the circumstances and the practice in this case reveal, and that is why we say we rely on not only the ‑ ‑ ‑

EDELMAN J: Mr Blackburn, what do you understand the Court of Appeal to mean by “in reality”? Does “in reality” mean anything more than who has the right, the legal right to do so, or – and if so, what does it mean?

MR BLACKBURN: Well, I take it as meaning that there was not a sufficient right of control over the performance of the work. It was considered that it did not give the agency sufficient right of control over the performance of the work. In this case, in our case, it is clearer still, because the contract between the agents, Construct and McCourt, goes nowhere near as far as the contract in..... In our case, there is nowhere that Mr McCourt agreed to obey Construct’s directions. There was an obligation to co‑operate, but there was no ability, in Construct, to issue directions to Mr McCourt, and in practice there was no ability either, of course, because ‑ ‑ ‑

KEANE J: Mr Blackburn, Mr McCourt’s obligation under its contract with Construct was to provide labour. That was it. That was what he provided. He was not a skilled worker, he was not a man with a plan. He was not directing anybody else as to what they were to do, he had no discretion. His obligation was to turn up and co‑operate and do so for the duration that he was required. He could only work upon direction. He could only work upon direction. There was nothing else that he could possibly do, because what he was supplying was his labour.

MR BLACKBURN: Yes, but it was not Construct’s direction ‑ ‑ ‑

KEANE J: But the entitlement originated in the contract with Construct because it was by virtue of the contract with Construct that he obliged himself to subject himself to the directions from Hanssen, because since he was doing nothing other than providing his labour he could do no other.

MR BLACKBURN: Yes, but that still, your Honour, leaves us in the position that Construct did not have the right of control and the right to direct Mr McCourt either as to what he did or how to do it or when to do it.

KEANE J: Save in this very important respect, that the minute that Mr McCourt ceased to obey directions from Hanssen as to what he was to do and how he was to do it, his contract with Construct would have been terminated because he would have been in breach of his obligations.

MR BLACKBURN: Well, there would have had to have been a fundamental breach because there is no express term allowing Construct to terminate a contract.

KEANE J: Because he would have been in fundamental breach - let us not worry about fundamental. It is probably not something that we should talk about any more. But he would certainly have been in breach of his obligation and he would have been in defiant breach of his obligation to co‑operate, because co‑operation required him to provide his labour. It could only be provided as required by Hanssen.

MR BLACKBURN: Yes. Well, any contractor who refuses to do the work that they have been engaged to do will find that their contract is terminated. That is not ‑ ‑ ‑

KEANE J: That is right.

MR BLACKBURN: But that is not the issue. That does not distinguish a contractor from Mr McCourt. He does not say that he is not a contractor.

KEANE J: But it does establish that your client was entitled to terminate his contract if he did not perform in accordance with his obligations to Construct.

MR BLACKBURN: The only entitlement that our client had would be in that event that the contract was fundamentally breached, because there is no express right to terminate and the contract was expressed that Mr McCourt would work for as long as the builder required or Mr McCourt gave four hours’ notice. So, they were the ways in which the contract would normally be terminated, for as long as the builder required, or Mr McCourt gave four hours’ notice. So, there is no provision for the implication of a term allowing Construct to terminate for poor performance.

But if Mr McCourt refused to do any work for the builder then the reality of it is that the builder would cease to use his services before Construct would even find out, which is what happened in the end, that the builder ceased to use Mr McCourt’s services without reference to Construct, without any involvement of Construct.....

STEWARD J: Can I ask you, Mr Blackburn, you say that on the issue of control that has been raised with you, that is, the requirement to supply labour, we still need to read that with 5(b), do we not, namely, that McCourt does not have to accept any offer to provide labour? It is a matter for him.

MR BLACKBURN: Yes, your Honour.

STEWARD J: Then 4(a) and (c) will be engaged.

MR BLACKBURN: Yes, correct, your Honour. Can we put this another way? The obligation on Mr McCourt was to attend the site and co‑operate. That is the service that he was providing and the service that he was providing to Construct, but it did not give Construct a right to control Mr McCourt in the performance of the work, or to direct Mr McCourt in the performance of the work. As the trial judge found at first instance, the reality of it was – and when I say reality this is not to sort of dive into the ether, it is the practice, to use the words in Hollis – in practice, Construct exercised no control over Mr McCourt, barely saw Mr McCourt.

In that situation we say the degree of control that Construct had over McCourt, if any, was so slight as not to be able to give rise to the contract of service, but if we are wrong about that and there was that minimum requirement of control necessary for even a contract of service to exist then we say that the other facts still outweigh any indicators of Mr McCourt being an employee and the facts in particular were the control which existed was slight and in practice even less so. It was perhaps what Justices Dawson and Wilson described in Stevens as theoretical, even Construct’s right to terminate for fundamental breach would fall within what Justices Wilson and Dawson described as theoretical.

The small measure of control, if it had that, coupled with the fact that there was an absence of representation, Mr McCourt – this was a very different case from Vabu in terms of the control. If one looks at Vabu, the workers – Vabu’s business was to control and direct the workers and the Court in Hollis made an observation. But in addition one of the documents said any worker who refuses work will not be offered work again, or words to that effect, so they did not even have the right to refuse work.

The couriers in Vabu wore Vabu’s livery so there was representation, all of the elements which are absent here. Here we have no representation, he did not wear Construct’s livery, he was not represented as an employee, he was represented as a contractor. Any control was minimal, and then on top of that you have the written terms. Then the only thing on the other side is that Mr McCourt did not have a business in the generally understood.....a business.

GAGELER J: Mr Blackburn, you took us to Bunce in the English Court of Appeal, in particular to paragraphs 28 and 29. Has there been any further consideration in the United Kingdom of the issue dealt with in those two paragraphs?

MR BLACKBURN: There are several cases, your Honour, which are referred to in our submissions and no further consideration after those cases as far as we can see.

GAGELER J: That is footnote 34, I think.

MR BLACKBURN: Yes.

GAGELER J: You focused on the United Kingdom, and I can see you have done that for historical reasons, but the issue would come up in any common law jurisdiction where you have this triangular type of arrangement. Did you look beyond the United Kingdom when you were preparing ‑ ‑ ‑

MR BLACKBURN: We did. In New Zealand the position is a little complicated because there is I think section 6 of the Employment Act, I think it is called there, and it says something along the lines of the court shall have regard to the reality of the situation and take into account all relevant circumstances.

In a case called Bryson the New Zealand Supreme Court said something to the effect that all relevant circumstances included the traditional tests, including control and integration and the test of whether a person has a business on their own account. So that is how it is looked at in New Zealand.

In Canada, there is the case that our learned friends have referred to, Ontario v Sagaz, which expresses approval of Mr Justice Cooke’s formulation in Market Investigations, so the own business test is there, although, again, in Sagaz, which is considered the leading authority, a most curious case, because the argument was whether one corporation was vicariously liable for the tort of another corporation, but nonetheless – and the question then was whether that second corporation was an employee.

Nonetheless, the principle was expressed that it was the own business test expressed by Mr Justice Cooke, it was a fundamental test. It was prefaced by the words, I think, that there is no universal test. So, before approving Mr Justice Cooke’s.....the court said there was no universal test. There was also a bilateral case, not a triangular case, and we were not able to find anything conclusive in a triangular setting in Canada. There is different legislation and also different jurisdictions, so we were not able to find anything conclusive either way. That is as far as it went, your Honour.

GLEESON J: What about the US?

MR BLACKBURN: The US. We looked at the US in Silk, because that was referred to in Market Investigations, and they said that they did not - in that case, that the question was the meaning of “employee” in the Social Security Act, and the court said that it did not take account of the common law tests, and that regard had to be - the term “employee” had to be interpreted having regard to the purpose and the intended scope of the statute, and not having regard to the common law test, which is completely the opposite of what we have here. But beyond that, we did not look at the US because, again, of the difficult legislative provisions which make comparison a bit difficult.

If I can come back to Justice Gageler’s question. I think, I stand to be corrected, but I believe that the position of agency workers may have been dealt with by regulation after those various Court of Appeal decisions to require workers to be paid an equivalent amount. I am happy to provide a note after the – perhaps tomorrow, if that would assist the Court. I would not be in a position to do so today. I think there might be agency regulations in place in the UK, to the extent that that is relevant.

GORDON J: Can I just ask, one aspect about the Bunce decision, and that is, am I right to read that the paragraph which precedes – which is 26, which precedes the paragraph that Justice Gageler took you to, in effect, represents a state of the law where control is a necessary but not sufficient condition, so it has a different emphasis on control?

MR BLACKBURN: That is the state of the law that runs through all of those cases. It is the Ready Mixed essential test, yes.

GORDON J: Thank you.

MR BLACKBURN: If I can just have a moment - I am sorry, your Honours.

EDELMAN J: Mr Blackburn, just while you are looking for that, I am wondering whether, given that it seems to be common ground that the reference to control is to a right to control and that a right to control or a legal right to control would almost always come from the contractual arrangements, either expressed in the contract or a contract implied by conduct between the parties, whether it might be more accurate to express this legal right to control indicium or, in your phrase, “necessary criterion”, as whether or to whom and to what extent are obligations owed by the worker in performance of the work.

MR BLACKBURN: Yes, the question of – I am sorry.

EDELMAN J: That is all.

MR BLACKBURN: The question of to whom or in whom the right of control must reside, we say is clearly dealt with in the authorities. It must reside in the employer. In our submission there is no question that lawful authority must reside in the employer and all of the cases say that: Humberstone, Stevens and we have referred to them in our written authorities.

EDELMAN J: In this case, that could only be Construct because Construct, on the assumption that both of the parties have conducted this litigation, is the only relevant party that has a contract with Mr McCourt.

MR BLACKBURN: Yes. In fact, some of those cases in which there has been predation or sham, or something approaching that, such as the Federal Court case in.....Damevski and Quest, they have found that the employer was the host because it was the host that exercised control and not the agency. So, yes, we say that control clearly needs to reside in the other party to the contract, the alleged employer, and that is fundamental to the master/servant relationship. It is not sufficient that somebody else exercises control.

On the facts of the case, there is very little evidence of any control exercised by Construct over Mr McCourt. There was just the one occasion when Mr Marshall, Construct’s representative, saw him wearing a safety harness and said that he had been to Hanssen, that he should not be doing that, and it was Mr Marshall’s view that Mr McCourt was not licensed to work at heights.

That was a statutory obligation that Mr Marshall had to intervene because, having identified a safety hazard, he was required by the Occupational Health and Safety Act to give some instruction or direction to Mr McCourt as if Mr McCourt was Construct’s employee and similarly by virtue of the provisions in the Occupational Health and Safety Act Mr McCourt was obliged to comply as if he were the respondent’s employee.

Those provisions are discussed in – we have not set them out in our written submissions, but we reference the relevant passage in the Full Court decision which addressed them. They are 23F(4) through to 23F(6) of the Occupational Health and Safety Act. Those sections impose obligations on both the host and the labour hire agent in relation to those matters over which each has the capacity to control, to provide information, instruction and training to the workers as if they were the employers of the workers and the workers were the contractors for employees to have the same corresponding obligation to obey safety instructions from both the host and the labour hire agent.

There are specific labour hire agent provisions in section 23F(4) through to (6) of the Occupational Health and Safety Act and those provisions are set out in the joint book of authorities beginning at page 95. I will not take your Honours to them; I am mindful of the time.

The appellants did argue that the safety guide you were taken to earlier was contractual and the safety guide appears in the respondent’s further book of materials at page 36. If I can take your Honours to that again.

GAGELER J: Do you say it was found to be contractual in the court below or do you just ‑ ‑ ‑

MR BLACKBURN: Well, we could be wrong, but that is what we understand from paragraph 160 of the Full Court decision where Justice Lee says:

I therefore accept that the Safety Induction Manual was contractual –

and by the safety induction manual they were referring to that document that my learned friend took you to earlier on, which begins at page 36. It is not so much a manual as an eight or nine‑page guide. That is the document. Then the so‑called acknowledgement is the document on page 46 and nothing in that acknowledgement obliges Mr McCourt to comply with the terms of what I will call the manual. It simply says that “I’ve had it read or explained to me and I’ve understood its content”. So, he is not signing up to the manual. Nothing in that 10‑point acknowledgement that he signs has that effect. We say that there is no basis for concluding that the manual was incorporated into the contract.

The contract, it was common ground below, arose each time Mr McCourt was offered and accepted work at a particular site. The contract did not arise at the time Mr McCourt was interviewed and signed the ASA. It arose at a later stage when he was offered and accepted work over the phone and it would have incorporated the terms of the ASA and whatever was said over the phone.

That is the view that has been taken of these sorts of arrangements in Odco and in fact by this Court in Accident Compensation v Odco took the same view of when the contract actually arose. So, there is really in this case three contracts, one when Mr McCourt starts at the first site, one when he comes back and starts again and the other one when he moves to the.....site each time a new contract had been formed.

We say there is no basis for the safety guide to be incorporated. As the guide indicates, it is simply a general guide to workplace health and safety. Mr McCourt, as appears from Mr van der Plas’ evidence, was interviewed and it was explained to him and Mr van der Plas gives evidence about this - and it is paragraph 67 of the trial judge’s reasons – as to why Mr McCourt was given the guide, in order to ensure that the workers understood their safety obligations, and Mr van der Plas deposed that he explained that by signing the acknowledgement the applicant was acknowledging that they had understood and agreed to the 10 points listed on that page.

So, there is no basis, we say, from there to conclude that the manual was incorporated into the contract. Of course there was also another reason why it might be inferred the respondent would want the worker to sign that acknowledgement, and that is so that the respondent has a record, should it be necessary, that the safety guide with those matters were raised with the worker and that is evidence of the steps which the respondent has taken to comply with its statutory duties.

There are a number of Federal Court decisions - Justice Lee referred to one, Romero, in which various policies have been incorporated into the employee’s contract of employment. In those cases, cases like Romero, Riverwood and Nikolich, which are referred to in Romero, they have involved cases in which the employer’s policy contained provisions of benefit to employees which would not have been able to be enforced unless they were incorporated into the contract, and the employment contract, on the other hand, contained a provision requiring the employee to abide by the employer’s policies, and in that scenario, rightly or wrongly, the Federal Court found that the contract incorporated the policy.

But that is not this case. The safety guide did not contain any promises or hold out any benefits Mr McCourt would need to enforce. There was no need for the safety guide to be regarded as contractual, because Mr McCourt was already under a statutory obligation to comply with directions from both Construct and Hanssen, as if he were its employee, but even if we are wrong about that we would say that the signed acknowledgment was incorporated, that is, acknowledgment by itself, or, alternatively, even if the safety guide was also incorporated into the contract, we say that a right of direction limited to safety matters does not constitute a sufficient degree of control to sustain a finding of employment. It comes back to ‑ ‑ ‑

GORDON J: May I ask one matter about this, and I may be missing something, but I had understood that he had already agreed with Construct in the ASA that he would carry out the work at the builder in a safe, competent and diligent manner, so he had already undertaken some of these obligations in relation – already, in the ASA.

MR BLACKBURN: No, your Honour. We say at the time of the ASA there was no offer of work - no offer of work had been made, no offer of work had been contemplated and the proposition was, and it was explained to him, that if there was work he would be contacted and he would be offered work at a particular site for a particular builder and there was no obligation on him to accept that work. So, the ASA was an umbrella document which would apply to any contract that had come into force if and when he accepted an offer of work, which he was under no obligation to do.

There was no obligation in the ASA to perform work, so, in our submission, it cannot be a contract of employment by itself, and that is the view that was taken by this Court in Accident Compensation v Odco. So, we say that the safety obligations did not lead to a sufficient finding of – a sufficient degree of control, to limit the obligation in relation to safety matters.

There was a comment, an observation by Justice Ipp in Sweeney v Boylan, in the Court of Appeal, when Justice Ipp was giving the decision of the Court of Appeal.....by this Court, and he said something to the effect that it would be a curious case where a person was an employee without the employer being able to exercise any control.

That is the difficulty with the finding that Mr McCourt was Construct’s employee. If Mr McCourt was Construct’s employee, Construct could not tell him what to do, could not direct him as to what to do, or when to do it, or how to do it, could not direct him as to anything. All that Construct could do was complain about a breach of the agreement and terminate the agreement. It had no right to direct or control him, and that is what basically all of the cases that have dealt with these sorts of arrangements have found, and that is the basis on which Odco was decided, on which Labour Force was decided in the UK, on which all of the other agency cases in the UK have been decided.

If I could move just quickly to the question of vicarious liability, because the High Court in Vabu was quite pointed about the fact that the policy concerns that underpin vicarious liability are important, and in that case they all pointed to the couriers being Vabu’s employees, that Vabu created the enterprise risk and the work was controlled by Vabu and the workers wore Vabu’s livery and were represented as emanations of Vabu, and did the very job that Vabu had contracted to do. Vabu had contracted to deliver parcels and documents and that is what the workers did, so they were in Vabu’s shoes.

Construct, on the other hand, has not contracted to do building work. That is not what Construct does. What Construct does is find workers. Its work is performed by a small group of employees in the office and its client representatives. Construct does not perform building work. That is the difference between Construct and, say, the position of Vabu, which contracts to deliver parcels, the position of Autoclenz, which contracts to clean cars, the position of Uber, which contracts to move passengers. Construct does not contract to build, or to do anything that its clients do. It is simply a finder of labour.

So, we had all those factors in Vabu - control, integration, representation, enterprise risk, deterrence, all pointing in Vabu towards the couriers being employees. In this case, all of the same considerations point away from the finding of employment. The respondent did not exercise control, and from a vicarious liability sense, now we are talking about the real ability to control, because we are talking about risk, and control, or deterrence and damage, so we are no longer talking about theoreticals and the actuality was the respondent did not exercise control either as to how the work was done or even as to what was done and deterrence is not assisted by imposing liability on the party which has no control, and that was the point that Justice Mason made at page 28 of Stevens.

The enterprise risk here was created by Hanssen. Hanssen was the builder, the construction was its operation, it controlled the work. Mr McCourt was not presented to either Hanssen or the public as the respondent’s representative. He did not wear the respondent’s uniform. It was made clear to Hanssen he was an independent contractor, and Mr McCourt was not integrated with the respondent’s business. He was integrated into Hanssen’s business. He attended Hanssen’s pre‑staff meeting, performed Hanssen’s work for Hanssen’s schedules, supervised by Hanssen supervisors.

So, in this case, it is the exact opposite of Vabu. All of the factors in Vabu that pointed towards employment here point away - control, deterrence, enterprise risk, representation, identification, integration, all pointing away from the finding that Construct is the employer and, indeed, if Mr McCourt was an employee then it is almost certain that vicarious liability would be on Hanssen, pro hac vice.

So, the law of vicarious liability accepts that for all practical purposes the agency would not be the employee, even for that purpose. Of course, Hanssen, for its part, would have its own obligations, direct obligations, to Mr McCourt. It would owe common law duties of the type discussed by Justice Mason in Stevens and by Justice Brennan in Stevens at pages 31 and 47 in relation to those onsite, duty to co‑ordinate the work, duty to supervise, where supervision was necessary.

Hanssen would also owe a non‑delegable duty to Mr McCourt, by reason of the control that it exercised over him, but getting back to vicarious liability, it looks like all of the vicarious liability indicators of this case point away from Construct being.....and those questions of representation and so forth, deterrence, they loom large in Vabu. It is said the test was to be informed by considerations of vicarious liability, and here they all point away.

That comes then to the written terms and we say there was no error in the written terms. Now, we notice that my learned friend today did not press upon the Court the sort of approach taken in cases such as Autoclenz. Autoclenz stands for no more than a proposition for when there is reason to question the genuineness of a contract and you do not need to look at the label, but that proposition has been around, as has been pointed out, since R v Foster and before, cases like Narich and Chaplin and so forth. There is nothing new about that. But here there was no reason not to accept the written terms as a genuine indicator of the parties’ bargain.

It was accepted by the appellants that the respondent intended to enter into a relationship of principal contractor and thought, quote, “subjectively in its heart of hearts that the workers were independent contractors”. There is no suggestion in this case of sham or pretence and there is no question of overreaching either, and that is why the Full Court found and said that:

There is no unconscionability or predation –

that is at Full Court paragraph 36, no suggestion of a “sham or pretence”, trial judge at paragraph 177, and paragraph 4. In those circumstances the court is entitled to have regard to the characterisation terms as an expression of the parties’ bargain. The appellants in their written submissions have referred to the imbalance in bargaining power. My learned friend today appeared to withdraw from that proposition. But, of course, it has never been the case in Australia that the imbalance of bargaining power should be a factor to be taken into account.

The Full Court made the observation at paragraph 117 that it should be take into account because the work contract, they said, “as distinct from commercial contracts, often involves inequality of bargaining power” and so for that reason it should not have the default of a tie breaker – that is what the Full Court said. The Full Court also referred disparagingly to so‑called contracts of adhesion being contracts in which one party presents its terms to the other on a “take‑it‑or‑leave‑it” basis.

Now, we say the proposition that a work contract should be distinguished from commercial contracts because a work contract often involves inequality of bargaining power is highly questionable. It has never been the law in this country. Commercial contracts usually involve inequality of bargaining power, consumer contracts always do, and as for contracts of adhesion, well, that is every standard form contract.

So, absent some disqualifying factors such as sham or unconscionability or predation there is no reason not to give the terms and the labels the parties applied due weight.

EDELMAN J: Mr Blackburn, if the question is one of the legal character to which the terms of the contract should bear, then how can the parties by their agreement deem the legal character to be anything other than that which the court finds it to be?

MR BLACKBURN: They cannot, your Honour, and that is ‑ ‑ ‑

EDELMAN J: If that is the case, then how can there be any weight at all that gets put on a term which says the legal character of this agreement is one of employment or the legal character of this agreement is not one of employment? All that is is the parties attempting to impress upon the court the conclusion that the court itself needs to draw from all of the circumstances.

MR BLACKBURN: Yes. The legal characterisation is opposite the legal characterisation which the court places on it, but in coming to that legal characterisation the court is entitled to look at any expression of the parties’ intentions and the label that the parties place on it is the expression of the parties’ intentions and when there is no reason to think that is other than a genuine expression then it can be given weight and all of the cases going back to Narich and cases such as that support that view.

It is a relevant factor and even as recently as Hollis they said it is contract plus practice. Justices Wilson and Dawson said the terms and terminology of the contract may be important. But all of those cases that we have cited indicate that, where there is no reason to think that the label is not a genuine expression of the parties’ intentions, that it can be given and ought be given weight. It has been described in some cases as important and it has always been accepted that it is able to be had regard to particularly where the other terms were ambiguous. So, it is something that the court can have regard to and ought have regard to in arriving at the legal characterisation.

Of the cases which my learned friend outlined but did not refer to today, one was Cam and Sons. Cam and Sons was a case in which it was contended that the agreement was merely a.....sham and the Court agreed. Justice Dixon said it was designed to disguise its real nature. Justice McTiernan said it was a sham, a cloak for concealing the real relationship.

Those conclusions are not surprising because as the headnote of that report indicated – I do not have time to take your Honours to it – it was expressed as a hiring agreement, but it did not require the master and crew to pay for the hire, nor did it place the exclusive possession of the vessel in the master and crew. It was a hiring agreement in name only. In this case, sham and pretence had been disavowed. Cam is of no relevance to this case.

In this case it is accepted that it was a genuine intention to create a relationship of principal independent contractor. The section 357 allegation brought originally was abandoned. So, this is not a case where there has been any attempt to deceive or disguise. It was never pleaded, it was never put to the respondent’s witnesses to disavow it.

The appellants also referred to R v Foster and R v Foster makes the point that labels are not conclusive. But the real point in R v Foster follows immediately after the statement by the majority that labels were not conclusive. This is at [1952] HCA 10; 85 CLR 138 at 151 after Justices Dixon, Fullagar and Kitto expressed their reservations about labels and then say:

For, if in practice the company assumes the detailed direction and control of the agents in the daily performance of their work and the agents tacitly accept a position of subordination to authority . . . a clause designed to prevent the relation receiving the legal complexion which it truly wears would be ineffectual.

If in practice the company assumes the detailed direction and control of the agents, Construct did not assume the detailed direction and control of the agency. Vabu did. Autoclenz did. Uber did. But Construct did not, and that is the difference in this case. That is why cases such as Cam and Sons and Foster really illustrate the difference between those cases and this case.

Lastly, your Honours, there are two further points. One is on the question of the ability to reject work and accept work. My learned friends say in their outline, look, that is something that is common to casuals as well. So, the question might arise then what is the difference between a casual employee employed by a labour hire agency and sent to work under the direction and supervision of the client, and Mr McCourt who was engaged as an independent contractor.

Well, firstly casuals, being employees, by entering into a contract of employment agree either expressly or impliedly to accept the employer’s control and direction. As we said in this case Mr McCourt did not agree to be controlled or directed by the respondent.

By way of example, casual employees may have provisions in their contracts – even if in a casual situation such as Mr Rossato’s case, for example, he was subject to control of work back on the site and it was not possible for his labour hire employer to direct the performance of that work, still there may have been other avenues through which Mr Rossato had control exercised over him.

By way of example, a casual employee may have provisions in their contract providing for probation and qualifying periods, exclusive service, the requirement to perform more work within their skill competence or training, the requirement to follow all reasonable and lawful directions, to abide by the employer’s policies, to abide by performance reviews, grievance and disciplinary procedures, the requirement to wear a uniform, and so on. Mr Rossato’s contract enterprise agreement had many of those things. That is a work back.....between paragraphs 73 and 82.

So that is the first thing, that by accepting an employment contract, the casual employee accepts he or she will subject to control, and there are many ways in which that control could be manifested in the case of a casual employee.

Secondly, if they are required to wear uniforms, the casual employees will be seen by the agency’s client and by the public as representatives of their employer and they are also likely to be integrated into their employer’s workshops through various means – into the employer’s enterprise through various means, the integration being achieved by, for example, attending staff meetings, being included in staff communications, participating in training, performance reviews.....staff, grievance procedures, attending staff functions, and so on. Thirdly, the casual employee’s contracts will be expressed to be employment contracts.

So, the differences between a casual and a contractor are the differences that the respondent relies on in this case: control, representation and integration, and the written terms. If, in this case, Construct had had a need to control the workers it referred to builders, it could have engaged them as casual employees, but it did not need to do so, and it did not do so. It had no need to retain control over the workers, for the reasons that I have given previously, and particularly, it had no desire to have the workers portrayed as its representatives. It did not require them to wear its livery. So, in that circumstance, Construct had no need to engage Mr McCourt as an employee.

There is no legislation that would require Mr McCourt to be engaged as an employee rather than an independent contractor. As long as Construct adhered to the distinction, and did not attempt to improperly control Mr McCourt, then it was entitled to engage Mr McCourt as the independent contractor. Nothing in the Fair Work Act mandates the use of casuals over contractors. In the Full Court, there was a fairly disparaging comment that the respondent had “artfully” structured their arrangement so that minimal interaction occurred between Mr McCourt and Construct.

The arrangement was not an artifice. Construct did not need to control Mr McCourt, so that is not Construct’s business. Its business was to find and refer labour. So, it is far from an artifice and the fact that it would have been entirely different if the parties had entered into a purported independent contract agreement, and then Construct had exercised rights of control inconsistent with such an arrangement, but that is not what occurred, and there can be no objection to a party engaging a worker as an independent contractor, even if the effect of that is to take him out of the realm of the Fair Work Act and into the realm of another Act, in this case, the Independent Contractors Act.

The last issue is the question of the longstanding authority, and there is a line of authority in which the cases are not relevantly distinguishable. My learned friend said, well, they are not a precedent because there is no ratio or they are fact specific. The principle is that where the ratio of a decision cannot be discerned if it is still a precedent in circumstances that are not reasonably distinguishable from those that give rise to the decisions, like cases must be decided alike.

Again, I am short of time, but the principle is explained in the authority at footnote 102 of our submissions, Benson v Rational Entertainment Enterprises Limited, and it refers to Justice McHugh’s statement in Re Tyler, which refers in turn to the speech of Lord Reid in Scruttons.

But more to the point, there are parties who will have relied on the decisions in Odco, and Personnel Contracting, and Young, to structure their affairs, and in those circumstances, those decisions having stood since Odco, so 30 years, the Court, this Court, ought to be slow to depart from them. We rely on the principle in Babiniaris, and this is a strong case, in Babiniaris, because that was only concerned with one decision of the Worker’s Compensation Tribunal, that is the first point, and secondly, the question of labour hire and, in particular, the Odco decision and Odco arrangements were looked at by the Parliament prior to enacting the Independent Contractors Act, and the Independent Contractors Act provides a remedy for workers who consider that their contracts are unfair, by reference to, among other things, the conditions and wages that an employee would be entitled to.

So, for those reasons we would say that the principle in Babiniaris should be followed. Mr Wieske relied on Odco in structuring his arrangements. In fact, in his affidavit, which is included in the materials, he makes the point – I think it was at paragraph 16 of his affidavit – that he had printed out the original decision in Odco in I think it was 2000 or when he structured his arrangements and he produced a copy of that.

While it is not in the further book of materials, it was an exhibit in the proceedings and it had the AustLII date stamp of when he printed it out, I think in about the year 2000, and he relied on that in implementing his arrangements and then it was date stamped 31 January 2001. The reference
to that is at paragraph 16 in Mr Wieske’s affidavit, at page 54 in the book of further materials.

Mr Wieske was not the only person who would have relied on that. There would have been parties who would have relied on the fact that special leave was denied in Odco and then of course Mr Wieske further relied on the contracting decision in his arrangements. There will be other parties in the same boat.

If those decisions are now overturned, then parties such as Mr Wieske and Construct will be liable for massive penalties. In this case, the appellants below pleaded approximately contraventions of 18 different award provisions and another six statutory provisions. The consequences will be very significant. If that sort of change is to be made to what has stood as a consistent line of authority for 30 years, then it is something which should be done prospectively by Parliament.

The appellants say no, the cases are different. If one had a close examination of them, one will find that the cases are not materially different. In the decision of Personnel Contracting that is what the Full Court found. We have given the references in our written materials to the Full Bench decision in Personnel Contracting where the facts can be seen more clearly.

Similarly, in Odco, we have given the reference in our written materials to where in Odco it can be seen that there are a number of labourers in Odco who did not provide their services through a company or partnership, did not provide tools, did not ever have any business of their own and two of them had derived almost all of their work through Troubleshooters and yet still they were found not to be employees. May it please the Court.

KIEFEL CJ: Yes, thank you. Mr Walker, anything in reply?

MR WALKER: Briefly, may it please your Honours. On this last point as to so‑called longstanding authority, the first question, of course, is whether the authority, so‑called, is right or not. I do not want to repeat what I have said about the lack of any true precedential value in the outcome of factual characterisation according to an established legal test. So much disposes, surely, of the idea of precedential value and the fact that, in the very Odco decision, there were labourers involved.

The question is whether there ought to be regarded as any authority that anyone could seriously or properly or prudently rely upon as to that covering the position of labourers. That is not the way in which stare decisis operates.

The second thing is this. It is surely not proposed that anything in the nature of an estoppel arises of any kind at all. Individual reliance is neither here nor there. It is a societal question as to whether a decision which, in this case, turns on what I will call common law, true, common law of statutory interpretation, but by reference to the ordinary meaning of an expression which springs from master and servant, which is a status and relation recognised at common law.

When that is in question, in our submission, the proposition that people have relied upon what is, ex hypothesi, a mistaken view, cannot possibly be admitted as a reason to distort the common law because it would by definition be a distortion of the common law to hold oppositely from what, ex hypothesi, the Court would otherwise hold. Now, that is not in accordance with common law method. In short, if there has been error, then the sooner it is corrected, the better. If there has been conduct that ‑ ‑ ‑

EDELMAN J: Mr Walker, is that right? Is it right to say that an error in the common law which, if corrected, would retrospectively or perhaps retroactively impose criminal liability upon parties, is something that should be corrected nevertheless?

MR WALKER: Yes, your Honour. In relation to criminal liability there may well be an occasion for generalisations about prospect to go to ruling to be reconsidered. It may even be that that is the very kind of thing for which urgent remedial legislation is required. The tail should not wag the dog, in our submission. Of course consequences for those who have ordered their affairs, to use the cliché, ought to be taken into account as of course the Court would always anxiously take into account, in considering whether some people’s perceptions of the law should be exposed as erroneous.

That brings me to my next point. Your Honours should certainly not assume that what is reasonably called the Odco model enjoys, as it were, a monolithic body of support either generally or in what might be called the realm of industrial relations. In particular, one should not proceed on the basis that there has never been an argument that Odco prevents employment existing that has failed. In our submission, they are always by definition case by case. That is why the legal test or characterisation approach is in question and that, in our submission, has a premium claim for correctness in the eyes of the Court so far as common law is concerned.

Your Honours, reference was made to the Bunce decision [2005] EWCA Civ 490. Can I just briefly point out that relying on reasoning which culminates in his Lordship’s paragraph 29 – I do not need to take you to it – in our submission leaves unanswered questions as to the nature of the “reality” referred to in the italicised words of emphasis in that paragraph and, in particular, does not grapple with what we submit is fundamental to the question, namely what is the juristic source and nature of the authority, power or right. In our submission, as in this case, in Bunce it could only have been a contract. It is not suggested there is any other source. For those reasons, in our submission, there is a flaw in fundamental aspects of the reasoning in Bunce that render it of no particular usefulness to this Court.

It remains the question as to what is the source of the so‑called control and, in our submission, properly understood, the logical consequence entailed in our learned friend’s argument this afternoon is that nobody controlled. The way in which it is sought to be put as a slight alternative to that is that Hanssen controlled and yet we know that Hanssen has no contractual right against Mr McCourt at all, cannot sue him for contractual damages for failing to do something.

For those reasons, of course, there was, and was only ever a source of authority in the promises made – and we have drawn to attention in particular 4(a). I do not want to repeat what I have said in‑chief about it. Then one leads with the interpretive question as to whether 4(a) in using the expression “co‑operating” in all respects with Construct and the client, the customer – in this case mostly Hanssen – whether that involves a liberty to disobey lawful directions.

Now, lawful directions by Hanssen simply means directions that do not invite the commission of crime and they probably do not involve the limits as between employer and employee which will govern whether it was a true contract of employment. But it suffices to say that dissatisfaction by the customer or client, Hanssen, is of course in practical economic and social terms a means by which the destiny of Mr McCourt on site may be radically altered.

That is not control within the meaning of the common law’s reference to that as one of the critical indicia of a relation of employment as opposed to independent contracting. That control comes from, as in particular one sees in the reasons of Justice Mason to which your attention has been drawn – in particular one looks for where there resides a right or entitlement.

Control may be a defining characteristic of a relationship as much when it is not exercised in particular instances as when it is constantly day by day or hour by hour the subject of instructions. It is the fact that 4(a) imposed an obligation which was backed up by a contingent possibility of a financial indemnity for failure to co‑operate with customers or clients such as Hanssen that, in our submission, constituted the control, exactly the same way as if a far more fine‑grained and detailed statement of job responsibilities had been scheduled to a straightforward contract of employment. They are equally promises to do something in a particular way.

The co‑operation which is required goes far beyond the standard implied term, term implied by law between contracting parties. This is, in particular, aimed at an obligation owed, and owed only to Construct for Mr McCourt to co‑operate with clients or customers such as Hanssen.

Justice Edelman drew to attention the Court of Appeal of New York’s decision of Braxton v Mendelsohn 233 NY 122 found in 135 NE 198, if that is convenient. That was an issue, of course, that turned on what their Honours regarded as the question whether a driver was loaned, as it is put by his master, who was a trucking contractor, to another, that is the milk manufacturer in that case, to do the latter’s business, or alternatively, was he, in performing the work of the trucking contractor for the third party, the milk manufacturer, simply performing work for his master, the trucking contractor, within the scope of his employment.

It is in that context that the question was posed as being that which remained after consideration of particular matters of a kind with which your Honours are now familiar being “in whose business was the servant engaged at the time”. The fact that orders were required to be taken and obeyed, which were delivered on behalf of the dairy corporation to the Shakers was, as the court held, obviously necessary, that being the nature of the trucking corporation’s business of supplying vehicles and drivers to customers of the trucking corporation. None of that was regarded in that decision as detracting from the relevant outcome.

As to other US cases about which my learned friend was asked, as your Honours appreciate, there is a plethora of settings in which issues that might superficially appear to resemble the one before this Court today has arisen over more than a century of United States and in the states of the United States. By way of an example of how the setting tends to render such authorities of perhaps only marginal interest is by way of example the National Labour Relations Board v United Insurance Co of America [1968] USSC 43; 390 US 254 (1968) where the statute in question, the National Labour Relations Act, actually stipulated in the provisions of the Act that persons were not employees who were independent contractors.

So, the dichotomy, as it has been called in shorthand in this argument, was actually posed as a closed class as it were by the terms of the statute which rather reduces the usefulness of what might appear. All those cases tend also to be very much subject to the exigencies of the limits on
judicial review of administrative decision‑makers’ evaluative assessments of the nature of a relationship for the purpose of characterisation.

However, it is of some note to see at the top of page 259 of the US Reports in that case that decisive factors have at the head of the list the agents do not operate their own independent businesses. I will not read on from the passage. May it please your Honours.

MR BLACKBURN: Your Honour, may I have 30 seconds. I have one matter I overlooked – I seek leave to ‑ ‑ ‑

KIEFEL CJ: Yes, Mr Blackburn.

MR BLACKBURN: Thank you, your Honour. It is just a minor matter. There was reference in the appellants’ reply to Odco Contractors being said in the parliamentary report it preceded the Independent Contractors Act. The co-contractors were.....ABN.....did not have an ABN. None of the contractors in any of the Odco Cases had ABNs. The original Odco Case preceded the introduction of the GST and ABNs and from the time of the introduction of the GST and ABNs on 1 July 2000, labour hire workers have not been eligible for ABNs whether they are employees or not and that is because under Australian tax laws work done by an individual under a labour hire arrangement, whether it is done as an employee or a contractor, it is excluded from the definition of “enterprise”.

We have included the relevant statutory provisions in the joint book of authorities in volume 2, Part B, tabs 4, 5 and 7 and also in volume 7, Part E at tab 46. I just wanted to get that.....out of the way. May it please the Court.

KIEFEL CJ: Yes, thank you. Is there anything arising out of that, Mr Walker?

MR WALKER: Just very briefly. Statutory treatment of various statutory obligations is of no moment when considering the approach to the ordinary meaning of “employment” in accordance with the principles and approaches that have been debated. That is the first point.

The second point is that the statutory provision for independent contractors, like the statutory provision in the Fair Work Act for employees positively requires an appreciation and proper application of those matters which are germane to the correct characterisation of one or the other. I am not going to say, but the fact that there are bookended statutes means that there is a perfect and exclusive dichotomy, but we do say that the existence of that statute is absolutely no reason to depart from a proper approach to
the interpretation of “employee” in the Fair Work Act. May it please the Court.

KIEFEL CJ: The Court reserves its decision in this matter and adjourns to 10.00 am tomorrow.

AT 4.17 PM THE MATTER WAS ADJOURNED