[2025] FWC 304
Citation: [2025] FWC 304
What happened
Hayley Smith commenced working for Kohli Traders Pty Ltd, a care services business, on 13 January 2023, under an Independent Contractor Agreement (ICA). She filed an unfair dismissal application alleging dismissal on 3 October 2024. Kohli Traders argued Ms Smith was an independent contractor, not an employee, and that the working relationship had not ended, meaning no dismissal occurred. The ICA stipulated Ms Smith was free to work for other businesses, invoice for services, provide her own equipment and insurance, and could subcontract work. Emails show Ms Smith referred to being an independent contractor. A dispute arose regarding the scope of services, with Ms Smith claiming tasks like bed-making were not initially agreed upon.
What was decided
The Fair Work Commission has dismissed Hayley Smith’s unfair dismissal application. Commissioner Crawford found Ms Smith was an independent contractor, both before and after the amendment to the Fair Work Act 2009 (s.15AA) on 26 August 2024. The Commission considered the ICA, which outlined an independent contractor arrangement, and Ms Smith’s claim that the agreement was a ‘sham’. While a dispute arose about the scope of services, the Commission found there was no intention to create a false representation of the working relationship. The transitional provisions of the Fair Work Act meant the relationship was assessed under pre-amendment principles initially, then again under the new s.15AA.
What it means for employers
Employers should carefully review their contracts with individuals to ensure they accurately reflect the intended working relationship. Kohli Traders' ICA was deemed genuine, highlighting the importance of clear and comprehensive agreements. Employers should also be aware of the potential for disputes over the scope of work and the implications of a 'sham' contract claim, which requires evidence of intent to deceive.
What it means for employees
Employees should carefully review any contracts before commencing work and understand their rights and obligations. If an employee believes they are misclassified as an independent contractor, they should seek legal advice. The recent changes to the Fair Work Act mean that the assessment of employment status can be complex, and the Commission will consider the substance of the relationship, not just the label applied.
Every statement above is drawn from the published decision. Read the original here:
https://www.fwc.gov.au/documents/decisionssigned/pdf/2025fwc304.pdfWant more cases like this?
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This summary was drafted by AI from the published decision and reviewed before publishing. It is general information, not legal advice. For your specific situation, speak to the Fair Work Ombudsman (13 13 94) or a qualified lawyer. About these summaries & corrections →