Australian firms face compliance challenges after offshore work ruling
BRISBANE, AUSTRALIA — The Brisbane-based Doessel Group has defended its outsourcing practices after a landmark Fair Work Commission (FWC) ruling determined that a Filipino paralegal, Joanna Pascua, was in fact an employee—not an independent contractor—entitling her to Australian workplace protections and minimum wage.
Graham Doessel, founder of the group, argued that the economic pressures facing Australian businesses make offshore hiring a necessity. “Those who are employing offshore workers are doing it because they can’t afford in the current economy to have the same work done by Australian employees,” he said in an exclusive interview with ABC News Australia.
The company had paid Pascua AU$18 (US$11.63) per hour—above Philippine standards but below Australia’s minimum wage of AU$24.87 (US$16.06) per hour.
Doessel Group maintained that Pascua was engaged as an independent contractor under a contract that referenced the term “independent contractor” 52 times, compared to just five mentions of “employee.” The company emphasized Pascua worked from the Philippines while lacking an Australian work visa, and this established she did not fall under Australian employment law.
The FWC, together with its appeals panel, rejected Doessel Group’s arguments because Pascua performed employee-level work as a paralegal by working under direct supervision while being paid by the hour and having no control over her work, which established her employee status under Australian law. The Commission rejected Doessel Group’s appeals because Pascua’s location did not impact her employment status, as the employer operated under the Australian national system framework.
Filipino paralegal’s case sets precedent for offshore workers
Joanna Pascua, who worked as a paralegal for Doessel Group’s MyCRA Lawyers arm from Manila, told ABC News Australia, “Australian law is very considerate on the actual circumstances of the consumer or the individual [and disputes] will get sorted out in a very fair way.”
The employee filed an unfair dismissal claim because she denied taking company information but received a termination notice.
The court decision of Pascua sets an example for offshore workers who want to make similar claims against Australian companies that employ them through offshoring. Experts predict that this court decision will lead to numerous minimum wage claims and unfair dismissal complaints and potential class-action lawsuits against wage theft offenders.
Brisbane lawyer Alex Moriarty, who defended Pascua, explained that the ruling makes it clear companies cannot avoid workplace protections by hiring offshore workers.
Derek Gallimore, CEO of Outsource Accelerator, added, “This ruling has dramatic implications for people who use ‘freelance’ offshore workers. The case determined that a Filipino worker (living in the Philippines) would be treated the same as an Australian worker and could expect compensation for unreasonable employment practices.”
“People also wrongly assume that hiring someone on a ‘contract’ basis eliminates the requirement to abide by the employment laws of the land. This is not the case,” Gallimore added.
Implications for Australian businesses and global outsourcing
The FWC ruling demonstrates that employment status cannot be determined by the labels assigned in contracts. The tribunals will assess the actual working relationship dynamics involving control, integration, and compensation to establish whether offshore workers qualify as employees.
The latest ruling presents further compliance issues for Australian companies that have to modify their outsourcing strategies to offer equal employment rights and pay to local and foreign employees. From January 2025 until the end of the year, wage theft will be recognized as a criminal offense throughout Australia, therefore raising the legal implications for companies that neglect to correctly categorize their employees.
The present situation shows a major change in global outsourcing rules, which influences company organization of their foreign staff and guarantees adherence to Australian labor laws.
