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Southern Cross Community Healthcare Pty Ltd v Chief Commissioner of State Revenue (NSW)

Judges:
Emmett AJA

Court:
Supreme Court of New South Wales

MEDIA NEUTRAL CITATION: [2021] NSWSC 1317

Judgment date: 15 October 2021

Emmett AJA

Introduction

1. The plaintiff, Southern Cross Community Health Care Pty Ltd ( Southern Cross ), is engaged in the business of arranging for the provision of in-home attendant care services ( Care Services ) for the disabled, frail and aged ( Participants ). It does so by arranging for the provision of Care Services by support workers or attendant care workers ( Support Workers ). Southern Cross makes such arrangements at the behest of various authorities ( the Funders ), which pay Southern Cross for the provision of such services under contractual arrangements between Southern Cross and the Funders. Southern Cross remunerates the Support Workers, who have no contractual arrangement with the Funders or the Participants. These proceedings are concerned with the liability of Southern Cross for payroll tax under the Payroll Tax Act 2007 (NSW) ( the Payroll Tax Act ) in respect of remuneration paid to Support Workers by Southern Cross in the years ended 30 June 2012, 2013, 2014, 2015 and 2016 ( the Relevant Tax Years ).

2. Southern Cross has received payroll tax assessment notices dated 11 July 2017 in respect of payments made to Support Workers during the Relevant Tax Years ( the Assessments ). By the Assessments, the defendant, the Chief Commissioner of State Revenue ( the Commissioner ), required payment, by 1 August 2017, of sums totalling $6,234,619.67, being payroll tax totalling $6,184,685.11 and interest totalling $867,731.83 (as at the time of the Assessments), less $817,797.27 already paid by Southern Cross. The total interest claimed by the Commissioner is $2,931,967.00 as at 30 April 2021 consisting of market rate interest of $533,967 and premium rate interest of $2,378,000. On 9 October 2017, Southern Cross lodged objections to the Assessments. By letter of 18 April 2018, the Commissioner disallowed the objections ( the Objection Decision ).

3. By its amended summons filed on 4 March 2021, Southern Cross now appeals from the Objection Decision under the Taxation Administration Act 1996 (NSW) ( the Administration Act ). Southern Cross claims orders that the Commissioner withdraw each of the Assessments or, in the alternative, reassess Southern Cross. Against the possibility that it fails in those claims, Southern Cross seeks orders that the Commissioner remit interest imposed. Before outlining the issues raised by

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the appeal, it is desirable to explain the legislative scheme under which the issues arise.

The Payroll Tax Act

4. Under s 6 of the Payroll Tax Act, payroll tax is imposed on all taxable wages . Under s 7, the employer by whom taxable wages are paid or payable is liable to pay tax on the wages. Section 8 deals with the ascertainment of the amount of payroll tax payable and, under s 9, a person who is liable to pay payroll tax on taxable wages must pay the tax within seven days after the end of the month in which the wages are paid or payable, except in the case of June, in which case the person must pay the tax within 21 days after the end of the month.

5. Under s 13 of the Payroll Tax Act, wages means wages, remuneration, salary, commission, bonuses or allowances paid or payable to an employee. Under s 14, wages includes fringe benefits and, under s 17, wages includes superannuation contributions.

6. Under s 10 and s 11, wages are taxable wages , relevantly, if:

• the wages are paid or payable by an employer for or in relation to services performed by an employee wholly in New South Wales,
• the employee or the employer is based in New South Wales, or
• the wages are paid or payable in New South Wales.

However, exempt wages are not taxable wages. I shall deal with exempt wages below.

7. Division 7 of Pt 3 of the Payroll Tax Act deals with "contractor provisions". Under s 32, a relevant contract in relation to a financial year is a contract under which a person ( the designated person ) during that financial year, in the course of a business carried on by the designated person, either supplies to another person services for or in relation to the performance of work, or has supplied to the designated person the services of persons for or in relation to the performance of work. However, relevantly for present purposes, a relevant contract does not include a contract of service or a contract under which the designated person during a financial year, in the course of a business carried on by the designated person, is supplied with services for or in relation to the performance of work, where those services are provided for periods that, in the aggregate, do not exceed 90 days in that financial year.^[1] See s 32(2)(b)(iii).

8. Section 33 provides that a person who during a financial year, under a relevant contract, supplies services to another person, or to whom during a financial year, under a relevant contract, the services of persons are supplied for or in relation to the performance of work, is taken to be an employer in respect of that financial year. Under s 34, a person, who during a financial year performs work for or in relation to which services are supplied to another person under a relevant contract is taken to be an employee in respect of that financial year. Amounts paid or payable by an employer during a financial year for or in relation to the performance of work relating to a relevant contract are taken to be wages paid or payable during that financial year.^[2] Section 35.

9. Division 8 of Pt 3 of the Payroll Tax Act, which includes ss 37 to 40, deals with "employment agents". Under s 37, an employment agency contract is a contract under which a person ( an employment agent ) procures the services of another person ( a service provider ) for a client of the employment agent. An employment agency contract, under which services are supplied by an employment agent, or a service provider is procured by an employment agent, is not a relevant contract for the purposes of Division 7.^[3] Section 32(3). Under s 38, the employment agent under an employment agency agreement is taken to be an employer and, under s 39, the person who performs work for or in relation to which services are supplied to the client under an employment agency contract is taken to be an employee of the employment agent.

10. Under s 40(1), any amount paid or payable to or in relation to the service provider in respect of the provision of services in connection with an employment agency contract is taken to be wages paid or payable by the employment agent under the employment agency contract. However, s 40(2) provides that s 40(1) does not apply, relevantly, to an employment agency contract to the extent that an amount, benefit or payment referred to in s 40(1) would be exempt from payroll tax under Pt 4, had the service provider been paid by the

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client as an employee. Section 40(2) applies only if "the client" has given to the employment agent, in the form approved by the Commissioner, a declaration to that effect.

11. Part 4 of the Payroll Tax Act deals with "exemptions". Division 3 of Pt 4 deals with "health care service providers". Under s 51, which is in Div 3 of Pt 4, wages paid or payable by a health care service provider are exempt wages if:

• the wages are paid or payable for work of a kind ordinarily performed in connection with the conduct of a health care service provider; and
• the wages are paid or payable to a person engaged exclusively in that kind of work.

12. Part 3 of Sch 2 to the Payroll Tax Act, which has effect by the operation of s 100, deals with "exemptions". Division 2 of Pt 3 of Sch 2, which consists of cll 7 to 10 inclusive, deals with "health care service providers". Under s 51(3) and cl 7 of Div 2 of Pt 3 of Sch 2, a health care service provider is a public hospital or a hospital that is carried on by a society or association otherwise than for the purpose of profit or gain to the individual members of the society or association.

13. Clause 8 of Div 2 provides that wages paid or payable by the Crown in respect of staff employed in connection with a public hospital or a Local Health District are exempt if:

• the wages are paid or payable for work of the kind ordinarily performed in connection with the conduct of public hospitals or of the Local Health District concerned; and
• the wages are paid or payable to a person engaged exclusively in that kind of work.

The Administration Act

14. Section 86 of the Taxation Administration Act 1996 (NSW) ( the Administration Act ) provides that a taxpayer who is dissatisfied with an assessment that is shown in a notice of assessment served on the taxpayer may lodge a written objection with the Commissioner. Under s 91 of the Administration Act, the Chief Commissioner must consider such an objection and either allow the objection in whole or in part or disallow the objection. Under s 94, the fact that an objection is pending does not in the meantime affect the assessment or decision to which the objection relates and tax may be recovered as if no objection were pending. Division 1 of Pt 5, which deals with interest in respect of tax defaults, applies to an amount of tax required to be paid following the determination of an objection.^[4] Section 95 of the Administration Act.

15. Under s 97 of the Administration Act, a taxpayer may apply to the Supreme Court for a review of a decision of the Commissioner that has been the subject of an objection if the taxpayer is dissatisfied with the Commissioner's determination of the objection. A review by the Supreme Court is taken to be an appeal for the purposes of the Supreme Court Act 1970 (NSW).

16. In such an appeal, the Court is required to consider the correct application of the provisions of the Payroll Tax Act to the relevant materials before the Court and has power to confirm or revoke the assessments or make an assessment or other decision in place of the assessments.^[5] See Tasty Chicks Pty Ltd v Chief Commissioner State Revenue (NSW) (2011) 245 CLR 446 ; [2011] HCA 41 at [12]-[20] . Under s 101(1) of the Administration Act, the Court may make any order as to costs or otherwise as it thinks fit. Under s 119(b) of the Administration Act, the Commissioner's notice of assessment is prima facie evidence, for the purposes of a review proceeding, that the amount and all particulars of the assessment are correct. As the appellant, Southern Cross bears the onus of proving, on the balance of probabilities, all matters necessary for the relevant questions to be answered in its favour.^[6] See s 100(3) of the Administration Act.

17. For the purposes of the Administration Act, a tax default is, relevantly, a failure by a taxpayer to pay, in accordance with the Payroll Tax Act, the whole or part of tax that the taxpayer is liable to pay.^[7] Section 3. Under s 21, if a tax default occurs, the taxpayer is liable to pay interest on the amount of tax unpaid calculated on a daily basis from the end of the last date for payment until the day it is paid at the interest rate from time to time applying under Div 1 of Pt 5 of the Administration Act.

18. Under s 22 of the Administration Act, the interest rate applying under Div 1 of Pt 5 is the sum of the market rate component and the premium component. The market rate component is the Bank Accepted Bill rate rounded to the second decimal place or the rate

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specified for the time being by order of the relevant Minister published in the Gazette. The Bank Accepted Bill rate in respect of any day is defined in s 22(4) by reference to the yield of 90-day Bank Accepted Bills published by the Reserve Bank of Australia. The premium component is 8% per annum. Under s 24, if judgment is given by or entered in a Court for an amount of unpaid tax, the interest rate determined in accordance with Div 1 of Pt 5 continues to apply, to the exclusion of any other interest rate, until the tax is paid. Under s 25 the Commissioner may, in such circumstances as the Commissioner considers appropriate, remit the market rate component or the premium component of interest or both, by any amount.

Grounds of Review

19. The Commissioner assessed Southern Cross for payroll tax on the basis that remuneration paid by Southern Cross to Support Workers in the Relevant Tax Years was subject to payroll tax as wages on the basis that the Support Workers were common law employees of Southern Cross. That is to say, he treated the Support Workers and Southern Cross as being parties to contracts of service. In its amended appeal statement of 25 July 2019, Southern Cross contends that the Support Workers are not common law employees.

20. However, Southern Cross also contends that some or all of the payments made by it to Support Workers in the Relevant Tax Years are not subject to payroll tax because they were made in relation to employment agency contracts and were exempt under s 40 and cl 8 in Sch 2 of the Payroll Tax Act. Southern Cross says, in the alternative, that if its arrangements with Support Workers are not employment agency contracts or are not exempt under s 40 and cl 8 in Sch 2, some of the payments fell within s 32(2)(b)(iii) of the Payroll Tax Act.

21. The issues as to liability raised in the appeal may be summarised as follows:

Issue (1)A Whether the arrangements between Southern Cross and the Support Workers are employment agency contracts within the meaning of s 37(1) of the Payroll Tax Act.

Issue (1)B Whether, if the arrangements between Southern Cross and the Support Workers are employment agency contracts, the exemption in cl 8 of Sch 2 would apply to the Support Workers.

Issue (1)C Whether, if the arrangements between Southern Cross and the Support Workers are employment agency contracts and the exemption in cl 8 of Sch 2 would apply to the Support Workers, the requirement for a declaration to the effect referred to in s 40(2) is essential for the application of the exemption.

Issue (2) Whether, if the arrangements between Southern Cross and the Support Workers are not employment agency contracts, the Support Workers are "employees" of Southern Cross by reference to the common law meaning of that term.

Issue (3) Whether, if the arrangements between Southern Cross and the Support Workers are not employment agency contracts and the Support Workers are not common law employees, payments to any of those Support Workers satisfy the 90-day rule in s 32(2)(b)(iii) of the Payroll Tax Act.

Issue (4) If Southern Cross is liable to pay any payroll tax, whether any amount of interest charged by the Commissioner on that payroll tax should be remitted, in whole or in part, under s 25 of the Administration Act.

22. If, in relation to any Support Worker, each of Issues (1)A, (1)B and (1)C is answered "yes", payments to that Support Worker will not be liable to payroll tax. If, in relation to any Support Worker, Issue (1)A is answered "yes" and either Issue (1)B or Issue (1)C is answered "no", or Issue (1)A is answered "no" and Issue (2) is answered "yes", the payments by Southern Cross to that Support Worker would be taken to be wages under s 40(1) of the Payroll Tax Act. If, in relation to any Support Worker, Issue (1)A is answered "no", Issue (2) is answered "no" and Issue (3) is answered "yes", some of the payments will not be liable to payroll tax. If, in relation to any Support Worker, each of Issue (1)A, Issue (2) and Issue (3) is answered "no", the payments by Southern Cross to that Support Worker would be taken to be wages under s 40(1) of the Payroll Tax Act. Issue (4) only arises if

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Southern Cross has any liability for payroll tax in respect of the Relevant Tax Years.

Issue (1)A, Issue (1)B and Issue (1)C: Sections 37, 40 and cl 8 of Sch 2

23. Southern Cross contends that the arrangement between it and each Support Worker constitutes an employment agency contract under s 37 of the Payroll Tax Act because it consists of a contract under which Southern Cross procures the services of the Support Worker for a particular Funder. Southern Cross contends that the Funders are its "clients" for that purpose and that s 40(2) applies to some or all of the payments by it to the Support Workers because:

• amounts paid by it to the Support Worker would be exempt from payroll tax under cl 8 of Sch 2 had the Support Worker been paid by the relevant Funder as an employee of the Funder, having regard to the following:
- ○ each of the Funders, being New South Wales Government entities or Commonwealth Government entities, is "the Crown";
- ○ each of the Support Workers works in connection with a public hospital or Local Health District;
- ○ the work of each of the Support Workers is of a kind ordinarily performed in connection with the conduct of public hospitals or the Local Health District concerned; and
- ○ each of the Support Workers is engaged exclusively in that kind of work; and
• each of the Funders has given, or has been asked to give, to Southern Cross a declaration as referred to in s 40(2).

Accordingly, Southern Cross says, such payments made by it to each of the Support Workers are not wages and are therefore not subject to payroll tax.

24. The Commissioner, on the other hand, contends that the Court should not be satisfied that the Support Workers provide services in an employee-like manner to the Funders such that it could not be said that a Support Worker swells the workforce of the relevant Funder. Accordingly, the Commissioner says, there is no employment agency contract between Southern Cross and a Support Worker.

25. The Commissioner contends that Southern Cross provides services to Participants of a kind that the Funders do not provide and that the Participants are aware that the services are being provided by Southern Cross. The Commissioner disputes that the Funders are "clients" of Southern Cross for the purposes of s 37 of the Payroll Tax Act. Further, the Commissioner says, the Support Workers do not provide their services for public hospitals or Local Health Districts and they do not work in connection with public hospitals or Local Health Districts. Finally, the Commissioner says, the Support Workers do not undertake work of a kind ordinarily performed in connection with public hospitals or Local Health Districts.

26. In any event, the Commissioner says, the Funders have not provided the declaration referred to in s 40(2), which is an essential requirement for the exemption relied on by Southern Cross. Accordingly, the claimed exemption under s 40 is said to fail on that basis alone.

Issue (2): Common Law Employment Relationship

27. Payroll tax is payable on "wages" paid or payable to "an employee". The term "employee" is not defined in the Payroll Tax Act and therefore has its general common law meaning. Southern Cross contends that the true character of the relationship between it and each of the Support Workers is not one of employment at common law. Rather, it says, having regard to the totality of the relationship, each of the Support Workers is more properly considered to be an independent contractor rather than a party to a contract of service giving rise to an employment relationship between Southern Cross and the Support Worker.

28. Southern Cross relies on the following indicia as pointing towards an independent contractor relationship and away from a common law employment relationship:

• Each of the Support Workers expressly agreed in writing with Southern Cross that he or she would not receive any of the usual incidents of an employment relationship,

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such as sick pay, annual holiday pay or redundancy payments, such that they were self-employed;
• Each of the Support Workers performed his or her services away from the premises of Southern Cross and without any presence by Southern Cross at the relevant locations of service;
• there was no control by Southern Cross over any of the Support Workers in undertaking the services performed nor a right to exercise control, in that the overall scope of the services performed by each of the Support Workers is determined by the relevant Funder, the Participant for whose benefit the services are performed and the treating doctor of that Participant and, within that framework, each of the Support Workers determined how to perform the services provided by him or her;
• each of the Support Workers was free to perform similar services for other entities unrelated to Southern Cross;
• none of the Support Workers was required to wear a uniform;
• each of the Support Workers was free to reject engagements, to nominate his or her own working hours and to arrange for another of the Support Workers to undertake some of his or her engagements;
• each of the Support Workers supplied his or her own motor vehicles and mobile telephones and was not reimbursed by Southern Cross for expenses incurred in relation to those matters;
• each of the Support Workers was personally liable in relation to the services performed by him or her and was insured in relation to such liability;
• each of the Support Workers agreed to indemnify Southern Cross against liability for loss or damage arising out of the performance of the relevant services by the Support Worker;
• each of the Support Workers generally lodged tax returns identifying himself or herself as self-employed, claiming deductions accordingly; and
• following a detailed investigation by the Fair Work Commission, a determination was made that the Support Workers were independent contractors.

Issue (3): 90-day Rule

29. Alternatively to Issue (1) and Issue (2), Southern Cross contends that some of the payments made by it to Support Workers fall within the exclusion in s 32(2)(b)(iii) of the Payroll Tax Act on the basis that they were payments to Support Workers who provided services to Southern Cross for periods that do not exceed 90 days in any Relevant Tax Year. Southern Cross contends that the provisions should be construed such that the prerequisites of s 32(2)(b)(iii) will be satisfied by reference to numbers of hours worked by Support Workers in a year rather than by reference to the number of days on which a particular Support Worker worked during a year. Southern Cross bases its contention on the premise that 8 hours worked is equivalent to one day.

Issue (4): Remission of Interest and Penalties

30. Southern Cross contends that, to the extent that any payroll tax shortfall remains after the resolution of the three issues set out above, the Court should exercise the discretion conferred by s 25 of the Administration Act to remit the interest charged in full or should at least remit the premium element. Southern Cross asserts that its payroll tax affairs have been audited by the Commissioner on four previous occasions and, on each occasion, the Commissioner confirmed that no additional payroll tax was payable in respect of the Support Workers. Southern Cross contends that its operations and its relationship with the Support Workers have not changed since the Commissioner last found that payments made to Support Workers were not subject to payroll tax. Southern Cross complains that the Commissioner has not given an adequate explanation as to why his position has changed, with retrospective effect. It contends that, in the circumstances, the interest charges, particularly the premium rate, served to act as a penalty.

The Evidence

31. The parties tendered a substantial number of documents evidencing the arrangements, during the Relevant Tax Years, between Southern Cross and Funders, between Southern Cross and Support Workers and

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between Southern Cross and Participants. The volume of the material was necessary having regard to the period to which the dispute relates, the number of Funders and the number of Support Workers. In addition, affidavit evidence was given by officers and employees of Southern Cross, including Ms Barbara Merran and Ms Deborah Dubos, both of whom were cross-examined.

32. Ms Merran is the Public Affairs Director of Southern Cross. She has been a registered nurse since 1974 and has had experience in providing home care for injured and disabled persons. She and was the founding President and was involved in the establishment of the Attendant Care Industry Association, which is the peak body for attendant care service providers operating throughout Australia. In 1984, Ms Merran and her partner, Mr Alexander Djekic, established the business now operated by Southern Cross and she has been the Public Affairs Director of Southern Cross for more than 30 years and has been a director of Southern Cross since October 1985. Mr Djekic has been the Managing Director of Southern Cross since 4 October 1985.

33. Ms Dubos is the Manager of Community Support and Services for Southern Cross. She has been a registered nurse since 1980 and commenced employment with Southern Cross in October 2000 and, although her title has changed from time to time, her role has been the same since that time. Before 2000, Ms Dubos held various positions in nursing and has numerous qualifications in nursing. From October 1999 to May 2000, Ms Dubos was seconded to the Western Sydney Area Health Service as an Associate Director of Nursing and Community Services. During the Relevant Tax Years, Ms Dubos was the manager of two Southern Cross teams, who reported to her. One was the Service Delivery Team and the other was the Community Support Co-ordinators Team. I shall describe the functions of the two teams below when dealing with the arrangements between Southern Cross and Support Workers.

34. Southern Cross and the Commissioner also adduced opinion evidence. Professor Jeffrey Braithwaite, who is director of the Australian Institute of Health Innovation, prepared two reports for Southern Cross. Associate Professor Christopher Kewley of the University of Newcastle also prepared two reports for Southern Cross. Dr Stephen Duckett, director of the health programme at the Grattan Institute, prepared a report for the Commissioner and Mr Paul Preobrajensky, who is a health service manager with 25 years of experience in the hospital and aged care service sector, also provided a report for the Commissioner. Professor Braithwaite, Assoc Prof Kewley and Dr Duckett also provided a joint report dated 26 October 2020 ( the First Joint Report ). It is interesting, although not decisive, that the report referred to Participants as "clients". In addition, Assoc Prof Kewley and Mr Preobrajensky provided a joint report dated 28 October 2020 ( the Second Joint Report ). All four gave concurrent oral evidence. Ultimately, there was no significant difference of opinion and the findings made below are based on their reports.

Overview of the Relevant Arrangements

35. Southern Cross is engaged by Funders to supply Support Workers to perform care services for Participants. That entails a quadripartite arrangement designed to ensure that adequate care is provided for Participants. The four parties to the arrangements are:

• Funders, which require care to be provided to Participants and make payments to Southern Cross;
• Southern Cross, which sources and administers Support Workers to provide care for Participants and makes payments to the Support Workers;
• Support Workers, who provide care to Participants and who are paid by Southern Cross; and
• Participants, who receive care without making any payment for that care.

36. Payments made by Funders to Southern Cross are based on the hours of care provided by Support Workers. Southern Cross categorises Participants into five groups according to their needs and the type of care they receive, as follows:

• Participants with spinal cord injury ( SPI );
• Participants with acquired brain injury ( ABI );

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• Participants in need of home and community care;
• Participants in need of home care packages; and
• Miscellaneous Participants.

The first two categories have high needs and make up approximately 66% of total revenue received by Southern Cross from the Funders. The other categories make up approximately 22%, 6% and 6% respectively of total revenue.

37. Southern Cross adduced evidence consisting of documents and files in relation to some 39 Participants, who were selected by way of example as to the arrangements made for the provision of care services to Participants. Those documents and files were the subject of the opinion evidence adduced by both Southern Cross and the Commissioner. The First Joint Report considered a cohort of 38 Participants, and the Second Report considered a cohort of 39 Participants, although the two groups were entirely identical, save for one. The Second Joint Report appears to have included one extra Participant, number 195, who was not dealt with in the First Joint Report. There was clinical complexity in the case of all of those Participants, such that even those classified as "less complex" might have "high needs" and therefore a high risk of decompensating, needing to go into hospital quite quickly, and ending up in an intensive care unit if there was any change in the continuity of the care that they received. Thus, even low-needs Participants would need to interact with medical or allied health professionals on a regular basis by reason of their condition, having regard to "the multi-comorbidities" of such Participants.

38. Southern Cross sought to identify Participants who were said to be representatives of particular categories of Participants who received benefits funded by various Funders. The Commissioner co-operated in that endeavour without conceding that the requirements of cl 8 of Sch 2 were met in relation to any Support Worker. Southern Cross identified some 10 categories of Participants in relation to various Funders and sample Participants said to be representative of Participants in each of those categories. The Commissioner indicated the extent to which he accepted that the Participants were representative of any particular category. The extent of agreement between Southern Cross and the Commissioner is set out in Appendix 1 to these reasons.

39. Mr Preobrajensky described, in relation to a number of Participants:

• the condition and resultant medical and care needs of the Participant;
• the programmes by which the Participants received medical and care services from Southern Cross;
• how the services provided by Southern Cross and Support Workers were funded;
• how Southern Cross came to provide services for the particular Participant, including how a care plan was developed;
• the interactions between Southern Cross and the relevant State and Commonwealth entities necessary for Southern Cross and Support Workers to provide care to the Participants; and
• whether, if the services provided by Southern Cross were not provided at home, the Participant would be in a public hospital and, if not, where the Participant would likely be.

40. A table prepared by Assoc Prof Kewley and Mr Preobrajensky in the Second Joint Report indicated, in relation to the 39 Participants, the condition suffered by the Participant, the hours of care provided per week, the kinds of care provided to the Participant by Support Workers and the relevant Funder. The table is set out in Appendix 2 .

Structure of Health Care during the Relevant Tax Years

41. The history of home care provision in New South Wales can be assessed at two levels, being the National or State policy framework and the service delivery framework. It was not until the late 1960s and early 1970s that the Commonwealth adopted a significant interest in home care services, when more generous Commonwealth grants to States and charitable organisations for home care services began. By the early 1980s, policy had begun to be concerned about the burgeoning cost of residential care for the elderly and the increasing preference of many older people to

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stay at home as long as possible, rather than being forced to move into residential care as their frailty increased. Policymakers became concerned about people in hospitals who were not in an acute-phase but had nowhere else appropriate to go. Those trends lead to an incoherent approach to services at homes, being a Commonwealth-State cost-shared home and community care programme and a parallel development of "community aged care packages" and "extended aged care at home" arrangements, each fully funded by the Commonwealth as part of the Commonwealth's residential aged care funding. Both packages were counted as part of the planning ratios used for residential aged care policy and funding. Policy and funding of aged care continued to have quite a different underlying framework from disability services, including in aged care an emphasis on planning and rationing service access.

42. In New South Wales, provision was much more consolidated, mostly into two not-for-profit organisations, being the Home Care Service of New South Wales ( Home Care Service ) and the Sydney Home Nursing Service. The former provided "domestic assistance", mostly by non-professional staff, while the latter provided professional nursing services, often with a holistic model. The role of Home Care Service expanded over time away from domestic support to support for "activities of daily living" for older people, constant with the developing Commonwealth support for home care for older people. By 2000, the Home Care Service had become incorporated into the NSW Department of Ageing, Disability and Home Care ( ADHC ) and the Home Care Service was subsequently privatised. The legislation incorporating the Home Care Service was repealed in 2016.^[8] See Home Care Service Act 1988 (NSW), which was repealed by cl 2(a) of Sch 4 to the Statute Law (Miscellaneous Provisions) Act 2016 (NSW) with effect from 28 June 2017. In contrast, the Sydney Home Nursing Service had a religious foundation but, eventually, its services were absorbed into the area health services when the latter were created. In addition to those publicly funded home nursing and home care services, private organisations also provided services to individuals and families with the means to pay for them. Over time, as incomes improved, more private nursing agencies were established to provide private in-home support.

43. The Commonwealth and New South Wales Governments have, over time, divided responsibility for the provision of acute care, general practice care, aged care, disability care, and rehabilitation care for people at home and in the community. Thus, a "National Health Reform Agreement" set out the respective formal responsibilities of the Commonwealth and New South Wales Governments. In broad terms, the Commonwealth Government was responsible for medical services, pharmaceutical services and private health insurance. The State Government was responsible for public hospital services, including mental health services provided through public hospitals or Local Health Districts. The Commonwealth had chief responsibility for primary health care and aged care and has funded and supported a range of health services. The State manages the infrastructure and operation of public hospitals and Local Health Districts. During the Relevant Tax Years, the Commonwealth transferred responsibility for much of the expenditure on healthcare to the States.

44. The various government funded in-home care programmes varied from Funder to Funder. In New South Wales, Local Health Districts adopt a five-step approach to the transfer of care to the home of the Participant involving multidisciplinary planning, assessment and integration, the object of which is to allow for the seamless and safe transition of care between service and healthcare providers. The process requires close consultation between the relevant providers about the level and type of service required for the transfer and ongoing care of a particular Participant.

45. During the Relevant Tax Years, the functions of public hospitals included diagnosis and treatment. Staff involved in those functions include medical and nursing staff, pharmacists and staff who support diagnostic services such as radiology and pathology, as well as allied health professionals such as physiotherapists. Those health professionals are supported and managed by administrative and clerical staff. There is also a range of domestic staff including cleaners, gardeners and security officers.

46. During the Relevant Tax Years, there were 15 Local Health Districts and 3 specialty

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networks in New South Wales, most of which were responsible for a particular geographic area. The functions of Local Health Districts are set out in s 10 of the Health Services Act 1997 (NSW). Broadly, their role is to lead and govern a geographical area with responsibility for ensuring that the care provided is of suitable quality and is safe and effective. In addition to the work performed in public hospitals, the work of staff and people connected with Local Health Districts included:

• overall governance responsibilities for the district, including support for the board of the Local Health District;
• managing the public hospitals and community health services within the district;
• co-ordination and liaison with other services relevant to the district, such as local government, private hospitals, general practitioners, private medical specialists, emergency services and other community groups; and
• interfacing with primary health care networks.

The Ministry of Health "purchases" public hospital services and other services from Local Health Districts and their relationship is governed by annual service agreements.

Management of Participants

47. For lower-needs Participants, such as the frail aged, care was sometimes also assessed in the context of a hospital admission. The main avenue through which care was assessed for lower-needs Participants involved the work of Local Health Districts. Local Health Districts are responsible for ensuring that the health care provided in the relevant area is of suitable quality and is safe and effective. All of the Participants referred to in the First Joint Report and the Second Joint Report who are subject to home care packages and some who are subject to home and community care were subjected to an assessment by an aged care assessment team prior to the receipt of services. Aged care assessment teams are part of Local Health Districts.

48. Local Health Districts applied a five-step approach to care co-ordination. First, transfer of care planning began prior to admission for planned patients and as soon as possible after admission for emergency patients. For emergency admissions, a Transfer of Care Risk Assessment had to be completed within 24 hours of the patient being admitted as part of the admission and treatment process. That information was required to be available for the multidisciplinary team or person responsible for planning care co-ordination and patient transfer needs. If the patient being admitted was a Participant with Southern Cross, that would be the first point of the transitioning of responsibility for care between Southern Cross and the treating hospital.

49. Secondly, health professionals from all disciplines were required to work closely together. The multidisciplinary team fulfilled that function and included the patient, the patient's family and any referring agency in the communication and care planning process. If care of the patient was to transition on discharge to a "community agency" that was often the first point of contact between the community agency, such as Southern Cross, and the treating hospital.

50. Thirdly, an estimated date of discharge was established as soon as possible after admission. The establishment of the date of discharge communicates to the patient, carer, staff and referring agency the timeframes for care delivery. If a patient was to be discharged as a Southern Cross Participant, both Southern Cross and the Participant's general practitioner would be informed of the estimated date of discharge.

51. Fourthly, referrals to care and service providers outside the core multidisciplinary team were expected to be made in a timely manner, when clinically appropriate, and within the agreed estimated date of discharge timeframe. That was a further critical contact point between a community agency such as Southern Cross and the treating hospital if the care of the patient was to transition to a Southern Cross Support Worker on discharge.

52. Fifthly, on discharge and transition of care from the hospital to a community agency or primary caregiver, a Transfer of Care Checklist was completed. The Transfer of Care Checklist included outcomes of care received in the hospital and a treatment plan to provide for

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the Participant's ongoing clinical and personal needs on discharge. Where care was being transitioned to Southern Cross, that was a further critical contact point in the transition of care and required a clinical handover.

53. An important aspect of Southern Cross's case concerning the characterisation of the work performed by Support Workers was demonstrating the need for a "seamless" transfer of the care of Participants from hospital care to the care of Support Workers provided by Southern Cross. In that regard, a distinction can be drawn between the terms "clinical handover" and "transition of care". The former term describes the transfer of care from one health professional to another, which is limited in its capacity to capture the broad range of issues involved with the transfer of a patient and the care responsibilities of the patient from one part of the health care system to another. The latter term refers to the various points to which a patient moves or from which the patient returns, being a particular physical location and includes transitions between home, hospital, residential care settings and consultations with different care providers. Thus, the term "transition of care" is broader than "clinical handover" because it encompasses the clinical aspects of integrated care transfer and other factors, such as the wishes, experiences and needs of the patient. Transition of care was an integral part of a patient's journey through the health care system.

54. Transitions from one care setting to the next were often accompanied by changes in health status. Patients transferred between health care sectors may have had a new diagnosis, a new treatment or a change in functional status that affected the ability of the patient to manage his or her own condition outside of the health care setting. A patient's journey through the health care system could involve a number of interfaces between primary, community and hospital care.

55. In ordinary circumstances, a Participant received care after he or she had suffered serious injury and his or her condition had stabilised and a hospital or Local Health District wished to discharge the Participant into the community. Care needs for high-needs Participants (those suffering from SCI and ABI) were assessed by a specialist clinical team before the Participant was discharged from hospital. Thus, each of the Participants suffering from SCI or ABI was discharged from a public hospital into the care of either Southern Cross or some other home care provider or, in the case of young children, the parents of the child.

56. Before the discharge of a Participant, a Support Worker attended the hospital and was trained by hospital staff in caring for the particular Participant. Once trained, the Support Worker provided care for the Participant in hospital. The "Care Needs Assessment" prepared by a hospital treating team for a Participant upon discharge was intended to replicate the care that was provided to the Participant in the hospital as a patient in a stabilised condition prior to discharge. When a Participant was discharged, which often involved a gradual process involving one or more short homestays followed by short returns to hospital, Support Workers provided care similar to the care provided in hospital but modified for the home environment of the particular Participant.

57. Ongoing assessment of the care needs of a particular Participant was undertaken in the light of the care prescribed by the specialist team and often in consultation with the specialist team. Generally, a Participant would need to interact with medical and allied health professionals on a regular basis, with a high-needs Participant continuing to have contact with the specialist team throughout his or her life, including visits to hospital outpatient clinics. Such hospital visits had the object of reviewing the status of the treatment of the Participant in order to see whether the Participant required alterations to current prescriptions, such as for ventilators and other equipment.

58. Support Workers performed a range of services for Participants, generally in the homes or residences of the Participants. The services included clinical care services, such as tracheostomy management, maintaining mechanical ventilation and wound management, personal care assistance, such as help with showering and domestic assistance,

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such as household cleaning. Ultimately, Support Workers performed whatever tasks had been determined by the Funder and the medical team as being necessary to ensure continuity of care for the particular Participant.

Arrangements between Southern Cross and the Funders

59. It is necessary to explain in some detail the activities of the Funders, the relationship between Southern Cross and the Funders and the basis on which Southern Cross received payments from the Funders. The following Funders have been identified for the Relevant Tax Years:

• the Lifetime Care and Support Authority of New South Wales ( Lifetime Care ), which provided approximately 27% of Southern Cross's revenue;
• New South Wales Health through the "Enable" programme ( NSW Health ), which provided approximately 20% of Southern Cross's revenue;
• the New South Wales Department of Family and Community Services ( FACS ), which includes ADHC, which together provided approximately 23% of Southern Cross's revenue;
• the New South Wales Department of Education and Communities ( DoE ), which provided approximately 1% of Southern Cross's revenue;
• the New South Wales Trustee and Guardian ( the NSW Trustee ), which provided approximately 5% of Southern Cross's revenue;
• the Commonwealth Department of Social Services ( DSS ), which provided approximately 15% of Southern Cross's revenue;
• the Victorian Transport Accident Commission ( TAC ), which provided approximately 2% of Southern Cross's revenue;
• commercial insurers, including AAMI, Allianz and GIO, which provided approximately 5% of Southern Cross's revenue; and
• other non-commercial entities, including the National Disability Insurance Agency ( NDIA ), individual hospitals and charities (such as Vision Australia or Life Without Barriers), which together provided approximately 1% of Southern Cross's revenue.

60. It is necessary say something about each of those Funders. It appears to be common ground that the arrangement as between Southern Cross, on the one hand, and each of the Funders, on the other, was relevantly the same throughout each of the Relevant Tax Years.

Lifetime Care

61. Lifetime Care is a statutory corporation established under the Motor Accidents (Lifetime Care and Support) Act 2006 (NSW) ( Lifetime Care Act ), which is responsible for administering the Lifetime Care and Support Scheme ( the Lifetime Scheme ), a compensation scheme for the lifetime care and support of persons injured in motor vehicle accidents in NSW. The Lifetime Scheme looks after long-term care needs for people with the most severe road or workplace injuries and supports people returning to work, with the aim of enhancing injured people's quality of life. While a person is a participant in the Lifetime Scheme, Lifetime Care pays for all of the reasonable expenses incurred by or on behalf of the person in relation to the assessed treatment and care needs of the person, including attendant care services.

62. Lifetime Care's annual reports during the Relevant Tax Years recorded the following about the activities of Lifetime Care:

• the "main goal" of Lifetime Care was to "ensure Scheme participants are treated with respect and dignity and given the best opportunities and choices in achieving quality of life";
• Lifetime Care "seeks to be an international leader in the delivery and development of disability services";
• once "eligibility has been confirmed", Lifetime Care "provides treatment and support as it is needed throughout the person's life. The injured person is supported by a coordinator who assists them to plan their rehabilitation and care"; and
• Lifetime Care "support(s) injured people to achieve an optimal quality of life by

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providing lifelong treatment, rehabilitation and care for people".

63. The functions of Lifetime Care did not extend to the provision of attendant care services or any medical or allied health treatment. Thus, under the Lifetime Care Act, Lifetime Care's functions in relation to the provision of care and other services were expressed to be "to monitor those services", "to provide support and funding for programs that will improve delivery of those services" and "for research and education".^[9] See s 43(3) of the Lifetime Care Act (emphasis added). The assessed treatment and care needs were to be provided only by a provider approved by the Authority.^[10] See ss 11C(1) and 11C(2) of the Lifetime Care Act. Southern Cross was one such approved provider.

64. During the Relevant Tax Years, there were approximately 600 to 1,100 Participants in the Lifetime Scheme, with the majority receiving attendant care. Throughout the Relevant Tax Years, Lifetime Care spent approximately $5 million to $8 million annually on staff salaries, and approximately $55 million to $110 million annually on Participants' care and support (of which approximately 40% was for attendant care services). Other expenses included modifications to a Participant's home, equipment required by participants, vehicle modifications, and educational support.

65. For most of the Relevant Tax Years, the relationship between Southern Cross and Lifetime Care was governed by an agreement entitled "Attendant Care Service Provider Agreement" dated January 2011, which commenced on 6 February 2011 ( the 2011 Attendant Care Agreement ). From 6 February 2015, an updated "Attendant Care Service Provider Agreement" applied. Each agreement attached "Agreement Details" and a number of Schedules that formed part of the relevant agreement. Each agreement incorporated the Attendant Care Industry Management System Standard (certified by the Attendant Care Industry Association NSW Inc.) and the NSW Disability Services Standards (and, once they had been implemented, the National Disability Services Standards). It also incorporated the "Policies and Guidelines" of Lifetime Care as they existed from time to time.

66. Under those arrangements, Southern Cross was obliged to comply with those standards, policies and guidelines, in accordance with any reasonable directions given by Lifetime Care from time to time. Southern Cross was to "liaise, cooperate, consult and confer with [Lifetime Care] in order for [Lifetime Care] to inspect, discuss or assess the provision" of services. Lifetime Care was entitled to change the nature, quantity or location of the services to be provided.

67. Many of the details of the arrangements were contained in schedules that set out service information and demonstrated how Lifetime Care was involved in the care of Participants. The schedules were prescriptive and provided, for example, that all services must be approved in writing by Lifetime Care prior to their commencement. The schedules contained the Disability Service Standards, which emphasised the Participant-focused nature of the care to be provided.

68. The agreements between Lifetime Care and Southern Cross relevantly provided as follows:

"2.10 Subject to the terms of the Agreement, [Lifetime Care] will pay [Southern Cross] for provision of the Services to Participants…

2.13 [Southern Cross] is not an agent, partner or employee of [Lifetime Care] for any purpose and must not hold itself out as such.

2.14 [Southern Cross] must ensure its agents or subcontractors do not hold themselves to be agent, partner or employee of [Lifetime Care]."

69. Under the agreements Southern Cross was responsible for paying for all materials and consumables, unless otherwise provided. Lifetime Care required Southern Cross to ensure that a Southern Cross staff member be responsible for the day-to-day management of certain programs and matters, including managing worker performance, reviewing care plans and making adjustments if necessary, managing consumables and equipment, and providing training and supervision to workers. Southern Cross acted in accordance with that responsibility.

70. Lifetime Care was not necessarily the entity that made referrals to Southern Cross

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during the Relevant Tax Years even though Lifetime Care paid for the services. Before the establishment of Insurance and Care NSW ( iCare ) under the State Insurance and Care Governance Act 2015 (NSW), Southern Cross received referrals from compulsory third-party insurers for services funded by Lifetime Care. The initial Attendant Care Request Form indicated that it was the Participant who selected Southern Cross from Lifetime Care's panel of approved providers. Any direct interaction by Lifetime Care was with either Southern Cross or the Participant, not with the Support Worker.

71. The arrangements contemplated that Lifetime Care, the clinical reviewing team and the Support Worker would all work together in order to achieve the best outcome for the Participant, and to ensure that the relevant Participant received continuity of care. Thus, continuity of care was a "key goal" of Lifetime Care's "integrated care strategy" during the Relevant Tax Years.

72. Lifetime Care was actively involved in determining the care required by Participants. Thus, Lifetime Care made an assessment of a Participant's care needs by a "Care Needs Assessment". In particular, Lifetime Care made an assessment of the services that were "reasonable and necessary" and consistent with its guidelines. The Care Needs Assessment would be made by an independent health professional, or a member of a multidisciplinary team appointed by Lifetime Care.

73. In relation to Participants in Lifetime Care's programmes, Support Workers worked with "LTCS Coordinators" and "Case Managers", and Participants were regularly reassessed by Lifetime Care. LTCS Coordinators were the front-line staff of Lifetime Care, and were directly employed by Lifetime Care. The LTCS Coordinator role encompassed all aspects of Lifetime Care's services being delivered to Participants. The LTCS Coordinators would support and assist the Participants to plan their rehabilitation and care needs and were also responsible for regular review of the attendant care services being provided to Participants. Case Managers were appointed by Lifetime Care and were independent from Southern Cross. The Case Managers would work with the Participant and his or her service providers and were the key point of liaison between a Participant, Southern Cross, and Lifetime Care. Thus, day-to-day care provision was passed over to Southern Cross, which provided the funded services not only through Support Workers but through the Southern Cross Service Delivery team, which included Community Support Co-ordinators as described below.

74. Lifetime Care also operated a training program for organisations such as Southern Cross and for Support Workers. Thus, Lifetime Care organised outside presenters with specialist knowledge to run the training, with the aim of ensuring that high quality services were delivered to Participants.

NSW Health

75. The term "NSW Health" described various bodies that were under the control of the Minister for Health or Secretary of Health. It is not a legal entity or person. Agencies and statutory corporations within "NSW Health" were distinct and interacted through formal arrangements. Some, such as HealthShare NSW, acted through "Service Compacts", instruments of engagement that detailed service responsibilities and accountabilities. The NSW Health service delivery model could be characterised as a "purchaser-provider split".

76. NSW Health encompassed both the NSW Ministry of Health and a number of state-wide or specialist health services, including the Health Administration Corporation, created under s 9 of the Health Administration Act 1982 (NSW). The name "Enable" was the branding for a set of services provided by HealthShare NSW, which was part of the Health Administration Corporation. Those services related to the provision of equipment and services to ventilator-dependent people in NSW with chronic health conditions or disabilities to assist them with mobility, communication and self-care. NSW Health had over-arching responsibility for public hospitals in NSW, through the Local Health Districts.

77. NSW Health was the largest health care system in Australia and one of the largest in the world. During the Relevant Tax Years, NSW Health had more than $10 billion in annual employee costs, more than 75% of which

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related to costs of employees of the NSW health system. During the Relevant Tax Years, NSW Health:

(a) employed more than 100,000 staff performing work from "acute hospital care to policy development, health promotion and community health initiatives";
(b) employed more than 13,000 "hospital support workers" and more than 8,000 staff providing "hotel services";
(c) paid fees to Visiting Medical Officers providing clinical services across Local Health Districts and hospitals;
(d) performed functions including "promoting, protecting, developing, maintaining and improving the health and wellbeing of the people of NSW";
(e) by 2015, cared for more than 21,000 people through the "Hospital in the Home" programme; and
(f) by 2015, served more than 65,000 meals to patients in public hospitals each day.

78. The "mission" of HealthShare NSW was to "support the delivery of patient care through the provision of State-wide services, and to be responsive to the needs of hospitals, clinicians and health managers". HealthShare NSW worked "closely with Local Health Districts and Health Agencies to build a framework for meaningful customer involvement in all states of service planning and delivery".

79. Through the Enable programme, NSW Health was responsible for two home ventilation programs:

(a) the Children's Home Ventilation Program, which provided assistance to children and adolescents up to sixteen years of age, who required respiratory support, equipment and tracheostomy, whose condition was stable, and who could be safely cared for at home by trained attendant carers; and
(b) the Adult Home Ventilation Program, which provided assistance to adults who needed life-support respiratory equipment more than 16 hours per day through a tracheostomy, whose condition was stable and not deteriorating, and who could be safely cared for at home by trained attendant carers.

80. Through the Enable programme, NSW Health was also responsible for:

(a) providing mechanical ventilators and other respiratory equipment to Participants on the program;
(b) repairing and maintaining that equipment;
(c) organising a community care coordinator, nominated by a Participant's Local Health District, to liaise with Participants on the program; and
(d) organising attendant care services, which it did by appointing and contracting with Southern Cross and other entities to procure Support Workers for Participants on the program.

81. The relationship between Southern Cross and NSW Health was also governed by the 2011 Attendant Care Agreement. Accordingly, the observations in relation to that agreement as between Lifetime Care and Southern Cross apply equally to the relationship between Southern Cross and NSW Health through the Enable programme. In particular, the agreement between Southern Cross and NSW Health was of a type that contemplated that NSW Health, the clinical reviewing team, and the Support Workers all worked together in order to achieve the best outcome for Participants.

82. NSW Health, through the Enable programme, worked with a Participant's hospital specialist team to confirm the hours of care a Participant required, and his or her specific care needs. The care that was then provided by a Support Worker was mapped to the requirements of the Enable programme. Southern Cross and NSW Health, through the Enable programme, effectively worked on an ongoing basis to case manage the care of Participants jointly.

83. As with the Lifetime Care Scheme, the Enable programme included the involvement of Co-ordinators and case managers who worked with both Southern Cross and Participants. Each year, a Participant's Local Health District's community care coordinator, who was independent of Southern Cross, would arrange "a review of [the

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Participant's] services, including a review of [the Participant's] care plan and ventilation requirements to make sure that [the Participant] can continue to be safely cared for at home". If a Participant had any concerns about his or her care, he or she was directed to contact his or her community care coordinator. Once a Participant's care needs had been assessed and approved by NSW Health, through the Enable programme, Southern Cross would follow the process described below to create "Care and Service Plans" and "Duties Plans" for the Support Workers, undertake hazards assessments, and conduct periodic evaluations of its own.

84. HealthShare NSW should not be confused or conflated with Local Health Districts. The Commissioner contends that, having regard to the above arrangements, the evidence establishes a much narrower focus and specific area of "NSW Health" to which Southern Cross provides services and in respect of which its payroll tax liability is to be determined, rather than the entire NSW health system as suggested by Southern Cross. The Commissioner asserts that the evidence points to HealthShare NSW being Southern Cross's true "client", if indeed Funders are "clients" at all. Thus:

(a) The status of Enable is unclear. However, it has been described as a "service area" and "branding for a set of services" within HealthShare NSW.
(b) Southern Cross identifies the relevant Funder as "Enable" in its system.
(c) The Enable Participants referred to in evidence all relate to the Home Ventilation Program and there is no suggestion that there are other types of programmes pursuant to which "Enable" funds attendant care services.

85. During the Relevant Tax Years, HealthShare NSW provided corporate services and information technology services to public hospital organisations across NSW under the auspices of a Board appointed by the Director-General of the Department of Health. It has not been suggested that such services include providing attendant care services to health organisations of the kind that the Support Workers provide, or at all.

86. HealthShare NSW made ventilators and other equipment available to Participants in homes, that is to say, outside the operation of health organisations. In particular, the Home Ventilation Program provided "funding assistance for adults and children who are dependent on mechanical ventilation and have significant care needs to leave hospital and be safely cared for at home". The in-hospital training of Support Workers in ventilation care was undertaken by hospital staff, who were distinct from and not synonymous with HealthShare NSW. Part of that funding assistance involved appointing and paying for accredited care providers, being entities who were accredited to provide care for a person with complex care needs. Southern Cross was such an accredited care provider. Apart from the appointment or contracting of Southern Cross as the service provider and provision of the ventilation equipment, HealthShare NSW was not involved in the management of the programme.

87. Control, instruction and direction was managed by Southern Cross, rather than HealthShare NSW. Southern Cross's Clinical Nurse Consultant Ventilator Advisor and Southern Cross's other clinical nurses who had ventilation skills performed training, shadow shifts, refresher training and skills sign-off with Support Workers for Participants with ventilators in the Participant's homes, that is to say, after hospital discharge. Support Workers were supervised and had their performance monitored by Southern Cross Community Support Co-ordinators, not NSW Health or any entity under that description.

88. Neither HealthShare NSW nor NSW Health, if that term identified a "client", had the capacity to provide the in-home attendant care services that Southern Cross and the Support Workers provided. Thus, the mainstream institutionally configured health organisations in NSW were not "geared up" to provide directly the community-based, home-centred care required by Participants. Rather, the State, through its public health system, was largely focused on hospital-based care, public and environmental healthcare.

89. There was no communication or interaction between Enable or HealthShare

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NSW, on the one hand, and Support Workers, on the other, including during any in-hospital training prior to discharge. After discharge, the Support Worker interacted with the Participant and Southern Cross only. The Southern Cross Community Support Co-ordinator was the contact and liaison for Enable and the Local Health District, not the Support Worker.

FACS (including ADHC)

90. Prior to the Relevant Tax Years, ADHC was a New South Wales Government department existing under the Public Sector Employment and Management Act 2002 (NSW). Between 2009 and April 2011, ADHC was an agency within the NSW Department of Human Services. From April 2011, just before the start of the first of the Relevant Tax Years, until after the end of the last of the Relevant Tax Years, ADHC was an agency within FACS. FACS was a New South Wales Government department existing first under the Public Sector Employment and Management Act 2002 (NSW) and then under the Government Sector Employment Act 2013 (NSW). Other divisions or agencies within FACS included Housing NSW, Community Services and Corporate Services. From 2014, FACS was responsible for administering the Disability Inclusion Act 2014 (NSW).

91. ADHC described its primary goal as being to "create, promote and sustain opportunities and services which allow people with disabilities, older people and their carers to participate fully in community life". That goal was expressly stated in the contract between ADHC and Southern Cross. According to Annual Reports published by FACS during the Relevant Tax Years, FACS:

• worked to "support people with disability to realise their potential" and "support seniors to participate fully in community life";
• employed more than 20,000 people, most of whom worked directly with people receiving services from FACS. Frontline roles included thousands of nurses, allied health workers, care workers, community care workers and disability support workers; and
• spent approximately $5 billion annually delivering services across NSW, with the largest category of expenditure being the delivery of FACS's major services and programmes including the disability services, Commonwealth Home and Community Care, Community Care Supports, many of those programs being delivered by non-government organisations on behalf of FACS.

92. ADHC /FACS directly operated the Home Care Service of New South Wales ( Home Care Service ), a statutory corporation constituted under s 4(1) of the Home Care Service Act 1988 (NSW), which was the largest provider of home and community care services in NSW with a staff of more than 4,300 people. A large part of its funding was from the Home and Community Care Program ( HACC ), from which Southern Cross also received funding. The Home Care Service provided domestic assistance and support in the home for activities of daily living, such as showering and toileting, to those who required it, provided mostly by nonprofessional staff. Many of those services were identical to the care services provided by Support Workers. Southern Cross contends that part of the role and function of ADHC/FACS was providing health and care services, including health and care services of a kind that Support Workers provided to Participants.

93. ADHC co-funded, with the Commonwealth, and administered the HACC programme until 1 July 2012. After 1 July 2012, ADHC/FACS funded and administered Community Care Support Programs ( CCSPs ) to people aged under 65 years (and Aboriginal people under 50 years of age). ADHC/FACS funded programmes to support people requiring intensive support to stay at home and not inappropriately move to residential aged care.

94. Until February 2016, FACS also managed the Home Care Service. Funding for the services provided by the Home Care Service came mainly from the NSW and Commonwealth HACC programmes, as well service fees charged to clients based on their ability to pay. The workforce of the Home Care Service comprised most, if not all, of FACS's "disability support workers".

95. CCSPs provided services to support people who had permanent functional disability, lived in the community and required support to

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remain living at home. In the year ended 30 June 2013, under CCSPs, FACS funded over 400 providers, both governmental and non-governmental organisations ( NGOs ), to deliver services including domestic assistance, personal care, respite, social support, meals and home maintenance. Southern Cross was one of those NGOs. The number of people receiving personal assistance from FACS funded CCSPs was 33,000 in the financial year ended 30 June 2014, 35,000 in the financial years ended 30 June 2014 and 2015, and 32,000 in the financial year ended 30 June 2016. In 2013, about 1,325 people were assisted through the NSW Attendant Care Program ( ACP ) and Home Care Packages ( HCP ) programme funding. There was a total of 8,001 places for community and family support under programs funded by FACS.

96. The arrangements between Southern Cross, on the one hand, and ADHC/FACS, on the other, spanned a number of different home care programmes. ADHC/FACS were involved in the HACC programme, which provided services to the frail aged and the disabled throughout the Relevant Tax Years. HACC aimed to "provide a comprehensive coordinated and integrated range of Basic Maintenance, Support and Care services". Participants covered by the HACC programme received what that programme termed "personal care", such as assistance with activities of daily living, or "domestic assistance", or both.

97. FACS was also involved in the ACP, the NSW High Needs Pool Program ( HNP ), and the CCSPs, each of which provided for the care of disabled people under 65 years of age. At a high level, the CCSPs progressively replaced the ACP and HNP during the Relevant Tax Years. Towards the end of the Relevant Tax Years, that was combined with the gradual introduction of the National Disability Insurance Scheme ( NDIS ) for certain Participants. Southern Cross classified Participants on the CCSPs as falling within one or other of its "SCI", "ABI" or "Miscellaneous" categories as appropriate. Each of FACS's programmes was dependent on funding from both the New South Wales Government and the Commonwealth Government.

98. In 2009, Southern Cross contracted with ADHC while it was still a NSW department in its own right. Under that contract, personal care services were to be arranged for Participants in a manner that was flexible in an endeavour to match service provision with the Participant's lifestyle requirements, including the provision of service outside standard business hours and over the weekend. From 1 July 2012, Southern Cross operated pursuant to a new funding agreement with ADHC, then contracting as part of FACS. By that agreement, ADHC was "committed to ensuring the ongoing delivery of quality services that are person centred and are well placed to provide individualised funding arrangements into the future". A further funding agreement between Southern Cross and ADHC, contracting as part of FACS, applied from 1 July 2015. That agreement formalised further record keeping requirements, reporting requirements, and performance requirements focused on compliance with the Disability Principles ^[11] Within the meaning of s 4 of the Disability Inclusion Act 2014 (NSW). and the Disability Service Standards.^[12] As set out in the Disability Inclusion Regulation 2014 (NSW), Sch 1. Under those agreements, FACS had the ability to amend the funding that was available and the services that were to be provided and during the term of the various agreements, FACS exercised that ability.

99. Under each agreement, Southern Cross was engaged to arrange HACC services on a "block-funding" basis for a range of distinct geographic areas within NSW, and also to arrange ACP/HNP/CCSP services to individual Participants with higher or more complex needs. Participants could receive a maximum of 15 hours per week of personal care under the HACC programme. Under the ACP, HNP and CCSP programmes, a higher number of hours of care could be provided. Services provided by Support Workers under those programmes included assistance with:

• bathing, showering or sponging;
• dressing and undressing;
• mobility;
• toileting;
• prescribed exercise or therapy programmes;
• meals; and
• domestic tasks.

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Services also included accompanying Participants to appointments and social activities.

100. Under the agreements, Southern Cross was obliged to comply with specified guidelines, specifications, performance standards and policies. The agreements included performance indicators that were required to be met in relation to the provision of services by Support Workers. FACS would verify compliance by Southern Cross with the Disability Service Standards. Southern Cross was required to report:

(a) in accordance with FACS's Reporting Policy;
(b) on the implementation of individualised funding arrangements for higher-need Participants; and
(c) in compliance with FACS's information and data collection requirements, including FACS's "Minimum Data Set for personal care".

101. ADHC /FACS was involved with Participants on the FACS/ADHC programmes to differing extents according to whether the Participant was a high-needs Participant or a low-needs Participant. Involvement of public hospitals and Local Health Districts with Participants on FACS/ADHC programmes also varied according to whether the Participant was a high-needs Participant or a low-needs Participant.

102. Under funding agreements with FACS in 2009, 2012 and 2015, Southern Cross received block funding from FACS at levels stated in the Schedules in order to provide services to Participants. The Commissioner contends that those contracts establish that Southern Cross was "autonomous" and that, while receiving funds from ADHC for the service, it was not an agent, partner, employee or contractor of ADHC for any purpose.^[13] Clause 2.3.1 of the 2009 agreement provided that the “Department and the Service Provider recognise that the Service Provider is autonomous and acknowledge that, whilst receiving Funds from the Department for the Service, the Service Provider is not an agent, partner, employee or contractor of the Department for any purpose.” Clause 3(e) of the 2012 agreement provided that the “parties agree that we are not engaging you to provide Services on behalf of us and that you are providing the Services to the community on your own behalf.” He asserts that the 2015 funding agreement establishes that Southern Cross was not providing services on FACS's behalf but on its own behalf.^[14] Clause 4(e) of the 2015 agreement provided that the “parties agree that we are not engaging you to provide Services on behalf of us and that you are providing the Services to persons in the target group (as defined in the DIA) on your own behalf.”

103. From a prudential perspective, FACS paid funding only when, amongst other things, FACS was satisfied that Southern Cross was properly constituted, had an Australian Business Number ( ABN ), had the power to carry out its responsibilities under the agreement, was capable of continuing the Service as defined (including implementing continuous quality improvement strategies and complying with policies and guidelines applicable to the Service) in accordance with the terms and conditions of the agreement. The Guidelines for the CCSP also highlight that the NGOs funded by ADHC were " independent, legally constituted organisations" (my emphasis).

104. The Commissioner contends that, notwithstanding that FACS was, through its ministerial responsibility for the Home Care Service, "in the business of" providing in-home care services during the Relevant Tax Years, the relationship between Southern Cross and FACS, through which it was funded, was that of two independent, autonomous parties. Southern Cross was but one of over 520 NGOs to which FACS provided grants and subsidies, including funding each financial year by way of community support to people with disabilities. Further, neither Southern Cross nor Support Workers undertook work for, or as part of the workforce of, the Home Care Service.

105. The Commissioner contends that the terms on which funding was provided under the various FACS programmes clearly demarcated the role of FACS as Funder and the role of Southern Cross as provider of care. He asserts that the evidence does not establish any interaction, control or direction as between the Support Workers and FACS so as to give rise to an employee-like relationship. Indeed, he says, the evidence suggests that, once a relevant referral was received, it was up to Southern Cross and the Participant to "work within" the funding cap provided.

DoE

106. The DoE was a New South Wales Government department existing under the same legislation as FACS. During the Relevant Tax Years, the DoE was aiming to ensure that 60% of school students with a disability had a personalised learning and support plan by 2020. The support in schools of students with a disability was a priority for the DoE and additional assistance for students with a disability was provided through the DoE's "Integration Funding Support

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Program" and the "Every Student, Every School" strategy. The DoE had a range of initiatives to train its employee teachers to better support students with a disability. Within the DoE, the "Disabilities Program Directorate" worked with clinical and community support services to provide an individualised learning programme for children who would otherwise be unable to attend school. Southern Cross contends that employees within the Directorate were plainly involved in the provision of care services to relevant Participants, even if they did not provide the care themselves.

107. The DoE was involved in the provision of care to a small number of Participants who were children requiring Support Worker services while they were at school. Southern Cross entered into agreements with the DoE in relation to individual Participants who required Support Worker services to attend school. The Commissioner contends, accordingly, that the evidence does not permit the Court to find that there is an employment agency contract between Southern cross and Support Workers undertaking work funded by NSW Education and that such evidence as there is suggests to the contrary.

NSW Trustee

108. The NSW Trustee was a statutory corporation constituted under s 5 of the NSW Trustee and Guardian Act 2009 (NSW) ( the NSW Trustee Act ). Under s 11(2) of the NSW Trustee Act, the NSW Trustee could be appointed to act in the capacity of a financial manager of the estate of a managed person. In doing so, it could do all such supplemental, incidental or consequential acts as may be necessary or expedient for the exercise of that function.^[15] Section 10(2) of the NSW Trustee Act. Its role was typically to provide trustee, guardian or financial management type services in respect of private persons.

109. Southern Cross arranged Support Worker services for a number of Participants whose affairs were managed by the NSW Trustee. No contractual materials between Southern Cross and the NSW Trustee are in evidence and there is no evidence as to the basis on which it provided funding for those particular Participants. Rather, Southern Cross's arrangements with the NSW Trustee appear to have been made on a Participant-by-Participant basis.

110. The Commissioner contends that the role of the NSW Trustee provided no support for a conclusion that the NSW Trustee was in the business of providing in-home attendant care services, nor any care services. He asserts that the evidence does not support a conclusion that there was an employment agency contract between Southern Cross and the Support Worker undertaking work paid for by the NSW Trustee. Rather, the usual and expected role of the NSW Trustee as a trustee, guardian or financial manager suggests to the contrary.

DSS

111. DSS is a Department of State of the Commonwealth Government. DSS was preceded by both the Commonwealth Department of Health and Ageing and the Commonwealth Department of Families, Housing, Community Services and Indigenous Affairs. Towards the end of the Relevant Tax Years, some relevant functions of DSS were taken on by the Commonwealth Department of Health. The departments were established by Administrative Arrangements Orders issued from time to time throughout the Relevant Tax Years. DSS had staff employed under the Public Service Act 1999 (Cth). For convenience, all are referred to as "DSS" or "the department".

112. During the Relevant Tax Years, the Commonwealth was responsible for aged care, and for the operation of the Aged Care Act 1997 (Cth) ( the Aged Care Act ). Under the National Health Reform Agreement, the Commonwealth had full responsibility for funding, policy, management and delivery for a consistent and unified aged care system covering basic home care through to residential care.

113. In its annual reports, DSS stated that:

• its mission was to "improve the lifetime wellbeing of people and families in Australia";
• its policies and services "look after families, children and older people…enhance the independence and wellbeing of people with high needs";
• 30,000 children and families received disability packages, and approximately

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500,000 older people benefited from the Commonwealth HACC programme;
• over 1 million older people received "Aged Care Sector services";
• the Australian Government is working with older people, their families, carers, aged care service providers and health professionals "to deliver the care and services people need to retain their independence and wellbeing for as long as possible as they age";
• it had an objective to "provide basic maintenance, support and care services through the HACC Program"; and
• it had as an objective "[t]he Home Care Packages Programme provides coordinated packages of services tailored to meet individuals' specific care needs including care services, support services, clinical services and other services to support old people to remain living at home".

DSS was involved in the HACC programme, which provided services to the frail aged and the disabled throughout the Relevant Tax Years and aimed to "provide a comprehensive coordinated and integrated range of Basic Maintenance, Support and Care services".

114. Prior to 2013, DSS was involved in the three predecessors to the HCP programme, which were subsequently combined into the HCP programme, being the Extended Aged Care at Home ( EACH ), the Extended Aged Care at Home - Dementia ( EACHD ), and the Community Aged Care Package ( CACP ) programmes. Each involved packaged home care services tailored for individuals with more comprehensive care and service needs.

115. From approximately 2013, DSS was involved in the HCP programme and the Commonwealth Home Support Program ( CHSP ). Both the HCP and the CHSP were programmes aimed at the frail aged. The HCP supported people at home who would be eligible for placement in a residential aged care facility ( RACF ), while CHSP was for people with lower-level needs. Southern Cross classified Participants on both programmes as falling within its "HCP" category. DSS was also relevantly involved in the "National Respite for Carers Program" ( NRCP ).

116. In July 2012, Southern Cross entered into a "Community Care Deed of Agreement" with the Commonwealth, represented by the Department of Health and Ageing. Under that agreement, Southern Cross was approved as a provider of community care for aged persons. The services to be provided by Support Workers were specified in a "Notice of Allocation". DSS subsequently made several variations to that agreement to update the relevant programme schedules. During 2015, the HACC and NRCP were transferred to the CHSP, which resulted in further contractual variations.

117. In November 2015, Southern Cross entered into a "Commonwealth and Home Support Agreement" with the Commonwealth, represented by DSS. That agreement was subsequently varied by the Commonwealth, then represented by the Department of Health. Those variations included approvals for updated work plans outlining the services to be provided. Under the agreements, Southern Cross agreed to arrange Support Worker services for the HACC, HCP, CHSP and NRCP, was obliged to comply with the requirements of the Aged Care Act and relevant guidelines made by the Secretary of the department or other relevant Commonwealth department and was subject to departmental monitoring and evaluation programmes, and to reporting requirements. The Commonwealth was able to modify the agreement unilaterally. The agreements specified the service types that were to be provided by Support Workers and the performance indicators that were required to be met in relation to the provision of that care.

118. Due to the "block-funding" model of HACC, DSS was less involved in determining the care required by individual Participants on the HACC programme. Some Participants in the HACC category were discharged from hospital into the care of Support Workers, while others were referred by way of an Aged Care Assessment Team ( ACAT ). Under the block-funding model, DSS was involved through contractually specified reporting, guidelines, specifications, performance standards and policies. All HCP Participants were assessed by an ACAT forming part of his or her Local Health District. The services received by a

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Participant under the HCP programme were individually tailored to his or her needs.

119. The Commonwealth Department of Health and Ageing administered the Aged Care Act during the Relevant Tax Years. Under Pt 3.2 of the Aged Care Act, that Department paid subsidies (later called grants) to approved providers for aged care services provided to persons aged 65 years and over in their home or community through block funding of various programmes or packages. The department approved Southern Cross as a provider of community care for aged persons under Div 8 of the Aged Care Act and allocated places under Div 14 in relation to a community care subsidy.

120. The community care programme contract , for example, established that Southern Cross operated or intended to operate an aged care service, provided or intended to provide community care services to individuals who were approved recipients of those services, and wished to obtain a community care subsidy under the Aged Care Act in respect of its provision of those services. Clause 11.1 also specified that the contract did not create an agency, fiduciary or any other relationship (except the relationship of contracting parties) between the parties. Southern Cross was required to comply with all the requirements of the Aged Care Act, which included that an agreement between Southern Cross and the Participant must include the complaints resolution mechanism that Southern Cross would use to address complaints made by or on behalf of the Participant.^[16] See s 61-1(1)(f) of the Aged Care Act.

121. The majority of programmes that the DSS funded were in the HACC category (later known as CHSPs), which were available to Participants over 65 years of age with low-level care needs. The support available included activities of daily living and social support, but an approval did not specify the exact services to be provided to Participants.

122. The Commissioner contends that, even for the higher-level care programmes (initially known as CACPs and later HCPs), which required an ACAT, the evidence does not establish any involvement in the provision of care by DSS. Rather, once a Participant was approved for a particular level of funding (which equated to a particular number of hours of care that Southern Cross could provide) by the ACAT, it was a matter for the Participant to decide what he or she wanted done in those hours and Southern Cross prepared the Duties Plan based on what the Participant wanted.

123. The Commissioner contends that the evidence does not establish any element of interaction or control by DSS in respect of Support Workers or otherwise indicate that Support Workers were working in an employee-like manner for DSS. Accordingly, the Commissioner contends, the evidence does not support the conclusion that there was an employment agency contract between Southern Cross and Support Workers undertaking work funded by DSS. Rather, the evidence there suggests the contrary.

TAC

124. TAC is a Victorian statutory corporation established by s 10(1) of the Transport Accident Act 1986 (Vic) ( the TA Act ). TAC managed a transport accident compensation scheme for people injured as a result of transport accidents in Victoria and who were entitled to compensation under the TA Act. It was effectively the Victorian equivalent of Lifetime Care, in that it was the administrator of a transport accident compensation scheme,^[17] See s 11 of the TA Act. and a provider of compensation rather than a provider of care ^[18] See s 12 of the TA Act. and could authorise a person to provide services.^[19] See s 23 of the TA Act. The scheme extended to medical, disability and rehabilitation services. Southern Cross was appointed as a service provider to eligible persons under the transport accident compensation scheme. There is no evidence that TAC itself provided care of the kind provided by Support Workers.

125. In its annual reports, TAC stated that it:

• supports people injured in transport accidents that are directly caused by the driving of a car, motorcycle, bus, train or tram;
• continuously developed and refined how it cares for its "clients";
• Provided income support, rehabilitation and disability services, return to work programmes, attendant care, allowances for parents to visit dependent children in hospital, travel costs to and from medical

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appointments and equipment or aids such as wheelchairs;
• funded more than $1 billion in support services and benefits annually;
• operated:
- ○ a "Return to Work" team (with rehabilitation specialists);
- ○ a "client assist team", who dealt with approval of services;
- ○ an "independence branch", who "works with clients who are more seriously injured to help them live independent lives"; and
- ○ a "service program" focussed on improving TAC's service to clients; and
• incurred approximately $150 million in administration costs annually, including employee costs.

126. Southern Cross was a member of TAC's Community Care and Support Services Panel. As a member of the panel, a Participant under TAC's scheme could select Southern Cross as his or her service provider. Southern Cross and TAC were parties to a "Services Agreement: Community care and support services (attendant care)" made in July 2007. The agreement was immaterially amended in September 2007 and was further amended in October 2009. That amendment introduced further training requirements for Support Workers, by reference to "TAC Recognised Training Courses", and further reporting and record-keeping requirements. Southern Cross's registration with TAC continued throughout the Relevant Tax Years.

127. Under the agreements, the services of Support Workers provided to TAC Participants included personal care services such as assistance with showering, eating, and mobility, complex daily care services, and both active and inactive overnight care. Southern Cross was required to arrange services for TAC Participants in accordance with TAC's "Support Needs Approval" for that Participant, in accordance with TAC policies and in accordance with the State Disability Plan and the principles set out in the Disability Act 2006 (Vic), the Health Services Act 1988 (Vic), the guidelines under them and the Standards for Disability Services.

128. In performing the services, Southern Cross was required to comply with all reasonable directions and instructions provided by the TAC Officers and the TAC Provider Manager. Southern Cross was also required to use "best endeavours to meet and exceed the Key Performance Indicators" set by TAC. Southern Cross was subject to detailed reporting requirements, both generally and for individual Participants, and to record keeping requirements.

129. Each TAC Participant would have a TAC Officer assigned to him or her. The TAC Officers appear to have been employees of TAC. The TAC Officer was responsible for day-to-day liaison with TAC Participants and Southern Cross, and was the first point of contact in relation to the "day to day provision of the Services". Under the agreement, Southern Cross was required to develop a "Care Plan" for each TAC Participant which was:

• consistent with TAC's "Support Needs Approval" for that Participant;
• based on information from "the TAC [Participant] and their treating therapists, representatives, advocates and family members";
• consistent with the Standards for Disability Services; and
• consistent with Southern Cross's occupational health and safety site audit of the Participant's home.

TAC was responsible for programme establishment expenses related to the recruitment of Support Workers, the coordination of services under a Participant's care plan, and the training of Support Workers.

130. TAC was actively involved in determining the care required by Participants and would assess a Participant's injury related care needs based on an assessment by an independent health professional. TAC would regularly review its assessments to ensure that it continued to meet a Participant's needs. If a Participant required more or less care than TAC had previously approved, a variation request was to be submitted, or TAC would undertake a new Support Needs Approval.

131.

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Because of the serious nature of their injuries, all TAC Participants were initially patients in a hospital. Southern Cross followed its usual process for high-needs Participants for TAC Participants, including "new programs management".^[20] See [192]-[194] below. Like all high-needs Participants, TAC Participants would need to attend a hospital outpatient clinic regularly for the rest of their lives, and medical treating teams would organise additional training for Support Workers as needed.

132. Under cl 2.2 of the contract between Southern Cross and TAC, it was the Participant that requested, selected and engaged Southern Cross to provide services to the Participant, not TAC and, under cl 28.8, Southern Cross was not in any way an agent, employee or partner of TAC. TAC agreed to pay fees to Southern Cross, and did so on behalf of the Participant as compensation due to that Participant under the relevant Victorian legislation.

133. By cl 6.2, the service agreement provided that, in relation to facilities and equipment, Southern Cross was solely responsible for all labour, materials, overheads, occupational health and safety compliance and other costs associated with providing the services. Supervision of and assistance for Support Workers was a Southern Cross responsibility, not a TAC responsibility. Clause 8.8 of the service agreement (as amended) obliged Southern Cross to assist and supervise Support Workers adequately and to carry out annual performance reviews of Support Workers who provided services to TAC Participants. There is no evidence of direct interaction or communication between TAC and Support Workers.

NDIA

134. The National Disability Insurance Agency ( NDIA ) is a Commonwealth agency whose role is to administer the NDIS. The NDIS, as its name suggests, is an insurance scheme much like that provided by Lifetime Care in NSW and the TAC in Vic, except that it is not tied to transport accidents. Although the NDIS had begun operating at trial sites it was not fully operational before the end of the last of the Relevant Tax Years. A proportion of NDIS Participants required Support Worker services.

135. The National Disability Insurance Scheme Act 2013 (Cth) ( the NDIS Act ) set out the role of the NDIA. The NDIA's business included assessing, coordinating and assisting in the provision of care to disabled persons. For example, s 6 of the NDIS Act provided that its objects included the following:

" Agency may provide support and assistance

To support people with disability to exercise choice and control in the pursuit of their goals, the Agency may provide support and assistance (including financial assistance) to prospective participants and participants in relation to doing things or meeting obligations under, or for the purposes of, this Act.

Note: For example, the Agency might assist a participant to prepare the participant's statement of goals and aspirations by assisting the participant to clarify his or her goals, objectives and aspirations."

Section 13 provided that the NDIA "may provide general supports to, or in relation to, people with disability who are not participants". Section 15(2) provided that the NDIA "must use its best endeavours to provide timely and accurate information to people with disability and other people in order to assist them in making informed decisions about matters relevant to the National Disability Insurance Scheme".

136. For a given Participant, part of the NDIA's role was to "ask questions about how you are going in different areas of your life, what goals you would like to achieve and what kind of help and support you need", in order to help NDIA to develop a plan that would provide "the right support" for the Participant. Subsequently, the NDIA would conduct plan reviews. The NDIA's 2016 annual report stated that:

• NDIS "is a new model of funding and social support for people with disability in Australia";
• NDIS had "the aim of providing an ordinary life for its participants";
• the "primary mission underpinning the Scheme is to increase the choice and control

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that Participants have over the supports and services they use"; and
• NDIA had over 1,000 employees.

137. In October 2015 Southern Cross was approved as a registered NDIS provider and agreed to comply with the NDIS "Terms of Business for Registered Support Providers" and other applicable laws. Southern Cross was registered to provide services to Participants including "assistance with daily personal activities" and "assistance with daily life tasks". Under the Terms of Business, Southern Cross was obliged to comply with the Objectives and Principles of the NDIS Act, and with any relevant NDIS Rules and Guidelines. Southern Cross was also subject to record-keeping and reporting requirements and was required to supply any information requested by the NDIA in relation to the provision of support and was subject to NDIA review activities.

138. The NDIA worked with Participants involved in the NDIS to develop their individual NDIS Plans. The NDIA would also contact Participants at regular intervals to review their plans.

139. This funding role of NDIA was confirmed by the statement made by the Deputy CEO, Corporate Services and Chief Financial Officer of the NDIA in response to Southern Cross's request for a declaration under s 40(2) of the Payroll tax Act as follows:

"The National Disability Insurance Agency (NDIA) provides financial supports to participants of the National Disability Insurance Scheme (the Scheme). The participants use funding provided by the Scheme to source the supports they require.

Neither the NDIA nor the Scheme are able to employ support workers.

Therefore, I am unable to confirm the sentence that you have requested the NDlA to confirm."

140. Care was instead provided by registered providers of support such as Southern Cross, which were encouraged to compete with one another for the business of Participants, who could "shop" around for service providers that best met their support needs, subject to the resources in their support packages. According to the "Program Description and Participant Service Agreement" between Southern Cross and the NDIA concerning Participant 12, the only Participant referred to in the Joint Reports who was funded by NDIA during the Relevant Tax Years, Participants funded under the NDIS had a choice as to whether they wanted the NDIA, a nominee or a "Plan Management Provider" to manage the funds they were allocated, or whether they wanted to manage their funds themselves. Except where the NDIA managed the funding, Southern Cross was required to send an invoice to the Participant, nominee or Plan Management Provider (as applicable) fortnightly.

Arrangements between Southern Cross and Support Workers

141. Southern Cross's Service Delivery Team was responsible for the recruitment of Support Workers and co-ordinated the rostering of Support Workers. Ms Dubos was sometimes involved in the recruitment interview process, especially where the recruitment was for a Participant who had high needs or for whom providing care was otherwise challenging. The Service Delivery Team operated a fortnightly roster for Support Workers. For most of the Relevant Tax Years, shifts were confirmed with Support Workers by telephone.

142. The members of Southern Cross's Community Support Co-ordinators Team were registered nurses and endorsed enrolled nurses. Ms Dubos nominated a Community Support Co-ordinator for each Participant, usually on the basis of location but sometimes on the basis of a particular level of skill. Each Community Support Co-ordinator was responsible for a number of Participants. The Community Support Co-ordinators worked from home and were provided with a telephone, laptop and remote access to Southern Cross's database. The Community Support Co-ordinator for a particular Participant was typically responsible for:

• discussing with the Participant, and sometimes with the family or treating team of the Participant, the Care Needs Report for the Participant that was put together by the Funder, the ACAT or the discharging hospital;

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• entering the care requirements in the Care Needs Report into Southern Cross's data system, which resulted in a "Duties Plan";
• attending the home of the Participant to make an assessment of any health and safety risks;
• monitoring the care provided by Support Workers to Participants, including progress against identified desired outcomes and conducting reviews, for high-needs Participants, every 6 or 12 months; and
• arranging training for Support Workers where a new care service or new piece of equipment was introduced.

143. The Duties Plan was developed by a registered nurse from Southern Cross prior to the commencement of delivery of services to the Participant. It outlined the expected outcomes of the requested care and the tasks, duties and interventions required to meet the care and service needs of the Participant, within the parameters of the funding programme. Each Support Worker was provided with a Duties Plan in relation to the particular Participant to whom the Support Worker was allocated. The Support Worker was required to follow the Duties Plan and to notify Southern Cross of any material deviations from it.

144. Southern Cross engaged Support Workers for Participants in the same way for each of the Funders. Once a Funder engaged Southern Cross to procure services for a Participant, Southern Cross identified relevant Support Workers who had the requisite experience and qualifications to meet the needs of the Participant.

145. Upon a Support Worker expressing interest in accepting an engagement, Southern Cross and the Funder would arrange a meeting between the Support Worker and the Participant, at which it was rare for Southern Cross to have an employee present. The Participant would either approve or not approve the involvement of the Support Worker in question. In the case of higher needs Participants, the Support Worker would receive training from the Participant's doctors and treating team, often at a hospital prior to the discharge of the Participant.

146. Where a new Support Worker joined a team, the Community Support Co-ordinator "signed off on" the Support Worker to confirm that he or she could perform the appropriate services. That process occurred at hospital or at the home or residence of the Participant. As part of that process, the Community Support Co-ordinator observed the Support Worker on a "shadow shift" over as many as four to six weeks. Ultimately, it was the Participant who had the final say on whether that Participant wanted the particular Support Worker. Where a new Support Worker became involved with a Participant, a "meet and greet" was often arranged, which typically involved a Support Worker visiting the Participant so that the Support Worker and the Participant were well-matched.

147. The arrangements between Southern Cross, on the one hand, and the Support Workers, on the other, were evidenced by several documents as follows:

• Contractors' Acknowledgement and Authority ( the Acknowledgement );
• Code of Conduct - Attendant Care Worker ( the Code of Conduct );
• General Standards and Conduct - Attendant Care Workers ( the Standards ); and
• Information Manual for Attendant Care Workers ( the Manual ).

148. One of the iterations of the Acknowledgement and the Code of Conduct that is in evidence is endorsed as being pages six and seven of 25 pages of a larger document bearing the date July 2012 and described as:

"M5D - 1 Recruitment Pack - Face to Face - Attendant Care Worker" ( the Recruitment Pack ).

The balance of that Recruitment Pack does not appear to be in evidence. The Acknowledgement refers to Southern Cross's "Information and Guidelines". It is not clear whether that document is in evidence. However, other documents bearing similar dates and containing iterations of the Code of Conduct and the Acknowledgement are in evidence. They have different page lengths and bear different dates, including March 2013, July 2012 and March 2012. For instance, a document dated March 2013 was described as:

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"M5D-1 Recruitment Pack - External - Attendant Care Worker".

That iteration was 20 pages long, the entirety of which was in evidence.

149. The Code of Conduct refers to "the Orientation Folder", which may be a reference to the Recruitment Pack but that is not clear. While the Acknowledgement and the Code of Conduct have provision for signature by the relevant Support Worker, there does not appear to be any instrument in evidence signed on behalf of both Southern Cross and the Support Worker evidencing the respective obligations of the parties to a contract.

150. By the Acknowledgement, the Support Worker acknowledged that he or she was a self-employed qualified "Registered Nurse/Division I Nurse/Enrolled Nurse/Division II Nurse/Assistant in Nursing/Personal Care Assistant/Other". There was a space for "other" to be specified and descriptions that did not apply to the particular Support Worker were to be deleted.

151. The Acknowledgement then provided that Southern Cross might refer "clients" to the Support Worker for whom the Support Worker was to perform services for which the Support Worker was qualified but that Southern Cross was not obliged to refer "clients" to the Support Worker and would only do so as and when such services were required. The Acknowledgement then provided that, upon any such referral, the Support Worker was to remain self-employed and that Southern Cross would not be liable to the Support Worker for any of "the usual incidents of employer/employee relationships such as sick pay or annual holiday leave pay".

152. The Acknowledgement provided that, "under this agreement", the Support Worker could nominate his or her hours for providing services and could reserve the right to accept or reject referrals according to the convenience of the Support Worker. It then provided that, should the Support Worker proceed to provide services to "a referred client", Southern Cross was authorised to obtain from "the client" such "money and other emoluments" to which the Support Worker was "contractually entitled" and to account to the Support Worker "for it". The Acknowledgement made no mention of the nature or quantum of any "such money and other emoluments". Nor did it refer to any contractual entitlement that the Support Worker might have.

153. The Acknowledgement then provided that the Support Worker indemnified Southern Cross against:

"…liability for loss or damage alleged or incurred by any client or [Southern Cross] or other party (or myself) arising out of my referral and provision of care or other services which I hold myself out to be qualified to perform."

Finally, it contained an acknowledgement that the Support Worker had read Southern Cross's "Information and Guidelines" and understood the "Information and Guidelines" and an acknowledgement of the desirability of compliance with the "Information and Guidelines" for the benefit of "referred clients". While it is not clear, it may be that the "Information and Guidelines" referred to in the Acknowledgement is the Manual.

154. The use of the term "clients" in the Acknowledgment is somewhat infelicitous in light of the contention now advanced by Southern Cross that the Funders are its "clients". However, that of itself cannot be decisive as to the proper construction of the Payroll Tax Act.

155. By the Code of Conduct, the Support Worker agreed to abide by:

"…the following Southern Cross requirements:

• Service User rights, religious and cultural beliefs, privacy, dignity and confidentiality will be respected at all times;

• Maintain high standards of respect for Service User and other team members;

• Adherence to professional boundaries (conduct) as outlined in the Orientation Folder …;

• Adherence to dress standards as outlined in the Orientation Folder;

• Adherence to the Attendant Care Worker Rights and Responsibilities as outlined in the Orientation Folder;

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• To provide services which help each Service User achieve his/her optimum health status and/or level of independent functioning …;

• [Support] Workers have a responsibility to ensure that they use safe practices at all times and that they do not put the health and safety of themselves or any person at risk…;

• Comply with all policies and procedures of Southern Cross/agreed Code of Conduct."

It is not clear whether "Agreed Code of Conduct" referred to the document itself or to some other document published by Southern Cross.

156. In a further iteration of the Code of Conduct bearing the date March 2014, the Support Worker agreed to abide by Southern Cross's requirements, which may be summarised as follows:

• provide services which help each service user achieve his or her optimum health status;
• respect the service user's rights, religious and cultural beliefs, privacy, dignity and confidentiality;
• maintain confidentiality of all service user, Support Worker and Southern Cross information;
• maintain professional relationships and appropriate boundaries with service users, including not providing services outside the care or service plan, not selling any products to or accepting or soliciting any money gifts from service users and not giving personal details to service users or family members;
• maintaining professional workplace behaviours with other members of the team;
• adhere to dress standards and always carry Southern Cross ID card while working;
• use of safe practices at all times to avoid putting the health and safety of service users, the Support Worker or any person at risk through acts or omissions;
• report any observed or suspected instances of abuse or neglect to Southern Cross;
• adhere to all work, health and safety requirements outlined in the Manual;
• adhere to Support Worker rights and responsibilities outlined in the Manual; and
• comply with all policies and procedures of Southern Cross/Agreed Code of Conduct.

I have assumed that the term "service user" when used in the Code of Conduct refers to a Participant.

157. The Standards began with a "Policy Statement", saying that Southern Cross is committed to providing quality care and services, with Support Workers understanding and abiding by standards for presentation, conduct and general behaviour that "reflect best practice". Support Workers were encouraged to use the "Australasian Code of Ethics for Direct Support Professionals". The Standards stated that the "desired outcome" was for Participants to feel that they were receiving high quality care and services and that care and services were delivered "according to best practice". Under the heading "Associated General Procedure", reference was made again to the Australasian Code of Ethics for Direct Support Professionals.

158. Directives under the following headings then followed:

• Code of Conduct;
• Dress Code and Presentation;
• Drugs and Alcohol;
• Children in the Workplace;
• Service User Related Issues;
• 24 Hour Programmes;
• Continuing Professional Education - Team Meetings;
• Newsletters;
• Rosters;
• Registration;
• Vehicles; and
• Work Health and Safety.

Under those headings, diverse exhortations, directions and prohibitions and recommendations were set out. The Standards did not have provision for signature or other acknowledgement by a Support Worker.

159. The Manual went through several iterations. In its original form, in use as at July 2011, it was entitled "Attendant Care Worker (ACW) Orientation Manual". That was

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replaced by a document that appears to have become operative as at December 2013. That iteration, in turn, was replaced by a version dated June 2016. A further iteration was in evidence but it appears to be common ground that it was operative after the Relevant Tax Years.

160. In the Manual, the Duties Plan was referred to as "care or service plan" and was described as "a document developed in response to a request for services to best direct care and services". The Manual stated that the "care or service plan" was to guide and direct the individual Support Worker in his or her day-to-day delivery of the attendant care services.

161. The July 2011 "Orientation Manual" contained nine sections covering some 33 pages. It ended with a summary stating that Southern Cross had many policies, procedures and manuals to assist the Support Worker in "best practice service delivery" and that the documentation relevant to each Participant (described as a "service user") was provided in the home of the Participant.

162. The December 2013 Manual contains 13 sections covering 46 pages. The final summary was in the same terms as the July 2011 version. The June 2016 Manual contained 12 sections covering 48 pages, with no summary section. Sections 1 to 12 of the December 2013 and June 2016 versions of the Manual contain information under the following headings:

(1) General Information;
(2) Rights and Responsibilities and Code of Conduct;
(3) Administrative Information;
(4) Reporting;
(5) General Work, Health and Safety;
(6) Manual Handling;
(7) Hygiene and Infection Control;
(8) Medications in the Community;
(9) Challenging Behaviours;
(10) Driving and Vehicle Safety;
(11) Support Workers Unwell Whilst Working; and
(12) Wellbeing Management.

163. Section 2 of the Manual, which was titled "Rights and Responsibilities and Code of Conduct", contains the following sub-headings:

• Rights and Responsibilities of the Service User;
• Rights and Responsibilities of Support Workers;
• Code of Conduct; and
• Confidentiality.

Under "Code of Conduct", the Manual stated that Southern Cross expected the Support Worker to adhere to a "Code of Conduct which you agree to and sign before accepting any shifts through Southern Cross". Support Workers were exhorted to familiarise themselves with the detail in "the Code of Conduct". There is no evidence of a code of conduct other than the document described above. Section 2 of the December 2013 iteration appears to be in the same terms as section 2 of the June 2016 iteration.

164. The July 2011 Manual contains nine sections as follows:

Section 1 - General Information;

Section 2 - Working with Southern Cross;

Section 3 - Administrative Information;

Section 4 - Rights and Responsibilities;

Section 5 - Reporting;

Section 6 - Medications in the Community;

Section 7 - General OH&S;

Section 8 - Emergency Response Procedures - Community Setting; and

Section 9 - Summary.

Section 2 contained a heading "Code of Conduct", under which it was said that Southern Cross expected the Support Worker to adhere to "a general Code of Conduct" and stated that the guidelines should assist the Support Worker to ensure that the expected steps and requirements were being met. There does not appear to be any reference to a specific Code of Conduct.

165. The "Rights and Responsibilities" sections of the July 2011 Manual and the December 2013 and June 2016 Manuals appear to be in similar terms. Thus, all Participants were said to have the right to receive a high standard of care and service delivery, which

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included some 15 to 19 specific matters. Participants were also stated to have rights in relation to 12 to 17 further matters. The rights and responsibilities of Support Workers were then set out. Thus, Support Workers:

• were treated in an equitable manner by Southern Cross;
• had the right to have access to debriefing if required;
• had the right to have any concerns/complaints dealt with in a timely and confidential manner;
• were responsible to report any change in a "service user's" care and services for the well-being of the "service user";
• were responsible to report to Southern Cross any situation in which they felt the "service user's" care or service was being compromised;
• had a responsibility to contact Southern Cross immediately if he or she was aware of not being able to attend to an agreed shift or to visit a "service user";
• were responsible for the safety and wellbeing of the assigned "service user" whilst present;
• were responsible for taking reasonable care of their own health and safety and that their conduct did not adversely affect others in the workplace;
• were responsible for complying with reasonable instruction and to adhere to and co-operate with notified Southern Cross policies and procedures;
• were responsible for notifying Southern Cross of any identified risks or hazards in the workplace and participating in the process to resolve the risk;
• were responsible to notify Southern Cross if they sustained a workplace injury as soon as they were able to do so and within 24 hours;
• had a responsibility to ensure the proper and appropriate use of "service user" owned equipment whilst present;
• had a professional responsibility to inform the "service user" about the care or service he or she was receiving;
• should have recognised that the giving and receiving of gifts and involvement in financial transactions between a Support Worker and a "service user" had the potential to compromise the professional relationship and was discouraged;
• should not borrow from or lend to a "service user" any personal items or property;
• had a responsibility when working with a "service user" who was having 24-hour care not to leave the "service user" until a replacement had arrived, since to do so would jeopardise the safety and well-being of the "service user" and be a breach of industry accepted standard; and
• had a responsibility not to sleep during night duty shift as per industry and funding accepted standards and requirements.

Arrangements between Southern Cross and Participants

166. When a new Participant became involved with Southern Cross, the intended Support Worker visited the Participant to ensure that the Participant and the Support Worker were well matched and to ascertain whether the Participant and Support Worker wished to commence the provision of services. Support Workers were not paid for attending such a meeting and either the Support Worker or the Participant could refuse the other.

167. The arrangements between Southern Cross and Participants were evidenced by a "Service User Information Booklet" ( the User Booklet ) in which Participants were referred to as "service users". The User Booklet stated that it was intended to assist the Participant to understand the services provided by Southern Cross and to explain how to contact Southern Cross, with whom the Participant would be dealing on a routine basis. Further, it aimed to tell Participants what Southern Cross and Support Workers would and would not do and to explain the respective rights and responsibilities of Participants and Support Workers. It said that, after the relevant Participant had read the User Booklet, the Participant would be asked to sign a "service agreement" to confirm receipt and understanding of the information about the relevant programme and services.

168.

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The "service agreement" was at the end of the User Booklet ( the Service Agreement ). It was in the following terms:

" SERVICE AGREEMENT

I, __________________ (Service User/Carer/Advocate) acknowledge that I have read, understood and agree with the following documentation.

Tick appropriate boxes and write the Program type:

□ Program Description ____________

□ Model of Service Delivery

□ Rights & Responsibilities of Service User

□ Service Delivery Plan

□ Community Aged Care Package Agreement

□ Charter of Rights &Responsibilities for Community Care

□ Service Timetable

□ Request for Services (Private Services)

□ LTCS Participant Attendant Care Agreement

□ Minimum Data Set &Information Collection Consent

□ Client Information & Referral Record

□ Information in regard to Advocacy

□ Information in regard to Conflict/Complaint

□ Child Protection Policy

□ Other relevant documents".

The Service Agreement contained provision for signature on behalf of the Participant and on behalf of Southern Cross.

169. The User Booklet stated that Southern Cross provided services to all members of the community, including those who were disabled of any age, frailty, injury, including brain and spinal cord injuries, and those requiring palliative care, post hospital discharge care and ventilation. It stated that Southern Cross was funded for various programmes by different organisations and government departments and that "in many instances" there was no cost to the Participant for services provided by Southern Cross.

170. The User Booklet also stated that Southern Cross provided many different types of community care and services and that the type of service received by a Participant was determined by "the Funding Body of the Program" or by the type of service privately purchased. It stated that the Participant would "most likely" receive services from Southern Cross through one programme only, either funded or purchased, and said that a general description of the particular programme "as determined by the funder" would be provided by the "Southern Cross Care Assessor" at the time of the Participant's assessment. The User Booklet also stated that a Participant could choose to purchase any level of service from Southern Cross, including Participants who were already receiving other services through Southern Cross funded programmes and that such Participants could choose to buy additional services from Southern Cross. The User Booklet stated that Southern Cross could be contacted at any time to discuss privately purchasing services and care and that a "Care Assessor" would visit privately funded Participants to assist in planning services.

171. The User Booklet contained a section entitled "Model of Service Delivery", which provided as follows:

" Model of Service Delivery

This policy sets out the standard of the service. This is what you can expect from the Southern Cross Team and the Attendant Care Workers. They ensure:

• All Service Users receive the same standard of service

• All the Southern Cross Team and Attendant Care Workers work to the same industry required standards

• An Assessment will be completed by a Care Assessor (when appropriate) with input from you and/or your family/Carer

• The standards expected for service delivery are discussed with you

• This booklet and a copy of the Program Description along with other relevant paperwork will be left in your home for future reference

• Your rights, religious and cultural beliefs, privacy, dignity and

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confidentiality will be respected at all times

• No documents or information about you will be given to anyone else without your consent (other than for the purpose of providing safe service delivery)

• We encourage you to assist in and to direct your care or service when possible

• A Care or Service Plan will be developed by the Care Assessor with your involvement and may also include information from the local doctor and other Service Providers

• Attendant Care Workers are only required to perform tasks that are written on your Care or Service Plan

• Attendant Care Workers report changes in care or service to Southern Cross so that the Care Assessor can change the Plan

• The Plan should only be updated by the Care Assessor, with your involvement

• Nursing Procedures are expected to be performed by all Attendant Care Workers uniformly using industry required standards as described in Southern Cross Procedures.

• The care or service provided is agreed by you in your Care, Service or Treatment Plan

• Visit times are also considered in relation to other Providers and your needs and requests

• You have the right to inform us of your concerns and the right to have them addressed

• All records and files are considered confidential and are securely kept

• If you have a concern about your service contact the Care Assessor or Roster Admin Officer on [ xxxx xxx xxx ] who will assist you

• You will also be provided with the contact details for complaints resolution at the department or organisation funding your program".

A schedule of the rights and responsibilities of the Participant then followed.

Examples of the Services Provided by Support Workers

172. It is desirable to say something about the specific Participants whose files were the subject of the opinion evidence. The material that follows is derived from the First Joint Report and the Second Joint Report. I shall deal with Participants by reference to the Funder involved for the relevant Participant. However, before doing so, it is desirable to make some general observations.

173. As I have said, each Support Worker was provided with a Duties Plan in relation to the particular Participant to whom the Support Worker was allocated. The Support Worker was required to follow the Duties Plan and to notify Southern Cross of any material deviations from it.

174. The services provided by Southern Cross are fairly characterised as being quite "diverse", in so far as they were provided for many Participants who had very complex health care needs and other Participants who had needs of lower complexity. Since Support Workers were not registered health professionals, they primarily provided care and support to Participants rather than health care assessment and management. However, in some cases, Southern Cross engaged nurses as Support Workers to provide a higher level of health care where needed. Such Support Workers could always connect to public hospital and Local Health District community services, such as ACATs or hospital-based clinical nurse specialists or clinical nurse consultants, as necessary.

175. Integrated care entailed the provision of seamless, effective and efficient care that reflected the whole of a person's health and disability needs in partnership with the Participant and his or her carers and family. Southern Cross crosses the "health-disability divide" through arranging integrated and person-centred health care in the community and arranges a "step down care option" allowing for early discharge and safe transitioning of patients from hospital settings, allowing for care co-ordination of complex patients who would otherwise occupy expensive beds to occur earlier.

176.

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If the services of Support Workers provided by Southern Cross were no longer available, the family and friends of a Participant would be called upon to provide the necessary care or residential aged and specialist disability accommodation outside the home or residence of the Participant. Where funding was from the health budget of the State of New South Wales, it is likely that such Participants would continue to be the responsibility of the NSW health system, which would need to develop appropriate alternative responses that might be home-based or "in congregate settings". Clients with high complexity needs, such as those who are ventilator dependent, may have to be accommodated in hospital settings, perhaps in specialist non-acute wards. Where funding was from compensation schemes or from the NDIS or sources other than the NSW Health budget, it is likely that a mix of services might evolve to manage Participants of lower complexity. Professor Braithwaite, Assoc Prof Kewley and Dr Duckett expressed the view that it was unlikely that lower complexity Participants would be re-accommodated into public hospitals unless there was nowhere else for them to go.

177. The nature and degree of interaction between Funders, service providers and Participants can be viewed from three levels, being broad policy and legislative requirements, specific funding and clinical care. In relation to broad policy and legislative requirements, Support Workers and Southern Cross were required to adhere to standards as to the quality of care that must be delivered. Thus, there were national standards for aged care. There were also standards of other kinds that could apply, depending upon the circumstances, such as those developed by the Australian Commission on Safety and Quality in Health Care. Support Workers contracted by Southern Cross practised within the guidelines prescribed by the Australian Community Industry Alliance, which is recognised as the peak body for community service providers and independent community service users across Australia.

178. From a funding perspective, Southern Cross's senior management provided annual feedback on the progress of Participants, or as prescribed within the particular contractual arrangements with the relevant Funder. Support Workers did not generally participate in that process.

179. From a clinical perspective, on review of the sample of the 38 Participants identified by Southern Cross and set out in the First Joint Report, 12 were considered to be clinically complex, requiring ongoing interaction between Support Workers and Southern Cross on the one hand, and Commonwealth and State clinical service providers on the other. Twenty-six of the sample Participants were assessed as less complex, requiring Support Workers and Southern Cross to interact with other government service providers.

180. Continuity of care is "the degree to which a series of discrete healthcare events is experienced by people as coherent and interconnected over time and consistent with their health needs and preferences".^[21] World Health Organisation, “Continuity and Coordination of Care: A Practice Brief to Support Implementation of the WHO Framework on Integrated People-centred Health Services” (2018, Geneva) at 8. The practice of continuity and co-ordination of care addresses the conditions and ongoing relationships needed to support seamless interactions among multiple providers within interdisciplinary teams and across care settings and sectors. The service agreements between Local Health Districts and the Secretary of NSW Health specified one of the key goals as being to provide for an integrated care strategy, the four aims of which were articulated as being:

• connecting different care providers to deliver person centred care;
• enabling care to be provided in the most appropriate setting;
• reinforcing prevention and early intervention; and
• embedding individual responsibility for health.

181. However, the services provided by Southern Cross were not provided in a vacuum. Health services were available for all people when necessary and the local health services were available as a backup for Participants in the various programmes. Southern Cross operated within a set of standards, policies and principles developed both by itself and also as mandated by the relevant policy and legislation as indicated above and more directly by the specific Funder. In some cases, the Funder would undertake the assessment of the Participant and specify, in some detail, the

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services to be provided to the Participant. In other cases, the assessment would be conducted by the Funder, but the specification would be broadly about the goals of the Participant. In yet other cases, the assessment might have been done by an independent contractor. Regardless of the assessment by the Funder, Southern Cross also undertook its own assessment and specified what Support Workers were required to do.

182. The nature of interaction with the local health service depended on the requirements of a particular Participant. Where the Participant had high healthcare needs, requiring oversight by health professionals, there would be regular interaction between the health service and the Participant, which may have required the Participant to visit the health service for assessment and monitoring or have required health service staff to visit the Participant in the home or residence of the Participant or a combination of both. In some circumstances, where the Participant had complex needs, Southern Cross staff may need to be trained by the health service to look after the Participant and the equipment. In cases where the health needs of the Participant were low, even though dependency may be high, there may be little regular interaction with the health service. In those circumstances, the care would be provided mainly by Support Workers. Ordinary health events may have required there to be an interaction with a health professional, such as a local general practitioner or the health service.

183. In the acute stage, the majority of Participant care was provided at a public hospital where, commonly, care was provided consisting of emergency medical care, acute medical care and rehabilitation medicine. In the restorative and maintenance stages, medical care was provided to Participants outside of the hospital. Those stages included:

• Non-admitted specialist care - provided on an appointment basis for Participants who could visit the hospital clinic.
• Sub-acute non-admitted medical care - specialist medical rehabilitation and care to improve a Participant's functional independence in a hospital outpatient clinic or gym; and
• General practitioner - Participants received general practitioner's medical care in the practitioner's office or with home visits.

184. If such Participants could no longer receive care in their homes or residences, there were limited accommodation options other than a RACF. Thus, a Participant would need to apply to his or her Funder in order to access the limited number of group homes or specific disabled access accommodation available in the community providing care for 24 hours per day, seven days per week. Where a Participant was declined as unsuitable, the only option would be for that Participant to seek an ACAT assessment and approval for a RACF. Participants who were 65 years of age and over who could no longer receive care in their respective homes or residences would require a referral to an ACAT.

185. In the Second Joint Report, Assoc Prof Kewley and Mr Preobrajensky expressed the opinion that the admission to alternate accommodation of the 12 identified complex case Participants would require staff to be up-skilled and, in some cases, ongoing support from rehabilitation specialists. Disruption to the routine care of a Participant with complex needs had the potential to result in rapid functional deterioration, which commonly required admission to an acute hospital bed and, if required, an intensive care unit. Step down to an observation bed would then be required to allow for a multidisciplinary review of the health status of and discharge options for the Participant.

Lifetime Care

186. One example involving Lifetime Care related to a Participant known as "Participant 2". Following a motor vehicle accident in 2008, Participant 2 suffered a serious spinal injury, and became dependent on a wheelchair, ventilator and other equipment. Lifetime Care assessed Participant 2 as requiring 28 hours of Support Worker services (24 hours per day each day, with four hours of 2 Support Workers). Participant 2's Case Manager would regularly reassess the requirements of Participant 2, and submit an "Attendant Care Service Request" and "Care Needs Report" to Lifetime Care. If Participant 2 wished to make any changes

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to his services, he was directed to contact his Case Manager or LTCS coordinator, not Southern Cross.

187. Participant 2's Attendant Care Service Requests included detailed timetables of the care required by Participant 2. A sample provided that, on Mondays, between 7am and 8am, the Support Worker was to administer "meds from Webster pack; prepare & feed [Participant 2] breakfast (as required); clean up post meal prep & clean dishes (as required); set up items required for morning personal care routine; swap overnight drainage bottle to day bag".

188. Once assessed, Lifetime Care referred Participant 2's need for attendant care services to Southern Cross, which would then undertake a process of "new programs management". Southern Cross would take the Care Needs Reports, and the Attendant Care Service Requests (including the timetable) and use it to create Support Worker "Care and Service Plans" and "Duties Plans". Southern Cross would also undertake an environmental hazards assessment of the home environment for workplace health and safety purposes.

189. Over time, Southern Cross would conduct periodic reviews and evaluations with Participant 2. Participant 2 was able to reject a Support Worker for any reason, and such a Support Worker was subsequently blocked from providing care to Participant 2.

190. Southern Cross contends that the evidence summarised above makes it clear that part of the role and function of Lifetime Care was to provide health and care services, including health and care services of the kind that Support Workers provided to Participants. Due to the nature of their conditions, all Participants on the Lifetime Care Scheme were initially patients in a hospital.

191. Thus, Participant 2 was a patient at the Prince of Wales Hospital Spinal Injuries Unit. Prior to discharge, Participant 2's multidisciplinary treating team held a number of meetings attended by representatives from the hospital treating team, Lifetime Care and Southern Cross. Topics discussed at such meetings included Participant 2's routines, staffing updates, home modifications, and equipment. Upon his eventual discharge, that hospital provided a detailed discharge summary, which included details of his medications, functioning, requirements for management (such as bowel, bladder, skin and wounds), equipment requirements, and particular risks (such as autonomic dysreflexia).

192. Southern Cross's "new programs management" process involved Support Workers being trained in the hospital to care for Participant 2. Such training was provided by Participant 2's treating hospital specialist team and would involve "buddy shifts", where Support Workers would work with more experienced Support Workers to acquire the necessary skills. Such "buddy shifts" would also take place in the home if a new Support Worker later joined the team caring for the Participant.

193. Support Worker training by the hospital would include matters such as how a Participant could safely be moved around his or her own home, how bowel management would be performed and how the hospital treating team would attend the Participant's home for that purpose. Support Workers would stay in the hospital delivering services to the Participant in the hospital and the hospital treating team would visit the Participant regularly when he or she was at home. The period during which the Support Workers received training in hospital and provided care for the Participant in hospital was usually about 12 weeks.

194. In the lead-up to discharge, the Participant would spend short periods, including overnight, at home before returning to the hospital. During those periods, assessments would be undertaken at the request of the medical treating team. For example, while on overnight leave from Prince of Wales Hospital, Participant 2 received an occupational therapy assessment in his home environment. During the assessment, the care provided by Support Workers was evaluated, and issues for rectification were identified.

195. After his discharge from hospital in 2009, Participant 2 continued to attend the hospital outpatient clinic. Typically, a patient in Participant 2's condition would need to attend the hospital outpatient clinic at least twice a year for the rest of his or her life. Participant 2 also had contact with his Local Health

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District (known in 2011 as an Area Health Service). For example, Participant 2's occupational therapist was from the South Eastern Sydney and Illawarra Area Health Service.

196. On occasion, Participant 2 was readmitted to hospital. For example, in 2014, approximately five years after discharge, Participant 2 was admitted to a respiratory ward. While in hospital, the operations managers approved the continuation of his Support Worker care. At other times, particularly when his wife was absent, Participant 2 would stay in serviced apartments and receive care from "community nurses" in addition to his regular Support Worker care.

197. Occasionally, Support Workers for a high-needs Participant would require additional training (perhaps due to some change in the Participant's condition, or due to a new piece of equipment). On such occasions, the Participant's medical treating team would organise training for Support Workers in the relevant area.

NSW Health

198. Southern Cross adduced evidence of documents in relation to a sample Participant known as "Participant 58", who was part of the Enable Children's Home Ventilation Program. In 2011, Participant 58 was three years old, and an in-patient at the Children's Hospital, Westmead. Participant 58 required a ventilator, and also had a catheter and a PEG feeding tube. NSW Health, through the Enable programme, confirmed that Participant 58 required Support Worker care for active night shifts, 12 hours in duration, seven days each week. Having regard to the nature of their conditions, all Participants on the Enable programme were initially patients in a hospital. The Children's Hospital, Westmead developed a home oxygen management plan that was implemented by Support Workers after Participant 58's discharge. The hospital also put together the risk assessment for Participant 58's home.

199. Prior to discharge, a number of "case conferences" were held at the Children's Hospital, Westmead. The case conferences for Participant 58 included input from Southern Cross, Enable, ADHC, primary care providers such as General Practitioners, FACS, the public hospital and allied health professionals. One outcome of the conferences was a plan for wound dressings for Participant 58. The plan was for Southern Cross's registered nurse to liaise with and obtain support from Clinical Nurse Consultants in community health, and at the Children's Hospital, Westmead as needed.

200. Southern Cross's usual "new programs management" process for high-needs Participants, as set out above, applied to all Participants on the Enable programme. In particular, that involved training by the Participant's hospital treating team. For Participant 58, Support Workers undertook theory training followed by "buddy shifts" at the Children's Hospital, Westmead in 2011. Theory training included "Introduction to Long Term Ventilation" from a Clinical Nurse Consultant, "Social Implications of caring for a [long term ventilated] child" from a social worker, manual handling training from a physiotherapist, and ventilator training with a nurse from the Hunter Baillie Ward, a general medical ward at the Children's Hospital, Westmead. "Buddy shifts" included hands-on experience with hospital nursing staff, and manual handling training from hospital allied health staff. Closer to discharge, training included "buddy" time at home and an overnight shift with nursing support from the Children's Hospital, Westmead.

201. Once discharged, and as noted above, each Participant on the Enable programme had a community care coordinator, nominated by his or her Local Health District. Like all high-needs Participants, each Enable programme Participant would need to attend a hospital outpatient clinic regularly for the rest of his or her life. In addition, as for all high-needs Participants, his or her medical treating team would organise additional training for Support Workers as needed.

FACS (including ADHC)

202. For higher needs Participants, FACS was actively involved in determining the care required. Participants involved in FACS's programmes, such as the ACP, HNP or CCSP, underwent a "High Level Personal Care Needs Assessment" performed by the Attendant Care & Physical Disability Unit ( ACPDU ) of FACS. For some Participants, FACS would also

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provide "Assets", including motor vehicles and equipment, for use in connection with services provided to Participants.

203. When Southern Cross was selected by FACS or the Participant, Southern Cross would then arrange for Support Workers to provide the care for which a need had been assessed. That involved the creation of Support Worker "Care and Service Plans" and "Duties Plans", hazards assessments, and periodic evaluations.

204. Southern Cross adduced evidence relating to "Participant 74", who was part of FACS's ACP and HNP programmes. Participant 74 was a 52-year-old man with quadriplegia following an accident as a young man, who required full assistance for all of his activities of daily living ( ADLS ), including toileting, showering, drying, grooming, dressing, meal preparation, and feeding. The ACPDU assessed Participant 74 as requiring 51.25 hours of Support Worker care each week. Participant 74 received 26.5 hours under the ACP programme, and 24.75 hours under the HNP programme. Participant 74 was assessed as predominantly requiring assistance with personal care, with two hours each week allocated to domestic assistance. Participant 74 had previously been receiving more limited hours of care on the HACC programme through the Home Care Service. The HACC programme was limited to 15 hours of care each week and, when that was found to be insufficient, and the Home Care Service advised that it could not "offer increased personal care hours" to Participant 74, he was assessed by the ACPDU for the ACP and HNP programmes, and transitioned to Southern Cross arranging his care. Participant 74 also received a powered wheelchair through the Enable programme following an assessment by an occupational therapist. He also had a care manager who was independent of Southern Cross.

205. The ACPDU assessment included an allocation of hours and task descriptions, but noted that a Participant could adjust his or her hours and routine to suit his or her needs best within the overall approved allocation. For example, Participant 74's evening care routine involved 2 hours of care, in which a Support Worker was to:

"Assist [Participant 74] with toileting, reheat dinner, assist [Participant 74] with feeding/drinking, assist with washing and drying mouth and face, assist with grooming, change into night clothes, transfer into bed upon request, charge wheelchair/hoist, tidy kitchen/bathroom, general DA as time permits".

If a Participant wanted to increase the hours of care being provided, he or she was directed to submit a request to the ACPDU.

206. The ACPDU assessment formed the basis of Southern Cross's care timetables and service plans that were provided to Support Workers. For example, Southern Cross's timetable for Participant 74's evening care routine stated that a Support Worker was to:

"• …transfer to shower/commode chair and transfer to toilet before bed. Ensure commode chair is securely and accurately positioned over the toilet to avoid mishaps
• Position wheelchair/showerchair in appropriate location for safe transfer to bed
• Transfer to bed using hoist and full body sling
• Check skin integrity
• Ensure [Participant 74] is comfortable in bed, adjust position as requested
• Adjust covers and pillows as required
• Ensure reading material, TV remote (if utilised) fluids are available for overnight
• Store equipment hoist - wheelchair, commode chair
• Ensure hoist and wheelchair batteries are placed on charge
• Complete required documentation".

207. Due to the nature of their conditions, all high-needs Participants on FACS programmes, such as those in the SCI, ABI and Miscellaneous categories, were initially patients in a hospital. For those Participants, Southern Cross's "new programs management" process applied, which involved Support Workers being trained to care for Participants by their treating medical team. For example, the training arrangements for the Support Workers for a disabled child on FACS's programmes involved 10 support workers each receiving 4 hours face-to-face theory training, six "buddy

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shifts" and a 2 hour "skill endorsement". All high-needs Participants, including FACS Participants, would need to attend a hospital outpatient clinic regularly for the rest of their lives, and medical treating teams would organise additional training for Support Workers as needed.

208. Because of the "block-funding" model for lower-needs Participants, ADHC and FACS were less involved in determining the care required by Participants on the HACC programme. Some participants in the HACC category were discharged from hospital into Support Worker care, while others were referred via an ACAT. Under the block-funding model, ADHC and FACS were involved by means of the contractually specified reporting, guidelines, specifications, performance standards and policies.

209. In relation to the HACC programme, some Participants were assessed by an ACAT forming part of the relevant Local Health District visiting the Participant's home, while others were assessed as an in-patient in a hospital. For HACC Participants, Southern Cross would receive a "Client Information, Assessment and Referral Record" ( CIARR ) from the referring entity (such as an ACAT or hospital).

210. An example CIARR relates to "Participant 6". Participant 6 was referred for domestic care by the Shoalhaven District Memorial Hospital, which is a public hospital serving the City of Shoalhaven in New South Wales. Participant 6 required assistance with bathing, dressing, eating, grooming and walking. As part of the referral, an occupational therapist from the hospital was to visit Participant 6's home to assess the home environment. Following such assessments, Southern Cross would arrange for Support Workers to provide the care for which a need had been assessed. Like all Participants receiving services from Support Workers, HACC Participants had the right to reject and replace Support Workers. Participant 6 exercised that right.

DoE

211. Southern Cross adduced evidence consisting of materials in relation to Participant 9, who commenced school in 2011. Participant 9 had a tracheostomy tube, used a ventilator, and had a PEG feeding tube. While not at school and in the years before starting school, many students like Participant 9 also received Support Worker services through the Enable Children's Home Ventilation Program.

212. Under its agreements with Southern Cross, the DoE required that the relevant school:

(1) knew the Participant was on the Children's Home Ventilation Program;
(2) had copies of the Participant's health and medical reports;
(3) had developed a health care plan for the Participant's school placement; and
(4) requested that Southern Cross provide Support Worker services for the Participant at school in accordance with the Participant's care needs assessment.

For each Participant, the DoE nominated a contact. In the case of Participant 9, this was a DoE "Coordinator, Disability Programs". The Participant's assessed care needs formed the basis of Southern Cross's service plans for Support Workers. Due to the serious nature of their injuries, all DoE Participants were initially patients in a hospital.

213. Southern Cross followed its usual process for high-needs Participants for DoE Participants, including "new programs management", though in many cases Southern Cross was already involved in the provision of services to Participants through an Enable programme before the Participants commenced school.

214. For Participant 9, the relevant children's hospital worked with the school in developing a care plan for school hours. The hospital representatives attended the school and provided training to the school staff and to the Support Workers engaged by Southern Cross that were chosen to support the child at school.

215. Like all high-needs Participants, DoE Participants would need to attend a hospital outpatient clinic regularly for the rest of their lives, and medical treating teams would organise additional training for Support Workers as needed.

216. The Participant files in evidence include three referrals for service from DoE to Southern Cross requesting Southern Cross to

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assess the health care needs of a school-aged Participant and, following assessment, to provide Support Worker support at school during school hours. All three Participants appear to be existing Southern Cross Participants who are tracheostomy dependent and were previously funded by the Enable programme. The "program" funded by DoE is described as being "to assist young people with disabilities to attend school who would otherwise be unable to attend".

217. The contractual material as to the arrangements between Southern Cross and DoE is limited to letters from DoE confirming that its usual supplier terms will apply, which include the requirement for a valid purchase order number and payment terms of 30 days, and invoices subsequently sent in relation to services carried out for DoE. Southern Cross appears to have provided services to DoE on an ad hoc basis.

218. The indicia typically relevant to an employment agency contract, in the context of DoE and Support Workers, are addressed below:

(a) DoE's business is public education and training. This education and training remit is reflected in its workforce. For example, its staff comprises teachers (schools and TAFE NSW), educational support (including schools, state and regional offices, TAFE NSW), corporate service (core and non-core), and staff of Adult Migrant English Service and National Art School and Office of Communities. It is not apparent that DoE's workforce includes disability support workers.
(b) The detailed Support Worker Duties Plan for Participant 9 for the school-day show that the Support Worker is not involved in any education role. Rather, the Support Worker's role is restricted to support care needs, such as maintenance of the Participant's breathing equipment, connecting the Participant to and from the ventilator and monitoring for shortness of breath.
(c) The services are provided at DoE's premises, the Support Worker works within ordinary school hours and has use of the washing facilities and cutlery. The Participant brings his or her own equipment for the Support Worker to use; that is to say, the Participant supplies his or her own ventilation equipment.

Those factors tend to weigh against the existence of an employee-like relationship between the DoE and Support Workers.

219. Another factor to that effect is the lack of evident control exercised, or instruction given, by the DoE; the Support Workers are required to follow the Southern Cross Duties Plan and are not required or encouraged to undertake any tasks beyond what is set out in the Care Plan. There is no suggestion that DoE provides Support Worker training, which is provided by Southern Cross. The only interaction between Support Workers and the school staff described in the Duties Plan is the need to notify the classroom teacher prior to the Support Worker taking a toilet break.

220. Accordingly, the Commissioner asserts, the evidence does not permit a finding that there is an employment agency contract between Southern Cross and Support Workers undertaking work funded by DoE. Rather, he says, the evidence suggests the contrary.

NSW Trustee

221. Southern Cross adduced evidence in relation to Participant 66, a 48-year-old woman who received Support Worker services for 24 hours each day pursuant to a programme operated by the NSW Trustee. Participant 66 had an ABI resulting in quadriplegia, epilepsy, bilateral incontinence, communication difficulties and diabetes. Prior to receiving Support Worker care through Southern Cross, Participant 66 lived in a rehabilitation centre for 19 years. Discharge and transfer of care from the rehabilitation centre to Participant 66's home required a "joint interagency multidisciplinary team in planning for the safe transfer of her care to the community". Due to the complexity of her needs, a Transfer of Care Risk Assessment ( TCRA ) or equivalent would have been completed by her treating clinical team. Support Workers provided services to Participant 66 including medication management, management of hygiene, management of spasticity, maintenance of respiratory function, management of skin integrity, monitoring of diabetes, and

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prevention of infection. The Support Workers also assisted with the activities of daily living.

222. The only documents related to the NSW Trustee are the documents produced by Southern Cross in relation to Participant 66. Of those documents, the only ones in which the NSW Trustee is mentioned are the five invoices addressed to the NSW Trustee and issued by Southern Cross in 2012. Thus, there is no document to suggest that the NSW Trustee plays any role in the services provided to Participant 66 by Southern Cross and the Support Workers other than the funding of those services in its capacity as trustee, guardian or financial manager of the Participant, and thereby on the Participant's behalf. The documents do not suggest that there was any interaction between the Support Worker and the NSW Trustee or its staff, that there was any involvement of the NSW Trustee in planning, delivering or reviewing the services provided to Participant 66, that there was any communication between either Southern Cross or the Support Worker with the NSW Trustee other than the invoices, or that there was any use of the NSW Trustee's facilities or equipment.

DSS

223. Southern Cross adduced evidence in relation to Participant 13. In 2014, Participant 13 was referred by her geriatrician to the Westmead ACAT as requiring assistance with personal care, housework and shopping. Participant 13 had a range of complex conditions, including cognitive impairment, depression, hypertension, poor vision and chronic pain. The Westmead ACAT subsequently undertook an assessment, which identified that Participant 13 required assistance with self-care, movement activities, health care tasks, transport, domestic assistance, meals and home maintenance. She was recommended for a HCP "level 3-4", but it was noted that with family support, a HCP "level 1-2" was appropriate. Her assessing team included a geriatrician, a registered nurse, and a physiotherapist. Following the assessment, Southern Cross was appointed to arrange services for Participant 13, and followed its usual process, including the creation of Support Worker "Care and Service Plans" and "Duties Plans", hazards assessments and periodic evaluations.

TAC

224. Southern Cross adduced evidence relating to Participant 7, who was a TAC Participant following a traffic accident in which he sustained a spinal cord injury and became paraplegic. Southern Cross contends that, in the circumstances outlined below concerning Participant 7, the provision of care of the kind provided by Support Workers was part of TAC's operations.

225. In May 2011, following recommendations from an occupational therapist, TAC determined that Participant 7 required 510 hours of personal care in each 28-day billing period (approximately 18 hours per day), including 224 hours of active overnight care (8 hours per night). Those needs were regularly reassessed. There was an updated assessment in December 2011 approving the same number of care hours. TAC's assessments formed the basis of Southern Cross's service plans for Support Workers.

226. Consistent with its statutory functions, TAC also developed "Independence Plans" for TAC Participants. Participant 7's Independence Plan was developed in consultation with Participant 7 and his treating medical team. In notifying Participant 7 of the plan, TAC noted that Participant 7's "Support Coordinator" at TAC will "continue to work with you to coordinate your Independence Plan", and that TAC has "approved your services to support you to meet your needs and achieve your goals". Participant 7's TAC Support Coordinator also undertook annual reviews of Participant 7.

NDIA

227. Southern Cross adduced evidence in relation to Participant 12, who commenced on the NDIS in November 2015. Participant 12 had a range of conditions including ependymoma (a type of tumour that can form in the brain or spinal cord), epilepsy, depression and osteoporosis. Participant 12's initial NDIS plan was for the period from 20 November 2015 to 24 April 2016. The NDIA approved Participant 12 to receive a set level of funding for "assistance with daily life at home

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in the community, education and at work", and "improved daily living skills". The funding was to be paid by the NDIA directly to Participant 12's support provider. Those services included support with personal care, assistance with meal preparation, and assistance with feeding.

228. Where Support Worker services had been approved by the NDIA, and Southern Cross was selected as a provider, Southern Cross would work with the Participant to develop his or her care plan. If an NDIS Participant's circumstances changed after his or her plan was approved, he or she was directed to contact the NDIA.

229. The NDIA developed a "National Disability Insurance Scheme Model Agreement" for use by Participants and providers. Consistently with the philosophy underlying the NDIS, the NDIA expected Southern Cross to "work with a [P]articipant to establish written or verbal agreement about the nature, quality and price of supports to be provided". Support was then to be provided in accordance with that agreement.

230. NDIS Participants requiring Support Worker care had high needs. Southern Cross adduced evidence concerning Participant 12, who, in 2015, had been an in-patient in John Hunter Hospital, a public hospital in Newcastle, before being transferred to the hospital's rehabilitation centre at Rankin Park. Prior to discharge, Participant 12's care needs had been assessed by the hospital. Upon discharge, follow-up with his general practitioner and a palliative care team was arranged by the hospital. The assessments by the NDIA and the hospital formed the basis of Southern Cross's service plans and Duties Plans for Participant 12. Southern Cross followed its usual processes, including in relation to risk assessment and periodic reviews. After discharge from John Hunter Hospital, Participant 12 had ongoing contact with the hospital's occupational therapist, rehabilitation specialist, and neurologist. He also had contact with an oncologist and a palliative care specialist at Calvary Mater Hospital, another public hospital in Newcastle.

Issue (1)A: Employment Agency Contract

231. In the context of s 37 of the Payroll Tax Act, one person ( employment agent ) provides the services of a second person ( service provider ) to a third person ( client ) in consideration for the payment of a fee or other remuneration by the third person to the first person. The term "client" is probably more frequently used in the context of a person who is the recipient of professional services such as legal services or accounting services. However, it is clear enough that s 37 is not to be construed so narrowly as to limit the third person, the client, to a person who receives such services. On one view, of course, the services of a Support Worker may well constitute professional services. It would not be difficult to regard the recipient of the services provided by a Support Worker pursuant to a contract between the recipient and the Support Worker as the client of the Support Worker.

232. An employment agency contract is a contract under which a person, described as an employment agent , procures the services of another person, described as a service provider , for a client of the employment agent. In the present circumstances, Southern Cross contends that its arrangements with Support Workers constituted a contract under which Southern Cross, as employment agent , procures the services of a Support Worker, as service provider , for a Funder, as client , of Southern Cross, as employment agent . It is clear enough that, for the purposes of the Payroll Tax Act, Southern Cross procures the services of a Support Worker. The question, however, is whether Southern Cross does so for a Funder, as the client of Southern Cross. The Commissioner contends that Southern Cross procures the services of a Support Worker for a Participant, as the client , rather than for a Funder, as the client .

233. No payment was made by a Participant to Southern Cross as consideration for the services provided by a Support Worker. Nevertheless, there was a contractual relationship between Southern Cross, on the one hand, and a Participant, on the other, as evidenced by the Service Agreement in the User Booklet. Further, there was a clear contractual arrangement between Southern

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Cross, on the one hand, and the Support Worker, on the other. In addition, there was a clear contractual arrangement between Southern Cross and the Funder. Payments were made by the Funder to Southern Cross pursuant to the contractual arrangements between them. Similarly, payments were made by Southern Cross to the Support Worker under the contractual arrangement between them. Clearly, there was a relationship between the Participant and the relevant Funder. However, it would be difficult to characterise the relationship between a Participant and the relevant Funder as a contractual relationship.

234. Southern Cross accepts that a Participant was effectively the consumer or end user of the services provided by a Support Worker. However, it contends, the consumer or end user of services need not be the client for the purposes of the Payroll Tax Act. Thus, for example, where the operator of a hotel retains Contractor A to provide services consisting of the cleaning, servicing and presentation of hotel rooms, and Contractor A uses employees or contractors provided by Contractor B for whom Contractor A paid fees to Contractor B based on the number of hours worked or the number of rooms cleaned, the arrangements between Contractor A and its client, the hotel operator, may be an employment agency contract for the purposes of the Payroll Tax Act.^[22] See HRC Hotel Services Pty Ltd v Chief Commissioner of State Revenue (NSW) [2018] NSWSC 820 ; (2018) 108 ATR 84 and Bayton Cleaning Company Pty Ltd v Chief Commissioner of State Revenue (NSW) [2019] NSWSC 657 ; (2019) 109 ATR 879 (“Bayton”).

235. Southern Cross characterises such arrangements as involving the guests at the hotel as the end users of the services of Contractor A. However, I would not necessarily characterise the hotel guest as the end user of the services consisting of the cleaning, servicing and presentation of the hotel room. The hotel operator contracts with the hotel guest for the provision of accommodation of an appropriate standard. How the hotel operator procures the accommodation to be of that standard is a matter for the hotel operator and not for the hotel guest. The hotel guest is the end user of the service provided by the hotel operator consisting of accommodation of the relevant standard. In that sense, the hotel operator is the end user of the services provided by Contractor A in order to achieve the appropriate standard of accommodation.

236. Southern Cross complains that the Commissioner's contention that the client of Southern Cross is the Funder rather than the Participant should not be accepted because it was not advanced in the Commissioner's amended appeal statement of 29 July 2019. However, no specific prejudice has been identified by Southern Cross by reason of the absence of such a contention. For example, Southern Cross has not pointed to any avenue of further inquiry that it might have undertaken in order to adduce further evidence if such a contention had been advanced. In any event, the question appears to me to be one of pure law. Accordingly, there is no reason why the Commissioner should be prevented from advancing the contention.

237. The introduction of the notion of "end-user" tends to obfuscate the construction of s 37. The essence of s 37 is that the Support Worker must be understood as providing services for a client of Southern Cross. In the present circumstances, I consider that the client of Southern Cross was the person who retained Southern Cross to procure the services of the Support Worker. The fact that the services of the Support Worker entailed the care of a Participant did not render the Participant the client of Southern Cross. The Support Worker provided the care services to the Participant because that was the contractual obligation that the Support Worker undertook to Southern Cross. Southern Cross procured those care services to be provided to the Participant because that was the contractual obligation that Southern Cross had undertaken to the Funder. In those circumstances, it can be said that, pursuant to its arrangements with and at the behest of the Funder, who in that situation must be understood as the client of Southern Cross, Southern Cross procured the services of another person, the Support Worker, as a service provider.

238. However, the more significant question that arises under s 37 is whether it can be said that the Support Worker provided services for the Funder, within the meaning of the section. Before it can be concluded that the Support Worker provided services for the Funder, as the client of Southern Cross, it must be demonstrated that the services were provided by

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the Support Worker in and for the conduct of the business of the Funder.^[23] See UNSW Global Pty Ltd v Chief Commissioner of State Revenue (NSW) [2016] NSWSC 1852 ; (2016) 104 ATR 577 at [62] (“UNSW Global”).

239. That language does not appear in s 37. However, the mischief to which s 37 was directed was the avoidance of payroll tax through the interposition of an agent to give the appearance of a contractor relationship where none existed in substance, rather than an employment relationship.^[24] See UNSW Global at [41]. The employment agency provisions were designed to bring to tax wages paid to persons who are, to all intents and purposes, performing duties similar to the duties of employees.^[25] See UNSW Global at [38].

240. The provisions were not intended to apply only to employment agents and labour firms, as those expressions may generally be understood. Rather, s 37 should be construed as referring to a contract under which a person, the employment agent, procures for the client the services of another person, the service provider, in the sense of procuring the services "in and for the conduct of the business of the client of the employment agent".^[26] See UNSW Global at [62]. The service provider is in a sense in loco mercenarii in relation to the client. That is to say, the service provider is in the position of an employee in relation to the client.

241. Thus, an employment agency contract is one where the services are provided by individuals who would comprise, or would be added to, the workforce of the client for the conduct of the business of the client , in order to help the client to conduct its business in the same way, or in much the same way, as the client would conduct its business through an employee. Where the services, although provided for the benefit of the client , are not provided by the service provider working in the business of the client , the provisions will not apply. Focus on whether the services are provided in and for the conduct of the business of the client leads to emphasis being placed on the nature of the business of the client .^[27] See Bayton at [94]-[97].

242. The following may be indicia as to whether a service provider was working in and for the conduct of the business of the client of the employment agent, in the sense that the service provider formed an addition to the workforce of the client :

• whether the service provider wears the uniform of the client;
• whether and the extent to which the service provider is entitled to make use of the client's staff amenities;
• whether it would be objectively apparent to a customer of the client that there was any distinction between the service provider and an employee of the client;
• the extent to which the service provider liaises with the customers and staff of the client in the provision of the services;
• whether the functions of the service provider are performed on site and are necessary for the operation of the business of the client;
• whether the functions are provided in the ordinary conduct of the business of the client, with regularity or continuity, as opposed to being provided on an ad hoc basis or as a one-off event;
• whether the work would otherwise have been done by an employee of the client if it had not been outsourced;
• the degree of independence of the service provider; and
• the significance of the provision of an "integrated package" to the client.^[28] See Bayton at [105].

243. A Participant is more fairly characterised as a person who received funding or subsidies from the Funder rather than a customer, or client, of the Funder. However, even if that was not so, a Participant is in any case clearly a customer or client of Southern Cross. Accordingly, the interaction between the Support Worker and the Participant and the degree of control and instruction exercised by the Participant over the Support Worker does not weigh in favour of a conclusion that the Support Worker is working in and for the conduct of the business of the Funder but weighs against that conclusion.

244. There was no relevant direction and control by the Funder of the work of a Support Worker, such that Funder and Support Worker could be said to be in an employee like relationship. The Funder paid for the services of a Support Worker to be provided to a Participant, being services that had been assessed as necessary for the well-being of the

ATC 24703

Participant. While a level of oversight of Southern Cross by the Funder, as the paying entity, would be expected to ensure that the Funder was getting what it was paying for and that the welfare of the Participant was being adequately provided for, that does not make the relationship between the Support Worker and the Funder an employee-like relationship. Southern Cross, rather than the Funder, had particular control and direction of the Support Worker. While it may have been possible for a service provider to perform services in and for the businesses of both the putative employment agent and the putative client, that is not what occurred in the circumstances under consideration.

245. Thus, the question raised by s 37 focuses very much on the relationship between the Support Worker, or service provider, and the Funder, or client, and, in particular, whether it can be said that that relationship was employee/employer-like. However, Southern Cross, in all material respects, effectively acted as a barrier between the Support Worker and the Funder, such that there can be no finding that a Support Worker is in an employee-like relationship with a Funder. That is to say, the connections between the Funder, on the one hand, and the Support Worker, on the other, were, at most, indirect and appropriately characterised as financial and prudential rather than employee-like. While Southern Cross, the Support Worker and the Funder may well have been working towards a common goal, namely the best outcome for the Participant, that does not satisfy the requirements of s 37.

246. Examination of the particular arrangements between Southern Cross and each Funder, as set out above, supports the conclusion that a Support Worker did not work as if he or she was part of the workforce of the Funder and did not work in an employee-like manner in and for the conduct of the business of the Funder. The interactions of a Support Worker focused on his or her relationship with Southern Cross and the Participant, rather than any relationship with the Funder.

247. Several matters that are for the most part common to all Support Workers and all Funders are inconsistent with the notion of any Support Worker being part of the workforce of a Funder or being in an employee-like relationship with a Funder. Rather, those common matters demonstrate that the Funder was peripheral to the day-to-day activities of the Support Worker. The common matters may also be relevant in relation to the question of whether the Support Workers were employees of Southern Cross or were independent contractors of Southern Cross. That question is addressed below in relation to Issue (2).

248. The common matters are as follows:

(a) Support Workers did not utilise the facilities or premises of Funders. Rather, they provided their services at the homes of the Participants and in the community, such as at gyms, in shops and at the premises of doctors or hospitals. The only exception was when the DoE was the Funder.
(b) The Participant, not the Funder:
- (i) allowed use of toilet and hand washing facilities and provided associated soap, towels and toilet paper for use by a Support Worker;
- (ii) allowed Support Workers access to kitchen facilities and provided adequate seating, lighting, heating and cooling;
- (iii) provided an adequate bed or sofa or sofa-bed with clean linen for shifts involving sleepovers; and
- (iv) provided the Support Worker with access to a telephone to assist in the provision of services or in an emergency.
(c) Southern Cross and not Funders provided the Support Worker with disposable gloves to use at the Participant's home.
(d) Support Workers carried a Southern Cross identification card and did not wear any uniform issued by the Funder (or for that matter Southern Cross), although each Support Worker was required by Southern Cross to dress in a neat and tidy manner and not to identify herself or himself as a representative of the particular Funder.
(e) Support Workers accepted shifts each 14-day roster cycle but, despite the roster being only 14 days, there was an expectation of regularity and continuance of care and shift coverage by teams of Support Workers determined by the needs and requests of the Participant directed at the best outcome for

ATC 24704
the Participant, paid for by (and within the funding budget of) the Funder.
(f) Regularity was dependent on input from the Participant as to how and when he or she wanted care to be delivered, the assessed needs of the Participant, who was at the centre of the assessment, and the number of funded hours per week.
(g) Support Workers did not deal directly with the Funder or the Funder's staff. Typically, the Funder identified Southern Cross as the service provider, following a nomination by the Participant. The Funder did not specify the Support Worker.
(h) A Participant was aware, when dealing with a Support Worker, that the Participant was, in substance, dealing with Southern Cross. Thus, Southern Cross provided Participants with the User Booklet and the Service Agreement, which the Participant signed or which someone signed on behalf of the Participant.
(i) Southern Cross, and not the Funder, took care of all rostering of Support Workers and supervised and monitored the work of Support Workers, including providing training, preparing care plans and undertaking periodic reviews.
(j) Support Workers reported to Southern Cross with any issues and not to the Funder. The Participant was likewise directed to contact Southern Cross if there were any issues with the performance of a Support Worker. Southern Cross maintained an assistance line for both Support Workers and Participants 24 hours per day, 7 days per week and encouraged all initial complaints to be discussed directly with Southern Cross.
(k) The Funder's exercise of control over the work ultimately provided by the Support Worker was mostly limited to the overarching obligations, standards and reporting processes contained in the agreement between Southern Cross and the Funder or general programme guidelines.

The matters outlined above indicate that the contract between Southern Cross and a Support Worker was not one whereby a Support Worker did work as if he or she was part of the workforce of the Funder. The contract was not one whereby a support Worker did work in an employee-like manner in and for the conduct of the business of the Funder. With the exception of ADHC and FACS, the evidence does not establish that any one of the Funders was in the business of providing, as opposed to funding, monitoring or reviewing, in-home attendant care of the kind provided by Southern Cross.

249. The role of the Commonwealth and New South Wales Governments during the Relevant Tax Years was specified in the National Health Reform Agreement signed by all governments. The principal role of government in health, aged care and disability services was to oversee the service delivery system and to ensure access to high quality services. Increasingly, external organisations were contracted to provide services under what is known as a purchaser-provider split. Under those arrangements, government did not provide services, but contracted with specialist organisations for that service delivery. Government specified what was to be achieved but did not control how that was to be achieved.

250. Consideration of the circumstances of each individual Funder confirms that, even if the Funder was considered to be in the business of providing care to persons such as the Participants, when taken together with the common features of the arrangements between Southern Cross and the Support Workers as described above, a Support Worker did not work in and for the conduct of the business of any Funder in an employee-like sense. A Support Worker could not be said to be swelling the workforce of the Funder. Accordingly, the arrangements between Southern Cross and a Support Worker do not constitute an employment agency contract for the purposes of s 37 of the Payroll Tax Act.

Issue (1)B: Clause 8 of Schedule 2 Exemption

251. Under s 40(1), any amount paid or payable to a service provider in respect of the provision of services in connection with an employment agency contract is taken to be wages paid or payable by the employment agent under the employment agency contract. Section 40(2) then provides that s 40(1) does not apply to an employment agency contract to the extent specified in s 40(2). The first requirement of s

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40(2) is that it must be shown that, if the service provider had been paid by the client as an employee, the amount of the payment would be exempt from payroll tax under Pt 4.

252. Part 4 of the Payroll Tax Act deals with "Exemptions". Division 3 of Pt 4 deals with "Health care service providers". Section 51, which is in Div 3, provides that wages paid or payable by a healthcare service provider are exempt wages if they are paid or payable for work of a kind ordinarily performed in connection with the conduct of a healthcare service provider to a person engaged exclusively in that kind of work. The term "health care service provider" has the meaning given in Div 2 of Pt 3 of Sch 2 to the Payroll Tax Act, namely "(a) a public hospital, or (b) a hospital that is carried on by a society or association otherwise than for the purposes of profit or gain to the individual members of the society or association".

253. It was intended that payroll tax legislation among the States was to be uniform. However, Sch 2 to the Payroll Tax Act contains provisions that have no equivalent in other States. Part 3 of Sch 2 deals with "Exemptions" and Div 2 of Pt 3 of Sch 2 deals with "Health care service providers". The critical provision is cl 8, which is part of Div 2.

254. Southern Cross contends that the intention of Parliament was to pose a hypothetical whereby Southern Cross, as intermediary, would be removed from the "worker-client relationship" and an inquiry would be made as to whether the "worker" would be performing a category of work that is exempt from payroll tax. The evidence suggests that, if the arrangements between Southern Cross and the Support Workers amounted to employment agency contracts under s 37, 94% of its payments to Support Workers in the Relevant Tax Years would be exempt. Southern Cross characterises the provisions in s 40(2) as "the look-through" because those payments would be exempt from payroll tax under cl 8 of Sch 2 if the Support Workers had been paid by "the clients" of Southern Cross as employees of those "clients", "the clients" being the Funders.

255. On the other hand, the Commissioner contends that, even if the arrangements between Southern Cross and the Support Workers amount to employment agency contracts, cl 8 does not apply because Southern Cross does not meet the requirements of cl 8 with respect to the requisite connection to public hospitals or Local Health Districts, or the kind of work performed by the Support Workers or the exclusivity of that kind of work. Further, the Commissioner says, certain of the Funders, such as the DSS, the NDIA and the TAC, are not the Crown because, he says, "the Crown" refers to the Crown in right of New South Wales only and not the Crown in right of the State of Victoria or of the Commonwealth.

Legislative History of the Cl 8 Exemption

256. Clause 8 relevantly required that each of the following be satisfied:

(a) the wages be paid or payable by the Crown ;
(b) the wages be paid or payable in respect of staff employed in connection with a public hospital or a local health district;
(c) the wages be paid or payable for work of a kind ordinarily performed in connection with the conduct of public hospitals or of the local health district concerned; and
(d) the wages be paid or payable to a person engaged exclusively in that kind of work.

The phrase "in connection with" is used twice in cl 8, as indicated by the emphasis that I have added. Thus, the wages must be paid or payable in respect of staff employed in connection with a public hospital or Local Health District and the wages must be paid or payable for work of a kind ordinarily performed in connection with the conduct of public hospitals or of the Local Health District concerned.

257. The origins of the exemption in cl 8 are to be found in s 10 of the Pay-roll Tax Act 1971 (NSW) ( the 1971 Act ). When the 1971 Act was originally enacted, public hospitals were able to employ staff and s 10(b) relevantly provided that:

"The wages liable to pay-roll tax under this Act do include wages paid or payable-

…

(b) by a religious or public benevolent institution, or a public hospital". (emphasis added)

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By the Pay-roll Tax (Further Amendment) Act 1977 (NSW), s 10(b) became s 10(1)(b). By the Pay-roll Tax (Amendment) Act 1979 (NSW) ( the 1979 Amendment ), s 10(1A) was inserted to provide, relevantly, that s 10(1)(b) only operated so as to exclude from wages liable to payroll tax wages paid or payable by:

"a public hospital to a person in respect of time when the person is engaged in work of a kind ordinarily performed in connection with the conduct of public hospitals".

The effect was to narrow the exemption such that it was not all wages paid or payable by public hospitals that were exempt. Rather, only those paid to persons in respect of work of a kind ordinarily performed in connection with the conduct of public hospitals were exempt.

258. In his speech on the second reading of the Bill for the 1979 Amendment, the Minister referred to the desire to avoid a mechanism whereby staff were being used by exempt entities for non-conventional purposes. The Minister said:^[29] New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 21 November 1979 at 3470-3471.

"The mechanism involves hiring out employees to industry in return for a fee and in the terms of the existing exemption no payroll tax would be payable on the wages paid to those persons so employed. The firms that have hired the services from the institution would also not be subject to payroll tax as they would not be an employer as defined by the Act in relation to these employees. Under the existing exemption it would be open for a large company to establish its own exempt institution from which it could hire its labour and thus avoid the payment of the tax."

Thus, the requirement that the work for which wages are paid or payable be of a kind ordinarily performed in connection with the conduct of public hospitals served as a narrowing factor and was not intended to extend the exemption to any work that may have had a connection with a public hospital.

259. The same qualification was placed on the exemption introduced for Area Health Services, which were the predecessors to Local Health Districts, when they were established in 1986. At that time, Area Health Services could employ staff.^[30] See ss 11 and 25 of the Area Health Services Act 1986 (NSW). Thus, wages were exempt only if paid or payable by an Area Health Service "to a person in respect of time when the person is engaged in work of a kind ordinarily performed in connection with the conduct of an Area Health Service ". That was the effect of the Miscellaneous Acts (Area Health Services) Amendment Act 1986 (NSW), which inserted s 10(1)(b1) and s 10(1A)(c1) into the 1971 Act. Further, the exemption introduced for the Home Care Service by the State Revenue Legislation (Miscellaneous Amendments) Act 1998 (NSW), which inserted s 10(1)(c1) into the 1971 Act (which sub-section was later repealed), was limited to wages paid or payable "in respect of time when the person is engaged in the work of a kind ordinarily performed in connection with the conduct of the Home Care Service "^[31] This Act also added s 10(1)(b2). (emphasis added).

260. In 2006, the Public Sector Employment Legislation Amendment Act 2006 (NSW) ( the 2006 Public Sector Act ) introduced a substantial change to the way in which both Area Health Services and the Home Care Service operated, namely, that they could no longer employ staff directly.^[32] Note that by this point the Area Health Services Act 1986 (NSW) was repealed and replaced by the Health Services Act 1997 (NSW). Rather, staff were to be employed in the New South Wales Health Service. The Minister's speech on the second reading of the Bill for the 2006 Public Sector Act makes clear that its purpose was not to make a substantive change to the way in which individuals worked for Area Health Services, including at public hospitals, or the Home Care Service. Rather, its purpose was to avoid what the then New South Wales Government perceived to be the unfair operation of the Commonwealth Government's WorkChoices legislation.^[33] New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 7 March 2006 at 21148-21152. To that end, employees of Area Health Services and the Home Care Service became direct employees of the State of New South Wales.

261. Thus, the explanatory note for the Bill for the 2006 Public Sector Act stated that it removed the employment functions of public health organisations such as Area Health Services, which currently employed staff in the public health system, and provided instead for that staff to be employed by the Government of New South Wales in the service of the Crown. The explanatory note also provided that, on the whole, the provisions relating to employment of staff in the public health system were not affected except to the extent that the staff would

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no longer be employed by a public health organisation but would be employed by the government in the New South Wales Health Service. The consequential amendments that the change in employment arrangements necessitated included changes to the payroll tax exemptions then enjoyed by Area Health Services and the Home Care Service. At that time, the Area Health Services were responsible for operating public hospitals.

262. The 2006 Public Sector Act amended the 1971 Act by introducing the requirement that the relevant wages be paid or payable by the Crown in connection with a public hospital or an Area Health Service. Section 10(1)(b1) and s 10(1)(b2) were omitted and replaced accordingly. Section 10(1)(c1) was also omitted. In addition, s 10(1A)(c1) and s 10(1A)(c2) of the 1971 Act were omitted and replaced by a requirement that there would be an exclusion only where wages were paid or payable by:

"(c1) the Crown in respect of staff employed in connection with a public hospital or an area health service when the staff are engaged in work of a kind ordinarily performed in connection with the conduct of public hospitals or of the area health service concerned.

(c2) the Crown in respect of staff employed under Chapter 1A of the Public Sector Employment and Management Act 2002 in the Government Service to enable the Home Care Service to exercise its functions for time when the staff are engaged in work of a kind ordinarily performed in connection with the conduct of the Home Care Service." (emphasis added)

263. The historical background outlined above demonstrates that the reference to wages paid or payable "by the Crown in connection with a public hospital or an area health service" was not intended to expand the scope of the exemption. Rather, the reference was inserted to reflect the fact that the Crown, and not public hospitals or Area Health Services (now Local Health Districts), was thereafter to be the employer of the staff of public hospitals and Area Health Services in the New South Wales Health Service.

264. Accordingly, the requirement in cl 8 of Sch 2 that the wages be paid or be payable in respect of staff employed in connection with a public hospital or a Local Health District was intended to capture the usual or conventional workforce of public hospitals and Local Health Districts and not anyone who simply had some connection with such institutions. Thus, the phrase "by the Crown in respect of staff employed in connection with a public hospital or a local health district" was intended as a compendious expression that was substituted for, but had the same meaning as, the phrase "by a public hospital or area health servicer". It was intended that the persons in respect of whom the exemption applied, being the workforce of public hospitals and Local Health Districts, would be the same.

Construction of the Exemption

265. Southern Cross asserts that 99% of the payments to Support Workers in the Relevant Tax Years were for work having a sufficient connection to a public hospital or Local Health District to satisfy the requirement of cl 8 that it be work in connection with a public hospital or a Local Health District and work of a kind ordinarily performed in connection with the conduct of public hospitals or of the Local Health District concerned. It contends that the requirement was directed at excluding payments for work of an entirely different type, such as when a public hospital operated a separate commercial venture.

266. The phrase "in connection with" is of considerable width. In general, it would be satisfied by a link or an association or a relationship. It has the meaning of "having to do with."^[34] See Commissioner for Superannuation v Miller (1985) 8 FCR 153 ; Our Town FM Pty Ltd v Australian Broadcasting Tribunal (1987) 16 FCR 465 ; Drayton v Martin (1996) 67 FCR 1 . Nevertheless, the meaning to be attributed to the phrase depends upon the context and purpose of the statute in which it appears.^[35] See Burswood Management Ltd v Attorney-General (Cth) (1990) 23 FCR 144 at 146 . Southern Cross contends that the Commissioner's argument that the phrase acts as a confining or narrowing factor should be rejected.

267. Southern Cross contends that the provision should be understood as meaning that the Support Worker performs his or her services in connection with a public hospital or a Local Health District. It relies on the following matters:

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• high-needs Participants came to receive the services of Support Workers while they were patients in a public hospital and the services required by the Participant and hours of care were determined by the hospital and the Funder;
• all HCP Participants were assessed by an ACAT forming part of his or her Local Health District and the services received by the Participants under the HCP programme were individually tailored to meet the care needs of the respective Participants. For HACC Participants, some were discharged from hospital into the care of a Support Worker while others were referred by way of an ACAT, although there were some for whom there was neither a hospital nor an ACAT referral. Southern Cross accepts that there is insufficient evidence that payments in respect of low-needs Participants in the Miscellaneous category come within the cl 8 exemption;
• Support Workers were trained in hospitals for high-needs Participants for a significant period by the Participant's hospital treating team, to learn how to perform care for that Participant. The transition to the home environment was a gradual process of short and interspersed hospital and home stays. For high-needs Participants, where the Funder was the DoE, the Support Worker training with hospital staff took place in the school as well;
• in the home or residence of a high-needs Participant, a Support Worker provided the same care as performed in the hospital, as modified for the home environment of the particular Participant and for the preferences of the Participant as to matters such as the time when he or she wished to get up in the morning or have his or her shower;
• Participants invariably had ongoing contact with their respective Local Health District, whether through further ACAT assessments, treatment by allied health workers, such as occupational therapists from the relevant Local Health District, and treatment by community nurses and public hospitals in the case of high-needs Participants. Such appointments were typically facilitated by a Support Worker;
• high-needs Participants were required to meet with their respective specialist clinical teams, including in hospital outpatient clinics, every six to 12 months. At those meetings, the Participant's care programme would be reviewed, including prescriptions as to Support Worker care and required equipment such as ventilators;
• There was clinical complexity in all of the 38 or 39 sample Participants, both high-needs and low-needs, as they were at high risk of decompensating if there was any change in the continuity of the care that they received. Each of the low-needs Participants would need to interact with medical or allied health professionals on a regular basis; and
• Support Workers would receive training from external sources, including hospital treatment teams, when new items of equipment or new treatments were introduced.

268. Southern Cross contends that there was a continuity of health care activities from inside a public hospital or Local Health District into the home of a Participant in the fashion described above in relation to "transition of care". The arrangements contemplated that the Funder, the clinical reviewing team and the Support Worker all worked together in order to achieve the best outcome for the Participant and to ensure that the Participant received continuity of care. That was a key goal of the New South Wales Government's integrated care strategy.

269. The vast majority of Participants would have to receive care from hospitals and Local Health Districts directly if they did not receive the services of a Support Worker. For example, high-needs Participants would continue to be the responsibility of the New South Wales health system, which would need to develop appropriate alternative responses. Such responses might be home-based or in congregate settings. Participants with high complexity needs, such as those who were ventilator dependant, may end up being accommodated in hospital settings, perhaps in specialist non-acute wards, if the services of Support Workers were not available. For other Participants, a "mix of services" would need to evolve to provide the required care. If no other

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options were available, Participants would ultimately be a burden on the public hospital system.

270. It is significant that none of the Funders operated a public hospital or a Local Health District. Further, none of the Funders employed the workforce of public hospitals or Local Health Districts, with the possible exception of Enable and HealthShare NSW, which may have employed some workers who performed work ordinarily performed by public hospitals. Further, none of the Support Workers formed part of the workforce of a public hospital or Local Health District. No Support Worker worked at the premises of public hospitals or Local Health Districts and none of them reported to or worked under the control or supervision of staff of public hospitals or Local Health Districts. Rather, they reported to and worked under the control and supervision of staff of Southern Cross, namely, Care Assessors, rostering officers and Ms Dubos.

271. In relation to complex cases, where Southern Cross was the first service provider to care for a Participant following discharge from hospital, a Support Worker may have received training from hospital staff. However, that training was not ongoing and was also provided to Care Assessors employed by Southern Cross so that they could continue to supervise Support Workers and meet the needs of Participants. Training was not provided to Support Workers who began providing services to Participants after discharge from hospital. Thus, that factor is not indicative of any control or supervision by hospital staff but rather an incident of discharge from hospital.

272. Further, the fact that in relation to complex cases hospital staff may also prepare a timetable or care plan was not indicative of control or supervision of Support Workers by hospital staff. Support Workers were not provided with and were not required to follow such timetables or care plans. Rather, they were required to follow the Duties Plans developed by Care Assessors employed by Southern Cross. Such Duties Plans were not merely transcriptions of timetables or care plans prepared by hospital staff. Rather, they were plans that Southern Cross was obliged to prepare under its arrangements with Funders. As indicated above, the Duties Plans were developed by Care Assessors employed by Southern Cross, applying their own expertise and experience, which they did in conjunction with the Participants. Employees of Southern Cross, not the staff of public hospitals or Local Health Districts, ensured that the Support Workers provided the care required, including by providing them with appropriate training support and supervision.

273. Work ordinarily performed in public hospital included medical and nursing care, pharmacy services, staff and support diagnostic services such as radiology and pathology and allied health professionals such as physiotherapists. Other staff in public hospitals who provided care work and who were not nurses included orderlies assisting with trolleys, kitchen staff, hospital cleaners and workers assisting hospital patients with showering, toileting, meals and the like. The functions of Local Health Districts are set out above. In addition to running public hospitals in their respective geographical areas, Local Health Districts provided community healthcare services, such as aged care assessment, mental health centres, community nurses, allied health professionals and community health clinics. The kind of services provided by the public hospitals and Local Health Districts also included assisting mobility impaired Participants to get out of bed and transition to a wheelchair, helping Participants who were not independently able to feed themselves, helping Participants to shower and providing Participants with bladder and bowel management. Southern Cross contends that Support Workers performed work of that kind.

274. Thus, Southern Cross contends, both public hospitals and Local Health Districts had a broad remit in relation to providing care that promoted the health of people in New South Wales, thereby ensuring the efficient and effective use of public health resources. It asserts, therefore, that the services performed by the Support Workers were services of a kind ordinarily performed in connection with the conduct of the public hospital or of the Local Health District concerned. It says that the specific services provided by Support Workers were typically of a kind that was provided by public hospitals and Local Health Districts

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directly, including clinical care such as managing tracheostomies, catheters, ventilators and wounds.

275. Southern Cross asserts that the Participants were assisted in hospital with the same activities by hospital staff and, closer to discharge, by Support Workers. Thus, Southern Cross says, public hospital staff included not only doctors, nurses and care workers but also allied health professionals such as occupational therapists, physiotherapists, speech therapists, dietitians, enrolled nurses and assistants in nursing, orderlies, hospital cooks and cleaners, assistants with showering and walking and assistants to attend to other needs that a patient or Participant may have.

276. Southern Cross points out that the care directions from the hospital treating team and the Funder were prescriptive in relation to clinical and medical services. For example, tasks in relation to pressure sores, ventilators, tracheostomies and PEG feeding had to be prescribed because a considerable degree of skill was required to manage them. Assessment by the hospital considered not only what a Participant would like but also what the Participant needed from a medical or health perspective, in order to avoid relapse into hospital.

277. Southern Cross asserts that the overarching objective of the health system and its players was for continuity of care from public hospitals and Local Health Districts, on the one hand, into the homes and communities of the Participants, on the other. That continuity required that services provided by Support Workers had to be of a kind ordinarily performed in connection with the conduct of public hospitals and Local Health Districts because continuity of care was a "key goal" of the integrated care strategy of the New South Wales Government, which oversaw public hospitals and Local Health Districts. I have referred above to the five-step approach that Local Health Districts had to the transfer of care involving multidisciplinary planning, assessment and integration.^[36] See above at [48]-[52]. That process was vital to allow for the seamless and safe transition of care between health providers and required close consultation between the relevant providers about the level and type of service required for the Participant's transfer and ongoing care. It was an objective of every health provider and every government to promote continuity of care. Nevertheless, continuity did not occur in every instance and there were significant failures because of discontinuities. Support Workers prevented discontinuities of care in order to ensure that there was not a "cliff" off which a Participant could fall and ensured that the on-going care that a Participant required in the community was, as far as possible, seamless.

278. Southern Cross points out that, for high-needs Participants, Support Workers provided care that continued the Participant in a "maintenance phase", a phrase recognised in the care of high-needs patients, including in-hospital. As such, Southern Cross says, the care needs assessment that was prepared at the hospital was intended to replicate the care that was being provided to the Participant while he or she was in hospital in a stabilised condition but with necessary adjustments for the home environment. Those services were provided so that a Participant did not relapse.

279. Southern Cross asserts that, in providing care, Support Workers were required to adhere to the broad policy standards that applied throughout Australia's health system. Those standards included standards developed by the Australian Commission on Safety and Quality in Health Care or promulgated by the Aged Care Quality and Safety Commission.

280. Southern Cross asserts that it was not a requirement for the cl 8 exemption to apply that public hospitals and Local Health Districts ordinarily perform attendant care services in the home or residence of the patient. Accordingly, it says, the fact that public hospitals and Local Health Districts did not ordinarily perform in-home attendant care services is not decisive. In any event, Southern Cross says, the remit of Local Health Districts in fact extended to in-home attendant care services, since Local Health Districts had responsibility over an entire geographic area with a mandate to promote, protect and maintain the health of the residents of its area. Local Health Districts were required to conduct and manage health services, which expressly included any community health service. Similarly, Southern Cross says,

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public hospitals routinely performed outpatient services.

281. Southern Cross contends that the exemption in cl 8 must be adaptable to new circumstances and is not fixed in its historical denotation. Thus, it says, as public hospitals routinely came to perform outpatient services, being health care services performed in the homes of patients as opposed to solely on the premises of the hospital, those services came to be within the description of work of a kind ordinarily performed in connection with the conduct of public hospitals. Similarly, Southern Cross says, while the fact that the 2006 Public Sector Act extended the public hospital exemption to certain payments by the Crown may have had a historical context of a change in employment practises, that did not result in its meaning being frozen in time. When the legislature adopts a formulation that is of indeterminate scope and of a high level of generality, the provision should be interpreted on the basis that the intention of the original enactment was that the particular application of the provision may vary over time.^[37] See Deputy Commissioner of Taxation v Clark (2003) 57 NSWLR 113 ; [2003] NSWCA 91 at [142] . Southern Cross contends that the formulation "in connection with" is an example of such a drafting approach.

282. However, that analysis by Southern Cross ignores the distinct threshold set by the requirement that the wages in question had to be paid or payable in respect of staff employed in connection with a public hospital or a Local Health District, namely, that it captured only the workforce of public hospitals or Local Health Districts. The analysis also depends upon the phrase "in connection with" in both its uses in the exemption in cl 8 being given a very broad meaning so that each of the tests is satisfied by:

• a public hospital or Local Health District initiating a referral to Southern Cross;
• the Support Worker attending to the Participant while a patient in a public hospital coupled with the hospital's role in determining the services and hours of care to be provided by the Support Worker once in the home; and
• a person with an ABI or SCI having initially been in hospital as a result of his or her acquired injury no matter how long ago that may have been. For example, Participant 74, a Participant with FACS, who is quadriplegic, was classified by Southern Cross as a hospital discharge notwithstanding that, at the time of the referral to Southern Cross, he was living at home, having suffered his injury some 34 years before.

Finally, the analysis advanced by Southern Cross depends upon the ongoing interactions that Participants with high care needs will have with the health system for the maintenance of the quality of their lives.

283. I do not consider that any of those matters is sufficient for the purpose of cl 8, each of them being inconsistent with its limited scope, as informed by the legislative history. Thus, the various "connections" relied upon by Southern Cross are not different from the connections that any member of the public potentially had with the health system. Health services were available for all people when necessary and the local health services were available as a backup for Participants in the various programmes. It was not the intention of the Parliament that such interactions would be enough to attract the operation of cl 8.

284. I do not consider that the nature of the work of the Support Workers was sufficiently similar to the work performed in a public hospital or Local Health District to satisfy the requisite connection. The contentions advanced by Southern Cross fail to pay due regard to the requirement that the work undertaken by Support Workers must be of a kind ordinarily performed in connection with the conduct of public hospitals or of a Local Health District , meaning that it must be work of the kind regularly, commonly or customarily so performed.^[38] See Grain Growers Ltd v Chief Commissioner State Revenue (NSW) (2016) 93 NSWLR 415 ; [2016] NSWCA 359 at [120] and [126].

285. The work ordinarily undertaken in a public hospital or by a Local Health District was materially and qualitatively different from the work undertaken by Support Workers in the home or residence of a Participant. Thus, hospitals were focussed on acute care and medical emergencies, where the purpose was to diagnose, treat and stabilise the condition of a patient so that the patient could be discharged. A public hospital would not discharge a patient unless confident that the patient could cope well

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at home. Hospital nurses were highly skilled. Hospital staff such as nursing assistants, who may be less skilled, undertook tasks under the supervision of registered nurses. Nurses made professional assessments at every opportunity and prescribed treatment where necessary. In the case of assistance with showering, for example, a nurse would assess such things as skin breakdown, such that there was more happening than merely cleaning the patient.

286. The evidence does not establish that Local Health Districts carried out in-home attendant care of the kind carried out by Support Workers. Rather, the role of a Local Health District was principally to lead and govern a geographical area. Its responsibilities were to ensure that the care provided was of suitable quality, safe and effective. The functions of were "high level" rather than the "hands-on" services provided by Support Workers. The functions of a Local Health District consisted of overall governance responsibilities and managing, co-ordinating, interfacing and liaising with other services.

287. The evidence also indicates that, aged care services, which included community care or assistance with the activities of daily living, typical of the work performed by Support Workers, and much of the disability care provided under the CCSPs, an ADHC and FACS funded programme, involved activities such as assistance with transport, shopping for groceries and managing money or paying bills. Such services were a replacement for accommodation in a RACF rather than the services of a public hospital. Thus, assistance with activities of daily living was an element of care for Participants under more complex programmes as well. None of the 38 or 39 Participants whose files were reviewed would have been in hospital if the Participant could not be cared for at home by a Support Worker. Rather, such Participants would typically be in an aged care facility, a residential group home or at home with some alternative domestic assistance.

288. Finally, I accept the Commissioner's contention that community-based care was care provided outside of acute settings, outside of hospitals, and was offered to those living at home who did not need or want to go into hospital. Community and home care were neither traditional health care nor squarely welfare. Rather, community and home care lay at the boundary between traditional healthcare and welfare.

The Crown

289. Section 3 of the Payroll Tax Act defines "employer" as including:

"(a) The Crown in any of its capacities;
…
(c) A public, local or municipal body or authority constituted under the law of the Commonwealth or of a State or Territory unless, being an authority constituted under the law of the Commonwealth, it is immune from the operation of this Act."

Southern Cross suggests a contrast with the prior position under the 1971 Act. Southern Cross asserts that "employer" was defined to include only the Crown in right of New South Wales. However, under the 1971 Act, "employer" was defined as "any person who pays or is liable to pay wages and includes the Crown in right of the State of New South Wales". That was not intended to mean that only the Crown in right of New South Wales could be an employer. Thus, under the 1971 Act, there was also an express exemption in s 10(1)(g) for the "Commonwealth War Graves Commission".

290. Southern Cross points to other exemptions in the Payroll Tax Act for Commonwealth entities or programmes. For example, s 50 provides an exemption for amounts paid to an Aboriginal person who is employed under the Community Development Employment Project funded by the Department of Employment and Workplace Relations of the Commonwealth. Section 63 contains an exemption for amounts paid by the Commonwealth War Graves Commission.

291. Southern Cross contends that, in circumstances where cl 8 of Sch 2 is concerned with a Crown employer paying wages, the definition of "employer" in s 3, which includes all capacities of the Crown, indicates an intention for the "Crown" to be understood as the Crown in any of its capacities whenever the Payroll Tax Act makes reference to wages paid by an employer that is the Crown. Similarly,

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Southern Cross says, s 5 indicates that, since the Payroll Tax Act is intended to bind the Crown in all its capacities, all of the capacities of the Crown should have the benefit of the exemptions to payroll tax available to the Crown.

292. Accordingly, Southern Cross contends, TAC satisfies the description of being the Crown, albeit in right of the State of Victoria. DSS, as a Commonwealth Government department, satisfies the description of being the Crown, albeit in right of the Commonwealth. Similarly, Southern Cross contends, NDIA, as a Commonwealth Government agency, should be treated in the same way as any other Commonwealth department or agency.

293. However, the references in the provisions relied upon by Southern Cross are to the Crown "in any of its capacities" or "in all its other capacities" or to the Commonwealth where the intention is to extend beyond the Crown in right of New South Wales. By contrast, cl 8 refers simply to "the Crown".

294. While the term "Crown" is not defined in the Payroll Tax Act, s 13 of the Interpretation Act 1987 (NSW) ( the Interpretation Act ) relevantly provides that, in any Act or instrument, a reference to the Crown is a reference to the Crown in right of New South Wales. Section 5(2) of that Act provides that it applies to an Act or instrument except in so far as the contrary intention appears in the Interpretation Act or in the actual instrument concerned. I do not consider that such a contrary intention appears. Both the legislative history referred to above and the heading "Schedule 2 NSW specific provisions" making it clear that it contains provisions specifically for New South Wales, confirm that "the Crown" in cl 8 of Sch 2 refers only to the Crown in right of New South Wales.

295. Thus, the legislative background outlined above also indicates that references to "the Crown" in s 10(1)(b1), s 10(1)(b2), s 10(1A)(c1) and s 10(1A)(c2) of the 1971 Act were references to the Crown in right of the State of New South Wales. That follows from the fact that the intention was to transfer the staff of the Area Health Services into the direct employment by the State of New South Wales, in the New South Wales Health Service.

296. Further, by an amendment made to s 10 by the State Revenue Legislation Amendment Act 2005 (NSW), the reference to the Home Care Service in s 10 of the 1971 Act was changed to refer to the Home Care Service of New South Wales constituted under the Home Care Service Act 1988 (NSW). The explanatory note to the Bill for the enactment said that that was to make it clear that a reference to the Home Care Service was a reference to the Home Care Service of New South Wales established under the Home Care Service Act 1988 (NSW).

297. I accept the Commissioner's contention that that amendment tends to confirm that "the Crown" was intended to refer only to the Crown in right of New South Wales.

Application in relation to each Funder

298. The Commissioner advances specific submissions in relation to each of the Funders. It is convenient to deal with each separately.

Lifetime Care

299. The Commissioner accepts that Lifetime Care is the Crown in right of New South Wales. However, he says, the requirement that the work in question be of a kind ordinarily performed in connection with the conduct of public hospitals or of the Local Health District would not be satisfied because Support Workers cannot fairly be characterised as constituting the workforce of a public hospital or a Local Health District, since the services provided by Support Workers in the home or residence of Participants with Lifetime Care were different in substance from the work ordinarily undertaken in public hospitals. The differences arise both from:

• the location;
• the tasks carried out;
• the acute condition or treatment stage of a person in hospital compared with the condition of a Participant at home; and
• the different qualifications of staff and oversight provided to staff at hospitals compared with Support Workers in the home.

Even where Support Workers provided services to high-needs Participants that required

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some technical training, such as ventilator care, the Support Workers typically also provided household domestic assistance to assist the Participant or the household generally as well as assistance with community involvement such as assistance with shopping, household cleaning, money management and gardening, as in the case of Participant 2. The fact that Support Workers undertaking work funded by Lifetime Care were not exclusively engaged in the requisite kind of work is demonstrated by the initial care needs assessment for Participant 2. Thus, mobility and activities of daily living were stated as being provided by the hospital. However, independent activities of daily living were stated as not being provided by the hospital at present.

300. Participant 88 is an example of a Participant suffering from SCI. For her, the only services funded by Lifetime Care were housekeeping, laundry and gardening, apart from some occasional nursing care. That kind of assistance was not work undertaken in a hospital. Accordingly, the Support Worker in question was not exclusively engaged in the requisite kind of work for the purposes of the cl 8 exemption.

NSW Health

301. NSW Health is the Crown in right of New South Wales. However, the requirements of the exemption would not be satisfied for the reasons explained above in relation to Lifetime Care. That would be so even if it could be said that the requirement of being employed in connection with a public hospital or a Local Health District and performing work of a kind ordinarily performed in connection with the conduct of public hospitals or a Local Health District were satisfied. Support Workers were not exclusively engaged in the relevant kind of work.

FACS (including ADHC)

302. FACS (and ADHC) is the Crown in right of New South Wales. However, ADHC and FACS workers, including Support Workers, do not constitute the workforce of a public hospital or a Local Health District. Further, even for more complex cases funded by FACS and ADHC, the requirement that the work performed be of a kind ordinarily performed in connection with the conduct of public hospitals or of the Local Health District was not satisfied for the reasons given above in relation to Lifetime Care. For example, Participant 74 was a quadriplegic, whose care can be characterised as complex. The services provided, however, also included dusting, washing and wiping up of dishes. That is not work of a kind ordinarily performed in connection with the conduct of public hospitals or of the Local Health District.

DoE

303. DoE is the Crown in right of New South Wales. However, Support Workers providing services in connection with DoE could not be said to constitute the workforce of a public hospital or a Local Health District. Nor could it be said that the work performed in a school be work of a kind ordinarily performed in connection with a public hospital or a Local Health District. It could certainly not be characterised as being work exclusively of that kind.

NSW Trustee

304. Section 11(4) of the NSW Trustee and Guardian Act provides that, where the NSW Trustee is appointed to act in a trust or protective capacity, it has the same liabilities, is entitled to the same rights and immunities and is subject to the same control and orders of any court as a private person acting in the same capacity. Therefore, if appointed in a trust or protective capacity in respect of a Participant, the NSW Trustee acts in a representative capacity for the Participant rather than in the capacity of the Crown. While the NSW Trustee typically acts as a trustee, guardian or financial manager on behalf of someone else, there is no evidence as to the basis of the appointment of the NSW Trustee for any particular Participant. Accordingly, there does not appear to be a basis for concluding that the NSW Trustee is the Crown in right of New South Wales when acting in relation to a Participant. Further, in the absence of evidence as to the source or nature of the NSW Trustee's appointment and absence of evidence as to the source of funding from which services are paid, it cannot be said that wages paid or payable to the Support Worker are paid in respect of staff employed in connection with a public hospital or a Local Health District.

305.

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The evidence in relation to Participant 66 indicates that Southern Cross began providing services to Participant 66 in 1998, at a time when she had been living at a purpose-built home in Guildford for over 12 months. Prior to that time, Participant 66 had been in Marsden Rehabilitation Centre for 19 years. There is no evidence regarding Marsden Rehabilitation Centre. There is therefore a lack of any kind of connection with a public hospital or relevant Local Health District in relation to the Participant 66. In any event, the exclusivity requirement in relation to the work of the kind ordinarily performed in connection with the conduct of public hospitals or of the Local Health District would not be satisfied for the same reasons as set out above in relation to Lifetime Care.

DSS

306. DSS is not the Crown in right of New South Wales for reasons indicated above. Even if it were, Support Workers, in carrying out aged care services under the HACC/CACP programmes and HCP/CHSP programmes, did not form part of the workforce of a public hospital or a Local Health District. Further, the kind of domestic and personal services that Support Workers undertook for Participants funded under those programmes was not work of a kind ordinarily performed by the work force of public hospitals in connection with the conduct of public hospitals or a Local Health District.

TAC

307. TAC is not the Crown in right of New South Wales. Even if it were, the exemption in cl 8 would not apply for the reasons given above in relation to Lifetime Care.

NDIA

308. The NDIA is clearly not the Crown in right of New South Wales and, accordingly, the exemption does not apply. In any event, the cl 8 exemption does not apply for the reasons given above in relation to Lifetime Care.

Issue (1)C: Requirement of Section 40(2) for a declaration

309. The second requirement of s 40(2) is that the "client" has given a certificate that an amount would be exempt from payroll tax under Pt 4 had the service provider been paid by the "client" as an employee. Southern Cross accepts that, while it has attempted to obtain declarations from the Funders in respect of Support Workers, it has not received declarations from any of the Funders, other than NSW Health. In some cases, the requests have been ignored and in other cases, Southern Cross says, the Funder has simply misunderstood the nature of the certificate being sought.

Requests for Declarations from Funders

310. On 20 April 2020, Southern Cross wrote to each of Lifetime Care, NSW Health, FACS, DoE, DSS, TAC and NDIA seeking information from each of those Funders. Relevantly, each letter said as follows:

"Recently, discussions have occurred between [Southern Cross] and the NSW Payroll Tax Authority.

One element of the discussion involves the quantum of Payroll Tax and whether, and to what extent, the quantum is affected by reason of the fact that clients of [Southern Cross] are not themselves liable to pay Payroll Tax.

Where that client is effectively part of the Government of NSW, the reality is that the amount of any Payroll Tax imposed on [Southern Cross] in relation to care services for that client effectively results in one arm of the NSW Government paying Payroll Tax to another arm, via [Southern Cross].

[Southern Cross] would be most grateful for some very limited input from you. Please note that [Southern Cross] is not asking for any opinion or support of the position of [Southern Cross]. [Southern Cross] has SCCH has met and will continue to meet Payroll Tax obligations.

[Southern Cross] locates and pays Support Workers to provide care for participants on behalf of your department or agency.

It seems clear to us that if, instead, your department or agency were to pay [Southern Cross's] Support Workers as employees, to perform the same services, such wages would be exempt from Payroll Tax under clause 8 of Schedule 2 to the [Payroll Tax Act].

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We would be grateful if you would confirm that the previous sentence is correct, and that it was correct in each of the years ended 30 June 2012 to 30 June 2017.

For assistance, we attach Revenue Ruling PTA 026. We also attach the declaration OPT006 referred to in the Ruling and ask that you complete and return it as soon as possible if the exemption hereof applied during each of the years ended 30 June 2012 to 30 June 2017."

311. Ruling PTA 026 relevantly said as follows:

"The employment agency provisions in Division 8 of Part 3 of the [Payroll Tax Act] apply to an employment agency contract, which is defined as a contract under which a person (the employment agent) procures the services of another person (the service provider) for a client of the employment agent. The provisions are designed to apply to labour hire arrangements where the employment agent contracts with the client for the provision of labour where there is no agreement between the service provider and the client.

Under the employment agency provisions, the employment agent is taken to be the employer (section 38 of the [Payroll Tax Act]) and the person who performs work for or in relation to which services are supplied to the client under an employment agency contract (on-hired worker) is taken to be the employee (section 39 of the [Payroll Tax Act]). Amounts paid or payable under the employment agency contract are taken to be wages (section 40(1) of the [Payroll Tax Act]). Consequently, the employment agent is liable to pay payroll tax on the amounts taken to be wages.

However, certain types of payments are exempt from payroll tax under section 40(2) of the [Payroll Tax Act]. The exemption applies where:

1. The wages would have been exempt from payroll tax under Part 4 except for Division 4 or 5 of that Part, section 50 or clause 5 of schedule 2 ( the Relevant Provisions ) had the service provider been paid directly by the client as an employee, and

2. The client has made a declaration to that effect to the employment agent, in respect of the service provider ( the Relevant Declaration ).

…

This Revenue Ruling explains the operation of the exemption under section 40(2) of the [Payroll Tax Act] and its requirements.

Ruling

Relevant Declaration

To claim the exemption in section 40(2) of the [Payroll Tax Act], the employment agent has to obtain a Relevant Declaration from its client. The Relevant Declaration must be in writing and must state that the wages paid or payable to or in relation to the service provider for the provision of services in connection with the employment agency contract would be exempt under the Relevant Provisions had the service provider been paid by the client as an employee.

OSR Payroll Tax Form OPT 006 (Employment Agency Contracts - Declaration by Exempt Client), which is available on www.osr.nsw.gov.au may be used to make the Relevant Declaration. This form is not a prescribed form and employment agents are free to develop their own version of the declaration.

…

Incomplete or Incorrect Declaration

Employment agents are liable for any payroll tax liability if a Relevant Declaration is found to be incomplete or does not meet the requirements outlined above. For this reason, employment agents should ensure that their exempt clients have competed the Relevant Declaration in full.

If a client has provided a Relevant Declaration which is later found to be incorrect (because the wages paid to or in relation to the service provider would not have been exempt under the Relevant Provisions had the service provider been paid by the client as an employee), the employment agent will nevertheless be liable to pay payroll tax on the amounts paid

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to the on-hired workers provided to that client.[ fn 1 ]

If an employment agent wishes is to confirm that a Relevant Declaration from a client is correct, the agent may contact the OSR. …

Frequency of Declaration

The [Payroll Tax Act] requires a separate Relevant Declaration for each employment agency contract entered into between the employment agent and their client(s). However, the Chief Commissioner recognises that this requirement may be impractical and onerous.

For this reason, the Chief Commissioner will be satisfied if the employment agent obtains one Relevant Declaration from its exempt client for each financial year if the type of work performed by all persons on-hired by that employment agent to that client is similar.

Where the contract for the provision of the workers goes beyond a financial year, only one declaration is required.

Employment agents should ensure that a Relevant Declaration is obtained before the end of the relevant financial year.

…

Application for refund made by an employment agent

If an employment agent becomes aware that its client is exempt under the Relevant Provisions of the [Payroll Tax Act] after having paid payroll tax on the wages under an employment agency contract, the employment agent may apply for a refund under section 18 of the [Administration Act].

A refund application must be accompanied by a Relevant Declaration and written confirmation from the client stating that Relevant Declaration is made for a retrospective period, relating to the refund period. …".

312. A footnote in the ruling (located at "fn 1" in the extract), states that the previous version of the ruling stated as follows:

"The previous version of this ruling stated that the employment agent would be exonerated from any payroll tax liability in this situation if the employment agent had acted in good faith at all times. However, in the process of arriving at a single harmonised position, all jurisdictions agree that it is not appropriate to exonerate the employment agent in such circumstances. Accordingly, jurisdictions which have issued the previous version of this Ruling have re-issued this ruling as PTA 026 (version 2)."

313. Form OPT 006 is headed:

"Employment Agency Contracts - Declaration by Exempt Client".

Form OPT 006 contains a note relevantly saying as follows:

"• Under Division 8 of Part 3 of the [Payroll Tax Act] an employment agency contract is defined as a contract under which a person (the employment agent) procures the services of another person (the service provider) for a client of the employment agent.
• The employment agent is liable for payroll tax on all payments made to the service provider unless this declaration has been completed by the client and given to the employment agent.
• This declaration is to be made by the client where wages paid to the service provider would have been exempt under Part 4 of the [Payroll Tax Act] if it had been paid directly by the client to the service provider as an employee. This exemption does not apply where the client does not pay payroll tax merely because their (the clients) wages are below the payroll tax threshold."

314. By Form OPT 006, the employer or public officer or authorised person of the "client" is required to declare that the wages payable under a contract with a named employment agent do not attract payroll tax "because those wages would have been exempt from payroll tax under Part 4 of the [Payroll Tax Act] if paid by the client". The form contains information concerning "Part 4 Exemptions".

315. Southern Cross received varying responses from some of the Funders. It had also

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received responses to earlier enquiries from some of the Funders.

316. Thus, Southern Cross received an email dated 28 May 2019 from an officer of Lifetime Care saying, relevantly, as follows:

• We trust your enquiry relates to Southern Cross's payroll tax position under s 40 of the Payroll Tax Act;
• iCare NSW does not qualify for any of the prescribed exemptions in the Payroll Tax Act and is registered for payroll tax purposes in NSW; and
• The Lifetime Care does not have any common law employees and does not conduct the activities listed, and therefore does not satisfy the provision, under cl 8 of Sch 2 to the Payroll Tax Act.

317. On 14 June 2018, Southern Cross wrote to NSW Health seeking confirmation that NSW Health was not subject to payroll tax itself and that that was correct for each of the years ended 30 June 2012 to 30 June 2017. Southern Cross received a response from NSW Health providing copies of letters from the Office of State Revenue dated 25 February 2014 addressed to NSW Health, saying relevantly as follows:

"Thank you for your application for an exemption from payroll tax.

Based on the information provided, [NSW Health] qualifies for an exemption from payroll tax under section 51 of the [Payroll Tax Act] as a healthcare service provider.

Accordingly, the organisation will be exempt from payment of payroll tax under Schedule 2, Clause 8 of the Payroll Tax Act, wages paid to staff employed by the Crown in connection with a public hospital or a local health district are exempt wages if the wages are paid or payable:

(1) the wages must be paid or payable:

a) For work of a kind ordinarily performed in connection with the conduct of a health care service provider; and

b) To a person engaged exclusively in that kind of work.

The exemption will be effective from 1 July 2010.

Your exemption will be reviewed every three years from the date of issue.

…".

318. Southern Cross contends that that is sufficient to satisfy the requirement for a declaration. However, the letters do not state that all of the employees, direct or indirect, will be exempt but only those who do "work of a kind ordinarily performed in connection with the conduct of healthcare service provider" and "engaged exclusively on that kind of work". That declaration begs the question and does not satisfy the requirement.

319. On 27 April 2020, DoE responded to Southern Cross's letter of 20 April 2020, saying relevantly as follows:

"I have sought advice from the Department's Taxation Centre regarding the statement in your letter that you wanted to question, that is if the Department were to pay [Southern Cross's] [S]upport [W]orkers as employees, to perform the same services, such wages would be exempt from Payroll Tax under clause 8 of Schedule 2 to the [Payroll Tax Act].

Advice from our Taxation Centre indicates that the above statement is incorrect. This department, along with all other NSW government departments are required to pay payroll tax. They are actually also grouped so they do not benefit from a threshold reduction. They all pay a flat fee.

…".

320. NDIA responded to Southern Cross's letter of 20 April 2020 saying, relevantly, as follows:

"[NDIA] provides financial support to participants of the [NDIS] (the Scheme). The participants use funding provided by the Scheme to source the supports they require.

Neither the NDIA nor the Scheme are able to employ support workers.

Therefore, I am unable to confirm the sentence that you have required the NDIA to confirm."

321. There is no evidence of any other response to the enquiries by Southern Cross. Nevertheless, Southern Cross contends that it is not surprising that, although it has taken steps

ATC 24719

to obtain the declarations contemplated by s 40(2), it has been unable to do so since the declarations involve the relevant "client" taking a position on both a question of law and a hypothetical situation. Thus, Southern Cross says, the Funders must consider what their payroll tax and taxation liability would be if they employed the Support Workers in circumstances where, in fact, the Funders do not employ the Support Workers. Southern Cross points out that there is no legal obligation imposed by the Payroll Tax Act on any "client" to give a declaration. In any event, whatever the reason, Southern Cross has not obtained the declarations required by s 40(2).

Legislative History of the Requirement for a Declaration

322. Southern Cross contends that the legislative history of s 40(2) shows that the overall purpose of the provision was to facilitate access to the exemption on the part of an employment agent and to confer exemption on payments by the employment agent where the underlying facts would meet the exemption, absent the intervention of the agent. Southern Cross asserts that, as the legislation evolved, the declaration language changed but there was no intention to narrow the scope of the exemption. Accordingly, Southern Cross says, unlike its predecessor in the 1971 Act, on which it says s 40(2) appears to have been "mistakenly" modelled, the declaration component of s 40(2) had no work to do during the Relevant Tax Years.

323. Section 3C(4) of the 1971 Act, which was introduced into the 1971 Act in 1998,^[39] See State Revenue Legislation (Miscellaneous Amendments) Act 1998 (NSW). was in the following terms:

"(4) An employment agent is not liable to pay-roll tax under this Act in relation to an employment agency contract:
- (a) if the contract worker is liable to pay pay-roll tax (as the employer of the person who actually provides the services to the client of the employment agent under the contract) in respect of wages paid for those services, or
- (b) if the wages that the amount, value of the benefit or payment under subsection (2)(c) is taken to be would have been exempt from pay-roll tax under section 10 had the contract worker been paid those wages by the client of the employment agent , or
- (c) if the client of the employment agent is not registered or required to be registered as an employer under this Act at the time the employment agency contract is entered into and a declaration to that effect has been given by the client to the employment agent .
(5) If, after a client gives a declaration referred to in subsection (4)(c) to an employment agent, the client becomes registered or is required to be registered as an employer under this Act, the client is liable to pay pay-roll tax in respect of the wages paid under the employment agency contract during each financial year in which the client is registered or is required to be registered ." (emphasis added by Southern Cross)

324. Clearly enough, s 3C(4)(b) was a predecessor of s 40(2). However, it did not require a declaration. On the other hand, s 3C(4)(c) provided an alternative exemption where a declaration had been given by "the client" to the employment agent to the effect that "the client" was not registered or required to be registered as an employer under the 1971 Act at the time when the employment agency contract was entered into. Section 3C(5) then provided that, if a "client" gave to an employment agent a declaration as referred to in s 3C(4)(c) and the "client" became registered or was required to be registered as an employer, the "client" was liable to pay payroll tax in respect of the wages paid under the employment agency contract during each financial year in which the "client" was registered or was required to be registered.

325. In the speech on the second reading of the Bill for the amendment made in 1998 to introduce s 3C(4), the Minister said:^[40] New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 14 October 1998 at 8287.

"Concessions have been provided where the end user of the services is exempt , such as a public hospital or a charity and where the end user is under the payroll tax threshold."

Southern Cross asserts that the declaration component in s 3C(4)(c) was intended to allow a "client" to declare to the employment agent

ATC 24720

that the "client" was below the payroll tax threshold without the agent having to examine the "client's" underlying payroll records, since the agent had no power to undertake such an examination. Thus, Southern Cross contends, the effect of the provisions was that, where the "client" was liable to be registered or became registered, the "client" would be liable for the payroll tax and the agent was never to be liable, despite the terms of s 3C(4)(c), which posited that a pre-requisite for the employment agent not being liable to pay payroll tax was that the "client" was not registered or required to be registered as an employer under the 1971 Act. Thus, the declaration had the effect that the agent could rely on it for the purposes of the exemption and the Commissioner could determine who should be assessed if the "client" became or was required to be registered.

326. In 1999, the words "and a declaration to that effect has been given by the client to the employment agent" were added to the end of s 3C(4)(b) by the State Revenue Legislation Further Amendment Act 1999 (NSW). While the explanatory note for the Bill for that Act described the addition as "a requirement", the extrinsic materials do not appear to indicate the purpose of the addition. Southern Cross asserts that the addition of s 3C(6) at the same time made the purpose clear. Thus, s 3C(6) provided as follows:

"If a client of an employment agent gives a declaration to the employment agent under subsection (4)(b), and that paragraph does not apply or at any time ceases to apply in respect of the wages paid or payable under the employment agency contract, the client, and not the employment agent, is liable to pay payroll tax in respect of the wages paid or payable under the employment agency contract during any period in which the paragraph does not apply. " (emphasis added by Southern Cross)

327. Southern Cross asserts that the declaration requirement inserted into s 3C(4)(b) had work to do at that time because the employment agent could rely on the declaration and, if the hypothetical contemplated by s 3C(4)(b) was or became incorrect, the liability fell on the "client", not on the agent. The provisions remained in that form until the 1971 Act was repealed in 2007, when the Payroll Tax Act was enacted and s 40(2) was enacted in its present form.

328. In the explanatory note to the Bill for the Payroll Tax Act, the following was stated:

" Clause 40 provides that any amount paid or payable … to or in relation to the service provider in respect of the provision of services under the employment agency contract is taken to be wages paid or payable by the employment agent. However, such a payment … is not taken to be wages if it would be exempt from payroll tax under [specified provisions] had the service provider being paid by the client as an employee. It is a requirement that the employment agent receives a declaration to that effect from the client ." (emphasis added)

Clause 8 of Sch 3 of the Payroll Tax Act refers to a declaration under s 3C(4)(b) of the 1971 Act that was in force immediately before 1 July 2007 remaining in force as if it were a s 40(2) declaration. Thus, it is clear that the requirement for a declaration that was included in s 40(2) when the Payroll Tax Act was enacted in 2007 was not included as the result of an oversight or mistake, as Southern Cross contends.

Construction of s 40(2)

329. It is common ground that s 40(2) contains a drafting error, in so far as it fails to refer to Pt 3 of Sch 2 immediately before the parenthesis. Southern Cross asserts that the drafting demonstrates another flaw, in so far as it expressed the declaration component as a precondition to the exemption in circumstances where the declaration component had no work to do other than to frustrate s 40(2) in the event that the declaration was not forthcoming.

330. Thus, Southern Cross contends, while the predecessor regime had machinery that allocated the payroll tax liability to the "client" in circumstances where the declaration was not correct, there was no equivalent provision in the Payroll Tax Act. While the explanatory note for the Bill for the Payroll Tax Act described the declaration component of s 40(2) as "a requirement", it said nothing further about the declarations. There appears to be no recognition

ATC 24721

in the extrinsic material that the provisions allocating the payroll tax liability to the "client" in the event of an incorrect declaration had been carried across. Further, there appears to be no indication in the extrinsic material that the exemption was intended to be narrowed.

331. Southern Cross contends that those responsible for the drafting of s 40(2) erroneously carried into it from the 1971 Act the requirement for the "client" to give a declaration to the employment agent on the mistaken assumption that it would serve as a liability allocation tool, as it had done in the 1971 Act. Southern Cross asserts that it served no other function in s 40(2) as drafted and, if read literally, the provision is capable of frustrating the purpose of the exemption, by elevating a matter of form over the substance of the requirement for exempt status.

332. Southern Cross asserts that those responsible for the drafting of s 40(2) overlooked the eventuality of a client failing to give a declaration. While that had been overlooked in the predecessor regime, the problem came to the fore under the Payroll Tax Act in circumstances where the role of the declaration was significantly reduced. Southern Cross asserts that those responsible for the drafting of the provisions also overlooked the related eventuality of the Commissioner failing to approve a form for the purposes of s 40(2). Thus, it says, a taxpayer may be unable to obtain the declaration referred to, despite satisfying the hypothetical in s 40(2) simply because the "client" would not provide a declaration or because the Chief Commissioner had not approved a form.

333. In effect, Southern Cross contends that s 40(2) should be construed on the basis that the words "if the client has given a declaration to that effect, in the form approved by the Chief Commissioner, to the employment agent" is surplusage and is of no effect. Alternatively, Southern Cross contends that s 40(2) should be construed as if it was in the following terms:

"Subsection (1) does not apply to an employment agency contract to the extent that an amount, benefit or payment referred to in that subsection would be exempt from payroll tax under Part 4 or Part 3 of Schedule 2 (other than under Division 4 or 5 of that Part, section 50 or clause 5 of Schedule 2) had the service provider been paid by the client as an employee, if the client has given a declaration to that effect, in the form approved by the Chief Commissioner, to the employment agent, or the Chief Commissioner is otherwise satisfied that the payment would be so exempt ."

Southern Cross contends that the words in bold should be added or substituted.

334. Southern Cross contends that the effect would be the same irrespective of whether the words are read as surplusage or the language is supplemented in the way indicated. What matters, for the purpose of s 40(2), it says, is that the payment would be exempt under the specified provisions had the service provider been paid by the "client" as an employee. That is a matter that the Commissioner, or the Court standing in his shoes in an appeal, can determine based on the facts but not something upon which a declaration by a "client" or the lack thereof has any effect. Southern Cross asserts that there is no inconsistency with the purpose of s 40(2) in reading the declaration component as surplusage. It asserts that the declaration component appears to be vestigial and performs no function other than, if read literally, to nullify the exemption for which s 40(2) makes express provision, where the "client" fails or refuses to give a declaration or no form is approved. That, Southern Cross asserts, is a material eventuality that was overlooked by those responsible for the language of s 40(2).

335. I consider that there is a rationale for the requirement for a declaration. Thus, the "client" would be the entity best placed to consider, and thereafter declare, if appropriate:

• whether a worker is working in and for the business of the "client"; and
• whether the worker satisfies the cl 8 exemption.

The declaration would need to address both questions because it is only where there is an employment agency contract that a declaration could be provided. Accordingly, it is not a hypothetical test consisting only of the second question, as Southern Cross contends.

336.

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Payroll tax is a self-assessment regime and no formal claim needs to be made for an exemption in the first instance. Accordingly, the provision of a declaration would enable the employment agent to determine whether it can reasonably operate on the basis that the "wages" paid to a service provider are exempt, such that it can claim the exemption in respect of those wages. Further, the provision of a declaration would assist the Commissioner and, where appropriate, the Court in determining whether the exemption applies.

337. Accordingly, the declaration had work to do during the Relevant Tax Years. It played the role referred to above and would be relevant as to whether or not penalties and interest should be imposed or remitted in circumstances where a declaration was provided and payroll tax was not paid in reliance upon it but the Commissioner or the Court later determined that the exemption did not in fact apply.

338. I do not accept, as Southern Cross contends, that those responsible for the drafting of s 40(2) overlooked an eventuality. Thus, it should be expected that, if a "client" considered the matters referred to above have been satisfied, it would provide a declaration to that effect, particularly if the "client" were approached during the Relevant Tax Years, which is when it would be expected that such a declaration would be sought.

339. Further, a failure by a "client" to provide a declaration would not necessarily be beyond the control of the employment agent. Thus, an employment agent could include in its contractual arrangements with the "client" an obligation for the "client" to provide a declaration. The acceptance of such an obligation may well be relevant to the price charged by the employment agent for the provision of the services. Alternatively, an employment agent might cease to provide service providers if the "client" declined to provide a declaration.

340. Further, if the "client" declined to provide the declaration when requested, it may be that a cause of action would arise for breach of an implied term of good faith or an implied term to do all things reasonably necessary to enable the employment agent to have the full benefit of the contractual arrangements. For example, cl 18 of the contract between Southern Cross and Lifetime Care compelled Southern Cross to comply and conform with all applicable State legislation. It may be arguable that an obligation would be implied that Lifetime Care would do all things reasonably necessary to enable Southern Cross to comply and conform with applicable State legislation.

341. The present situation has arisen in circumstances where Southern Cross did not obtain declarations at the time of entering into the arrangements with the Funders or at any time during the Relevant Tax Years. Rather, Southern Cross waited until between two and nine years after the end of the last of the Relevant Tax Years before requesting a declaration from Funders.

342. The reading of s 40(2) suggested by Southern Cross would render the requirement for a declaration nugatory, notwithstanding the plain and clear language of the provision as enacted. To read out the requirement for a declaration would be too much at variance with the language in fact used by the legislature.^[41] See Taylor v The Owners – Strata Plan No 11564 (2014) 253 CLR 531 ; [2014] HCA 9 at [38]-[39] (“Taylor”). The question of whether a court is justified in reading a statutory provision as if it contained additional words or omitted words involves judgment of matters of degree.^[42] See Taylor at [38].

343. Therefore, construing s 40(2) on the basis of reading out the requirement for a declaration would not give s 40(2) the meaning that, despite its terms, it was plain that the legislature intended it to have. Rather, reading out the requirement would frustrate the intention of the legislature and would not be consistent with the language used by the legislature.^[43] See Taylor at [39]. The language used clearly required a declaration as a pre-requisite for the exemption.

344. The purpose of the declaration component of s 3C(4) of the 1971 Act was not to allow an employment agent to meet the exemption in circumstances where it did not have knowledge of the underlying facts pertaining to the "client", such that the declaration requirement in s 40(2) has no work to do. Rather, the purposes of the declaration in both s 3C(4) of the 1971 Act and s 40(2) of the Payroll Tax Act included ensuring that the "client" turned its mind to the question of whether, and confirmed, that the worker was

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working in and for the business of the "client" and satisfied the cl 8 exemption, such that an employment agent did not receive an exemption unless a declaration had been provided. There is nothing absurd about denying Southern Cross an exemption in the present circumstances by reason of failure to obtain declarations. Southern Cross has simply not satisfied the statutory requirements for an exemption, in many cases because the relevant Funder does not consider that the exemption applies and otherwise because Southern Cross failed to ensure that declarations were provided before procuring the services of Support Workers.

345. Southern Cross says, if read literally, s 40(2) would frustrate the purpose of the exemption and produce absurdity where the necessary declaration is not given by "the client". It asserts that it is evident from the legislative text and legislative history that the eventuality that has come about in the present case was inadvertently overlooked by those responsible for the legislation. Southern Cross contends that that inadvertence can be remedied by the construction of the provision for which it now contends.

346. The syntax of s 40(2) is clear. Thus, it states that s 40(1) does not apply to an employment agency contract to the extent that an amount, benefit or payment would be exempt in specified circumstances if "the client" has given a declaration that the amount of benefit or payment would be exempt in those circumstances. That is to say, the syntax makes clear that the giving of a declaration is a necessary prerequisite for s 40(1) not to apply to a particular employment agency contract.

Court Intervention

347. Alternatively, Southern Cross asserts that there is no policy imperative that would require a declaration to be given prospectively only and contends that a declaration can be given retrospectively.^[44] Cf. Moore Park Gardens Management Pty Ltd v Chief Commissioner State Revenue [2006] NSWCA 115 ; (2006) 62 ATR 628 . Nevertheless, it accepts that ordinary limitation periods for amending and adjusting returns and assessments would apply. Accordingly, Southern Cross asks the Court to grant declaratory relief as to its entitlement to an exemption but for the absence of the declarations under s 40(2). Southern Cross is hopeful that the Funders, as clients, would then be better disposed to provide the declarations if the Court found that the balance of the criteria for the exemption were satisfied. Thus, Southern Cross invites the Court to make declarations that the criteria for the relevant exemption are satisfied, namely:^[45] See prayer 4 of the amended summons.

• the Funders are "the Crown" for the purposes of the Payroll Tax Act;
• Southern Cross made payments under employment agency contracts;
• the payments were made to Support Workers for work of the kind ordinarily performed in connection with the conduct of public hospitals or Local Health Districts; and
• the Support Workers were engaged by Southern Cross exclusively for work of that kind.

348. I am not persuaded that the Court has jurisdiction or power to grant the relief sought by Southern Cross, of making declarations that would facilitate the provision of declarations by the Funders. Part 10 of the Administration Act is an exclusive code for the review of adverse decisions of the Commissioner on notices of objection by taxpayers against assessments made under the Payroll Tax Act.^[46] See Harrington Park Children Services (NSW) Pty Ltd v Chief Commissioner of State Revenue [2008] NSWSC 266 ; (2008) 71 ATR 143 at [18] . Under s 103A of the Administration Act, the jurisdiction and power of the Court, in considering any question concerning an assessment or other decision of the Commissioner, does not extend beyond the jurisdiction and power set out in Pt 10 of the Administration Act.

349. Thus, the only presently relevant powers of the Court are those contained in s 101 of the Administration Act, which include the power to confirm or revoke assessments, make assessments or other decisions and make orders for payment or remission. While s 101(1)(e) empowers the Court to make any further order as to costs or otherwise as it thinks fit, that provision should not be given an unduly broad operation.^[47] See Smith’s Snackfood Co Ltd v Chief Commissioner State Revenue [2012] NSWSC 1116 ; (2012) 90 ATR 342 at [16]-[18] . The relief sought by Southern Cross, in the form of declarations, does not fall within the Court's power under s 101(1)(e) of the Administration Act, particularly in circumstances where the question of the whether the declarations required under s 40(2) have been provided is a question of fact.

350. Further, the Court should not grant declarations in circumstances where parties

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who would be affected by the declarations, and are therefore necessary and proper parties, are not parties to the proceedings. Before declarations affecting rights or obligations of the Funders are made, the Funders would need to be joined as parties and be heard. In that regard, none of the Funders is a party to these proceedings and the declarations by the Court sought by Southern Cross would affect their rights and status.

351. Declarations under s 3C(4)(c) of the 1971 Act were required to be given at or before the time when the liability for payroll tax arose and retrospective declarations under those provisions were not possible.^[48] See Moore Park Gardens Management Pty Ltd v Chief Commissioner State Revenue [2006] NSWCA 115 ; (2006) 62 ATR 628 at [77] . There is no such provision in the Payroll Tax Act. Nevertheless, the Commissioner says, although he would be prepared to accept retrospective declarations referred to in s 40(2) if they were made prior to the final hearing of the appeal, the declarations cannot be given retrospectively after the hearing.

Issue (2): Employee or Independent Contractor

352. It is common ground that, if and to the extent that contractual arrangements between Southern Cross and Support Workers are employment agency contracts, Southern Cross is not liable to pay payroll tax on payments made to such Support Workers on the basis that they are common law employees. However, I have concluded that contractual arrangements between Southern Cross and Support Workers are not employment agency contracts. Accordingly, Issue (2) now arises for determination, namely, whether Support Workers are common law employees of Southern Cross.

353. Common law employment is assessed by reference to a range of factual indicia, none of which is determinative on its own. Thus, no list of factors can be regarded as exhaustive and the weight to be given to particular facts varies depending upon the circumstances. Ultimately, it is necessary to take into account the totality of the relationship between the parties.^[49] See Hollis v Vabu Pty Ltd (2001) 207 CLR 21 ; [2001] HCA 44 at [24] . Accordingly, whether or not Support Workers are common law employees of Southern Cross requires a multifactorial assessment of the totality of the relationship, as ascertained from the surrounding matrix of facts.^[50] See Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 24 and 29; [1986] HCA 1 (“Stevens v Brodribb”).

354. The factors ( the Accepted Indicia ) often considered to be relevant to such a determination include:^[51] See Hollis v Vabu Pty Ltd (2001) 207 CLR 21 ; [2001] HCA 44 at [68] and [71] ff.

• control and direction;
• integration;
• contracts to achieve a "given result";
• power to delegate;
• assumption of risk;
• provision of tools and equipment; and
• extent to which the worker operates an "independent business".

355. The test is concerned with the substance of the relationship and the degree of control exercised by the payer.^[52] See Jamsek v ZG Operations Pty Ltd (2020) 279 FCR 114 ; [2020] FCAFC 119 at [6], [182] and [212]. The parties to an arrangement cannot alter the reality of the relationship by giving it a particular label. Thus, the characterisation of the relationship by the parties will rarely be conclusive, although such a characterisation may sometimes remove any ambiguity as to the nature of the relationship where the Accepted Indicia point in both directions.

356. The ultimate question will be whether one person is acting as the employee or servant of another or on behalf of another.^[53] Stevens v Brodribb at 37. If the hallmarks of a business conducted on the part of a worker are absent, it may be easier to conclude that the worker is an employee.^[54] See Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd (2015) 228 FCR 346 ; [2015] FCAFC 37 at [184] .

357. The Commissioner seeks to downplay the significance of the terms of the contractual arrangements between Southern Cross and Support Workers. However, the actual terms of the arrangements between the parties may be significant.^[55] See Stevens v Brodribb at 37. Thus, binding contractual promises may be reliable indicators of the true character of the relationship between parties in determining whether that relationship is one of employment. Where there are express terms of a contract between parties, those express terms must be given effect, unless they are contrary to statute. The judicial function in relation to the characterisation and construction of such contracts does not extend to straining the language used by the parties or the legal concepts underlying their arrangements so as, for example, to adjust their bargain in order to moderate a perceived unfairness resulting from the disparity in bargaining power between the parties.^[56] See WorkPac Pty Ltd v Rossato [2021] HCA 23 ; (2021) 95 ALJR 681 at [62]-[65] . This is not a case where the contractual arrangements bear little practical

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connection with the reality of the relationship. Rather, Southern Cross and the Support Workers conducted themselves consistently with the contractual arrangements, which set out and characterised the substance of the engagement of Support Workers by Southern Cross.

358. The distinction that Issue (2) calls for is one of some antiquity. Roman law recognised the same distinction in the dichotomy between the contract of locatio conductio operis and locatio conductio operarum. The former corresponds with the common law notion of an independent contractor and the latter corresponds with the common law notion of an employee or servant. A significant distinction for Roman jurists was that the former involved a contract to achieve a particular end, irrespective of who performed the contract and achieved that end. The latter involved the contracting party performing the relevant task. In the latter case, the remuneration accrued from time to time, and the death of worker ended the contract. By contrast, in the former case, the provider of the service, or contractor, was entitled to be paid only after the task was complete, although the price fixed could be a lump sum or might be apportioned to different parts of the task in question.^[57] See, for example, WW Buckland, A Textbook of Roman Law: From Augustus to Justinian (3rd rev ed, 1963, Cambridge University Press) at 503-505; see also Theodor Mommsen, Paul Krueger and Alan Watson (eds), The Digest of Justinian (1985, University of Pennsylvania Press) (“Digest”) at 19.2.9.5; Digest at 19.2.19.9; Digest at 19.2.19.10; Digest at 19.2.22.2; Digest at 19.2.35.pr; and Digest at 19.2.51.1.

359. The Commissioner contends that "the overall substance, look and feel" of the relationship between Southern Cross and Support Workers was that of employer and employee. He refers, in particular, to three publications by Southern Cross as follows:

• An extract from Southern Cross's website:
"Come and work with us and contribute to the Community. Make a difference to the quality of life of people who need care or assistance (such as the frail aged, disabled, injured).

Apply Now

…

As a quality healthcare provider, all applications will undergo the Southern Cross recruitment and selection process which is based upon the principles of merit and equality of opportunity.

…

Why work with Southern Cross?

Working with Southern Cross provides a wide variety of opportunities and experiences within your local area. The work ranges from basic duties to skilled positions and is highly rewarding and stimulating. Personnel working with us receive many benefits including:
- • Valuable work/life balance (flexible work hours)
- • Work within your own region
- • Above award hourly rates that are reviewed annually
- • Ongoing support/supervision and training (Continuing Professional Development) to further develop skills and career opportunities.
We are a leading provider of quality community care and currently provide services across New South Wales, Queensland and Victoria. At Southern Cross, we work together as one team to achieve our mission of making a difference to quality of life for Service Users and to enable them to remain living independently in their own homes.

Southern Cross Service and Administration Personnel and Attendant Care Workers work closely together to ensure the delivery of high quality community service. Attendant Care Workers include Personal Care attendants (PCAs), Disability Support Workers, Assistants in Nursing (AINs), Endorsed Enrolled Nurses (EENs), Enrolled Nurses (ENs) and Registered Nurses (RNs).

By becoming a member of the Southern Cross team in your local area, you will embark on a new and rewarding career that makes a real difference to the quality of life of a wide variety of people living in the community. Furthermore, by joining Southern Cross you will become a part of an essential and rapidly expanding industry with high levels of job satisfaction and security."
• A further extract from Southern Cross's website:

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" What are Southern Cross' screening procedures for its Attendant Care Workers?

Southern Cross follows a formal and thorough recruitment process when selecting its Attendant Care Workers. This includes completing relevant Reference Checks, National Criminal History Record Checks and Working with Children Checks on all Attendant Care Workers prior to their commencement."
• Two job advertisements for Support Workers in March 2016 under the heading "Benefits of working with Southern Cross":
"As a national organisation, Southern Cross offers:
- • Opportunity to develop a career in Community Care - a growing and secure sector
- • Wide range of roles available
- • Work/life balance
- • Workplace education and support provided
- • Competitive remuneration
- • Opportunity to make a real difference to your community and the lives of those in need".

360. The Commissioner contends that when the relevant principles, which are not in dispute, are considered against the circumstances of the present case, the Acknowledgement, as signed by Support Workers, bears little practical connection with the reality of the relationship between Southern Cross and the Support Workers. He contends, therefore, that the proper characterisation of the relationship between Southern Cross and the Support Workers is that of employer and employee. Southern Cross, on the other hand, contends that, having regard to the totality of the relationship that it has with Support Workers, the Support Workers should be characterised as independent contractors.

361. The Commissioner contends that the evidence points towards a conclusion that Support Workers were not working in their own businesses. In so far as a Support Worker held an ABN during the Relevant Tax Years, that was a requirement of Southern Cross. Thus, typically, Southern Cross would apply for an ABN on behalf of a Support Worker if the Support Worker did not already have one. From December 2015, s 18 of the A New Tax System (Australian Business Number) Act 1999 (Cth) provided that an ABN could be cancelled if the holder was not entitled to have an ABN. Section 8 of that legislation provided that a person was entitled to an ABN if, relevantly, the person was carrying on an enterprise in Australia. In late 2015, the Australian Taxation Office ( ATO ) decided to cancel ABNs held by Support Workers with effect from 1 July 2016. The Commissioner contends that the ATO cancelled the ABNs of Support Workers because it formed the view that Support Workers were not carrying on a genuine enterprise and were not operating genuine businesses. The Commissioner asserts that the cancellation of the ABNs is evidence that the Support Workers were, by 2015, no longer entitled to an ABN. Nevertheless, the Commissioner accepts that the holding of an ABN is not determinative of whether a person is an employee.

362. There was no evidence that Support Workers promoted their activities to the public as a business through advertising or any other means. Rather, the evidence indicates that Southern Cross recruited Support Workers through job advertisements rather than Support Workers tendering for work. Support Workers had little chance of profit or risk of loss.^[58] See Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance [1968] 2 QB 497 at 526 ; 1 All ER 433. Thus, there was no opportunity for a Support Worker to generate a profit by arranging for someone else to undertake that Support Worker's shift. Southern Cross, not the original Support Worker, would pay a replacement Support Worker.

363. The services provided by Support Workers were presented to Participants, to Funders and to the general public as an activity of Southern Cross and not as a separate activity by each Support Worker carrying on his or her own business. Thus, the services provided by Support Workers were a core feature of the business of Southern Cross and generated goodwill for Southern Cross. There was no evidence that a Support Worker could build up his or her own goodwill. Indeed, Support

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Workers were prohibited from providing their personal contact details to a Participant.

364. There was no evidence that Support Workers held accreditations under Australian and New South Wales standards applicable to the providers of attendant care services that would enable the Support Worker to provide services directly to members of the public under a programme funded by government. Support Workers did not contract directly with either the Participant or the Funder. Rather, both the Participant and the Funder contracted with Southern Cross and Southern Cross was the single point of contact and central administration for all services provided by a Support Worker, not the Support Worker himself or herself.

365. The Commissioner points to the Accepted Indicia as indicating a relationship of common law employment between Southern Cross and Support Workers. He asserts that Southern Cross exercised control and direction over Support Workers by means of various mechanisms. Thus, Southern Cross:

• recruited Support Workers by describing the role of Support Workers as providing an opportunity to develop a career in community care, with a competitive work/life balance and remuneration, where Support Workers were not required to possess any pre-existing skills or training;
• provided orientation and regular team meetings for continuing education and training and exercised direct supervision over Support Workers;
• required Support Workers to adhere to the Code of Conduct, its care and service plans and other policies, including requirements always to carry a Southern Cross identification card while working;
• required Support Workers to complete a recruitment pack, which stipulated rules and procedures regarding behaviour;
• provided Support Workers with the Manual;
• required Support Workers to complete and sign an orientation checklist; and
• required Support Workers to comply with dress and footwear standards, such as non-slip fully enclosed shoes.

366. The Commissioner asserts that Southern Cross exercised control over the work of Support Workers through the Duties Plans that it prepared, which Support Workers were required to observe. He contends that, from the perspective of the Support Worker and for the purposes of considering the relationship between Southern Cross and the Support Worker, it is immaterial that the content of the Duties Plan may have been based on the plan prepared by a hospital or using the care assessment of some other entity. The Code of Conduct provided by Southern Cross to Support Workers required the Support Worker to follow Southern Cross's service plan and Duties Plan. Thus, while deviations in the order in which tasks were carried out could occur, if requested by the Participant, Support Workers were not permitted to provide Participants with services outside the Duties Plan.

367. The Manual, which Southern Cross provided, stated that Support Workers were only required to perform tasks that were written on the care plan, service plan or Duties Plan. Support Workers were required to report any incident or exception to Southern Cross or to a Care Assessor. If a Participant requested something outside the relevant Duties Plan, the Support Worker could telephone Southern Cross for clarification. In any event, the Support Worker was to inform Southern Cross of the request and Southern Cross would, in consultation with the Participant, assess the proposed change and amend the Duties Plan if necessary. Support Workers were not permitted to change the Duties Plan.

368. The Commissioner contends that the extent of the training provided by Southern Cross exemplifies the degree of instruction provided and control exercised by Southern Cross over Support Workers. Support Workers were not necessarily skilled workers with qualifications. Training was provided prior to commencing work and also occurred during team meetings. The level of training depended on the type of services being provided and the care needs of the particular Participant. Southern Cross, in a job advertisement for a Support Worker, stated that extensive support and training would be provided and all skills assessments carried out prior to the Support Worker working solo on a shift.

369.

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Before a new Support Worker could be assigned to a Participant, a "sign off" by a Care Assessor and acceptance by the Participant was required. For the purposes of the sign off, the Support Worker would be observed by a Care Assessor, who was an employee of Southern Cross, by way of shadow shifts. The Support Worker would also engage in "buddy shifts" with existing Support Workers. For a complex case, over the first four to six weeks, a new Support Worker may have had approximately 12 shadow shifts with another Support Worker who was already skilled in looking after the Participant. The Southern Cross Care Assessor would attend throughout that period. The purpose of that process was to ensure that the Support Worker was suitably trained and that the Participant was happy. That was important to Southern Cross.

370. Southern Cross supervised and monitored Support Workers providing services to Participants. The Southern Cross Care Assessors and Community Support Co-ordinators reviewed and supervised Support Workers on an ongoing basis, including visiting each Participant about once every three months. Southern Cross's senior Care Assessor also attended the homes and residences of Participants. Such supervision and monitoring of a Support Worker were often requirements imposed by the Funder and reflected and reinforced the ongoing responsibility of Southern Cross for the Support Worker and the services provided by the Support Worker. The Manual provided to Participants by Southern Cross stated that Southern Cross's service personnel were "supervised to meet your needs".

371. Southern Cross implemented benefits and retention programmes that the Commissioner characterises as being "employee-like". Thus, Southern Cross retained Support Workers through team meetings, merit awards, use of service awards, debriefing as required, education programmes and regular performance appraisals. Southern Cross recognised Support Workers who had "gone way and beyond" and gave long service awards by means of gift vouchers, shopping vouchers and flowers.

372. Support Workers were integrated into Southern Cross's service delivery team and roster administration team. The service delivery team, consisting of Care Assessors and the senior Care Assessor, worked day-to-day with Participants and Support Workers to provide support for the Participants in their homes and residences. The roster administration team also worked day-to-day with Support Workers and Participants. That "team approach" was referred to on Southern Cross's careers webpage in the following terms:

"We work together as one team … Southern Cross Service and Administration Personnel and [Support Workers] work closely together to ensure the delivery of high quality community services."

373. Thus, each Participant had a Southern Cross Care Assessor assigned to him or her. If requested by the Participant, a meeting with the Support Worker occurred with the Care Assessor present. Support Workers attended regular team meetings, where education and training sessions were held on a range of topics. Team meetings were also held as required in response to specific issues and needs. While attendance at a team meeting was not compulsory, it was highly encouraged to maintain future work placement through Southern Cross. There were instances where non-attendance at a team meeting may have resulted in the Support Worker not being offered any further work. Southern Cross sent regular newsletters to Support Workers and feedback from Support Workers was welcomed by Southern Cross.

374. While the swapping of shifts was permitted, that did not entail any delegation of work. Thus, a Support Worker could not delegate tasks to a third person employed or retained by the Support Worker for which the Support Worker would be paid by Southern Cross. Each Support Worker received payment only for the hours personally worked by him or her, whether on the original roster or on a varied roster. In any event, the ability for a Support Worker to swap, substitute or transfer shifts to another Support Worker was limited. If a Support Worker was unable to work a particular shift or undertake particular work, that Support Worker could only substitute

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another Support Worker approved by the particular Participant and then only with the approval of Southern Cross. Thus, Southern Cross regarded it as important to maintain a consistent group of Support Workers for the Participant and Southern Cross's practices were aimed at achieving that goal. The substitution of an appropriate Support Worker was managed by the Southern Cross rostering team rather than by a particular Support Worker. Thus, the requirement to notify Southern Cross of any proposed shift change gave Southern Cross the ultimate say on the matter.

375. While Support Workers agreed to indemnify Southern Cross against liability for loss or damage arising out of the provision of care or other services performed by the Support Worker, there was no evidence of any instance where Southern Cross actually sought indemnification from a Support Worker. In any event, the professional indemnity and public liability insurance taken out by Southern Cross on behalf of Support Workers removed any commercial risk and, the Commissioner contends, made the indemnity in the Acknowledgement irrelevant in substance.

376. Support Workers were recruited with a view to their committing to and fulfilling particular shifts regularly over an extended course of time and providing consistency to Participants. Support Workers were organised by a 14-day roster devised and managed by Southern Cross. Support Workers were requested to provide as much notice as possible, preferably four weeks, of any planned unavailability. There was evidence that Southern Cross maintained Support Worker levels in excess of rostered needs in order to assist in times of sickness and holiday leave. The Commissioner characterises the language used by Southern Cross as being characteristic of an employee-employer relationship where anticipated work absences were only in the event of illness or certain limited holiday leave.

377. The Commissioner asserts that acceptance and maintenance of shifts by Support Workers was important to Southern Cross's business model for ensuring continuance of care and shift coverage. The Support Worker, the Participant and Southern Cross were all involved in rostering. Thus, shift changes were subject to approval by Southern Cross and the Participant.

378. Immediately upon completion of each fortnight's roster, a Support Worker was required to submit a "record of services delivered". In those circumstances, the Commissioner contends, it is not appropriate to say that Support Workers determined their own hours of work and had the right to reject any engagement. He asserts that the reality of the rostering practice was contrary to the statement in the Acknowledgement in the following terms:

"I may nominate my hours for provision of services and reserve the right to accept or reject referrals according to my own convenience, including rejection following initial acceptance."

379. Southern Cross, not the Support Workers, determined the rates of pay for Support Workers. Support Workers were paid for time worked and not on any other basis, such as for each piece of work or task performed. A June 2016 version of the Manual stated that Southern Cross's hourly rates of pay were "in line with the relevant Award wages". Southern Cross voluntarily withheld tax on behalf of Support Workers and paid superannuation guarantee payments on behalf of Support Workers, who were deemed to be employees for the purpose of the Superannuation Guarantee (Administration) Act 1992 (Cth) ( the Superannuation Guarantee Act ).

380. Support Workers did not invoice Southern Cross for the services provided by them. Rather, Southern Cross controlled the process and procedures for payment. Support Workers submitted timesheets created by Southern Cross called "Record of services delivered", which were submitted either electronically through Southern Cross's portal or by facsimile. After the information was verified by Southern Cross, Southern Cross would issue tax invoices to the Support Worker.

381. Southern Cross did not supply Support Workers with mobile telephones or reimburse telephone expenses. However, Southern Cross provided a 24-hour, seven day per week free call phone service that Support Workers were able to use to contact Southern Cross about

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rostering, non-emergency issues with Participants and deviations from care plans. Southern Cross required Participants to allow Support Workers to use their telephones in the case of emergency. In some cases, Southern Cross supplied iPads for use at the homes of Participants to enable direct communication. The Commissioner contends that those arrangements eliminated the need for a Support Worker to have a mobile telephone for work purposes.

382. NSW Health required Southern Cross to supply protective clothing and equipment, including gloves and hand wash, to Support Workers working in home ventilation programmes. Southern Cross placed bulk supplies of protective gloves in the homes of all Participants who had complex needs.

383. Southern Cross took steps to ensure that Support Workers were covered by professional indemnity and public liability insurance. On the other hand, Southern Cross paid for workers' compensation insurance and superannuation guarantee payments in respect of Support Workers under deeming provisions of the relevant legislative regimes.

384. A Support Worker was free to accept or reject any particular engagement or any particular roster and was free to negotiate or alter the engagement without having to provide reasons. However, there was no specific evidence that any Support Worker who provided services through Southern Cross did in fact provide services through any other organisation.

385. A Support Worker was free to decide how many hours per fortnight he or she would work and could pass a particular engagement to another Support Worker provided that other support Worker had been approved by the Participant in question and was competent to provide the relevant services. Each Support Worker was free to provide care services to or through other organisations, including competitors of Southern Cross. If a Participant ceased receiving care through Southern Cross and began receiving care through another agency, it was possible for the Participant to continue to receive care from the same Support Worker, through the other agency.

386. Support Workers provided services to the particular Participant in the home or residence of the Participant. Support Workers were not accompanied by representatives of Southern Cross, which generally had no presence in the Participant's home or residence. When Southern Cross's Community Support Co-ordinators visited the home of a Participant, the Co-ordinator observed the Support Worker working at that time. The primary objective of the Co-ordinator was to monitor the Participant and, in the case of a Participant in the Lifetime Care programme, a Lifetime Care representative was also in attendance.

387. In providing care, Support Workers were required to adhere to the broad policy standards applicable throughout Australia's health system. That was commonly an express term of the contractual arrangements between Southern Cross and the relevant Funder. Within the confines of those professional requirements and particular requirements imposed by Participants and Funders, a Support Worker had some freedom in determining how he or she would provide relevant services.

388. Other than in exceptional circumstances when urgent or protracted travel was required, a Support Worker used his or her own motor vehicle to attend the home or residence of the Participant. A Support Worker was not reimbursed by Southern Cross for running expenses associated with the use of such a vehicle or with any other expenses incurred by the Support Worker. Support Workers were not required to wear uniforms. Each Support Worker was paid for the services provided by that Support worker in each fortnight. Each Support Worker was sent an "Advice of Deposit by Direct Credit Recipient Created Tax Invoice" following payment. Except to the extent that Support Workers were deemed by legislation to be treated as employees, such as for superannuation or workers' compensation purposes, Support Workers accepted that, as a matter of contract, they did not enjoy the conventional benefits of employees, such as holiday pay and long service leave.

389. I consider that, in the circumstances outlined above and having regard to the Accepted Indicia, Southern Cross's relationship with Support Workers lacked the

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elements necessary for the relationship to be characterised as an employment relationship at common law. When the actual nature of the engagement of Support Workers is examined, the overall conclusion is that they were independent contractors. Thus, the physical recipient of the services provided by Support Workers was the Participant. The Participant, or sometimes the guardian of the Participant where appropriate, was the ultimate controller of the Support Worker.

390. The care that was provided by a Support Worker to a Participant, which was often physically intimate, took place in the home or residence of the Participant and the Participant's local community, in circumstances where the Participant was physically vulnerable. The Participant and the Support Worker retained independence from each other and from Southern Cross. In particular:

• the Participant could refuse the services of any Support Worker, either at the outset or after the Support Worker had commenced providing care and was not required to justify such a decision or give notice;
• the Support Worker could refuse to provide care to any Participant, either at the outset, or after the Support Worker had commenced providing care and was not required to justify the decision or give notice;
• the Participant could ask the Funder, at any time, that Southern Cross no longer be engaged to provide care;
• Southern Cross could stop offering engagements to a Support Worker at any time; and
• a Support Worker had the absolute discretion to determine how many hours and on which days he or she wished to perform work through engagement by Southern Cross and for which Participants he or she was to provide services.

391. The work of a Support Worker bears fundamentally on the dignity of a Participant. Conversely, an employee such as a truck driver, courier or labourer, has no personal or intimate connection with the recipient of his or her services and does not build up a relationship or goodwill with the recipient of such services. It would be highly unusual for such a recipient to refuse the services of a particular employee without notice.

392. While the care needs assessment for a particular Participant, as devised by the hospital team and the Funder, were prescriptive as to essential clinical and medical tasks, the Participant controlled when and where tasks would take place and how that could be altered. The Duties Plan prepared by Southern Cross was a guide and the Participant ultimately decided how he or she would be cared for in his or her own home or residence. Nevertheless, the Support Worker had a discretion and degree of control. The Support Worker was free to control how he or she performed the care tasks that were required, how he or she spoke with the Participant, how to sequence flexible tasks, and how much gentleness and empathy to show, in order to tailor the services to the particular Participant.

393. A Support Worker was able to control how much work he or she performed through Southern Cross, and was free to provide care through other agencies or directly to other Participants and could build goodwill through his or her relationship with a Participant. Support Workers were not held out as employees of Southern Cross, which did not exert direct control over them, as Support Workers were not directly supervised by Southern Cross in the performance of their work. While Southern Cross conducted 6-monthly and 12-monthly reviews to ensure the Participant was satisfied with the care programme, involving meetings between the Community Support Co-ordinator and the Participant, the Support Worker was not necessarily present at the meetings. While Community Support Co-ordinators attended the homes of high-needs Participants, they did so for only four hours per month, and for the purpose of obtaining the Participant's feedback about the programme generally (and providing Registered Nurse health care). The attendance was not for the purpose of supervising Support Workers.

394. While Southern Cross performed and arranged training of Support Workers, much training was provided to Support Workers by the treating doctor and other members of the hospital team while the Participant was being

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prepared for discharge from hospital into in-home care, and in "buddy shifts" with other experienced Support Workers both in the hospital and in the Participant's home or residence.

395. Support Workers were in a unique position, in that they provided highly personal and health-regulated care in the environment of the home or residence of the Participant, thus making it less likely that the Support Worker would be redeployed in the way that institutional employees were redeployed. It was the non-institutional context that made the work attractive to a Support Worker who was seeking flexibility and autonomy. The bespoke nature of the engagement between the Support Worker and Southern Cross and between Southern Cross and the Participant strongly supports the conclusion that a Support Worker could fairly be characterised as an independent contractor.

396. I accept that such rights of mutual independence are anathema to the common law notion of employment, including casual employment. The mutuality of obligation and continuity that is typical of common law employment was lacking. That, combined with the fact that Support Workers were not controlled by Southern Cross, leads to the conclusion that Support Workers were not common law employees of Southern Cross.

Issue (3): 90-day Rule

397. If the arrangements between Southern Cross and the Support Workers are not employment agency contracts within the meaning of the Payroll Tax Act and Support Workers are not employees of Southern Cross under the general law, it would follow that all payments made to Support Workers were made under relevant contracts within the meaning of s 32(1) of the Payroll Tax Act. Accordingly, the payments would be subject to payroll tax unless the exception in s 32(2) applies.

398. Section 32(1) of the Payroll Tax Act provides that a relevant contract in relation to a financial year is a contract under which a person ( the designated person ) during that financial year, in the course of a business carried on by the designated person, supplies to another person services for or in relation to the performance of work or has supplied to the designated person the services of persons for or in relation to the performance of work. However, under s 32(2)(b)(iii), a relevant contract does not include a contract under which the designated person during a financial year in the course of a business carried on by the designated person is supplied with services for or in relation to the performance of work where those services are provided for a period that did not exceed 90 days or for periods that, in the aggregate, did not exceed 90 days in that financial year.

399. There are two bases upon which Southern Cross calls in aid the exception in s 32(2)(b)(iii) to support its contention that its arrangements with Support Workers do not constitute relevant contracts for the purposes of s 32. First, Southern Cross contends that the reference to services provided for a period that does not exceed 90 days should be limited to the provision of services on fewer than 90 calendar days in a year, regardless of how many hours are worked on a given day. In support of that contention, Southern Cross relies on a formula set out in "OSR Ruling PTA 035v2". The Commissioner accepts that, while the ruling is not binding on the Court, he would not contest a result produced by a proper application of the method described in that ruling. Thus, the Commissioner would not contest a result whereby approximately 10% of amounts paid to Support Workers during the Relevant Tax Years fell within the exception in s 32(2)(b)(iii) and would be exempt from payroll tax if the Court concludes that Support Workers are independent contractors and not common law employees.

400. The relevant language of s 32(2)(b)(iii) is as follows:

"those services are provided for a period that does not exceed 90 days or for periods that, in the aggregate, do not exceed 90 days in that financial year…".

401. Southern Cross contends, in effect, that the word "day" in the context of that language means a number of hours equivalent to a day's work rather than a period of 24 hours. Thus, it says, eight hours has been a standard working day in New South Wales since the Eight-hours Act 1916 (NSW), which bound the Crown and all direct and other employees of the Crown. Clause 25.1 of the Social, Community,

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Homecare and Disability Services Industry Award 2010 specifies that ordinary hours of work consist of shifts not exceeding eight hours each. Eight hours per day on each of 90 days would amount to 720 hours. Accordingly, Southern Cross contends, the exception in s 32(2)(b)(iii) will be satisfied in relation to payments made to a Support Worker who is paid for the provision of services for an aggregate number of hours that does not exceed 720 in a financial year. Southern Cross says that, in each financial year during the Relevant Tax Years, between 20% and 25% of payments made to Support Workers were made to Support Workers who worked less than 720 hours in that financial year.

402. Southern Cross's contention depends upon construing the word "day" as meaning a number of hours equivalent to a standard day's work rather than to any period of work completed throughout a 24-hour day, irrespective of its duration. There are contexts in which a reference in a statute to the word "day" should be taken as a reference to a notional concept related to the number of hours worked rather than a calendar day.^[59] See Mondelez Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2020] HCA 29 ; (2020) 94 ALJR 818 (“Mondelez Australia”). However, in each case, the particular statutory scheme must be considered and construed. In doing so, an important factor would be that one construction could lead to inequalities between employees with different work patterns and would therefore be unfair.^[60] See Mondelez Australia at [41]-[42].

403. The word "day" is not defined in the Payroll Tax Act and there appears to be nothing in the explanatory notes to the Bills that introduced the exception into the legislation that casts light on this question of construction. The provisions in the Payroll Tax Act are relatively identical to provisions of the Pay-roll Tax (Amendment) Act 1983 (Vic). The explanatory memorandum in relation to the introduction of those provisions stated that the exception was designed to exempt short-term engagements having regard to the fact that the general thrust of the legislative amendments was to tax payments under contracts that were long-term and were replacing the traditional contract of employment.

404. Southern Cross contends that there is no reason to suppose that the only periods that may be aggregated for the purposes of s 32(2)(b)(iii) are whole days of 24 hours. It draws attention to the fact that the exception refers to "periods" that, in the aggregate, do not exceed 90 days. Further, it says, the construction for which it contends accords better with the legislative purpose that relevant contracts are intended to be those replacing traditional contracts of employment or service contracts. It says that a construction that simply counts the number of 24 hour days on which any work is done would go beyond that purpose and that a contract under which more than 90 full days of work are done is far more akin to a traditional contract of employment or service contract than a contract under which small amounts of work may be done over a total of 90 days.

405. Southern Cross asserts that its preferred construction is more practical because it would be simpler to calculate the total number of hours worked and would produce greater consistency between contractors. It asserts that its preferred construction would avoid inequalities between employees with different work patterns.

406. Southern Cross asserts that, under the alternative construction, liability for payroll tax could be dependent upon the idiosyncratic choices of an independent contractor as to how that contractor structures his or her work, assuming that the work is sufficiently flexible. Southern Cross proposes an example of two contractors who are given the same work, which would take 100 hours to complete. One contractor might choose to do one hour of work each day for 100 days while the other contractor might choose to do 10 hours of work each day for 10 days. Unless the construction preferred by Southern Cross were adopted, the second contractor would fall within the exception while the first contractor would not, notwithstanding that precisely the same work would have been performed. Southern Cross contends that the possibility of such an outcome tends in favour of its preferred construction.

407. Southern Cross also asserts that its preferred construction would promote the object and purpose of the provision, which is to exclude from payroll tax payments to persons who perform services for a relevant taxpayer for only a minor part of the year. In such

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circumstances, the person likely to be providing services is more likely to be an independent contractor. Southern Cross asserts that the various exemptions in s 32(2) are directed at identifying genuine independent contractors.^[61] See Bridges Financial Services Pty Ltd v Chief Commissioner of State Revenue [2005] NSWSC 788 ; (2005) 222 ALR 599 at [220]-[221] . It says that 90 days of eight hours work per day represents a minor part of a full year, satisfying that legislative object. It says that the legislative object would not be better achieved by reading the provision as referring to 90 days of any quantity of work, as the alternative construction would require. That, Southern Cross says, would unduly restrict the exception because a Support Worker working for a particular Participant for only one or two days per week would be less likely to resemble a traditional employee than a Support Worker working for a longer day.

408. I do not consider that there is any justification in the language of s 32(2)(b)(iii) for the construction contended for by Southern Cross. The provision is concerned with the regularity and continuity of the relationship between the contractor and the employer. Accordingly, such a construction would not meet the object of the provision. Further, there is no indication that 720 hours is a relevant approximation of 90 days' work for Support Workers.

Issue (4): Interest

409. By the operation of the Administration Act, on the happening of a tax default, which arose when Southern Cross failed to pay payroll tax on taxable wages within seven days of the end of the month in which the wages were paid or payable, interest became payable. The Assessments notified Southern Cross of payroll tax payable and the interest that had accrued in accordance with the provisions of the Administration Act. However, if Southern Cross is successful in establishing that an exemption applies, interest will be reduced accordingly on that part of the payments found to be exempt or not to be wages. Southern Cross seeks the remission of interest on payroll tax that is found to be payable. Standing in the shoes of the Commissioner in these proceedings, the Court may, in such circumstances as it considers appropriate, remit the market rate component or the premium component of interest, or both. The Commissioner opposes the remission of any interest.

410. The effect of ss 103 to 105 of the Administration Act is that an application for review does not stop interest from accruing. However, if a taxpayer's appeal is successful, the Commissioner is required to repay any interest paid, together with interest at the market rate on that repaid interest.

411. One purpose of the market rate component is to compensate the Commissioner for not having the benefit of a tax payment from the time when it is due. It would be rare, if ever, that the market rate component should be remitted. Otherwise, there would be an inducement for a taxpayer to dispute liability. The effect would be to discriminate against taxpayers who meet obligations on time in accordance with the Administration Act.^[62] See Bayton at [255] and [302], citing Lease A Leaf Property Pty Ltd v Chief Commissioner of State Revenue [2011] NSWADTAP 41 ; (2011) 85 ATR 273 . Only very exceptional circumstances would justify any remission of the market rate component.^[63] See Adams Bidco Pty Ltd v Chief Commissioner of State Revenue [2019] NSWSC 702 at [156] , citing Trust Co of Australia Ltd v Chief Commissioner of State Revenue [2002] NSWADT 21 at [27] .

412. In the present circumstances, I am not persuaded that there is any basis upon which there should be any remission of the market rate component of interest imposed by the Administration Act. The market rate component is referable to the Bank Accepted Bill rate and represents the value of money and the lost opportunity for the Commissioner in not receiving tax when it is payable in terms of the Administration Act. The premium component, on the other hand, which is a further 8% on top of the market rate component, is fairly characterised as being penal, particularly in circumstances where current interest rates are historically low.

413. Southern Cross contends that the premium component should be remitted because it has taken reasonable care, in the light of prior audits and investigations that have taken place in relation to its liability for payroll tax, and where the employment status of Support Workers has been considered in other forums on several different occasions. While Southern Cross accepts that the results of those considerations are not binding on this Court, they are relevant to the question of remission of interest.

414. Thus, in 2020, the Fair Work Commission dismissed an unfair dismissal claim brought against Southern Cross by a

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Support Worker. The Fair Work Commission concluded that the Support Worker was an independent contractor and not an employee of Southern Cross.^[64] See Leffanue v Southern Cross Community Health Care Pty Ltd [2020] FWC 3122 . It is relevant, however, that that decision was given well after any obligation arose for Southern Cross to pay payroll tax. More relevantly, in 2012, the Fair Work Commission investigated Southern Cross and determined that a claim that Support Workers were employees of Southern Cross was not sustainable.

415. In 2001, 2003, 2004 and between 2008 and 2012, the ATO conducted audits that variously concluded or accepted that Support Workers were independent contractors and not employees of Southern Cross. In 1996 and 1997, WorkCover New South Wales conducted a review that concluded that Support Workers were independent contractors and not employees of Southern Cross. Payroll tax reviews in relation to Southern Cross have been conducted in Queensland and Victoria and the conclusion was reached that Support Workers were not employees of Southern Cross.

416. In addition, from 1984, when Southern Cross was established, through to 2016, Southern Cross has been the subject of five audits or investigations by the Office of State Revenue in respect of its payroll tax arrangements. Until the investigation in late 2016 that led to the Assessments, each of those audits or investigations concluded that no additional payroll tax was payable by Southern Cross in respect of payments made to Support Workers. The last of those audits conducted prior to the 2016 investigation was completed in 2011.

417. In the course of the 2011 audit, the Office of State Revenue noted that the business of Southern Cross involved "dealing with a lot of exempt clients" and concluded that Southern Cross had provided "substantial evidence" concerning the contractor status of the Support Workers and that Southern Cross had "no control over the work performed" by them. It was noted that full co-operation had been received from Southern Cross's external accountant and financial controller and that all information had been provided in a timely manner as requested. There was no relevant change in the structure or operations of Southern Cross in relation to its arrangements with Funders and Support Workers between 2011 when that audit was completed and the end of the Relevant Tax Years.

418. Southern Cross points to the time that elapsed between being formally notified of an investigation on 16 February 2016 and the time when the Assessments were issued on 11 July 2017. Southern Cross asserts that it has co-operated with the Commissioner in relation to the investigation that led to the amended assessments.

419. Southern Cross asserts that in circumstances where, in 2011, at the beginning of the first of the Relevant Tax Years, the Commissioner completed an audit and informed Southern Cross that it was not liable to pay any additional payroll tax, it is not fair and reasonable that Southern Cross should pay premium component interest as well as the market rate component on any shortfall for any of the Relevant Tax Years.

420. The Commissioner contends that the fact that, in prior audits and investigations, Southern Cross was not assessed as liable for payroll tax in respect of payments to Support Workers, does not, of itself, demonstrate that Southern Cross exercised reasonable care. Thus, the Commissioner points out, the finalisation letter to Southern Cross dated 4 November 2011 stated that the audit that had been carried out was limited to and based on the records and information provided at that time. That information included a document provided by Southern Cross's accountants under cover of a letter dated 27 October 2011 ( the Contractor Fact Sheet ).

421. The Commissioner asserts that the Contractor Fact Sheet was neither an accurate nor a full and frank disclosure of the relationship between Southern Cross, on the one hand, and Support Workers, on the other. The audit report in fact refers to:

"Substantial evidence in the form of [the Contractor Fact Sheet] and contractors' acknowledgement and authority form to show that the contractors engaged to perform services are not common law employees."

Ms Merran accepted that she caused the Contractor Fact Sheet to be provided to the

ATC 24736

Commissioner with a view to convincing him that he should treat Support Workers as independent contractors and not employees. She also accepted that, when it was provided to the Commissioner, she knew that it was important to be full and frank about the aspects of the relationship between Southern Cross and the Support Workers. Nevertheless, Ms Merran accepted that the Contractor Fact Sheet was not a full and frank description of that relationship.

422. The Contractor Fact Sheet contained the following statement:

"It should be noted that Southern Cross has been audited on several occasions by Commonwealth Government Departments (Australian Taxation Office, both as regards PAYG and SGL - therefore Southern Cross has not paid SGC on payments to Contractors), the NSW Government (workers compensation, payroll tax), the Victorian Government (payroll tax) and the Queensland Government (payroll tax). All of these bodies accept that the relationship between the contractors and Southern Cross is not one of employee and employer. Accordingly, Southern Cross does not pay payroll tax in NSW, Queensland and Victoria on payments to contractors."

423. The Commissioner asserts that the Contractor Fact Sheet was inaccurate for several reasons.

424. First, in June 2011, the ATO informed Southern Cross, through its accountants, that it was of the view that Southern Cross was "an employer" within the meaning of s 12(1) and s 12(3) of the Superannuation Guarantee Act. Under s 12(1), the terms "employee" and "employer" have their ordinary meaning except to the extent that the subsequent provisions of s 12 expand the meaning of those terms and make particular provision to avoid doubt as to the status of certain persons. Section 12(3) provides that if a person works under a contract that is wholly or principally for the labour of the person, the person is an employee of the other party to the contract. In July 2011, the ATO provided to Southern Cross's accountants an advice that the ATO had received in February 2011 to the effect that s 12(3) of the Superannuation Guarantee Act applied to the facts relating to Southern Cross but that it could not be stated conclusively that s 12(1) would apply. The ATO expressed the view that, if it came to litigation, it would be prudent to run an argument based on s 12(1) with a fallback based on s 12(3), since "Indicia exist which are common to both sub-sections."

425. Thus, the Commissioner asserts, it was apparent that the ATO did not accept that the relationship between Southern Cross and Support Workers was not one of employer and employee and that that dispute had not been resolved by 27 October 2011, when the Contractor Fact Sheet was sent to the Commissioner or by 4 November 2011 when the Commissioner's letter concerning the result of the audit was sent. Rather, the dispute was only resolved in January 2012 when Southern Cross entered into a compromise deed with the ATO on terms that it would pay the superannuation guarantee levy for Support Workers under s 12(3) of the Superannuation Guarantee Act. The recitals to the compromise deed recorded the following:

"A The Commissioner [of Taxation] and [Southern Cross] are in dispute as to whether [Support Workers] engaged by [Southern Cross's] business are employees under the [Superannuation Guarantee Act] and whether s 12(11) applies in any event.
B The parties remain in dispute as to whether [Support Workers] engaged by [Southern Cross's] business are employees under the [Superannuation Guarantee Act] and whether subsection 12(11) applies in any event.
C The parties nonetheless wish to settle their dispute on the following terms."

Section 12(11) of the Superannuation Guarantee Act provided that a person who is paid to do work wholly or principally of a domestic or private nature for not more than 30 hours per week is not regarded as an employee in relation to that work.

426. The Contractor Fact Sheet also stated as follows:

"Southern Cross does not 'control' the on-site provision of services at people's homes. That is entirely within the responsibility of the [Support Worker]."

ATC 24737

Ms Merran accepted that that was not a correct or a "true and frank" statement having regard to the fact that Support Workers were provided with a Duties Plan that they were required to follow and to notify Southern Cross of any material deviations from it.

427. The Contractor Fact Sheet also said:

"The [Support Worker] is aware of the standard of the service to be provided but how and in what manner it is provided is entirely a matter for the [Support Worker]."

Ms Merran accepted that that was not, for the same reasons, a correct or full and frank statement. The Commissioner asserts that the Contractor Fact Sheet did not reveal the level of control that Southern Cross exercised over Support Workers and that that role was not accurately characterised as one of "setting guidelines and standards".

428. The Contractor Fact Sheet also said:

"The contractor has the right to delegate the provision of the services in question."

Ms Merran accepted that that was not an accurate statement or full and frank disclosure of the rights of Support Workers in relation to delegation. The Commissioner asserts that the statement was not in any way accurate, full or frank since Support Workers had no right to delegate in an unlimited fashion. The best they could do was to nominate a suitable alternative whose approval was then a matter for Southern Cross and the Participant.

429. The Contractor Fact Sheet also stated as follows:

"The costs of attending at the home premises '(i.e. car/mobile phone)' are borne by the contractors without additional recompense from Southern Cross."

Ms Merran acknowledged that under the contract between Southern Cross and Lifetime Care, Lifetime Care would fund some Support Workers' travel, which funding in turn would be paid by Southern Cross to the Support Worker. However, Ms Merran would not accept that that statement was incorrect because she could not recall whether or not such travel had been paid for as at 27 October 2011. The Commissioner asserts that it was not a full and frank description of the relationship between Southern Cross and Support Workers, given that it was intended to be a blanket statement of that relationship. Even if the practice was common, the statement was expressed, without qualification, as a universal statement.

430. Next, the Contractor Fact Sheet stated as follows:

"Given the contractor status, Southern Cross requires all contractors to produce an ABN (Australian Business Number) before they are able to undertake any services. These arrangements are reflected in the contractual documentation. The arrangement demonstrates and acknowledges their self-employed status."

It was Southern Cross's practice, if a Support Worker did not have an ABN, to apply for one on behalf of the Support Worker. The Commissioner says that that was therefore not a full and frank description of the arrangements between Southern Cross and Support Workers, as Ms Merran accepted.

431. The Commissioner asserts that, in the light of the above, the contention by Southern Cross that it was "not unreasonable" to rely upon the results of the 2011 audit should be rejected. Ms Merran accepted that, if she was going to rely on the results of audits, it was important to be full and frank in the information that Southern Cross provided and that the results of the audit were only as good as the records and information provided during the course of the audit.

432. The Commissioner asserts that the audits and investigations that occurred prior to 2011 were too old to be relevant and, in any event, were overtaken by the audit completed in 2011 when the Commissioner made plain that he was examining again the relationship between Southern Cross and the Support Workers. He asserts that the evidence does not establish accurate and full and frank disclosure on the part of Southern Cross as to its relationship with Support Workers. Accordingly, the Commissioner says, there is no basis for remitting the market rate component or the premium component of the interest charge.

433. The Commissioner also contends that the Court should reject the submission on behalf of Southern Cross that it co-operated with the Commissioner in the 2016 audit. He

ATC 24738

says that the absence of full and frank disclosure displayed in the 2011 audit continued and that many of the inaccurate statements made in the Contractor Fact Sheet were repeated in 2016.

434. Thus, on 15 March 2016, Southern Cross's accountants wrote to the Commissioner providing information in relation to the audit. Ms Merran saw the letter before it was sent. The letter said that, since inception, Southern Cross had participated in numerous audits by various government authorities and that, following each of those "reviews", it was confirmed that Southern Cross had met all of its statutory obligations and that the Support Workers were accurately described as independent contractors, not employees. The Commissioner characterises that statement as inaccurate. The letter also included, among "key factors in support of the contractor status" of Support Workers, the fact that Support Workers were able to delegate a shift to another Support Worker without reference to or formal approval from Southern Cross. That, the Commissioner asserts, was neither accurate nor full and frank.

435. The letter of 15 March 2016 also said that Support Workers were not supervised while delivering services, that Support Workers used their own equipment, such as phones and medical items, and that Support Workers received no vehicle allowance or reimbursement. The Commissioner asserts that those statements were inaccurate for the reasons set out above in relation to the Contractor Fact Sheet. Further, Ms Merran said that Southern Cross places bulk supplies of gloves in the homes of Participants for use by Support Workers.

436. The letter of 15 March 2016 concluded as follows:

"As mentioned above additional and extensive information on the contractor status of the [Support Workers] has also been previously provided to your office - please refer to your files."

The Commissioner asserts that Southern Cross thereby sought to repeat the inaccurate statements in the Contractor Fact Sheet. Further, Southern Cross did not reveal, during the 2016 audit, the fact that the ATO was about to cancel the ABNs of Support Workers in circumstances where Southern Cross had learned of that proposal by 23 December 2015 at the latest. Southern Cross's response was to request the ATO to put a timetable in place to enable it to get its affairs in order, including notifying Support Workers that their ABNs were about to be cancelled. The Commissioner asserts that Southern Cross had done that by 9 March 2016. The Commissioner had notified Southern Cross of its audit on 16 February 2016 yet, a week after notifying the Support Workers that their ABNs would be cancelled, the letter of 15 March 2016 was sent to the Commissioner. Not only did the letter make no reference to the matter of the ABNs, it contained the inaccurate statement referred to above. It also contained a statement to the following effect:

"…there have been no changes to [Southern Cross's] operations and structure since your last review, with the exception that effective from 1 July, 2012, in accordance with a Deed of Settlement with the Australian Taxation Office ('ATO'), [Southern Cross] now make[s] superannuation contributions on behalf of the [Support Workers] under the contractor 'deeming' provisions of s 12(3) of the [Superannuation Guarantee Act]. This also further confirms the contractor status of the [Support Workers]."

437. The Commissioner complains that Southern Cross did not reveal that the ATO was about to cancel the ABNs of Support Workers or that the "Deed of Settlement" was a compromise between Southern Cross and the ATO, which indicated that the parties remained in dispute as to whether the Support Workers were employees under the Superannuation Guarantee Act. Ms Merran accepted that the statement that one of the "key factors" in support of the contractor status of the Support Workers was that all Support Workers held an ABN was not a full and frank disclosure to the Commissioner. Further, no mention of the cancellation of the ABNs was made in a further letter of 7 June 2016 sent by Southern Cross. Rather, that letter repeated the incorrect statement that Southern Cross "has not changed its operational business model throughout the

ATC 24739

period." There is no evidence that the cancellation of the ABNs was volunteered during the rest of the audit and the Commissioner invites the inference that it was not volunteered at all.

438. The Commissioner asserts that, in the circumstances outlined above, the Court should not accept the contentions advanced on behalf of Southern Cross for the remission of interest, since to do so would condone the absence of candour exhibited by Southern Cross during both the 2011 audit and the 2016 audit. Section 10(1) of the Administration Act requires full and true disclosure of relevant facts and circumstances. Co-operation must involve full and frank disclosure.^[65] See Winston-Smith v Chief Commissioner of State Revenue [2018] NSWSC 773 ; (2018) 108 ATR 63 at [82] (“Winston Smith”). In the circumstances, the Commissioner contends, the submission on behalf of Southern Cross that it co-operated in the 2016 audit, which led to the Assessments, should be rejected.

439. The Commissioner also relies on further matters as weighing against the remission of interest. First, Southern Cross has had the benefit of the use of money that it would otherwise have been required to pay in tax and has had the benefit of that use for between five and nine years, during which period the Commissioner has been deprived of the use of the funds. The Assessments were issued on 11 July 2017, more than four years ago, and Southern Cross has been aware since that time, at the latest, that the Commissioner did not accept that the payments made to Support Workers were exempt from payroll tax. No further interest would have accrued on the amounts set out in the Assessments had they been paid by the due date, namely, 1 August 2017. Nevertheless, Southern Cross chose not to discharge its obligation, even on a without prejudice basis or under protest, in order to stop interest from accruing. Southern Cross adopted that stance notwithstanding that, in the event that it is successful in its appeal, it will be entitled to interest on any tax paid that is refunded.

440. Southern Cross is legally obliged to pay the balance of the tax liability, regardless of any pending objection or appeal, as is made clear by s 94 and s 103 of the Administration Act. The Commissioner rejects any suggestion that an offer of remission of interest for payment should have been forthcoming from him. The Commissioner also rejects any suggestion that there was any relevant "delay and inaction" on his part in issuing the Assessments. He points to the fact that, as late as 4 July 2017, Southern Cross was urging an exchange of position papers rather than the issuing of assessments.

441. Southern Cross has had professional advice at all times in relation to its liability to pay payroll tax. Southern Cross has not disclosed that advice in these proceedings. Therefore, the Commissioner says, there is every reason for concluding that the default was wilful.^[66] See Winston-Smith at [84]-[86].

442. In all of the circumstances, I am not persuaded that there is any basis for remitting the market rate component of the interest payable under the Administration Act. There has been no evidence to suggest that it is not a fair reflection of the value of money. Southern Cross has had the benefit of the use of the funds. It would have been reimbursed with interest on the funds paid had it paid the tax claimed in the Assessments.

443. The premium component is in a somewhat different category. The facts outlined above indicate a degree of a lack of frankness on the part of Southern Cross. On the other hand, it is relevant that it was advancing contentions in the context of a dispute. Nevertheless, it appears tolerably clear that the material provided on behalf of Southern Cross to the Commissioner bears a slant that is not consistent with the evidence that has been adduced for the purposes of this appeal. The premium component is clearly penal and, in the context of historically low interest rates, the relationship between the market rate component and the premium component is somewhat different from the relationship that they bore when the relevant provisions were enacted. The premium component is a fixed 8% per annum, irrespective of the market rate component.

444. The want of frankness and full disclosure shown by Southern Cross was not insignificant. However, significant contentions advanced on behalf of Southern Cross have been accepted, in so far as I have concluded that the Support Workers are not employees of Southern Cross under the general law. That is

ATC 24740

the area in relation to which the want of frankness and full disclosure occurred.

445. As I apprehend the position, there will nevertheless be a substantial payroll tax liability on the part of Southern Cross. In the circumstances, I consider that the premium component should be remitted to the extent of 4%.

Conclusion

446. I have concluded that none of the arrangements between Southern Cross, on one hand, and Support Workers, on the other, constituted employment agency contracts within the meaning of s 37(1) of the Payroll Tax Act. Even if they did, I do not consider that the exemption in cl 8 of Sch 2 to the Payroll Tax Act would apply to any of the Support Workers. Even if the exemption applied, I do not consider that Southern Cross has satisfied the requirements of s 40(2) in so far as it required a declaration from the Funders.

447. I have concluded that the Support Workers are not common law employees of Southern Cross. However, I do not accept the construction of s 32(2)(b)(iii) of the Payroll Tax Act contended for by Southern Cross in relation to "the 90-day rule".

448. It follows that Southern Cross is liable to pay an amount of payroll tax. I do not consider that any basis has been established for remitting the market rate component of interest charged under the Administration Act on the amount of unpaid tax. However, I consider that the premium component of interest should be remitted to the extent of 4% per annum.

449. I propose to make the following orders:

(1) Direct the plaintiff, no later than 14 days after the publication of these reasons, to bring in short minutes to reflect the conclusions reached in these reasons;
(2) Order that the plaintiff pay the defendant's costs of the proceedings; and
(3) Reserve leave to the parties to apply, no later than 28 days after the publication of these reasons, for further directions if there is a dispute as to the calculation of payroll tax or interest or as to the costs of the proceedings.

Appendix 1

Clause 8 of Sch 2 of the Payroll Tax Act requires that: ( the Requirements )

(a) In respect of any Funder or category, the Support Workers satisfy the first "in connection with" test.
(b) In respect of any Funder or category, that the work done by Support Workers satisfies the second "in connection with" test.
(c) In respect of any funder or category, that the work done by Support Workers satisfies the exclusivity test in cl.8(b) of Sch 2.

Category	Position of the Parties
Amounts paid to Support Workers providing care to Participants with an SCI or ABI, where that care was funded by Lifetime Care.	If the Court finds that both Participant 2 and Participant 88 satisfy the Requirements, then it is agreed that the Court can find the Requirements are satisfied for all Participants in this category. ATC 24741
Amounts paid to Support Workers providing care to Participants with an SCI or ABI where that care was funded by NSW Health.	If the Court finds that each of Participants 9, 21 and 58 satisfy the Requirements, then it is agreed that the Court can find the Requirements to be satisfied for all Participants in this category.
Amounts paid to Support Workers providing care to Participants with an SCI or ABI under the ACP/HNP/CSP disability programmes where that care was funded by FACS/ADHC.	If the Court finds that each of Participants 68, 71, 74, 77 and 187 satisfy the Requirements, then it is agreed that the Court can find the Requirements to be satisfied for all Participants in this category.
Amounts paid to Support Workers providing care to Participants in the Miscellaneous category under the ACP/HNP/CSP disability programmes where that care was funded by FACS/ADHC.	The Chief Commissioner does not agree that this category can be determined by reference to one or more representative or sample Participants.
Amounts paid to Support Workers providing care to Participants under the HACC programme, where that care was funded by FACS/ADHC.	If the Court finds that each of Participants 116, 118, 191, 195, 201, 217, 229, 252, 296, 306 and 343 satisfy the Requirements, then it is agreed that the Court can find the Requirements to be satisfied for all Participants in this category.
Amounts paid to Support Workers providing care to Participants under the HACC programme, where that care was funded by DSS.	If the Court finds that each of Participants 116, 118, 191, 195, 201, 217, 229, 252, 296, 306 and 343 satisfy the Requirements (and that Cth DSS/Ageing is "the Crown"), then it is agreed the Court can find the Requirements to be satisfied for all Participants in this category.
Amounts paid to Support Workers providing care to Participants under the HCP programme, where that care was funded by DSS.	If the Court finds that each of Participants 13, 332, 335, 345 and 346 satisfy the Requirements (and that DSS is "the Crown"), then it is agreed that the Court can find the Requirements to be satisfied for all Participants in this category.
Amounts paid to Support Workers providing care to Participants with an SCI, where that care was funded by DoE.	If the Court finds that each of Participants 9, 10 and 11 satisfy the Requirements, then it is agreed that the Court can find the Requirements to be satisfied for all Participants in this category.
Amounts paid to Support Workers providing care to Participants with an ABI where that care was funded by NSW Trustee.	The Commissioner does not agree that this category can be determined by reference to one or more representative or sample Participants.
Amounts paid to Support Workers providing care to Participants with an SCI, where that care was funded by TAC.	If the Court finds that both Participants 7 and 1235 satisfy the Requirements (and that TAC is "the Crown"), then it is agreed that the Court can find the Requirements to be satisfied for all Participants in this category.
Amounts paid to Support Workers providing care to Participants with an SCI or ABI or in the Misc category, where that care was funded by NDIA or another government client in the "Other" category.	The Commissioner does not agree that this category can be determined by reference to one or more representative or sample Participants.

Appendix 2

Participant condition, weekly hours of care, kinds of care provided and programme funding

Participant	Conditions	Hours of care/week	What kinds of care were provided by the [Support Workers]/[Southern Cross] to the Participant?	Funding Agency ATC 24743
2	Spinal Cord Injury, tetraplegic, neurogenic bowel, neurogenic bladder, sustained in a motor vehicle accident in March 2008	20 hrs day 48 hrs night Invoice period end 29/01/15	a) 24 hours per day [Support Worker]; b) Additional four hours per day of second [Support Worker]; c) Additional five hours per month for second [Support Worker] for assistance with attendance to medical appointments; d) Two hours per month registered nursing, plus an additional three hours twice per year for attendance at the spinal cord injury clinic; and e) Two hours of [Support Worker] training for 10 [Support Workers]. (Attendant care service request 30 April 2014)	[Lifetime Care]
88	a) Spinal Cord Injury T10-12; b) Paraplegia; and c) Pressure areas.	4 hrs Nov 2015 Participant Attendant Care Agreement	a) Domestic assistance: (four hours per week): lawn mowing, handyman services, cleaning, spring cleaning, shopping, housekeeping, annual window and gutter clean, changing bed linen, empty bins, wash dishes, clean mirrors; and b) Personal Care: Wound dressings by a RN for pressure wounds.	[Lifetime Care]
93	a) Incomplete quadriplegia C4-5 as a result of a motor vehicle accident in 2008.	93 hrs 7 inactive sleepovers 1-hr RN 2 hrs Garden Notice of Assessment and Certificate 12/04/14	a) Personal care: Showering, dressing, grooming, skin care, oral hygiene, shave, supervise mobility, change of suprapubic catheter (by RN 2 hrs per fortnight), bowel management, assist feeding, attend exercise program; b) Domestic assistance: Lawn mowing (2 hours per week); and c) Inactive sleepovers.	[Lifetime Care]
96	a) Head Injury - impaired cognition, caused by a motor vehicle accident in April 2014; b) Upper limb pain; c) Insulin dependent diabetic; d) Prostate disease; and e) Urge incontinence	112 hrs 7 inactive sleepovers Notice of Assessment and Certificate 10/09/15	a) Personal Care: Mobility and transfer supervision, assist shower and dressing, continence support, medication supervision, assist exercise program, grooming, foot care; and b) Domestic assistance: transport assistance, food preparation, cleaning, laundry, wash dishes, change bed linen, empty rubbish bins, sweep.	[Lifetime Care] ATC 24744
99	a) Spinal Cord Injury C7, and b) Neurogenic bladder and bowel.	41.6 hrs 6 hrs RN Notice of Assessment and Certificate 6/11/14	a) Personal Care: Suprapubic catheter care, chair to car transfers, wound care, skin integrity support, shower supervision, assist grooming, assist dressing, dress child, bowel management; b) Domestic assistance: Food preparation, shopping, attend appointments, laundry, change bed linen, wash floors, wash dishes; and c) Community Support: assistance with attending social outings.	[Lifetime Care]
107	a) Spinal cord injury: L5- S1; b) Brain Injury; c) Right Below Knee Amputation, in respect of which he uses a prosthesis; and d) Right Elbow Injury and nerve damage to the right hand.	4 hrs 0.5 hrs garden Notice of Assessment and Certificate 08/04/15	a) Domestic assistance: (four hours per week): Shopping, food preparation, cleaning assist, lawn mowing, assistance with exercise and hobbies, laundry, make the bed, empty bins, clean windows and blinds, pick up kids' toys.	[Lifetime Care]
119	a) Traumatic Brain Injury; b) Left-Hand Weakness; c) Right leg weakness; d) Left below-knee amputation, as a result of which he uses a prosthesis; and e) Diabetes type 2.	1 hr Notice of Assessment and Certificate 13/08/13	a) Personal Care: Wound dressings (September 2011), mobility supervision, assist with transport to appointments, transfer to car supervision, assist dressing, supervision with gym program, inactive overnight supervision (personal care no longer required by July 2013 assessment); and b) Domestic assistance: Vacuum, dust, clean bathroom, wash the floor, make the bed, change bed linen, and shopping.	[Lifetime Care]
135	a) Burns to 60% of Total Body Surface Area.	59 hrs [Support Worker] 21 hrs RN Notice of Assessment and Certificate 25/5/11 - 16/08/11	a) Personal Care: Wound management, wounds monitoring once per week by Registered Nurse, shower, dressing, grooming, skin integrity check, eye care, oral hygiene, supervise mobility attend medications, monitor pain, attend exercise program, provide appointment transport; b) Domestic assistance: clean bathroom, make the bed, change linen, washing, ironing, shopping, pay bills; and c) Social care: attend outings.	[Lifetime Care] ATC 24745
140	a) Spinal Cord Injury in 2013.	2 HRS Notice of Assessment and Certificate 28/07/14	a) In August - September 2014: Domestic assistance: Washing, ironing, folding clothes, bed making (Attendant Care Service Request and Southern Cross Care Plan); and b) In June 2015 and again in November 2015: Domestic assistance: assistance with relocation, packing, delivery of and unpacking belongings (Service Approval/Purchase Orders).	[Lifetime Care]
153	a) Cerebrovascular accident; and b) Traumatic Brain injury.	94.5 Hrs 7 night inactive sleepover, Notice of Assessment and Certificate 09/05/2016	a) Personal care: Assist mobility, toileting assist, dressing assist, grooming assist, assist therapy programs, inactive sleepovers, assist bed and chair transfers; b) Domestic assistance: meal preparation assist, clean bathroom, attend medical appointments, assist in looking after grandchildren, house cleaning, vacuum, mopping, washing up, assist laundry, shopping; and c) Social Care: Outings assistance, assist transport to appointments.	[Lifetime Care]
182	a) Acquired brain injury, which affects cognitive function / mental abilities b) Vision impairment; c) Unsteady gait; d) Rheumatoid arthritis (non-injury related); e) Diabetes; f) Hypothyroidism; g) Hypogonadism; and h) Depression	47.5 Hrs Notice of Assessment and Certificate 11/11/11	a) Personal Care: take for a walk for a therapy program, shower, assist dressing, skincare, foot care, oral hygiene, shave, hand hygiene prompting, assist eye drops, supervise medications, support attendance to therapy appointments and work program; b) Domestic assistance: Prepare meals, safety supervision, assist bed making, clean bathroom, wash dishes, change bed linen, attend shopping, and c) Social care: organise social activities in the community.	[Lifetime Care] ATC 24746
366	a) As a result of a stroke in 2006, left side weakness, reduced mobility and vision and speaking difficulties	35 Hrs FaCS Funding Agreement 1/7/15	a) Personal care: mobility and transfers, showering, grooming, dressing; b) Domestic assistance: cleaning, preparing food, washing clothing, shopping, gardening; and c) Social support: attending outings to maintain community connections.	[FACS/ADHC]
21	a) Brain Injury from a spontaneous intracerebral bleed into the brain stem from an arteriovenous malformation; b) Quadriplegia, requiring full-time ventilation; and c) "Locked in syndrome", where the patient is cognitively alert and orientated, however control over the person's physical functions has been severely impaired.	49 hours FaCS Funding Agreement 1/07/15	a) Personal Care: Ventilator and humidification set-up and management, Tracheostomy care, tube changes, suctioning, neck care and tape changes, Gastrostomy feeds, site care and reporting on nutritional status, assist with medications, mouth care, bowel care, suprapubic catheter, application of splints/passive range of movements, physiotherapist regime, bathing/showering and dressing, positioning and transfers - managing the client in a powered/manual wheelchair, eye care, suprapubic catheter care, pressure- relieving mattress management, monitor for autonomic dysreflexia; b) Social Assistance: normal adult activity interaction with the client, e.g. through a variety of communication methods; c) A Nurse Educator (A Registered Nurse with a post-registration certificate, experience or other appropriate qualification) to conduct an education program, skills-based and assessment of competency, for [Support Workers]. This will include client-specific mechanical ventilation management and tracheostomy care; d) 24-hour on-call service by a person to troubleshoot any problems with ventilation equipment, including identification of the specific issue and appropriate referral; e) Be available to family/carers and care staff for consultation and education in all aspects of home mechanical ventilation as needed; f) Liaise with the Area Health Service Contact and EnableNSW to ensure ventilators and all equipment required for home ventilation is maintained and serviced; g) Liaise closely with the Area Health Service EnableNSW to ensure ongoing effective use and maintenance of equipment; and h) Domestic assistance: vacuum, dust, clean bathroom, wash floors, change bed linen, wash dishes	[FACS/ADHC]
68	a) Spinal Cord Injury level C4, sustained in a bicycle fall in May 2012. While able to walk short distances, requires wheelchair for longer distances; and b) Sleep apnoea.	26 hours FaCS Funding Agreement 1/07/15	a) Personal Care (24 hrs per week): Continuous positive airway pressure (CPAP) at night, Showering and personal hygiene, catheter care, grooming, dressing, mobility assistance, medications, outings; b) Domestic assistance (2 hours per week): vacuum, cleaning, washing, ironing, change bed linen, shopping, food preparation.	[FACS/ADHC] ATC 24747
71	a) Spinal Cord Injury - C6 complete quadriplegia, sustained in an injury in February 2011. The person has very limited movement in his arms and hands. b) Neurogenic bladder and bowel.	28 hours FaCS Funding Agreement 1/07/15	a) Personal Care: Showering and Hygiene, transfers, skincare, Suprapubic catheter care, shaving; and b) Domestic assistance: Washing.	[FACS/ADHC]
74	a) Quadriplegia.	28 hours FaCS Funding Agreement 1/07/15	a) Personal care: showering, oral hygiene, toileting assistance, grooming, dressing, skincare, transfers; and b) Domestic assistance: prepare food, dust, clean bathroom wash floors, wash dishes, sweep the floor, clean kitchen.	[FACS/ADHC]
77	a) Spinal Cord Injury secondary to tumours in cervical and thoracic as an infant at six months old.	46 hours FaCS Funding Agreement 1/07/15	a) Personal care: Medication assistance, positioning, transfers, shower and hygiene, bowel management, suprapubic catheter management, skincare, grooming, exercises; and b) Domestic assistance: Meal preparation, washing, ironing, sweeping.	[FACS/ADHC] ATC 24748
187	a) Acquired Brain Injury, from b) Ruptured carotid aneurysm; and c) Subarachnoid haemorrhage.	35 hrs FaCS Funding Agreement 1/07/15	a) Personal care: assist physiotherapy program, assist shower, assist dressing, skincare, oral care, continence management; b) Domestic assistance: prepare meals, take for a walk, tidy bed, and bathroom, change bed linen, clean bathroom, vacuum, dust, wash floors, put laundry away, tidy bedroom; and c) Social care; in respite care plans, to encourage leisure activities, encourage communication board use.	[FACS/ADHC]
355	a) Progressive Dematopolymyositis, an inflammatory disease affecting the participant's skin and muscles; b) Calcinosis, the formation of calcium deposits in any soft tissue; and c) Sepsis, an immune response to bacterial infection that gets into the blood	27 hrs SCCH Assessment 31/07/13	a) Personal Care: assist shower, assist dressing, skin care, foot care, assist with toileting, assist grooming, oral hygiene, monitor and supervise mobility, monitor pain, wound care, administer medications, continence management, assist with chair and bed transfers; b) Domestic assistance: Prepare meals, vacuum, dust, wash the floor, clothes washing, make the bed, attend shopping, wash bandages, Ironing, clean bathroom, collect mail; and c) Social care: shopping and lunch outings.	[FACS/ADHC] ATC 24749
367	a) Cerebral Palsy; and b) Epilepsy.	35.1 hrs FaCS Funding Agreement 1/07/15	a) Personal Care: assist shower, assist dressing, skincare, foot care, assist with toileting, assist grooming, oral hygiene, monitor and supervise mobility, assist toileting; and b) Domestic assistance: Prepare meals, vacuum, dust, wash the floor, clothes washing, make the bed, change bed linen, attend shopping, clean bathroom, wash dishes, wash clothes.	[FACS/ADHC]
380	a) Spinal Cord Injury (C4 Incomplete Quadriplegia), sustained in an injury in March 2012	26 hrs High Level Personal Care Needs Assessment 25/06/12	a) Personal Care: assist shower, assist dressing, skincare, foot care, assist with toileting, assist grooming, oral hygiene, monitor and supervise mobility, suprapubic catheter care and change, bowel management, monitor for dysreflexia	[FACS/ADHC]
58	a) Spinal Muscular Atrophy; b) Respiratory Distress Syndrome; and c) Seizures.	98 hrs SCCH New programs management May 2010	a) Tracheostomy care, including suction; b) Catheter care; c) Parenteral Gastrostomy care and management; d) Oxygen saturation monitoring; and e) Care on weekend outings.	[NSW Health]
9	a) Goldenhar Syndrome; b) Thoracic Cage Syndrome; and c) Tracheal Malacia.	100 Hours SCCH Assessment 6/1/14	a) Tracheostomy care; b) Percutaneous Endoscopic Gastroscopic (PEG) management; and c) Ventilator management.	[DoE] ATC 24750
66	a) Acquired Brain Injury; b) Quadriplegia; and c) History of Seizures.	168 Hrs SCCH Service user assessment summary 26/3/14	a) Personal care: showering, hygiene, grooming, dressing, eye care, foot care, oral hygiene, Bladder and Bowel management, Exercise program, Monitor skin integrity, application of creams, administer medications as ordered; b) Social support: outings; and c) Domestic support: cleaning, washing clothes, ironing, making the bed, emptying bins, shopping.	[NSW Trustee]
7	a) Spinal Cord Injury, T6 Paraplegia; and b) Brachial plexus injury left arm.	184 Hrs TAC Service claim 93/00091 23/12/11	a) Personal care: Showering, grooming, medications, catheter care, meal support, suprapubic catheter care, bowel care, repositioning, transfers; tilt table exercises daily b) Active Overnight Care: see TAC approval May and Dec 2011; c) Domestic assistance: tidy care work environment; d) Social care: supported leisure options, gym support workers, camps.	[TAC]
1235	a) C5 Incomplete quadriplegia, sustained in a motor vehicle accident in 2002.	35 Hours TAC Support Needs Approval 26/10/12	a) Personal Care: assist shower, assist dressing, skincare, foot care, assist with toileting, assist grooming, oral hygiene, bowel management, exercise regimen; b) Domestic assistance: Prepare meals, attend shopping, domestic; and c) Social care: community integration	[TAC]
12	a) Spasticity, dystonia, dysarthria resulting from a resection of right frontal ependymoma (type of brain tumour) when the person was 11 years old; b) Metastatic, colorectal carcinoma; c) Epilepsy; d) Depression; e) Left clavicular fracture; and f) Osteoporosis	52 hrs SCCH Individual plan - Service User 25/11/15	a) Personal care: Assistance with activities of daily living, preparing meals, feeding assistance, medication assistance; b) Domestic support: cleaning, meal preparation, vacuuming, dusting, washing changing bed linen; c) Transport for daily activities; d) Assistive technology; e) Social: assistance to access local community, assistance to manage money; f) Home modifications; and g) Improved life choices.	[NDIA] ATC 24751
195	No clinical information	2 Hrs SCCH Care / service plan domestic 21/11/13 Unclear hrs of personal care , SCCH service plan 21/11/13	a) Maintain personal hygiene b) Promote independence c) Assist service user to remain at home d) Avoid high levels of carer strain e) Maintain Skin integrity f) Improve cleanliness of user's home.	[DSS]
414	No clinical information	8 Hrs SCCH Service plan personal 7/2/12	a) Maintain personal hygiene; b) Promote independence; c) Assist service user to remain at home; d) Avoid high levels of carer strain; and e) Maintain skin integrity.	[DSS]
415	No clinical information	2 Hrs SCCH Service plan domestic 16/7/12	a) Maintain a clean and safe home environment; b) Identify and record safety risks; c) Assist service user to remain at home; d) Avoid high risks of carer strain	[DSS]
418	No clinical information	12 hours SCCH Service plan domestic 6/1/14 SCCH service plan community support 6/1/14	a) Reduce the social effects of isolation; b) Improve and maintain the cleanliness and safety of the person's home environment; c) Assist service user to remain living in their own home; d) Promote independence; and e) Reduce the effects of carer strain.	[DSS] ATC 24752
827	No clinical information	Unclear hours over 5 days SCCH Service Plan personal	a) Maintain personal hygiene; b) Promote independence; c) Assist service user to remain at home; d) Avoid high levels of carer strain; and e) Maintain skin integrity.	[DSS]
114	a) Osteoarthritis; b) Osteoporosis; c) Hypertension; d) Depression and anxiety; e) Gastric ulcer; f) Constipation; g) Irritable bowel syndrome; h) Kyphosis; and i) Thyroidectomy.	70 hrs Online RSD Transactions Robyn Shaw - 01994	a) Personal care (three days per week): shower, dressing, skincare, foot care, supervise mobility.	[DSS]
118	a) Three strokes; b) Pacemaker; c) Osteoarthritis; and d) Sleep Apnoea.	3 hrs SCCH Assessment 3/11/11 Domestic service hrs unclear Service plan domestic 26/5/14	a) Personal care: Showering; and b) Domestic assistance: Transport, house work, minor home maintenance.	[DSS]
191	a) Right Hip and Knee replacements, causing decreased mobility; b) Myocardial Infarction (heart attack) in January 2013; c) Anxiety; d) Hypertension; e) Gout; and f) Respiratory tract infections.	Unclear Hrs over 5 days SCCH service plan Sept 2013	a) Personal Care: assist shower, assist dressing, skincare, foot care, assist with toileting; and b) Domestic assistance: tidy bedroom, change bed linen, clean commode, dust furniture, prepare meals.	[DSS]
201	a) Chronic obstructive pulmonary disease; and b) Confusion and memory loss.	29.5 Hrs 05275 RCTI fn ended 11 Feb 2016	a) Personal care: assist shower, assist dressing, skincare, oral hygiene, tidy bathroom, tidy bed linen, assist with toileting.	[DSS] ATC 24753
229	a) Ischaemic heart disease; b) Hypertension; c) Cerebral Vascular Accident; d) Type 2 diabetes; e) Chronic renal impairment; f) Asthma; g) Hypomagnesaemia; h) Falls; and Hearing loss.	Unclear Hrs over 5 days SCCH service plan 2/5/14	a) Personal care: assist shower, assist dressing, skincare, oral hygiene, tidy bathroom, tidy bed linen, assist with toileting, monitor & supervise mobility, encourage and promote independence, wound care.	[DSS]
252	a) Ischemic Bowel, b) Cardiomyopathy; c) Atrial fibrillation; d) Congestive Cardiac Failure; e) Chronic Renal failure; f) Hypertension; g) Traumatic Brain Injury; h) Gastroesophageal reflux disease; and Hypercholesterolaemia	9 Hrs SCCH Assessment 23/12/13	a) Personal Care: assist shower, assist dressing, skincare, foot care, assist with toileting, oral hygiene, tidy bathroom, supervise and monitor mobility; and b) Domestic assistance: offer tea or coffee, vacuum, dust, clean bathroom, washing, ironing, change bed linen, was dishes.	[DSS]
296	a) Dementia; and b) Intellectual impairment	7.5 Hrs SCCH Service plan 12/08/14	a) Personal Care: assist shower, assist dressing, skin care, foot care, assist with toileting, shave, tidy bed, monitor and supervise mobility, assist grooming.	[DSS]

Footnotes

^[1] See s 32(2)(b)(iii).
^[2] Section 35.
^[3] Section 32(3).
^[4] Section 95 of the Administration Act.
^[5] See Tasty Chicks Pty Ltd v Chief Commissioner State Revenue (NSW) (2011) 245 CLR 446 ; [2011] HCA 41 at [12]-[20] .
^[6] See s 100(3) of the Administration Act.
^[7] Section 3.
^[8] See Home Care Service Act 1988 (NSW), which was repealed by cl 2(a) of Sch 4 to the Statute Law (Miscellaneous Provisions) Act 2016 (NSW) with effect from 28 June 2017.
^[9] See s 43(3) of the Lifetime Care Act (emphasis added).
^[10] See ss 11C(1) and 11C(2) of the Lifetime Care Act.
^[11] Within the meaning of s 4 of the Disability Inclusion Act 2014 (NSW).
^[12] As set out in the Disability Inclusion Regulation 2014 (NSW), Sch 1.
^[13] Clause 2.3.1 of the 2009 agreement provided that the “Department and the Service Provider recognise that the Service Provider is autonomous and acknowledge that, whilst receiving Funds from the Department for the Service, the Service Provider is not an agent, partner, employee or contractor of the Department for any purpose.” Clause 3(e) of the 2012 agreement provided that the “parties agree that we are not engaging you to provide Services on behalf of us and that you are providing the Services to the community on your own behalf.”
^[14] Clause 4(e) of the 2015 agreement provided that the “parties agree that we are not engaging you to provide Services on behalf of us and that you are providing the Services to persons in the target group (as defined in the DIA) on your own behalf.”
^[15] Section 10(2) of the NSW Trustee Act.
^[16] See s 61-1(1)(f) of the Aged Care Act.
^[17] See s 11 of the TA Act.
^[18] See s 12 of the TA Act.
^[19] See s 23 of the TA Act.
^[20] See [192]-[194] below.
^[21] World Health Organisation, “Continuity and Coordination of Care: A Practice Brief to Support Implementation of the WHO Framework on Integrated People-centred Health Services” (2018, Geneva) at 8.
^[22] See HRC Hotel Services Pty Ltd v Chief Commissioner of State Revenue (NSW) [2018] NSWSC 820 ; (2018) 108 ATR 84 and Bayton Cleaning Company Pty Ltd v Chief Commissioner of State Revenue (NSW) [2019] NSWSC 657 ; (2019) 109 ATR 879 (“Bayton”).
^[23] See UNSW Global Pty Ltd v Chief Commissioner of State Revenue (NSW) [2016] NSWSC 1852 ; (2016) 104 ATR 577 at [62] (“UNSW Global”).
^[24] See UNSW Global at [41].
^[25] See UNSW Global at [38].
^[26] See UNSW Global at [62].
^[27] See Bayton at [94]-[97].
^[28] See Bayton at [105].
^[29] New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 21 November 1979 at 3470-3471.
^[30] See ss 11 and 25 of the Area Health Services Act 1986 (NSW).
^[31] This Act also added s 10(1)(b2).
^[32] Note that by this point the Area Health Services Act 1986 (NSW) was repealed and replaced by the Health Services Act 1997 (NSW).
^[33] New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 7 March 2006 at 21148-21152.
^[34] See Commissioner for Superannuation v Miller (1985) 8 FCR 153 ; Our Town FM Pty Ltd v Australian Broadcasting Tribunal (1987) 16 FCR 465 ; Drayton v Martin (1996) 67 FCR 1 .
^[35] See Burswood Management Ltd v Attorney-General (Cth) (1990) 23 FCR 144 at 146 .
^[36] See above at [48]-[52].
^[37] See Deputy Commissioner of Taxation v Clark (2003) 57 NSWLR 113 ; [2003] NSWCA 91 at [142] .
^[38] See Grain Growers Ltd v Chief Commissioner State Revenue (NSW) (2016) 93 NSWLR 415 ; [2016] NSWCA 359 at [120] and [126].
^[39] See State Revenue Legislation (Miscellaneous Amendments) Act 1998 (NSW).
^[40] New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 14 October 1998 at 8287.
^[41] See Taylor v The Owners – Strata Plan No 11564 (2014) 253 CLR 531 ; [2014] HCA 9 at [38]-[39] (“Taylor”).
^[42] See Taylor at [38].
^[43] See Taylor at [39].
^[44] Cf. Moore Park Gardens Management Pty Ltd v Chief Commissioner State Revenue [2006] NSWCA 115 ; (2006) 62 ATR 628 .
^[45] See prayer 4 of the amended summons.
^[46] See Harrington Park Children Services (NSW) Pty Ltd v Chief Commissioner of State Revenue [2008] NSWSC 266 ; (2008) 71 ATR 143 at [18] .
^[47] See Smith’s Snackfood Co Ltd v Chief Commissioner State Revenue [2012] NSWSC 1116 ; (2012) 90 ATR 342 at [16]-[18] .
^[48] See Moore Park Gardens Management Pty Ltd v Chief Commissioner State Revenue [2006] NSWCA 115 ; (2006) 62 ATR 628 at [77] .
^[49] See Hollis v Vabu Pty Ltd (2001) 207 CLR 21 ; [2001] HCA 44 at [24] .
^[50] See Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 24 and 29; [1986] HCA 1 (“Stevens v Brodribb”).
^[51] See Hollis v Vabu Pty Ltd (2001) 207 CLR 21 ; [2001] HCA 44 at [68] and [71] ff.
^[52] See Jamsek v ZG Operations Pty Ltd (2020) 279 FCR 114 ; [2020] FCAFC 119 at [6], [182] and [212].
^[53] Stevens v Brodribb at 37.
^[54] See Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd (2015) 228 FCR 346 ; [2015] FCAFC 37 at [184] .
^[55] See Stevens v Brodribb at 37.
^[56] See WorkPac Pty Ltd v Rossato [2021] HCA 23 ; (2021) 95 ALJR 681 at [62]-[65] .
^[57] See, for example, WW Buckland, A Textbook of Roman Law: From Augustus to Justinian (3rd rev ed, 1963, Cambridge University Press) at 503-505; see also Theodor Mommsen, Paul Krueger and Alan Watson (eds), The Digest of Justinian (1985, University of Pennsylvania Press) (“Digest”) at 19.2.9.5; Digest at 19.2.19.9; Digest at 19.2.19.10; Digest at 19.2.22.2; Digest at 19.2.35.pr; and Digest at 19.2.51.1.
^[58] See Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance [1968] 2 QB 497 at 526 ; 1 All ER 433.
^[59] See Mondelez Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2020] HCA 29 ; (2020) 94 ALJR 818 (“Mondelez Australia”).
^[60] See Mondelez Australia at [41]-[42].
^[61] See Bridges Financial Services Pty Ltd v Chief Commissioner of State Revenue [2005] NSWSC 788 ; (2005) 222 ALR 599 at [220]-[221] .
^[62] See Bayton at [255] and [302], citing Lease A Leaf Property Pty Ltd v Chief Commissioner of State Revenue [2011] NSWADTAP 41 ; (2011) 85 ATR 273 .
^[63] See Adams Bidco Pty Ltd v Chief Commissioner of State Revenue [2019] NSWSC 702 at [156] , citing Trust Co of Australia Ltd v Chief Commissioner of State Revenue [2002] NSWADT 21 at [27] .
^[64] See Leffanue v Southern Cross Community Health Care Pty Ltd [2020] FWC 3122 .
^[65] See Winston-Smith v Chief Commissioner of State Revenue [2018] NSWSC 773 ; (2018) 108 ATR 63 at [82] (“Winston Smith”).
^[66] See Winston-Smith at [84]-[86].

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Southern Cross Community Healthcare Pty Ltd v Chief Commissioner of State Revenue (NSW)

Issue (1)A, Issue (1)B and Issue (1)C: Sections 37, 40 and cl 8 of Sch 2

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