Read: 2025fwc2159.pdf
The MBA ACT has recently received a number of enquiries concerning the practical effect of the changes to the definition of ‘employee’ as contained in the Fair Work Act 2009 (Cth).
The changes to the ‘employee’ definition requires that the true nature of the employment relationship be determined, with reference to various factors, rather than relying on what is stated in the employment contract.
The recent case of Hatmane Elezaj v Baldwin Care Group Pty Limited [2025] FWC 2159 provides a practical example of how the true nature of the employment relationship can be determined.
Case Summary
Hatmane Elezaj provided home care services to clients of Baldwin Care Group (trading as Baldwin Living) through the Mable platform, which connects independent contractors with clients needing support. Elezaj entered into separate service agreements directly with the clients, Mrs and Mr Bruce, and invoiced for her services via Mable. Baldwin Living facilitated these arrangements but did not directly engage or pay Elezaj.
Elezaj claimed she was unfairly dismissed by Baldwin Living. However, Baldwin Living argued that Elezaj was not its employee, but an independent contractor engaged by the clients, so the Commission lacked jurisdiction.
The Fair Work Commission examined the nature of the relationship, considering:
- The contractual arrangements showed direct contracts between Elezaj and the clients, not Baldwin Living.
- Elezaj held an Australian Business Number (ABN) and invoiced through Mable, who handled payments.
- Baldwin Living’s involvement was limited to overseeing service delivery on behalf of clients and managing administrative matters.
- Control over scheduling and service details was exercised primarily by the clients, not Baldwin.
- There was no written contract between Baldwin Living and Elezaj.
Although Elezaj argued that Baldwin Living exercised control and integrated her into its team, the evidence showed these were consistent with managing client services rather than an employment relationship.
The Commission found no employment relationship existed between Elezaj and Baldwin Living and dismissed her unfair dismissal application for lack of jurisdiction as Elezaj was not considered to be an employee.
Key Takeaways for Construction Employers:
- Employment Relationship is Crucial
An unfair dismissal claim can only succeed if the worker is an employee. Independent contractors or those engaged via third-party platforms (like Elezaj was through Mable) do not have the same protections under the Fair Work Act.
- Substance Over Form
The Commission looks at the true nature of the relationship, not just labels or contracts. Factors like who pays the worker, who controls their schedule, and who directs their work matter must be considered in making this determination. Here, despite some oversight by Baldwin, the contractual and payment arrangements showed Ms Elezaj was an independent contractor engaged by the clients, not Baldwin.
- Platform and Third-Party Engagements
Use of platforms or intermediaries to engage workers can further complicate employment status. Construction employers should clearly understand and document their arrangements and relationships with subcontractors or labour hire workers.
- Control and Integration are Important Indicators, But Not Definitive
Even where a business exercises some control or oversight over a worker’s activities, this alone may not establish employment if other key factors, like payment and contractual arrangements, point to independent contractor status.
- Documentation and Contracts Matter
Having clear, written contracts specifying the nature of the relationship helps avoid misunderstandings and legal risks. Informal arrangements or ambiguous relationships increase the risk of disputes.
- Terminating a Contractor is Different from Dismissing an Employee
Only employees can be unfairly dismissed. Contractors can have their contracts ended but are not covered by unfair dismissal legislation.
Implications for Construction Employers
Employers in the building and construction industry often engage a mix of employees, subcontractors, and contractors.
To ensure you are not caught out by the new definition of ‘employee’, an employer should:
- Ensure you understand the employment status of your workers.
- Use clear contracts specifying the nature of the relationship.
- Document the arrangement and maintain control consistent with that status.
- Seek advice if unsure whether a worker is an employee or contractor, especially before termination.
If in Doubt, Reach Out!
Contact the Workplace Relations Team at:
📞 (02) 6175 5900
📧 workplace@mba.org.au
