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Can a Contractor Claim Unfair Dismissal?

27th October 2021

Under the Fair Work Act 2009 (Cth), certain workers are eligible to receive compensation when dismissed from their job in a harsh, unjust, or unreasonable way. But can a contractor claim unfair dismissal compensation? 

Unfortunately, independent contractors are not protected from unfair dismissal as they’re not employees, and it is employees who are eligible for unfair dismissal compensation.

Despite this, it is possible that the involved parties have mischaracterised the agreed-upon relationship as a contractor relationship when it is actually an employment relationship. In these cases, because the worker is technically an employee, they can be protected from unfair dismissal.

With over 125 proud years of leadership in law, wilson/ryan/grose are the leading legal experts in regional Queensland, advising a wide range of clients from private individuals to corporate entities and government authorities. When considering “can a contractor claim unfair dismissal?”, it is important to note there are a number of moving parts that will affect eligibility.

WRG’s knowledge and leading practice in employment law can help you understand your legal rights in the event of unfair dismissal and assist you in receiving your rightful compensation where applicable.

What is an Independent Contractor?  

An independent contractor is a person that works for themselves and is their own boss. Independent contractors sell their services to others, unlike employees who work in someone else’s business where the employer controls how, where and when they do their work. Ordinarily, contractors are free to determine the price they charge for their services, select the manner by which the services are provided and work for more than one client at a time.

Unfair Dismissal Contractor Rights

Despite this, it is not uncommon for some workers to be engaged as a contractor, obtaining their own ABN and invoicing for their work, who do not meet the legal criteria of a contractor.  Although the worker is labelled as a ‘contractor’, they’re likely to be an employee, meaning in some cases, they’re eligible for compensation. 

While the label that the parties have given the relationship is important, the parties themselves cannot deem the relationship to be something that it is not., In the case of unfair dismissal claims, the Commission will look into the substance of the relationship and determine it’s true characteristics before giving a decision regarding compensation for unfair dismissal. 

How Do the Courts Determine if you are an Employee / Contractor?

The court or tribunal involved will assess a number of factors relating to the working relationship to determine if you are an Employee and are eligible to sue for unfair dismissal:

  • How the work is performed and controlled.
  • Whether or not the person can delegate the performance of their work.
  • Whether the person advertises their services elsewhere.
  • Whether the person works solely for one company.
  • How the person is paid for their work.

When considering “can a contractor claim unfair dismissal?”, it is important to note that contractors have workplace rights and protections, but different responsibilities relating to insurance, taxation, and superannuation. While the relationship may be labelled as one thing, the actual agreement and relationship may be another.

The Fair Work Commission can determine whether or not the dismissal was unfair through analysis as part of a jurisdictional hearing, regardless of the label of the relationship. 

Unfair Dismissal Time Limit

All employees, regardless of whether they have a claim for unfair dismissal in the Queensland Industrial Relations Commission or Fair Work Commission, have 21 days from the date of dismissal to file an application.

The Queensland Industrial Relations Commission / Fair Work Commission can extend this period but will only do so in exceptional circumstances.

It is important to obtain sound legal advice prior to submitting a claim so that you can determine whether you have been genuinely engaged as an independent contractor, or if a mislabelled relationship has taken place. 

Employee Rights Unfair Dismissal

Employees other than of a small business must be employed for at least 6 months before they can file for unfair dismissal.

Employees employed by a small business can only file for unfair dismissal after being employed for 12 months. 

Should I File for Unfair Dismissal?

Unfair dismissal can involve complex legal matters that require the expertise of a lawyer.

At wilson/ryan/grose, our dedicated, diligent, and experienced employment lawyers can advise you as to whether there are grounds for unfair dismissal, and help you decide on the best course of action to follow.

As regional Queensland’s leading legal experts in employment law, we can achieve the best result for you.

If you feel you’ve been unfairly dismissed, contact us on 1800 974 529 to discuss how we can best help you move forward.

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