25 Jun Shared Responsibilities: Understanding Joint Employment in Australia
In Australia’s dynamic labour market, it is increasingly common for businesses to engage workers through various working arrangements. This may include labour hiring or independent contracting. While these arrangements offer flexibility, they can also blur the lines of responsibility. Where there is ambiguity surrounding who is the employer, the concept of “joint employment” can arise.
WHAT IS JOINT EMPLOYMENT?
Joint employment is the idea that courts should impose joint liability on two employers. Joint liability can be found under the common law, or for the purpose of some statutes. It exists even in the absence of an express tripartite contract between the employee and the two employers.
Jurisdictions worldwide apply the concept of joint employment. In the United States of America, a business can be liable for the employment conditions of another business’s workers. This occurs when it controls factors that influence those workers’ employment terms and conditions. Similarly, both Canadian and New Zealand courts can divide liability for infringement of employees’ rights across two employers.
JOINT EMPLOYMENT IN AUSTRALIA
The question of whether joint employment exists in Australia has not been answered definitively. Many decisions touching on the subject matter have remained in the Fair Work Commission (Commission). Employees frequently raise joint employment in relation to labour hire arrangements. In these situations, employees attempt to hold both employing agencies and principals liable for employment law breaches.
Please also see our article on independent contracting or sham contracting here.
In the decision FP Group Pty Ltd v Tooheys Pty Ltd [2013] FWCFB 9605 (Tooheys), the Full Bench of the Commission stated that to “apply joint employment to labour hire arrangements would involve a very considerable development of the common law”. While declining to recognise joint employment, the Full Bench applied the description of the state of the law at that time provided by the South Australian Industrial Relations Commission decision in Costello v Allstaff Industrial Personnel (SA) Pty Ltd and Bridgestone Tg Australia Pty Ltd [2004] SAIRComm 13, which suggested that the law in Australia generally strives to find who the “real”, single employer is.
RECENT DEVELOPMENTS
Following the landmark decisions in Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1 and ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2, litigators have changed their strategy. They have brought more claims for joint employment, though these have yet to succeed.
In 2024, the Commission decided on joint employment on three occasions. In Joel Minchin v Civmec Construction & Engineering Pty Ltd [2024] FWC 2204, the Commission flatly stated an argument of joint employment must fail given that the concept does not apply in the Australian jurisdiction. The Commission also revisited the Toohey decision on two occasions, in Marc Casis.v JD.COM Australia Pty Ltd [2024] FWC 809 (Casis v JD.COM) and Rosmaria Binti Ahmad Subji v Stanley Black & Decker Australia Pty Ltd [2024] FWC 2654, before concluding the current law in Australia does not recognise the concept of joint employment.
In Casis v JD.COM, the Commission did comment that any development in the law is a matter for the courts, not the Commission. However, at the date of this article, there are no decisions from a superior court which address the issue.
CONCLUSION
While the Commission has consistently held that joint employment does not exist, it is crucial to understand that its decisions do not set legal precedent. This means the decision of a superior court on this topic could be uncertain. We therefore cannot definitively say how a higher court would rule on the concept of joint employment in Australia.
As such, to mitigate the risks associated with allegation of joint employment, or to reduce ambiguity concerning who is a worker’s employer, business should take the following proactive steps:
1. Review all workers’ terms of engagement with the business to understand the nature of the working relationship.
2. Perform due diligence on all labour-hire firms and independent contractors to ensure they are compliant with Australian laws.
3. Perform regular audits on workers, labour-hire firms and independent contractors.
4. Seek legal advice where it is unclear what workers’ relationship to the business might be.
For more information on industrial and workplace law, please see out other articles here.
GENERAL AND CONTACT INFORMATION
The article, the content and references made are intended to keep an audience updated with information. It is not intended that the article or part of it should be relied upon as advice. Information provided may not apply to in all circumstances or in particular situations. If you do want particular advice , we welcome you to contact us on (02) 9189 5905 or at general@cdclaw.com.au.