EOFY Sale · Save up to $750 off your legals · Ends 30 June

Claim offer
Selected cases

High Court of Australia · [2022] HCA 2

ZG Operations v Jamsek

A High Court contractor-status case about long-term owner-drivers, partnerships and how contracts frame the worker relationship.

High Court of Australia9 Feb 2022

Plain-English explainers, not legal advice. Check the linked official source before you rely on a specific section, and get advice for your situation.

Get legal help

Start here

Quick read

  • Long-running contractor relationships can still be genuine contractor arrangements where the contracts and business structure support independence, but businesses should...
  • A High Court contractor-status case about long-term owner-drivers, partnerships and how contracts frame the worker relationship.

Use this to check

  • Contractual structure matters, especially where contractors operate through partnerships or businesses.
  • A long relationship does not automatically become employment.
  • Superannuation and workplace law can still create separate risk even if common-law employment is not established.

Decision snapshot

  1. 1

    What happened

    • Two truck drivers originally worked as employees, then agreed in the mid-1980s to become contractors.
    • Each set up a partnership with his spouse, bought a truck, invoiced for delivery services and charged GST.
    • They worked almost exclusively for the company for decades, displayed company branding and followed operational requirements, but the contracts were between the company and the partnerships rather than the drivers personally.
  2. 2

    What the court had to decide

    • The Court had to decide whether the drivers were employees despite the partnership and owner-driver structure.
    • It also had to deal with how far courts should look beyond the written contract when the contract is genuine and the parties have acted under it for many years.
  3. 3

    What the court decided

    • The High Court held the drivers were not employees for the Fair Work claims before it.
    • The contracts were with the partnerships, the partnerships owned and operated the trucks, and the legal rights and obligations pointed away from employment, even though the commercial relationship was long-running and close.

Practical impact

Practical read

  • Long-running contractor relationships can still be genuine contractor arrangements where the contracts and business structure support independence, but businesses should not treat that as a free pass.

Useful next steps

  • Contractual structure matters, especially where contractors operate through partnerships or businesses.
  • A long relationship does not automatically become employment.
  • Superannuation and workplace law can still create separate risk even if common-law employment is not established.
  • Check whether the contractor operates a real business with its own assets, risk and customers.
  • Review superannuation exposure separately from employment status.

Practical read

Jamsek is the companion story to Personnel Contracting. Here, the workers had a long and dependent commercial relationship with one company, but they also had a real owner-driver structure: partnerships, trucks, invoices, GST and business expenses. The case shows why the same contractor label can fail in one case and survive in another.

For business owners, the lesson is not that owner-driver or consulting models are automatically safe. It is that the whole legal structure needs to be coherent. A contractor model is stronger when the contract, the assets, the invoicing, the tax treatment and the actual work all point in the same direction.

Checks to run

Key points

  • Check whether the contractor operates a real business with its own assets, risk and customers.
  • Review superannuation exposure separately from employment status.
  • Avoid converting employees into contractors without a genuine structural change.
  • Document the commercial reasons for the contractor model.

Key takeaways

  • Contractual structure matters, especially where contractors operate through partnerships or businesses.
  • A long relationship does not automatically become employment.
  • Superannuation and workplace law can still create separate risk even if common-law employment is not established.

Related topics

Employment & WorkplaceFinance, Payments & Security

How Sprintlaw can help

Contractor AgreementContract Review