Unfair termination remedies only available for workers behind the wheel most of the time

The Fair Work Commission (FWC) recently considered an application by the sole director of a transport company for a remedy for unfair termination under the Fair Work Act 2009 (Cth) (FW Act) scheme for regulated road transport contractors.

What is the unfair termination scheme?

The unfair termination scheme in the FW Act is a new scheme that covers regulated road transport contractors. This applies where a road transport business receives services under a services contract (whether or not the business is a party to the services contract). It protects a person who has been performing work in the road transport industry under the services contract, or a series of services contracts, under which that road transport business receives services for a period of at least 6 months.

If the scheme applies, the Fair work Commission (FWC) can order a remedy for the unfair termination of the regulated road transport contractor.

Owner drivers are one example of the type of regulated worker who may fit the definition of regulated road transport contractor.

Work will be performed under a services contract if it is performed pursuant to, or in accordance with, the terms of the services contract. If the party to a services contract is a company, partnership or trust, the scheme can protect an individual who is a director of the company, or a partner in the partnership, or a trustee or beneficiary of the trust. However, that person must earn less than the contractor high-income threshold ($175,000 per annum in 2024–2025) and perform all, or a significant majority, of the work to be performed under the services contract, not as an employee.

Case before the FWC

In Ho Wong v Sal National Pty Ltd (2025), the applicant for a remedy for unfair termination of a services contract worked in the business, in his capacity as a director, on a full-time basis. He is not employed but receives director’s fees from time to time.

The FWC ruled that when the contract was terminated, the applicant was not performing all, or a significant majority, of the work to be performed under the contract. This work was performed by the delivery drivers working for the company.

Therefore, the director was not a regulated road transport contractor when the contract was terminated, so he was not protected from unfair termination under the FW Act scheme.

Lessons from the case

The unfair termination scheme is not intended to provide protection against the unfair termination of commercial contracts between businesses where the business engaged to perform the work employs multiple employees to do the work. The protections are limited to circumstances where a person performs all, or a significant majority, of the work to be performed under the services contract.

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