The Full Bench of the Federal Court has dismissed an insurance company’s appeal against a 2011 decision that found its five sales representatives were employees and not independent contractors, despite signed contracts saying they were independent contractors. As a result, the workers will be entitled to over $500,000 in accrued annual and long service leave. The Court upheld the findings that the workers lacked the true independence and autonomy to be called individual agents, having regard to the close control the insurance company had over the organisation of the work and how the sales representatives were sent out. ACE Insurance Limited v Trifunovski [2013] FCAFC 3.

Lesson for employers: Caution should be exercised when entering into an independent contracting relationship, particularly with an individual. Organisations should consider, and preferably seek professional advice, as to whether such an arrangement will stand up as a true independent contract rather than one of employment.