The contract said contractor. The tribunal looked at what actually happened
A remote worker hired as an independent contractor was really an employee, Australia's workplace tribunal ruled - letting her dismissal case proceed.
The Fair Work Commission handed down the decision on July 7, 2026, in a case that turned on a question plenty of employers get wrong: does calling someone a contractor actually make them one?
The worker signed on in July 2025 under an "Appointment Setting Services Agreement." On paper, everything said contractor. She had her own ABN, invoiced monthly, sorted her own tax and superannuation, used her own laptop and phone, got no leave, and was free to work for others. She was paid commission, starting at 5%.
Then the role grew. She shifted from booking appointments to also closing sales, and her commission climbed to 15%. By the time the company ended the arrangement on October 28, 2025 - giving two weeks' notice and locking her out of its systems that same day - she was working around five hours a day.
She took the matter to the Commission under s.365 of the Fair Work Act, alleging she had been dismissed for exercising workplace rights. The company's answer was blunt: she was never an employee, so there was no dismissal and no case to hear.
Settling that threshold question meant applying s.15AA of the Act. That provision, added after the High Court's Personnel Contracting and Jamsek decisions, tells the Commission to weigh the "real substance, practical reality and true nature" of a working relationship, not just the wording of a contract.
The label did not hold up. The Commission found the company controlled how the work was done. The worker had to use its CRM, its Zoom account, its calendar and its Canva sales deck, with no room to swap in her own materials. Every lead came from the company's marketing, and she owned none of the clients. She could not hand her work to anyone else. Her roles were central to a business that lived or died on client sign-ups. She was working in the company's business, the Commission said, not her own.
The points in the company's favour were acknowledged but outweighed. The worker had her own ABN and equipment, no tax was withheld, and she was free to take other work. The Commission also found she had limited constraints on when and where she worked, with a high degree of flexibility over her hours. And it noted that leave, superannuation and tax setups carry little independent weight, because they tend to reflect what one side simply assumed the relationship was. In the end, the control the company held over how the work was done, and how deeply the worker was woven into the business, tipped the balance.
The conclusion: the worker was an employee, and she was dismissed on October 28, 2025. The Commission dismissed the company's jurisdictional objection, and the matter now heads to conference. Importantly, the Commission has not yet decided whether the dismissal actually broke the law - that question comes later.
The takeaway for HR is a familiar one, but it keeps catching employers out. A contractor agreement is a starting point, not a shield. Once someone is using your tools, following your scripts, living inside your systems and depending on your business for income, the day-to-day reality can override the paperwork - and open the door to the kinds of claims only employees can bring. The danger grows when a contractor's role quietly expands, as it did here, and no one goes back to update the contract.
