AFTER THE WA Industrial Appeal Court recently overturned a controversial ruling that would have restricted the ability of recruitment firms to use contracting arrangements for temporary staff, the Recruitment and Consulting Services Association (RCSA) said the decision provided necessary clarity for contractors
AFTER THE WA Industrial Appeal Court recently overturned a controversial ruling that would have restricted the ability of recruitment firms to use contracting arrangements for temporary staff, the Recruitment and Consulting Services Association (RCSA) said the decision provided necessary clarity for contractors.
The original ruling, made in May 2004, found that two independent contractors on-hired to work for a client were actually employees under State legislation.
At the time, Commission President Justice Peter Sharkey said that, “once a labour hire agency, as defined, arranges for an employee to do work for another person, that agency is an employer, as defined.”
He added that, “The question of day-to-day control by a hirer is simply irrelevant once a contract of employment exists between a labour hire agency and an employee and an arrangement is made by the labour hire agency for the hire of the employee’s services to a hirer.”
While unions welcomed the original decision, Tricord Personnel’s appeal resulted in the two workers being recognised as legitimate independent contractors following consideration of the contractual terms and the limited Tricord control of the work being performed.
In handing down his judgement, Justice Christopher Steytler said there was no doubt that the intention of the parties, as it appears from each contract, was to categorise the relationship as one of principal and independent contractor and not as one of employer and employee.
“In such a case, and in circumstances in which (contrary to what was said by the Full Bench) there is, in my respectful opinion, little to suggest that the label applied by the parties is a sham (and a good deal to suggest that it is not), it seems to me that the evident intention of the parties should be given effect and that the relationship between them should, in each case, be found to be that which they have been at some pains to describe, namely, that of independent contractor and principal and not that of employer and employee,” he said.
Julie Mills, CEO of the RCSA, said the decision “protects the rights of on-hired employees in Western Australia to work as they want to and for on-hired employee service providers to determine the true nature of employees and independent contractors in an on-hired employment contract.
“We welcome this decision because it provides a degree of clarity for people who chose to work as contractors and allows them to be recognised as such,” she said.
