Vicarious Liability, Entrepreneurship and the Concept of Employment at Common Law

Abstract

The concept of employment at common law serves as a gateway to a wide range of statutory labour rights in Australia. Despite its significance in labour law and its frequent invocation before the courts, the concept remains the subject of significant contestation. A major point of disagreement concerns the notion of entrepreneurship. In some cases, judges have stated that entrepreneurship should be determinative of the inquiry as to whether a worker is an employee or an independent contractor. In other cases, entrepreneurship has been treated as simply one factor to be weighed against many others in the multifactorial test for employment status. This article explores the issue from a theoretical and a doctrinal perspective. It draws upon theories and case law on the doctrine of vicarious liability for guidance on the test for employment status. It argues that the proper approach is to treat entrepreneurship as the organising principle for the inquiry into whether a worker is an employee or an independent contractor. It contends that the adoption of such an approach would bring a greater degree of conceptual and analytical coherence to the complex task of distinguishing employees from independent contractors.