In 2025, the Commission ruled in favour of a remote worker in the Philippines who successfully claimed unfair dismissal against Queensland law firm Doessel Group Pty Ltd.
Even though she worked offshore, she was still considered an employee under the Fair Work Act, not a contractor because the overall arrangement looked and operated like standard employment.
After the business ended her role by email, she lodged an unfair dismissal claim and won. The Commission awarded her $10,800 in compensation.
Why the fair work decision matters for Australian businesses
Hiring offshore doesn’t create a legal ‘loophole’. What this case reminds businesses is that if the working relationship functions like employment, Australian rules may still apply, no matter where the worker is located.
The biggest risk for small businesses remains misclassification of this employment/contractor relationship, especially where someone is called a contractor but performs like an employee. This can lead to:
- unfair dismissal claims
- backpay obligations
- breaches of minimum entitlements
- penalties and reputational damage
Distance doesn’t remove responsibility.
Overseas hires can still be employees under Australian law, risking unfair dismissal claims.
Common risks when hiring overseas contractors
Many employers assume that because a worker is overseas, local labour laws won’t apply. The Doessel case shows how that assumption can create serious exposure, especially when the worker:
- works Australian hours
- uses your internal systems and tools
- receives direction on how, when and where to work
- functions like part of the team
These are all indicators of employment under the Fair Work Act.
How employers can stay compliant when hiring offshore staff
To reduce risk and stay compliant:
- Review offshore and contractor agreements to confirm the correct employment status
- Use a multi-factor test to assess control, independence, hours, tools and integration
- Look at the practical reality, not just what the contract says
- Seek advice before hiring internationally, especially if you direct how work is done
Hiring globally can be a smart strategy, but only if compliance foundations are set up properly.
Where to find more information
For more details, you can read the Fair Work Commission summary of the case by searching decision U2024/3881 at https://www.fwc.gov.au
If you engage offshore workers and want to avoid costly misclassification risks, contact us for tailored advice and compliance support.
