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Supreme Court of Vanuatu |
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IN
THE SUPREME COURT
OF
THE REPUBLIC OF
VANUATU
(Criminal
Jurisdiction)
CRIMINAL CASE No. 39
of 2002
PUBLIC
PROSECUTOR
-v-
MARKE
LOWEN
Coram: Chief Justice
Vincent Lunabek
Counsels: Daniel
Evans for the Public Prosecutor
John
Malcolm for the Defendant
JUDGMENT
This is the judgment of
the case. The defendant Marke Lowen is the owner and Manager of the Port-Vila
Presse, a newspaper business
which has commenced publishing in Port-Vila in
November 2000.
The prosecution
alleges that staff working at Port-Vila Presse were engaged as employees and
therefore the provisions of Vanuatu National Provident Fund Act [CAP. 189]
(‘the Act’) are binding upon the defendant as their employer. The
defendant is charged and he pleaded not
guilty to 270 counts under the VNPF Act
[CAP. 189]. It is then apparent that at the end of the prosecution case the
prosecution having
not called evidence in relation to some other counts such
counts must now have been withdrawn. They are so withdrawn. At the end
of the
prosecution case, the prosecution proceeds with 138 counts against the defendant
under the VNPF Act [CAP. 189]. These counts
are set out
below:
Count
1:
This count relates to the
defendant failing to register as an employer pursuant to Section 22 and 50(1)(b)
of the Act.
It is particularized
that Marke Lowen (trading as Port Vila Presse) being the sole proprietor of Port
Vila Presse a news media business
in Port-Vila, having as at November 1999... as
employees for whom you were liable to pay contributions to the Fund for, you did
fail
to register yourself and Port Vila Presse as an employer liable to
contribute to the
Fund.
Counts 29
to 45:
These counts relate to 3
separate offences in relation to Akesha Litch. Namely to register Akesha Litch
as an employee contrary to
Section 50(1)(b) of the Act, failing to pay
contributions contrary to Section 26 and 50(1)(c) of the Act and, having failed
to pay
the applicable contributions, failing to pay the surcharge contrary to
Section 26(2) and 50(1)(e) of the
Act.
It is particularized that the
defendant failed to cause Akesha Litch to be registered as a member of the
Fund.
It is also particularized
that the defendant failed to pay VNPF contributions in relation to Akesha Litch
for the months of September
2001 to April
2002.
It is further particularized
that the defendant having failed to pay VNPF contributions, failed to pay the
surcharge due at the rate
of 2% per month from the month of November 2001 to
June
2002.
Counts 46
to 78:
Those counts relate to 3
separate offences in relation to Rex Issachar. Namely, failing to register Rex
Issachar as an employee contrary
to Section 50(1)(b) of the Act, failing to pay
contributions contrary to Sections 26 and 50(1)(c) of the Act and, having failed
to
pay the applicable contributions, failing to pay the surcharge contrary to
Section 26(2) and 50(1)(e) of the
Act.
It is particularized that the
defendant failed to cause Rex Issachar to be registered as a member of the
Fund.
It is also particularized
that the defendant failed to pay VNPF contributions in relation to Rex Issachar
for the months of January
2001 to April
2002.
It is further particularized
that the defendant having failed to pay VNPF contributions, failed to pay the
surcharge due at the rate
of 2% per month from the month of Januaty 2001 to June
2002.
Counts
151 to 182:
Those counts relate to
2 separate offences in relation to Winston Tarere. Namely, failing to pay
contributions contrary to Sections
26 and 50(1)(c) of the Act then, having
failed to pay the applicable contributions, failing to pay the surcharge
contrary to Sections
26(2) and 50(1)(e) of the
Act.
It is particularized that the
defendant failed to pay VNPF contributions in relation to Winston Tarere for the
months of January 2001
to April
2002.
It is also particularized
that the defendant having failed to pay VNPF contributions, failed to pay the
surcharge due at the rate
of 2% per month from the month of March 2001 to June
2002.
Counts
183 to 212:
Those counts relate to
2 separate offences in relation to Jonas Cullwick. Namely, failing to pay
contributions contrary to Sections
26 and 50(1)(c) of the Act and, having failed
to pay the applicable contributions, failing to pay the surcharge contrary to
Sections
26(2) and 50(1)(e) of the
Act.
It is also particularized
that the defendant failed to pay VNPF contributions in relation to Jonas
Cullwick for the months of February
2001 to April
2002.
It is further particularized
that the defendant having failed to pay VNPF contributions, failed to pay the
surcharge due at the rate
of 2% per month from the month of April 2001 to June
2002.
Counts
213 to 234:
Those counts relate to
3 separate offences in relation to witness Antony Ligo. Namely, failing to
register Antony Ligo as an employee
contrary to Section 50(1)(d), failing to pay
contribution contrary to Sections 26 and 50(1) and, having failed to pay the
applicable
contributions, failing to pay the surcharge contrary to Sections
26(2) and (50)(1)(e) of the
Act.
It is particularized that the
defendant failed to pay VNPF contributions in relation to Anthony Ligo for the
months of July 2001 to
April
2002.
It is further particularized
that the defendant having failed to pay VNPF contributions, failed to pay the
surcharge due at the rate
of 2% per month from the month of August 2001 to June
2002.
The charges are criminal and
carry punitive sanctions. As in any criminal trial the law is for the
prosecution to prove the case against
the defendant beyond a reasonable
doubt.
The relevant provisions of
the VNPF Act [CAP. 189] are set out
below:
Section
22 of the Act provides:
“Every employer who has in his employ any person for whom contributions are payable under this Act shall apply to the board [Vanuatu National Provident Fund Board] in the prescribed manner for registration as an employer liable to contribute to the Fund and shall be so registered by the Board”.
Section
23 of the Act provides:
“Every employer shall cause every employee of his to apply to the Board in the prescribed manner for registration as a member of the Fund and every such employee shall be registered as a member with effect from the date that contributions under this Act first became payable in respect of him”.
Section
26(1) of the Act provides:
“The employer shall pay to the Board the contributions payable in any month for and by all of his employees by the end of the following month in such manner and in such form as may be prescribed”.
Section
26(2) of the Act provides:
“Where the employer fails to pay some or all of the contributions due within the time specified in subsection (1) he shall be liable to a surcharge on the amount of the contributions not so paid at the rate of 2 per cent in respect of each month or part of the month after the due date for which the contributions remain unpaid...”.
Section
50(1)(b) of the Act provides:
“Any person who-
(b) In respect of whom the provisions of either section 22 or section 23 apply fails to apply for registration;
fails to pay to the Board in any month any amount which, under section 26(1), he is liable to pay in that month in respect of any employee;
...
shall be guilty of an offence and shall be liable on conviction to a fine not exceeding VT100,000 or to a term of imprisonment not exceeding 6 months or to both such fine and imprisonment.”
Elements
of the Offence that the Prosecution Must
Prove
In order to find the
defendant guilty, the prosecution must prove the following:
1. That the defendant was a “director, manager, secretary or other similar officer” of ‘Port-Vila Press’ or was a, “partner of the body corporate, firm, society or other body of persons or was purporting to act in such capacity”, in accordance with section 53 of the Act;
2. That the staff of ‘Port-Vila Presse’ were employees of the defendant’s business and did not fall within any of the exemptions detailed in the Schedule or section 34(6) of the Act;
3. That the employees of ‘Port-Vila Presse’ received in excess of VT3,000 in any given month during which they were employed by the defendant in accordance with section 25(2) of the Act;
4. Being an employer, the defendant failed to apply for Registration as a member of the Vanuatu National Provident Fund (the ‘Fund’) in accordance with section 22 of the Act;
5. That the defendant failed to cause employees to be registered with the Fund in accordance with section 23 of the Act and section 9 of the Vanuatu National Provident Fund (Registration and Contribution) Regulation [CAP.189] (the ‘Regulation’);
6. That the defendant failed to pay contributions to the Fund. Namely, the defendant failed to deduct the employees’ share of the contribution to the fund and failed to pay the employer’s share of the contribution to the fund;
7. That the alleged offending was committed with the defendant’s consent or connivance and that he failed to exercise such due diligence to prevent the commission of the offence in accordance with section 53 of the Act.
Applicable
Legal Principles
1. Status of
Staff: Employees vis-à-vis Independent
Contractors
In order for the
provisions of the Act to be binding upon the defendant it is necessary for the
prosecution to prove that the staff
of ‘Port-Vila Presse’ were
employees, as opposed to independent contractors or agents. The prosecution
relies on the
definitions of employees’ and ‘employer’ as
provided in section 1 of the
Act.
To demonstrate that the staff
were employees, according to the definition prescribed by the Act, and by the
common law, the prosecution
relies on established common law tests. Several
tests have been developed by the common law. A brief summation of the main tests
follows:
(a) The
Control Test
At its simplest, the
control test relies on the degree of control exercise by the employer (master)
and the person alleged to be his
employee (servant). The greater the control
that the employer exerts over the supposed employee, the more likely courts are
to find
an employee-employer
relationship.
Control has been
described as follows:
“The relation of master and servant exists only between persons of whom the one has the order and control of the work done by the other. A master is one who not only prescribes to the workman the end of his work, but directs, or at any moment may direct, the means also, or as it has been put, “retains the power of controlling the work”: (Cropton J in Sadler v. Henlock (1855) 1198 E 209). A servant is a person subject to the command of his masters as to the manner in which he shall do his work: (see per Bramwell LJ in Yewens v. Noakes (1880) 6 QBD 530 at 532) and the master is liable for his acts, neglects and defaults, to the extent specified. An independent contractor is one who undertakes to produce a given result, but so in the actual execution of the work he is not under the order or control of the person for whom he does it, and may use his own discretion in things not specified beforehand.”[1]
It is
necessary to take into account all of the features of the relationship between
the defendant and his staff to determine the
degree of control. It is also
important to note that Courts have stated that the important feature of control
is not the actual exercise
of control, but the right of a supposed employee to
exercise it.[2]
In
Performing
Rights Society Ltd v. Mitchell and Booker (Palais de Danse)
Ltd
[1924]
1 KB 762 it was said that one must look
at the following matters, inter alia, to help determine the degree of control
and, accordingly, the
nature of the relationship:
• The nature of the task undertaken;
• The freedom of action given;
• The magnitude of the contract amount and the manner in which it is to be paid;
• The powers of dismissal;
• The circumstances under which payment of the reward may be withheld.
Whilst
not exhaustive, the above list provides guidance as to those features indicative
of
control.
(b) ‘The
Organization Test’
Put
simply, the Organization Test prescribes that an employee’s work is done
as, “an integral part of the business”,
whereas an independent
contractor’s work, “is not integrated into it but is only accessory
to
it.”[3]
Therefore, the more central the alleged employee’s work is to the primary
business, the more likely that worker will be found
to be an
employee.
This test has been subject
of judicial
criticism.[4]
Accordingly, today it is typically treated as just one matter to take into
account in determining the nature of the relationship.
(c) ‘The
Multi-Factor Test’ or ‘Multiple
Test’
This test prescribes
that no none test is fully indicative of the nature of the relationship. This
test is currently the most widely
accepted test in the common law
world.[5]
In addition to the above tests the following indicia, inter alia, must be
considered:
• The provision and maintenance of tools and equipment. If a worker supplies their own equipment, this, prima facie, suggests an independent contract;
• The granting of annual holidays, sick leave, long service leave and the like. If the worker has to make their own provision for holidays and sick leave, this will indicate an independent contract;
• The need to report one’s comings and goings. If a worker must inform someone of their movements this will suggest an employee-employer relationship;
• The hours of work. If the place and hours of work are not at the discretion of the worker, then this will simply that the worker is an employee;
• The right of a person to delegate the work which he or she has agreed to do. If the worker is able to delegate the work to others, it may indicate that he or she is under an independent contract;
• The right of a person to incorporate and perform as a person in business on his or her own accord. If the worker operates under the name of a company or a registered business name, this will be a sign that the worker is engaged as an independent contractor;
• The mode of remuneration. If payments are made by means of ‘lump sums’, or reimbursement on the submission of invoices, this will be indicative of an independent contract;
• The ability of the person providing services to work elsewhere. If the worker is able to offer his services to others this will be indicative of an independent contract.
• A legal intention to be engaged as an independent contractor.
The prosecution says that
the ‘multi-factor’ test is not a formalized test which allows for
the definition of employer-employee
or independent contractor to be positively
determined by the application of any one factor alone. Instead, the prosecution
says that
all the indicia present in the case must be balanced in order to
arrive at a final
conclusion.
(d) Appropriate
Test
The prosecution submits that
the issue of who is an employee and who is an independent contactor must be
approached on a case-by-case
basis. The prosecution contends that all of the
tests detailed above must be utilized in order to arrive at a correct and
balanced
outcome. In this regard, the prosecution argues that, in keeping with
other common law countries, the multi-factor or multiple approach
should be
adopted in Vanuatu. The degree of weight to be place on any specific indicia is
a matter for the Court. The prosecution
contends, however, that the degree of
control exercised by the defendant should be given prime
consideration.
The prosecution
adopts the words of the High Court of Australia:
“But the existence of control, whilst significant, is not the sole criterion by which to gauge whether a relationship is one of employment. The approach of this Court ahs been to regard it merely as one of a number of indicia which must be considered in the determination of that question:... other relevant matters include, but are not limited to, the mode of remuneration, the provision and maintenance of equipment, the obligation to work, the hours of work and provision for holidays, the deduction of income tax and the delegation of work by the putative employee.”[6]
Contract
of Employment
The prosecution
alleges that the staff of ‘Port-Vila Presse’ were employed under
contracts of employment.
The
prosecution makes the following points in relation to contracts of
employment:
(a) Contracts of employment need not be reduced to writing but can be oral (see section 9 Employment Act [CAP. 9] and section 1 VNPF Act [CAP. 189]);
(b) When an employment contract is not reduced to writing and is not orally expanded upon, various implied conditions are attributed by the common law;
(c) If the Court accepts that the employment contract in this matter was not reduced to writing, there are no express contractual provisions that can help the Court in determining the nature of the relationship;
(d) If the staff of ‘Port Vila Presse’ are found to be employees, all of the provisions of the Employment Act [CAP. 9] are binding upon the defendant.
Matters
to be raised by Prosecution in Determining
Staff
The prosecution will raise
the following matters, inter alias, in order to prove that the staff of
‘Port Vila Presse’
were employees and not independent
contractors:
1. The provision of equipment;
2. The method of engagement;
3. The method of payment;
4. the degree of control exercised by defendant.
This will entail looking at matters such as:
• Working hours;
• The requirement to attend work;
• Superiors;
• Place of work;
• Holiday arrangements;
5. The degree of skills of staff;
6. The intention of staff (i.e. on what basis they believed they had been engaged.
7. Whether staff were in a business or their own;
8. The ability of staff to delegate their work.
Status
of Defendant
The prosecution
alleges that the defendant was the director and manager of ‘Port Vila
Presse’. In accordance with section
53 of the Act the defendant, if found
to fail within the category of individuals outlined, is liable for any offences
committed by
the body corporate under the
Act.
The defendant, by his own
admission, is the owner and publisher of ‘Port Vila Presse’. The
defendant was responsible for
the hiring of staff, interviewing of staff,
drafting of internal policies, communication of work policies and procedures and
acting
as a spokesperson for the business. Staff considered the defendant to be
the head of ‘Port Vila
Presse’.
The purported
‘Independent Contractor Agreement’ details the contracting party as
‘Marke Lowen / Port Vila Presse’,
indicating an apparent ability to
contract on behalf of the
company.
Failure
to register as an Employer / Failure to register Employees / Fails to pay
Contributions / Fails to pay
Surcharge
The prosecution will
rely on the evidence from the VNPF Investigator and the staff of Port Vila
Presse in relation to the above
matters.
The defence case is set
out below:
The defendant says that
he is not required to be registered as an employer under count 1. In respect to
other counts the defendant
says that he is not required to pay VNPF
contributions. There is no requirement for him to pay surcharges. The basis of
the defence
is that each of the remaining counts relates to all people who are
contracted as self-employed people. These people commenced their
contract under
an old oral agreement. Defence says the initial confusion was put into writing.
In the circumstances of this case
the defendant says the business licences were
not required as journalists are exempted under the Rates & Taxes
legislations (Exh.D1).
The defendant further says that because the people
engaged are self-employed the defendant did employ anybody except himself. If
self-employed people wanted to pay contributions that is a matter for
themselves.
The defence accepts
the definition of employee contained in VNPF Act section 1. The defendant says
that the issue in this case is
what constitutes the contracts of service. The
defence accepts the multi-factor test on determining whether it is the contract
of
or
for
service and the entire factual situation needs resolution the paramount factor
being controlled.
The multi-factor
test is adopted by the Court to determine whether the contract is a contract of
service or for service. The Court
relies also on the persuasive authorities
submitted by the prosecution in their submissions for guidance. But in any
event, the law
that must be applied by the Court in the present case is the VNPF
Act [CAP. 189].
I turn now to
consider the
evidence.
The
summary of the evidence
Summary of
the prosecution evidence
Jonas
Cullwick is the first prosecution witness. This witness gave evidence to the
following effect. He is 50 years of age. He is
from Maewo residing in Port-Vila.
Before he joined Port Vila Presse he worked for Radio Vanuatu until 2000. He
started work with
Port Vila Presse in January 2001 as sub Editor. He said he
immediately reported to the Editors Ricky Binihi and Shirley Joy. He said
the
defendant was the owner of the Port Vila Presse. He came to see the defendant
Mr. Lowen. Mr. Lowen told him that they had a job.
He said he called the
defendant a couple of months later, he called him again and Marke Lowen told him
that he has a job for him.
He said he went to see the defendant at his office at
Port Vila Presse. He said he asked the defendant about the requirement of the
job and the basic requirements about an employee. He was given the job. He said
he met Lowen in his office two years ago. He said
he asked him about the
conditions of employment. The defendant told him he will be paid 80,000 VT per
month. He did not sign any
contract at that time. He did not recall the
defendant told him or mentioned about an independent contract. He said he told
the defendant
that he needed a job. He mentioned that the editor Ricky Binihi
assisted him by saying what are the requirements of the job. The
system is that
he did the work he has to do. He said that he needed to tell somebody that he
would leave. His superior would help
sometime. He worked at Port Vila Presse
mostly from 8.30AM sometime earlier. His job requires not to go to hold up the
papers going
on presse. He finished at work mostly at 5.00PM o’clock. He
worked same hours every day. If he was allowed he could have worked
on different
times. If he did not turn up he needed to inform someone so that the papers are
not held up. He gave evidence that he
remembered the defendant as Manager tried
to get them signed on a board when they are going in and out. As to equipment he
said he
used computers belonging to Port Vila Presse. He has no computer. He
never worked at home. He would like to work at home. This would
require an
agreement with the employer. He was paid twice, on the
15th
and at the end of the month. He did not receive slip of salaries. At once he and
others were required to sign invoices on receiving
payments. The Finance Manager
prepared invoices. He did not prepare them. He said Lowen told them that they
need to sign invoices.
It would be easy for employees. He started to sign
invoices two months after he started work with the Presse. Then he said they
stopped
to sign invoices for some reasons. He gave evidence that he and others
received an increase from 80,000 VT to 100,000 VT in January
2002. He said Mr.
Lowen decided to give them increases. He said they asked him about different
things as to the structure. But Lowen
gave them increases instead. He gave also
evidence that if you need minor or petty things then Port Vila Presse pay for
those. He
said he never take any holiday leave apart from public holiday. He
never arranged for someone else to do his job at Port Vila Presse.
He said he
did not think that someone outside can come in and do his job. He said they are
not required to work anywhere else. He
would like this to happen but he said the
organization would not allow him to get paid. He said when people asked him
where he works
he said he was working for Port Vila Presse. He said when he
started to work with Port Vila Presse he did not really know what was
going on.
He said he thought it was left in various situations. He denied that he ever
talked to a person in Port Vila Presse of
the status of work. He did not have a
business licence. He never applied for one. He mentioned about some arrangements
but he cannot
recall. He was registered with VNPF. He does not think any payment
for his VNPF accounts is paid. He made reference to a meeting.
He said a letter
was drafted to enquire about their VNPF situations. The letter was sent to
various authorities including the defendant
Mr.
Lowen.
This witness says that he
did not enter into a contract of independent contractor with Mr. Lowen. He made
reference that there was
some attempts at the beginning of the year. He said he
told Marke Lowen that he could not sign the contract. That was sometime in
mid
May 2002. He said the letter he made reference to came from the administration.
He said he got a letter he felt he could not
sign the contract. He said he
needed to discuss and agree to some of the points in the contract. He said that
is the contract. He
said he was asked to sign it instead. He mentioned that he
did on several occasions have meeting with the defendant about his employment
status. He denied that he never employed staff to work for him when he is at
Port Vila Presse.
This witness
was cross examined. He confirmed that prior to working at Port Vila Presse he
was employed by Radio Vanuatu and VBTC.
He was appointed as General Manager of
VBTC continuously for 26 years. He left VBTC about October 2000. He mentioned
that he did
not resign but he was dismissed. There was an argument between the
Board and himself he got paid and he left. He confirmed he started
work with
Port Vila Presse sometime in February 2001. He confirmed he used computers for
Port Vila Presse. He said he has a computer
at home but his computer is not the
type of computer that defendant Lowen has in the office. However he said that
the difference
between the computers is not a matter. He mentioned that a
computer in Port Vila Presse is able to fit into any information that
was placed
in. He mentioned also he needed to work into the computers to place the stories
into the computers. He did not control
any body. His work is to check and make
corrections of the stories. This is his main job. He did not contract any body
to do his
job. He was then asked if from day one he was told he is an
independent contractor. He said that he could not say that he is an independent
contractor. He said he did not think that he recalled about the independent
contractor in the first day of his work. He said he talked
about the conditions
of the work. He said he cannot recall that he discussed about the status of VNPF
on the first day of work. He
confirmed he had never applied for a business
licence. And he was shown a document Exhibit D.1 he confirmed his signature, his
name
but he said it is not his writing. He said the signature on the document
was his signature and the date is 8 February 2001. He said
despite signing this
application form for business licence he never received a business licence. He
said further that Mr. Lowen came
with this paper but he told him he could not
sign it. He pointed out that he could not sign it. He told Mr. Lowen that he
needed
to read through the document. He said he did not see any contractual
document to confirm he was an independent contractor. He explained
that he was
looking for clarification. He was asked that if a letter of complaint was
drafted by him. He said that it was the decision
of the staff. He confirmed the
staff did not want to loose their job. He was asked as to why he refused to sign
the contract. He
said that the conditions of the contract did not suit him. He
said on several times he talked in respect to some parts of the conditions
of
the contract relative to the pay of the position. It was put to this witness
that he was asked to be on independent contractor.
This witness confirmed that
he did not have the contract on the first day of his employment. Mr. Lowen told
him that he could no
longer employ him. The witness said he had no input in the
contract. He said he has no copy of the said contract. The witness was
shown a
document he was asked to sign. The document was entitled independent contractor
agreement. The witness says he did not recall
about this document. The witness
says further that he has no problem with the contract. He confirmed that he
never signed such a
contract. A letter of complaint was shown to the witness.
The witness says he wrote the letter and signed the letter. He pointed
out that
the complaint is made by the staff of Port Vila Presse. It is a collective
decision. They accepted it. He said the staff
expatriate working with Port Vila
Presse is not the issue. It is the rights of ni-Vanuatu employees to get their
status cleared.
It was suggested to this witness that he spoke to the defendant
lots of time about their contracts. The witness accepted he spoke
to the
defendant about his and others’ employment status. He said he saw a copy
of the contract a week before he left sometime
on May 2002. He confirmed his job
is just editing newspapers. He confirmed the defendant does not allow him to
work at home. He said
there are hours for the work to be done. The most
important thing is to get news on paper. He did not recall that Mr. Lowen took
him in his office and told him that he would be an independent
contractor.
He was re-examined. He
confirmed the signature on the business licence document is his signature. He
said the Administrator filled
the document out. The Manager thought it would be
quicker. He said the office of the Port Vila Presse lodged the application for
business licence when they started to discuss about the employment issues
sometime in August 2002. He denied he did ask the business
licence to be filled
up for him. He said the staff needed to have their status clarified as to
whether they are employees or independent
contractors. He said he was not shown
a copy of the contract where the contract was mentioned. Further he said after
the form was
filled in no Rates & Taxes were sent to him. He was shown the
document D.2 he said he did not know who wrote the word ‘absent’
before his name on that paper. He did not encourage anyone to sign the document
He said the staff went together and asked him to
write the complaint letter. He
said he wrote it as requested and all staff saw the content of the letter, read
the letter and signed
it. He said that at that stage ni-Vanuatu employees needed
to be recognized also. He clarified that the document entitled
‘independent
contract’ was shown to him for the first time in May
2002. Prior to May 2002 he had never seen such a document.
Akesha Litch is the second
prosecution witness. She gave evidence to following effect. She started work
sometime in September 2001
at Port Vila Presse. She says she does reporting from
the Court House and she is a journalist. She gave evidence that at first, when
she started she assisted in the laying out and advertising and she does
research. Mark Lowen is the publisher of the Port Vila Presse.
Her job was
advertised in the newspaper. She applied for it and Marke Lowen accepted it. And
said he had a job for her. She described
her duties as to write and be a
journalist. She mentioned she wrote by e-mail for the application. She applied
for the vacancy of
the position. She was interviewed for the position by the
defendant Marke Lowen. Marke Lowen told her that she would be paid every
fortnight, every two weeks. She said when she started there was no contract. She
said Marke Lowen told her that she was accepted
and she will be paid like all
other staff Marke Lowen told her that he has some important work for her to do.
She said Marke Lowen
did not tell her about the duration for work. But first
Marke Lowen told her that because of her legal background she needed first
to
make herself familiar with the workplace. When she just started work with Port
Vila Presse she said she assisted Mr. Lowen with
the competition. She gave also
evidence that she has no other superior than just Marke Lowen. He was telling
her what to do with
the competition. He told her to take the names and
subscription for competitors. She says that is important for her to be familiar
with everything in the newsroom. She says as a matter of common sense she will
tell Lowen if she wanted to go home. Her usual working
hours is from 7.30AM to
11.30AM – 1.30PM to 5 to 5.30PM. Sometimes she worked after these hours.
She said if she did not turn
up at work somebody will ring and ask and nothing
will happen to her wages. As to the equipment she says she used a computer,
telephone
they are the Port Vila Presse’s equipment. She only works at
Port Vila Presse. She could not work at home. She would like to
but she could
not. She gave evidence that she was paid every fortnight. She received an
invoice which is already prepared by Port
Vila Presse Accountant. She read it,
check it and sign it. She gave description of the process of the invoice. She
says that every
pay day everybody was called one by one inside the office of the
Accountant. She called everybody she gave each of them their respective
salaries. Each one check and then each one is given an invoice. She said she had
never prepared an invoice. She said they received
a bonus at the end of the
year. She was told by the accountant that they received the pay rise that year.
She also gave evidence
that the Port Vila Presse pays for the first aid and bus
fares. Sometimes they ask for advances like 100 VT or 200 VT. She also said
that
every body take holiday after 2 years. She says she took her holiday. She wrote
a formal letter to Marke Lowen and asked if
she can take holiday leave. She says
she was never sick but her son was. She took 2 weeks holiday. After her holiday
she says she
received her pay. She received her normal salary. She said she
never organized the advertisement. Kone Betsy who works at the advertisement
section at the Port Vila Presse and she could not afford to call anybody. She
does not know if she could be allowed to work elsewhere.
She says she does not
run her own business. She does not know what business whether it is incorporated
or not. She says she is an
employed person. Her evidence is to the effect that
she was not told of the status of her employment at the beginning. She says
independent
contract was introduced in December 2001. She says she thought she
worked for Port Vila Presse before the contract starts. She says
that the
disciplinary process of Port Vila Presse is straight forward. She says if you
commit an offence or misuse of company money
you are just kicked out. She was
shown a document called a Philosophy Approach. She says at Port Vila Presse
Office they used to
hear about it. She says Mark Lowen used to talk to them
about it. She says that the Philosophy Approach is what they should do. She
further says that she does have a business licence, she has never applied for
one. She does not know whether a person applied for
it. She says to her
knowledge she is not registered with VNPF, that there is no contribution paid,
and she has not enquired about
it. She says she got paid more than 3,000 Vatu.
She gave evidence also that she saw that independent contract but she did never
see
who prepared it. She says they were told that they were just independent
contractors about October 2001 by the publisher of Port
Vila Presse. She says
she was not involved in the draft of independent contract. She said she heard
about the contract. It contains
conditions of the work like VNPF contributions,
salaries and they read through the contract and signed it. This is the only
independent
contract she signed with Port Vila Presse. She said they have a
meeting to clarify their contract. The publisher told them about
the contract
what they should do.
Akesha Litch
was cross-examined. She was shown a contract she says that this is her
independent contract dated 7 January 2002. She
said she signed the contract. The
contract is exactly the same contract for everybody. She shows the signature of
the defendant on
the contract. She gave evidence that before she came to give
her evidence in Court the defendant Marke Lowen has not threatened her.
She says
Lowen has told them to tell the truth. She further says that she received
summons to come to Court. She says that a policeman
came to their office and
told her to come. She says she signed the summons. The police officer did not
threaten her. As to her contract
she gave evidence that she was not forced to
sign the independent contract. She gave evidence that after she signed the
independent
contract she became an independent contractor. She also says that
she is aware about the notice of termination of the contract under
the
Employment Act. She also says that she did not wear uniforms. She was asked
about the Accountant and she says the Port Vila Presse Accountant is
Mrs.
Mussika. She also says that the contract is the basis for her to work at Port
Vila Presse. She confirmed that when she started
working at Port Vila Presse
Lowen talked to her in his room. She says she came to the office. She waited for
Lowen. He talked to
her about the work. They had coffee. At that time Lowen did
not say anything about employee, employer or independent contractor.
She said
Lowen said he had some work. She confirmed out of the money paid to her she does
not loose any money. She confirmed that
Lowen told her every week every body
must have a meeting. One of the matters would be the news week. She says also
that she could
not recall Marke Lowen mentioning about the Philosophy Approach
in the beginning but she says after she had worked for sometime she
says Marke
Lowen always told them that they must work together to make sure the papers come
out in time. She confirmed she does not
have a computer at home. She says she
could not because she came to Court and take notes. She gave evidence that
Mussika was the
Accountant. They signed documents invoices every month when they
started work until Linda Mussika
left.
Akesha Litch was
re-examined. She confirmed there is no independent contract mentioned at the
beginning when she started work. She
said she started work with Port Vila Presse
in September 2001. She confirmed she has no accountant outside Port Vila Presse
for her
other needs. She was referred to the meetings and she says she is
required to attend such meetings. She says it is a must for everyone.
Everyone
must attend.
Rex Issachar is the
next prosecution witness. Rex Issachar is 26 years of age and lives in
Port-Vila. He did not work now. Before
he worked at Port Vila Presse from
January 2001 until beginning June 2002. His job is sales officer. Sometimes he
does reporting.
Marke Lowen is a publisher. He regarded him as his superior. He
gave evidence that he saw a vacancy position so he applied for it.
He says there
is no specification mentioned in the vacancy. He applied by sending a letter. He
was asked for an interview. Marke
Lowen did interview him. He is not sure if
Marke Lowen said something about employment conditions. He said he was told he
would be
paid fortnightly. His task was to get advertisements. He said he did
not sign any contract during the interview. He mentioned that
Marke Lowen told
him that Port Vila Presse would be like part of our living not like other
newspapers. He said when he worked at
Port Vila Presse he has a superior who is
Marke Lowen. He told him what to do. He briefed him what type of advertisement
and prices.
He helped him with those things. If he has to leave office he needed
to tell one of the journalists. He worked from 7.30AM to 11.30AM
– from
1.30PM to 4.30PM. Sometime he finishes late. He could not work in different
hours. He said if he did not if he did not
turn up on the first allocation he
would have a word with Marke Lowen. He gave evidence about system of recording.
He said there
is a board he has to leave information on the board for Marke
Lowen. He gave evidence that he worked with computer of the Port Vila
Presse. He
said he worked at home by doing gardens. He did not write at home as journalist.
He was paid fortnightly, he received
pay slips. He did not prepare invoices. He
signed invoices one at a time. He started to sign invoices when Mussika was
employed by
Port Vila Presse as Accountant. He said he has never received a
bonus. He said he received a pay raise because Mr. Lowen made a promise
to all
staff that the following year there will be a pay raise. He is not sure about
any expenses paid by Port Vila Presse. He has
not taken any holiday when he
worked with Port Vila Presse apart from Christmas public holidays. He said he
was sick he was not paid,
he arranged for someone in the Port Vila Presse to do
the job but not a person outside the Port Vila Presse. She said she could not
get someone from outside. He gave evidence issues was raised by staff. Staff
wanted Marke Lowen to clarify whether they are contractors
or employees. He said
he was dismissed from Port Vila Presse because Marke Lowen told him that he
cannot continue to him. He said
he has never heard about Philosophy Approach. He
has no business licence. No person applied for business licence on his behalf.
He
was shown a document on which his signature appears. He confirmed it was his
signature. He said Marke Lowen gave him the document
for him to sign it (Exh.
P1). He said he was registered with the VNPF. He said he did not receive a
contribution to VNPF. He said
he enquired to Port Vila Presse staff but he was
told they cannot do that. He needed to do that for himself. He said if he got
into
an independent contract however, he could not recall about the date. He
said he did not prepare the agreement. Lowen prepared the
document. He said he
did not have input to the content of the agreement. He said he did not know much
about the content of the document.
That is the only document he
signed.
Rex Issachar was cross
examined. He confirmed he signed two agreements with Port Vila Presse. One
independent agreement for 2001 and
one for 2002. He confirmed document 2001 was
backdated (Exh. D8). He was not forced to sign the document. When he signed the
document
he said he is not sure whether he is contracted or he is an employee.
He said when he worked at Port-Vila Presse he was engaged in
various businesses.
He said he operates music shows in Vanuatu. He said he sold T-shirts as part of
No.2 promotion. He said he has
no business licence to operate those businesses.
He said after he worked at Port Vila Presse he carried on with some of those
activities.
He said he has a mobile phone at that time. However he said the
mobile phone was given to him by the defendant. At Port Vila Presse
he used
e-mail, computer, telephone for his own businesses. And sometimes he asked
Lowen. On leave holiday he got pay. He conducted
other business while working at
Port-Vila Presse. He has flexible hours. He worked at home. He has a computer at
home but he cannot
use that computer for work. He is not connected with e-mail.
It is impossible to transfer anything from his computer to Port Vila
Presse’s computer. On or about June 2001 the issue about business licence
arises and Lowen offered to complete and pay business
licence for him. He could
not recall that the business licence was never completed because he is exempted.
He recall about signing
a letter on August 11, 2001 written by Jonas Cullwick.
The letter came into being after there were discussions about the conditions
of
the staff. He signed that letter but he was not present during discussions. He
confirmed that the defendant told him that he could
not afford to pay him. He
denied that that allegation was raised at the time he left Port Vila Presse. He
said his dismissal from
Port Vila Presse was made before he left Port Vila
Presse. He confirmed that he did not pay any VNPF contributions. And he said
that
the reason is that he is an independent contractor. He said that he has
given opportunity of taking another job but he chose to be
an independent
contractor. He was asked if the contract of employment reflect the terms of work
in his understanding on the first
day he has started work. He said yes. He
recalled that he never employed someone else while working at Port Vila Presse.
He confirmed
that the management encourages all to work together as a
group.
Under re-examination he
says he could not recall about the date of the contract. He said one of the
contracts governed the past relations
with the defendant. He said he read all
the documents but he did not understand much. He was asked whether he could
explained what
is an independent contractor he said he is not so sure. Asked if
he is purported to be one. And he said yes. He said he did not recall
about
Lowen asking him to be an independent contractor. He said further that he is not
working as a journalist outside Port Vila
Presse. He said he used phone calls
then Lowen gave him a mobile phone. He said he has not a mobile phone at home.
Finally he said
that he did not sign an independent contract with the defendant
on the first day of his work with Port Vila
Presse.
Anthony Ligo is the next
prosecution witness. His evidence is to the following effect. He lives in
Port-Vila and works at Port Vila
Presse. He started sometime in June 2001. He
works as journalist. And delivered newspapers. Lowen is the Manager of Port Vila
Presse.
He gave evidence that he had 2 years contract with Unelco and he had
problems and then the contract came to an end and he was looking
for different
positions. He contacted the media they had discussions with Marke Lowen and he
approached Port Vila Presse and he agreed
to work with Port Vila Presse. He came
on and interviewed with Marke Lowen. He was then interviewed by Mr. Lowen. He
said Marke Lowen
accepted he came in on contract like every body. He agreed on
the contracted basis. He was paid for work done. He worked as part
of marketing
team. One or two months after Moses Stephens resigned he asked if he could leave
marketing and worked as sports journalists.
And he said he did his own articles.
He did his own stories. He said he work for himself. Mostly on Wednesday he said
he does not
work. He said he got paid with the work he did and he also got paid
for the distributions of the newspaper. He said he used the Port
Vila Presse
car. At Port Vila Presse he used computer when he did not have any computer. He
said Lowen provided something for convenience.
He said he collected news
outside, write it up and type it up at Port Vila Presse. He said he did not
receive pay slips. When Linda
Mussika was there he got invoices and signed them.
Once he got paid invoices were sent to him. He could not recall when he started
signing invoices. He mentioned that at the end of last year they got bonus.
Marke told them that they will receive bonus. He received
an increase because
Marke Lowen is happy of his work. He said he has never got holiday. When he
worked he said he asked someone in
Port Vila Presse to take his place. He asked
his wife to do distributions of papers with him. He produced one or two reports
outside
Port Vila Presse and he got paid for that work. He said he started work
on oral independent contract. And they talked about it. He
said Mark Lowen spoke
about Philosophical Approach. He said he will talk to them about this. He said
there is no need to get business
licence for journalists. That he could not
recall if someone applied for his business licence. He was told to get a
business licence.
He could not have one. He applied for it but he did not
receive it. He said he was told that because he was an independent contractor
he
has to pay for his own VNPF contributions. He said he signed a contract sometime
at the end of last year. He agreed before he
signed. He signed it on the same
date. And he made no amendments. And this is the only written contract he
has.
This witness was
cross-examined. He said he signed two documents (Exh. D10 & D11). To his
understanding the two documents reflect
his discussions before he started work.
He denied he ever spoke to the defendant’s counsel. He denied he ever
talked to the
defendant Mr. Lowen before he came to Court. When he signed the
contract he said he did not receive any threats and he said he was
told he
worked on contract individually he signed the contract after their discussions
as a group. So then he signed it. He gave
evidence that they used to pay lump
sums. So now Marke produces the system reflecting in the columns that is shown
to him. He said
that it was only a few months ago that the system of payment
changed to a situation whereby the staff would be paid on a different
basis. To
the journalists he said he knows the system and however for the rest of the
staff he did not know. He gave evidence that
he did not work every day in the
office. He does not record any time. When he was out of office he leaves a phone
call number. He
was given a mobile phone. He was doing his work on the field. He
wrote at home and type it on a computer in the
office.
His evidence is that after
a month of working at Port Vila Presse, they started to talk about their
positions in respect to their
status. There were discussions, how they work at
Port Vila Presse. It was clear that they do not get VNPF contributions. He said
they started to raise concerns. They decided to write letters. They wrote a
letter after they talked about their conditions. And
the situations are sorted
out. Those who are not happy have gone. He said he did not know who wrote the
invoices.
He was re-examined. He
said he works on Saturday as sports journalist. He never asked the defendant he
told him as soon as he finished
his work. Then he took a day off. He confirmed
that after they started work they were worried about their status. There were
lots
of discussions between them and the defendant Marke Lowen. Some of them
resigned. Others decided to stay.
The next prosecution witness is
Winston Tarere. Tarere’s evidence is to the following effect. Tarere is 28
years of age. He
worked with Port Vila Presse from January 2001. He is a
journalist reporter. Lowen is the publisher of Port Vila Presse. He wanted
to
join a newspaper. He found out a vacancy on paper advertisement. He wrote a
letter and sent it to current publisher. There was
no formal interview but he
talked with Lowen before hand. Marke Lowen told him what the job is all about.
He had a conversation with
Marke Lowen. He was told that he was joining the
Presse on a condition. Set the contract for a certain salary for 80,000 VT per
month.
He said he did not sign anything. He said he has superior, his editors.
He will consult them for help. He told them now and again
if he wanted to leave
the office. He was told to write down time he came in and out of the office. He
worked anytime. If he did not
turn up to work then that does not matter. He said
sometimes he went out he did get paid for what he did. In the office he used the
computer provided by the Presse. He did not provide for his own computer. He
does his work only at Port-Vila Presse. When he started
work he got paid every
fortnight,
15th
and
30th
of the month. As to the pay structure he does not think that there is a
structure. He said he does not receive pay slips. At one
stage he submitted
invoices. That had stopped. Everything has now taken care of for them. At some
stage invoices were made by Linda
Mussika. He received increase payment. The
publisher is happy about what they do. So they received a pay raise. He said for
expenses
a company pays for bus fares, books and pens. He did not have holidays.
He did not work for any body else. He said if he had opportunities
he will. When
he started work he was told about the contract. He said it is the first time
they enter into a contract. He said he
is not involved in any discussions about
the contract. He is not aware about disciplinary processes. He heard about
Philosophy Approach.
He said the publisher talked to them every day about
Philosophy Approach. He could not remember exactly all what was said. The
business
licence was filled up for him. Louise Cooper filled it up for him. But
not at his request. And he signed it thereafter. He is registered
with VNPF.
There was no monthly contributions received. He has to pay for himself. He said
now he is on an independent contractor.
They were asking for written contract
and the company produced it for them. The publisher prepared the contract for
them. He has
no input. He gave evidence before the contract came into being,
they talked about the conditions of the work. There was a letter
explaining how
they felt about the status of their
work.
This witness was
cross-examined. He said he never talked to the defendant’s counsel. He
said he never talked to Mr. Lowen before
he came to Court. He said he signed the
contract of his free will. He was re-examined. He confirmed that the contract
was never shown
to him on the first day of his starting work.
The second last prosecution
witness is John William Timakata. Timakata’s evidence is to the following
effect. Since 1999 he
worked with VNPF. He was the Manager Legal Compliance. Now
he worked as a Consultant. At VNPF, as Manager, he is responsible to ensure
that
all employers comply with the Vanuatu National Provident Fund Act. He confirmed
he was involved with the investigation of Marke Lowen the defendant. He further
said that the investigation is not
concerning Mark Lowen alone. There are
others. He said they have identified Marke Lowen in Port Vila Presse as an
established business
in town employing a certain number of people doing work at
Port Vila Presse premises. This is part of the check of the VNPF system
to
identify whether a business or an employer is registered. He said they do that
to Mark Lowen and businesses that were not registered.
They identified some of
the employees working at Port Vila Presse. They checked whether their staff
accounts were registered. Some
staff were not registered. Those who are
registered were registered by former employer. Those are Betty, Tony Ligo.
Akesha Litch
is a staff of Port Vila Presse. She is not registered. Issachar is
also not registered. His contribution is not paid. No VNPF contributions
paid
made to Tony Ligo. This witness says he was given a copy of the
‘Philosophy of Approach’. He spoke to Mr. Lowen.
He said they
explained to him what they are going to do at the premises. He said they
required him to inspect the documents and interviewed
the staff. He interviewed
the staff. He said Marke Lowen gave the document called ‘Philosophy of
Approach’. He did interview
the defendant in March
2001.
He was then cross-examined.
He was shown documents signed by some individuals. This witness says he has seen
the document and he says
those people confirmed that they self-employed people.
He was asked if self employed people do not require to contribute to VNPF.
He
said under the Act that is
correct.
This witness was
re-examined. He said the defendant was trying to sort out the situation when he
did the investigation. Business licences
were filled
up.
The prosecution last witness
is Edwin Kalorisu. Kalorisu is the Acting Deputy Commissioner of Labour. He is
in charge of staffing
and labour management. In August 2002 he received a copy
of a letter from the staff. He found it difficult because the staff were
employed for 9 months. He wrote letter advising the management. In his letter he
said the nature of work relationship is not
clear.
He was cross-examined. He
confirmed that the contract of employment can be oral. He said he wrote a letter
but there is no letter
to him in
reply.
Summary of the defence
evidence
The
evidence of the defendant, Marke
Lowen
Marke Lowen gave evidence to
the following effect. He lives at No.3 Port-Vila. He is a publisher. He owned a
newspaper, Port Vila
Presse. He started in November 11, 2002. He said the Presse
does not employ anybody. They did have a person from England who left
after 3
months. She is English. The majority of staff were working for VBTC. People who
came to Port Vila Presse were sacked from
VBTC. He had wanted to produce an
online news service. He spoke with Shirley Joy and Ricky Binihi. He told them to
buy news stories
if any of them were interested to sell stories to him. Shirley
and Ricky passed this information to their other colleagues who have
been sacked
by the VBTC. A meeting was arranged between himself and six former VBTC
employees. At this meeting he made it clear that
he wishes to purchase story on
a free lance basis. Due to past work practice which he felt contributed to the
internal problem of
the VBTC he decided to make it clear which he has made clear
to all subsequent people who wrote for the Presse that he is not prepare
to
employ journalists to write stories. He made it clear to all involved that he
did not wish to replicate the situation at the VBTC.
He was solely offering them
an opportunity to get of the street and make some money through writing stories
which he will choose
whether or not to
publish.
He gave evidence that in
November 2001 when they first commenced he paid a flat sum on the basis that the
people who worked at Port
Vila Presse had been without any form of income for
many months and it was done in order to help them out and get back on their
feet.
He gave evidence about how he started to pay those people. He said once
journalists were back on their feet it was agreed that they
would be paid by the
quality of their writings. Column centimetres. They are not required to work any
set of hours. No minimum hours
is set. He said there is indication as to how to
provide stories so he knows he will have enough material to put in the papers.
They
were free to write if they want. He accepted that there is evidence before
the Court that he provided apple computers. There was
no floppy disk facilities.
He confirmed also that the contractants have access to the internet. There is no
agreement preventing
any of the contractants to work at home. There is no other
constraints on them as if they wish to work at home, other than the fact
that he
has to be able to get their material into his computer system where the layout
of the newspaper is done by using specialized
software. If they wish to purchase
similar equipment or find a different means of formatting and sending their
writing they are free
to do so. In respect to newspapers other than the Presse,
he said there is no agreement preventing stories to be sold somewhere else.
People working at the Presse are free to do so. He said some of them have done
that elsewhere. The income that they earn in that
activity the Presse takes no
part of it. The contractants are not required to wear uniforms. He has no
agreement to pay for medical.
He said he has paid it occasionally because if
they have no money he is not going to leave them. He said it is about people. As
to
expenses he has authorized bus fares. But generally he does not held the
people the content of their stories. They do what they want.
It is their
responsibility to write their stories. He was shown the document (Exh. D1) dated
19 February 2002. The defendant says
he received that particular letter. It
granted exemptions to any journalist. He explained that it stands from when he
first approached
the journalists. He told them they would not be employees. They
would have to satisfy themselves personally any requirement as set
out in the
Ministry of Finance in regard to licence to work and write. He initially made
telephone calls to Rates & Taxes. He
followed up by confirming e-mail and
asked the director of Rates and Taxes the requirements on behalf of the group of
journalists
so that he himself was satisfied that those people were operating
themselves with the law by not needing individual licences. He
said he has no
ability to discipline the journalists. He is only refusing to pay them if they
do not provide their writings. He was
shown the document Exhibit D2 dated 19
February 2002. He said that there is a bit large number of people contracted by
the Presse.
As to who wrote the
letters he said they had discussions in regard of the feeling of harassment he
then authorize their letter. It
was standard and undersigned as truthful which
they understood and freely signed. The letter came about due to the fact that
all
of the people were clear of their entitlement to be exempted from business
licences. However, there were concerns over pressure from
VNPF demanding the pay
money which they considered legally they should not have to pay. When he decided
how much to pay people on
flat rate amount he considered the monthly income of
journalists at the Trading Post. He then doubled that amount and allowed another
12% of that sum as being the fund contribution as he was aware that may be one
day he would targeted for simply not wanted to pay
VNPF. This sum of money
allowed individual contractors to contribute VNPF if they wish with no advantage
to them. He confirmed he
received a copy of a letter from Kalorisu from the
Labour Office. He said there is no issue to resolve. They are not employees. He
has no complaint reported to him. He said everyone wants more money. He was
shown the document called ‘Philosophy Approach’.
He said the
document was drafted by the English girl and given to him to consider if in fact
it was in line with his thinking. He
said he is not. However it was circulated.
The girl printed it and gave him a copy. He did not provide a copy to
Timakata.
This witness was
cross-examined. He confirmed he is the publisher. He did not employ the people
working at Port Vila Presse. He said
he engaged them. He denied some of the
prosecution witnesses’ testimonies. There was a meeting but some of the
witnesses were
not present in the
meeting.
When asked if he had
interviewed each of the witnesses he said it was made clear to each of them that
they are not employees. They
are told they are not employees. He was asked that
in September Akesha Litch said that she was not told about her employment
status.
Other witnesses said they wanted the defendant to clarify their status.
He said the people working at the Presse wanted to have their
conditions stated
in writing. He was asked to explain to Court what it means sign in and sign out.
He said this is to find the movement
of the people. People are ringing to find
out. He said they are told to use his premises to get contact. That makes sense.
The English
girl was working with him for about 5 months as a General Manager.
She drafted the document. The defendant says he did say nothing
about the
document. He says that one of the concerns was that he was not a party to the
draft. That his personal philosophy is his
own. The English girl does something
for her own. He said the document was not purported to have come from him. He
said he did not
know it was circulated. He said he never circulated it. He said
he did not pay the contribution of the English lady that he employed
because she
got paid in London.
It was put to
him that some of the witnesses said that the defendant talked about the
philosophy approach to them. This witness said
you can put this to him and the
witness would say no. He is not aware about the date. As to the payment of two
weeks he said it is
a tricky question. The lump sum is consistent to self
employed. Consistent was an accountant lump sum. That is that they are on
contract
paid for urgently they required to be paid so. He said people working
on the new system. Some of the people have same tasks. He said
they are more
than 2 independent contract documents signed. There are new contracts every
year.
It was put to him why it is
not possible to pay journalists. He said there is no reason at all people need
money urgently. Some of
the people will be disadvantaged by particular language.
He has paid additional salaries because of work they do. And he does not
want to
loose those people at
pleasure.
Marke Lowen said that
the people who work at Port Vila Presse do not have their own equipment. The
system of invoices helps them out.
None of those people did supply their
equipment. As to the papers and pencils he said that those people usually supply
for themselves.
They did it themselves. He was asked if it is not strange that
he supplied the equipment and they have an independent contract he
said no. He
had done this overseas. As to why he did not stipulate that contractants will
have some equipment, he said that they
had made verbal agreements and they are
put into written contracts.
He
was asked if there are independent contracts why he made it in writing. His
evidence to this effect is that in the end when the
VNPF started to make noises
he wanted to be clear. He backdated the contracts legally and it is not a
problem. They work and write
stories supplied to him. He said everything was
clear from the beginning. Some people wanted to have something on permanent
basis.
There was no payment as usual. He said he gave money out of his pocket.
He is a generous person. He said the contract did not mention
about policy. They
have double ones. He gave an example that no one should down load pornographic
material out of the computers.
He denied the evidence given by Jonas Cullwick.
He said Jonas Cullwick wanted a great pay. He engaged Akeisha Litch to write
reports
about Court cases. He would not allow her to do that. It is up to him to
decide what he pays for. He wanted someone to make reports
about court cases. He
said why he prepared business licenses for Port Vila Presse he said that because
people are called that they
are self employed. They are waiting for Rates &
Taxes to give them exemptions. The defendant says that Port Vila Presse
Accountant
had her business on her own. As to the reception, it is a very small
matter. The girl at the reception is a translator. Various people
can answer the
telephone. He said Akeisha Litch never did any layout. The people at the Port
Vila Presse did have different scope
from scope of their own independent
contract. As additional expenses he said he paid from time to time little things
as generous
payments. No deduction was made for such additional expenses. He
said he did not deduct for those expenses. It is in his interests
to give them
the additional expenses. He pointed that he mentioned about incidentals. He
mentioned that nobody oversees the work
of the people working at the Port Vila
Presse. He has journalists as editors. Akesha Litch had very little knowledge of
the journalism.
But she came out of University with little
experience.
It was put to this
witness that some of the witnesses of the prosecution consider Shirley Joy and
Ricky as their superiors. He said
this means that they are editors. As to
Exhibit D2 this witness says that there is no issue to settle the conditions of
the people
engaged. He said at this stage Jonas Cullwick was disappointed. The
woman from England was put to a position Jonas Cullwick can do.
So he pushed for
others to sign the letter. There was discussion about the letter in respect to
the status of the people engaged.
Some of the people working at the Port Vila
Presse felt they were put in a situation in favour of Cullwick. In respect to
document
D2 this witness says that Cullwick was not there. He was not there he
refused to sign. He said he did not write the word ‘absent’
on the
document D2. He said the staff are happy to sign the document. He said he
refused the increase of pay. He further said that
at that time they did not want
to pay VNPF. They have their own choice. They did not remember they knew what
their employment said.
He said he did not concede to that. He was asked if he
paid VAT tax. He then said he did not know. He said he has an accountant to
take
care of what she does. He guessed what they are doing VAT enquired on
them.
Assessment
of evidence: Fact findings - credibility of
witnesses
On the basis of the
evidence before me, the following facts are
established:
1. Method
of Engagement & Employment
status
The defendant, Marke Lowen,
is the owner and the publisher of the newspaper Port Vila Presse. He advertised
the vacancies for various
positions. People who worked at the Presse applied for
the positions. The defendant interviewed each of them and offered each of
them a
job at the Presse.
The Port Vila
Presse started its activity in November
2000.
I find that witnesses who
worked at the Presse did not tender, submit quotations or enter into
negotiations regarding their remuneration.
None of the witnesses signed an
independent contract at their interview or when they first commenced
working.
It is a fact that most of the
witnesses were unsure as to whether they were independent contractors or
not.
It transpires from the
evidence that the witnesses working at the Presse were told of their employment
status by the defendant.
I reject
the evidence of the defendant that there is a verbal independent contract from
the commencement of the work by each of the
witnesses for the following
reasons:
• It is an extraordinary situation that an independent contractor would not be aware of his/her own status, especially in circumstances where the defence maintains that a verbal contract was in place. The existence of a verbal contract is contrary to the evidence that has emerged from witnesses. It is a fact that the defendant did not even discuss their employment status with them when engaging them.
It
is an extraordinary situation that the witnesses who are purportedly independent
contractors would need to be informed of their
status.
It is also a fact that
because the status of the witnesses was not clarified to each of them right from
the start, they were confused.
That confusion is an indication that the
independent contract was not discussed during the interview stages between the
defendant
and each of the witnesses as their evidence point to that effect. This
confusion by the witnesses culminated to their meeting and
the letter of 11
August 2001, written by Jonas Cullwick and signed by the witnesses for the
defendant to clarify their employment
status.
Below are part evidence in
support of the above.
• In examination in chief, and again in cross-examination, Res Issachar said he was not sure on what basis he was employed when he commenced work and that his employment status was never clarified. In cross-examination the defendant stated that such an oversight was due to the witness not remembering a discussion as to status;
• Evidence has been given by Rex Issachar of a meeting in which staff went to in order to clarify with the defendant the issue of their employment status;
• Jonas Cullwick, in examination in chief and cross-examination, gave evidence that he could not recall if he was told about his employment status during his interview with the defendant. He also gave evidence that he could not recall ever being told he was an independent contractor. In cross-examination the defendant disputed such evidence, stating that Jonas Cullwick ‘knew full well’ the basis on which he was engaged;
• When giving evidence Jonas Cullwick constantly referred to other staff members as employees;
• In examination in chief Akesha Litch gave evidence that she was not told of her employment status when she was engaged by the defendant. She further stated that the defendant told her in October 2001 that she was an independent contractor and that the defendant explained to her what an independent contractor was. In cross-examination the defendant simply told the Court that the evidence of Akesha Litch on this point was ‘incorrect’;
• Rex Issachar and Winston Tarere gave evidence that they were not told how long they would be engaged for. On would expect an independent contractor to be engaged to do a specific task for a set period or until the completion of that task;
• Jonas Cullwick gave evidence of a letter being written to the defendant as concerns staff employment status. This letter was exhibited and is dated August 11, 2001. The prosecution contends that this letter is demonstrative of the confusion that surrounded employment status. This letter, headed ‘Staff Grievances Over Working Conditions’ clearly expresses the concerns of staff at the lack of employment status;
• Evidence was given by Edwin Kalorisu, Acting Deputy Commissioner of Labor, that, having received the August 11, 2002 letter, his Office regarded the staff as employees.
2. Business
of their Own
The witnesses did not
run their own business when they commenced work at ‘Port Vila
Presse’. None of the witnesses were
incorporated or were partnerships. It
is unusual that independent contractors would not have a business of their own.
A typical feature
of an independent contractor is that they run their own
business and are thereby responsible for all the administrative functions
consequential to operating such a
business.
The materials disclose
that the issue of a business licence exemption was not clarified by the
defendant until January 2002, over
one year after the business had commenced.
Prior to this time the defendant did attempt to obtain a business licence for
his staff.
In this regard, evidence has emerged that everything done in relation
to obtaining a business licence was done by the defendant and
not by any of the
witnesses.
In relation to business
licences, the fact is also that not all witnesses have been exclusively working
as journalists for which the
exemption relates. Evidence has been given by
Akesha Litch, Rex Issachar and Tony Ligo that they all carried out other roles,
aside
from being journalists. The exemption, as exhibited, clearly relates to
journalists, and no other category of people.
• Akesha Litch gave evidence that she didn’t think she worked at ‘Port Vila Presse as a business;
• Winston Tarere said that he was not in a business of his own when he commenced working at Port Vila Presse;
• Rex Issachar and Akesha Litch, in examination in chief, did not even know that a business licence had been completed on their behalf;
• Winston Tarere gave evidence that the business licence application was not done at the request of the staff;
• Rex Issachar gave evidence, in cross-examination, that he knew nothing of any exemption in relation to business licences;
• Jonas Cullwick gave evidence that he couldn’t recall if he signed a business licence application. He said that he’d never personally applied for a business licence.
3. Invoices
It
is established that invoices were prepared by ‘Port Vila Presse’ for
staff to sign for services rendered. Upon signing
these invoices they were then
given back to ‘Port Vila Presse’. In a ‘normal’
independent contract relationship
the bookkeeping and accounting functions of
the independent contractor would be completely separate from the contractor. It
is a
strange scenario whereby the administrative functions of the independent
contractor are carried out by the principle.
• All of the witnesses gave evidence of having invoices prepared by Port Vila Presse as opposed to themselves;
• Rex Issachar gave evidence that he did not know why he signed invoices;
• Winston Tarere gave evidence that the invoices were prepared by Linda. He stated that invoices were no longer being submitted;
• Akesha Litch also gave evidence that the invoices were prepared by the accountant;
• In cross-examination the defendant stated that invoices were prepared by ‘Port Vila Presse’ was as a matter of convenience. This explanation is rejected. It can be inferred on the basis of facts as found that the arrangement at ‘Port Vila Presse’ was that invoices were being prepared to give the relationship the appearance of an independent contract. The process of preparing invoices is straight-forward and in a typical independent contract relationship would be carried out by the contractor. The evidence pointed to the contrary.
4. Job
Roles
• Akesha Litch gave evidence that she has had numerous roles at PVP. She said that at first she assisted with lay-out, advertising and reception work. She said that she then became a reporter;
• Akesha Litch said she initially helped the defendant with a competition in order to make herself familiar with the workplace;
• Tony Ligo also gave evidence that he changed work roles from a marketing position to a reporting position;
• Rex Issachar said the defendant helped him with his job;
• In cross-examination the defendant stated that he engaged Akesha Litch without her having any journalistic experience. Akesha Litch, in examination in chief, gave evidence of the defendant helping her with a competition and the defendant explaining such a task as an exercise whereby she could familiarize herself with the workplace.
The
evidence discloses a situation akin to a contract of employment. The defendant
engaged staff without experience that therefore
needed to be trained. Such staff
did not carry out one defined role, but did several tasks.
5. Method of Payment, Incidental Expenses, Sick-Pay, Bonuses and Pay Rises
All
of the staff gave evidence that they commenced work receiving fortnightly
payments. Such form of payment is consistent with a
contract of employment
whereby payment is not linked to the outcome of one specific task and is
periodical. Under an independent
contract one would expect payment to vary
according to the amount of work undertaken by the
contractor.
During the trial,
evidence was given by Anthony Ligo that it was only a few months ago that the
above system changed to a situation
whereby staff would be paid on a different
basis. This is close to two years after ‘Port Vila Presse’ commenced
publishing.
Anthony Ligo was the only witness to give evidence as to this method
of payment. Mr. Timakata gave evidence that the defendant was
trying to sort the
situation out during the investigation of the matter.
It is difficult to understand why
the method of payment detailed above was not instigated at the inception of the
business. The explanation
that the need to ensure quick payment was the impetus
behind such an arrangement cannot be accepted. The evidence indicates that
this
payment method was in place for close to two
years.
Contrary to a typical
independent contract, and, indeed, contrary to the written independent contract,
is the payment of incidental
work expenses by ‘Port Vila Presse’.
Several witnesses gave evidence of the defendant paying for incidental expenses.
The prosecution submits that a true independent contract is one in which the
independent contractor pays for all or his or her own
supplies and services, as
one would expect of a person running their own businesses. Any financial burden
of the independent contractor
is not subsumed by the principal and vice-versa.
This is one of the key advantages of an independent contractor
arrangement.
The payment of a
bonus and pay-rises is also foreign to a true independent contract. With an
arms-length financial relationship existing
between contractor and principle, it
is an atypical situation whereby a principle deviates from any supposed
agreement and pays a
contractor additional moneys outside the terms of the
agreement. Again, one of the key advantages of an independent contract is the
financial simplicity; the principal pays a fixed amount to the contractor and no
more.
The evidence shows also that
a scenario, whereby sick-pay is paid by the principal, as has emerged in this
matter, which is similarly
unfamiliar to a true independent contractor and
principal relationship. In such a situation, one would expect the contractor to
simply
organize someone to carry out his or function and then directly
remunerate that person.
• Jonas Cullwick said that ‘Port Vila Presse’ would pay for bus fares;
• Akesha Litch said that ‘Port Vila Presse’ paid for medical items, toiletries and bus fares and had given her an advance;
• Winston Tarere said that ‘Port Vila Presse’ would pay for scrapbooks and pens;
• Akesha Litch, Tony Ligo and Winston Tarere all gave evidence that at Christmas they would receive a bonus;
• Rex Issachar gave evidence, in cross-examination, that he was still paid on sick days;
• Akesha Litch gave evidence that she was paid when she took days off owing to her children being ill;
• Jonas Cullwick gave evidence that he received a pay-rise from 80,000 Vatu to 100,000 Vatu. Akesha Litch and Rex Issachar also gave evidence that they had received a rise;
• In cross-examination the defendant appeared to state that any payment of incidental expenses and sick-pay was purely an altruistic exercise on his part. Such an explanation is rejected and seen as an attempt by the defendant to explain his actions in conformity with an independent contractor relationship.
• No evidence has been received in relation to staff being given an ‘option’ when they first commenced work as to their method of payment. Indeed, any such a contention would appear to be contrary to the evidence of the defendant himself.
6. Control
As
to the issue of control generally the prosecution refers to its opening
submissions.
Has the defendant
exercised a degree of control consistent with an independent
contractor-principal relationship? The exhibited document
entitled
‘Philosophy and Approach’ is important when analyzing the extent of
control. The document was drafted by an
employee of the defendant’s
company, was circulated to staff and spoken about by the defendant. In
particular, the evidence
of Akesha Litch given in examination in chief, she
stated, in relation to the ‘Philosophy and Approach’ document, that
the staff had ‘all heard about it’ from the
defendant.
This document goes into
a minutia of detail that demonstrates a wide degree of control. The written
instructions, as contained in
the document, demonstrate a degree of control over
staff inasmuch as it is concerned with the manner of the performance of work as
it is with the end result.
The
following features of the exhibited document are reflective of control and
therefore an employer- employee relationship:
• The document refers to ‘management’ (see, for example, paragraph 1.3);
• The document refers to ‘reliable and regular attendance” at work (see paragraph 2.1);
• The document refers to management telling staff their hours of work, uses the term ‘working hours’, and refers to the need to obtain permission to leave work (see paragraph 2.1 & 2.2);
• The document refers to holiday leave and absenteeism (see paragraph 2.8);
• The document refers to disciplinary procedures and ‘summary dismissal’ (see paragraph 6.1); “An employer can have no more ‘practical control’ over an employee than the right to dismiss the employee”;
• The document uses the term ‘employee’ to describe staff (see paragraph 6.6).
All
of the above are typical features of an employee-employer relationship. It is
extraordinary that such detailed matters of control
can be said to exist in the
context of an independent
contract.
Further indicative of
control is evidence from some witnesses that efforts were made to have them
record their comings and goings.
• Jonas Cullwick said, in examination in chief, that he remembered the defendant trying to get staff sign on a board where and when they were going;
• Rex Issachar, in examination in chief, said that there was a board at ‘Presse’ to let Mark know where one was going. He also stated that he would need to contact someone at ‘Port Vila Presse’ and tell them if he was not coming to work;
• Winston Tarere said that at one stage a book system was introduced whereby everyone had to report their comings and goings.
• Akesha Litch gave evidence that when she wanted a holiday she would write a formal letter to the defendant;
• The exhibited letter to the defendant of August 11, 2001 states: “...you have moved to penalize us by cutting our salaries in line with your ‘sign in sign off’ book...”. This clearly indicates a link between recording movements and payment and is not, therefore, simply a book used to monitor movements for convenience as the defendant maintained in cross-examination.
On
the matter of control, it is interesting that the written independent contract
states, “any
advice given independent contract regarding the scope of work shall be
considered as instruction”
(paragraph 6). This document indicates that the defendant is capable of
instructing staff as to the manner in which they carry out
their
work.
7. Delegation
This
is in keeping with a person running a business of their own.
• When asked in examination in chief as to whether he could have someone else do his job, Jonas Cullwick replied, ‘I don’t think so’;
• Rex Issachar said in examination in chief that he could not have someone else do his job;
• Akesha Litch said that she would not get someone else to carry out her role when taking holidays;
• Akesha Litch said that she would not get someone else to carry out her role when taking holidays;
• No prosecution witness gave evidence that they had ever delegated their task to a third party.
8. Equipment
The
evidence shows that the witnesses use the computers of the Port Vila Presse to
do their work. The defendant owns the
tools.
The principal would
outline, when engaging the contractor, what items he or she requires to perform
his or her role and it would be
the responsibility of the contractor to obtain
and maintain such equipment. To the extent that such tools do not conform with
the
work to be carried out, it is the responsibility of the contractor to obtain
the correct tools.
• Anthony Ligo, in cross-examination, stated that he was provided with a mobile phone by the defendant;
• Jonas Cullwick said ‘Port Vila Presse’ provided all of the equipment he used and stated that he would need the defendant’s consent to work at home;
• Akesha Litch gave evidence that the defendant told her that her first task when commencing work at ‘Port Vila Presse’ was such that she could familiarize herself with the workplace;
• All of the other witnesses stated that they used equipment provided by the defendant;
• The prosecution contends that is an odd arrangement to have a ‘sign-in sign-out’ book, as detailed in the 11 August 2001 letter, when there is absolutely no requirement that staff work at the defendant’s place of business.
Typically
an independent contractor would own and use their own equipment, as befits
running a business of their own. Before engaging
an independent contractor, a
principal would typically enquire of an independent contractor as to ownership
of tools of
trade/business.
9.
Status of Written Contracts
In
this matter the defendant presented to staff a contract to
sign.
The contract presented to
the Court for 2002 states that it shall be, “effective commencing
7th
January, 2002”. ‘Port Vila Press’ commenced publishing in
November 2000. By his own admission, the defendant stated
that the contract was
drafted purely as a result of the investigation into ‘Port Vila
Presse’. In these circumstances,
the independent contract agreement was
drafted in an attempt to circumvent the true nature of the relationship between
the parties.
It was drafted after the investigation into the defendant had begun
in order to portray to investigators the purported arrangement
between staff and
the defendant. It is strange that if the defendant was so sure of the legality
of his oral contract that he felt
the need to reduce this to writing,
irrespective of whether an investigation was being carried out or not. In any
event, the 7 January
2002 contract does not purport to govern any prior
relationship.
The further
contracts that are presented to this Court by the defence were professed to be
signed on the date as marked on the contract.
That is the day that the witnesses
were engaged by ‘Port Vila Presse’. The Court has heard evidence
that this was not
the case, but that they were in fact entered into on the same
date as the 7 January 2002 contracts. In these circumstances the Court
should be
alert as to the true nature and purpose of the contract. These contracts were
drafted in an attempt to circumvent the true
nature of the relationship between
the parties as disclosed in the evidence of the various
witnesses.
As detailed above,
evidence has been given that some staff were unaware of their employment status
when they commenced work. It is
odd that a condition of a written contract could
then purport to impute knowledge upon
them.
The witnesses were not
required to wear uniforms. This was not a matter raised by the prosecution and I
accept that it does not form
part of the prosecution
case.
It is not part of the
prosecution case that salaries may have or were reduced for leave of sickness.
Any payment of sick leave or
leave is contrary to an independent contract
arrangement.
In relation to the
dates that appear on the individual counts, that the staff have given evidence
of their commencement date at Port
Vila Presse and the fact that they have never
received VNPF payments. Accordingly, the staff were engaged by the defendant for
those
months that appear on the individual counts. These are not in dispute and
accepted as such. When the prosecution evidence differs
from the evidence of the
defence, I prefer the evidence of the prosecution
witnesses.
It follows as a matter
of fact that on the basis of the whole evidence before the Court and submissions
and arguments of counsels,
the staff working at Port Vila Presse were engaged as
employees from the period covering January 2001 to April 2002. Any respective
contract for that period either oral or in writing is a contract of service but
not a contract for
service.
Application of the law to
the
facts
Section 1
of the VNPF Act provides:
“‘employee’ means any person, not being a person of any of the descriptions specified in the Schedule nor a person exempted by an Order made under section 60(a) nor under section 34 or 35 who-
(a) is employed in Vanuatu under a contract of service or apprenticeship, whether written or oral or whether expressed or implied; or
(b) being a citizen of Vanuatu, is employed in the manner specified in the last preceding paragraph outside Vanuatu by an employer having a place of business in Vanuatu; or
(c) being a citizen of Vanuatu, is employed under a contract of service entered into in Vanuatu as a master or member of the crew of any vessel, or as captain or member of the crew of any aircraft, the owners of which have a place of business in Vanuatu; or
(d) is declared by the Minister, in his discretion by Order published in the Gazette to be an employee for the purpose of this Act;
‘employer’ means the body or person with whom the employee entered into a contract of service or apprenticeship and includes any body or person designated as the employer by an Order made by the Minister under section 60; ...”
There is no need
to state all other relevant provisions of the VNPF again here. They are already
mentioned earlier on in the judgment
(at pages 4 & 5). I bear them in mind
at this stage. I consider and apply them on the facts before the Court in
respect to each
and all essential elements of the offences as set out in the
judgment (at page 6).
Applying the
law to the facts as found I am satisfied that the prosecution has proved each
and all essential elements of the offences
as charged beyond a reasonable
doubt.
The defendant was the
employer of the prosecution witnesses and, was accordingly responsible to
register as an employer, register
employees, namely: Akesha Litch, Rex Issachar,
Anthony Ligo, Jonas Cullwick, Winston Tarere and by failing to pay
contributions,
failed to pay the surcharge due at the rate of 2% per month from
the month of January 2001 to June
2002.
Verdict
The
defendant, Marke Lowen, is found guilty and convicted on each and all of the 138
counts as
charged.
Dated
at Port-Vila this
18th
day of June 2003
BY
THE
COURT
Vincent
LUNABEK
Chief
Justice
[1]
Performing Rights Society Ltd v. Mitchell and Booker (Palais de Danse) Ltd
[1924] 1 KB 762 at 766 -768 per McCardie J ([924] 1 KB
762 at
766-768.
[2]
Stevens v. Brodribb Sawmilling Company Pty
Ltd, High Court of Australia, 1986 160 CLR 16, per Mason J at p.27 & Ready
Mixed Concrete (South East) Ltd v. Minister of Pensions and National Insurance,
[1968] 2 QB per
MacKenna J at 515.
[3] Stevenson Jordan and Harrison v. MacDonald and Evans, [1952] 1 Times LR 101 per Denning LJ
[4] Ready Mixed Concrete (South East) Ltd v. Minister of Pensions and National Insurance, op cit., at p. 524
[5] Robert Upex writes, “The test currently used is the ‘multiple test’, of which there are numerous variants”, ‘The Law of Termination of Employment’, 5th ed., Sweet & Maxwell, 1997, London
[6] Stevens v. Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 per Mason J at 24
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