A delivery rider working for Deliveroo was an employee and therefore unlawfully terminated during the COVID-19 pandemic, the Fair Work Commission has found.
Tuesday's decision was lauded by the Transport Workers Union as a major boost for gig workers.
But the British-founded delivery business will appeal, not accepting the premise of the decision.
"Riders frequently tell us that the freedom that comes with self-employment is the key reason why they choose Deliveroo, and we will appeal this decision to protect those freedoms," a Deliveroo spokeswoman said.
Brazilian national Diego Franco was into his fourth year of working for Deliveroo in Sydney when terminated on 30 April, 2020, for delivering meals too slowly.
Deliveroo asserted it was within its rights as Mr Franco was an independent contractor and it had no control over when, where or how long Mr Franco worked during any particular engagement.
Unlike a traditional casual or part-time employee, Mr Franco was permitted to "multi-app" or work for multiple delivery companies at the same time.
But the commission found the various elements of the relationship painted a picture of an employer and its employee.
That included the use of a uniform and a system that organised shifts and measured performance.
"Although, the picture is impressionistic and not precise, it is nevertheless a compelling conclusion," Commissioner Ian Cambridge said.
The level of control Deliveroo possessed "when properly comprehended, represented an indicium that strongly supported the existence of employment rather than independent contracting", he said.
While "multi-apping" did point away from the existence of an employment relationship, it could not represent a factor that prevented such a relationship in the context of the modern, rapidly changing workplace significantly altered during the COVID-19 pandemic.
Having found Mr Franco was an employee, Commissioner Cambridge was scathing of Deliveroo's method of firing him for slow deliveries.
Deliveroo is appealing the decision Source: AP
He was given seven days' notice by email on 23 April.
Deliveroo said it had also emailed him in February 2020 noting a number of deliveries were taking longer than expected.
Its internal systems also showed he was 20 per cent slower than comparable riders.
But critically, Mr Franco was never told what delivery times were expected and that failing to meet them would result in termination, Commissioner Cambridge said.
No response was sought from Mr Franco prior to his termination, Deliveroo admitted.
"Irrespective of whether Mr Franco was a contractor or an employee, it was plainly unconscionable to terminate what would be well understood to be his primary source of income, without first hearing from him," the commissioner said.
Even accounting for the parties' usual use of electronic communications, the impact of firing someone "was a matter of such significance that basic human dignity requires that a matter of such gravity should be conveyed personally".
As Mr Franco had sought, Deliveroo was ordered to reinstate the rider as an employee as of 30 April, 2020, and compensate him for wages "lost or likely to have been lost".
"This ruling has huge implications for gig workers in Australia and we urge the federal government to look at it today and to start devising regulation now," TWU national secretary Michael Kaine said in a statement.
In his decision, the commissioner noted the "dichotomy of the common law position" towards gig workers in Australia.
The Full Court of the Federal Court in 2020 decided owner-drivers of delivery trucks were employees while, separately, finding a labourer engaged by a labour-hire company was a contractor.
Similarly, the commission has found a food delivery worker on a bicycle was an employee while one driving a motor vehicle was an independent contractor.
