Jane encountered problems pertaining to contractual work relationship issues with Total Mechanic Management Services Pty Ltd (TMMS). The Common Law Tests (Also known as case law) is used to establish the following two categories.

Based on the information provided, Jane encountered problems pertaining to contractual work relationship issues with Total Mechanic Management Services Pty Ltd (TMMS). The Common Law Tests (Also known as case law) is used to establish the following two categories.

Contract of Service relates to employees who provide labour to the employers. The employers are held accountable for vicarious liability arising from any wrongdoings from an employee’s action. Employees are accorded legislative protections and statutory rights, through welfare and benefits by the employers.

Contract for Service relates to independent contractors who provide services to their clients, in the capacity of a business entity and is self-employed. Unlike Contract of Service, separate general commercial law are covered for independent contractors and they are held responsible for vicarious liability in the event of any kind negligence.

It is a challenge to differentiate and identify the scope of Jane’s employment status. However, a series of control tests shall determine that aspect.

The Control Test consists of two elements, which are the nature, and degree of control the employer has towards the employee. Federal Commissioner of Taxation v J Walter Thompson (Aust) Pty Ltd (1944) 69 CLR 227, states that the producer had exercised great details of control over how the artists must perform during rehearsals and final performance. In relation, TMMS has exercised great control on Jane because she must set precedence to TMMS’s call over other private calls.

Zujis v Wirth Brothers Pty Ltd (1955) 93 CLR 539, states that the proprietor need not exercise the actual control of the employees, rather they have the right to exercise some form of control. TMMS did not directly control how Jane performs her mechanic work, but she was subjected to random checks by TMMS for quality control purposes, which establishes the right of control.

The control test fails to address the problem because TMMS lack the technical knowledge to supervise how Jane performs her duty.

The Integration/ Organisation Test determines whether a worker ...

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The control test fails to address the problem because TMMS lack the technical knowledge to supervise how Jane performs her duty.

The Integration/ Organisation Test determines whether a worker is part and parcel of the organisation. Stevenson Jordan and Harrison v Macdonald and Evans (1952) 1 TLR 101, states an worker employed under a contract of service is an integral part of the organisation. Whereas, work done under contract for service cannot be integrated in the business. It is revealed that works performed by Jane contributed to continual success to TMMS’s business.

In the case of Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 63 ALR 513, Mason J questioned on the reliability of this test. It is established that an independent contractor may also be considered indispensible to the business. Therefore, the Integration Test has failed to identify Jane’s true nature of employment contract.

The Business/ Economic Reality Test distinguishes whether the worker is providing his services on his own account as a business entity or if the worker is an employee with the company. There is a need to establish whether TMMS hired Jane as an independent contractor.

Market Investigations Ltd v Minister of Social Security (1969) 2 WLR 1, states the Market Investigations has detailed control over the interviewer. In relation, Jane was paid an hourly rate for the number of hours worked and was provided allowances for petrol. Although Jane is permitted to take on private call, TMMS jobs are given first priority. Therefore, Jane is depended economically for TMMS to provide enough jobs for her livelihood.

Abdalla v ViewDaze Pty Ltd (2003) 122 IR 215, gave an insight and determined that Jane is not an independent contractor because she did not received any commission for her completed work, but was drawing only a fixed hourly payment. Therefore, this test has failed to establish the true nature of her employment relationship.

The Ready Mixed Concrete Test was discussed because it does not apply to Australia’s employment law.

The Multi-factor Test points to the final test that is used to identify Jane’s employment. It consists of other elements that derive from previous tests. Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 63 ALR 513, states the degree of control and the right by the employer to exercise control. In relation, TMMS has exercised control for Jane to give priority to TMMS’s jobs; she was also required to wear overalls with TMMS’s logo and can be regarded as a representative of the company. However, just by identifying the presence of the control is not sufficient. There is evidence that Tax was deducted from Jane’s payment and she was given 3 week of paid leave while she is away from work. In addition, all tools and equipment were supplied by TMMS. Vicarious liability existed because TMMS is answerable for any dissatisfied work performed by Jane.

By merely labelling the nature of an employment relationship into something else without giving any supported evidence is unacceptable. Employment relationship must be negotiated and put into written agreements. Narich Pty Ltd v Commissioner of Pay-Roll Tax (1983) 50 ALR 417, states that Narich had exercised degree of control on the lecturers. Simply labelling the lecturers, as independent contractors were inconclusive.

Sam had deliberately altered and labelled the employment status of Jane by offering her an independent contractor agreement. The independent/ client relationship cannot be established because Jane’s role as a mechanic has remained unchanged and she still receives remunerations and benefits as per an employee under contact of service. It does not justify that Jane is an independent contractor.

Sham Arrangement is defined where an employer intends to conceal the true employment relationship of contract of service, to avoid the responsibility of fulfilling legal entitlements that are rightfully due to an employee. Fair Work Ombudsman (FWO) v Centennial Financial Services Pty Ltd (2010) , demonstrated that the HR manager had breached the Workplace Relation Act 1996 by not granting the employees their due entitlements. In relation, Sam had intentionally forced Jane into signing the revised contract of employment, so that he could evade the responsibility of vicarious liability and legislatives law, protecting Jane who is an employee.

In conclusion, the facts have established that Jane is duly an employee employed under terms of contract of service. She will have the right to claim accident compensation from TMMS under the Workers’ Compensation and Injury Management Act 1981.