Liam’s Employment Status & Contractual Obligations at Eclipse Marketing : SUSS, Singapore

Assignment Question

Eclipse Marketing Pty Ltd (Eclipse) is a digital marketing agency based in Perth, Western Australia. The company specializes in providing social media management and advertising services to small businesses. Eclipse operates out of a sleek, modern office in the city, known for its glass facade and open-concept design.

At the start of 2023, Liam, aged 24, entered into an independent contractor agreement with

Eclipse to provide social media marketing services. The contract explicitly stated that Liam was not an employee, but an external consultant engaged to provide services on a project-by-project basis. Under the agreement:

• Liam had flexibility in his work, setting his own hours and deciding how to complete projects, provided he met agreed-upon deadlines.

• He was free to work for other clients, including businesses in the same industry as Eclipse’s clients.

• He was responsible for paying his own tax and superannuation.
• He used his own laptop and software to complete the work.
• He billed Eclipse on a per-project basis, submitting invoices at the end of each month.

Over time, Liam’s engagement evolved, but the changes were gradual and informal rather than the result of a clear contractual amendment. By mid-2023:

• Eclipse offered Liam a desk in their office, which he occasionally used when collaborating with the team.

• He was invited to staff meetings and strategy sessions, though it was never explicitly required.

• Eclipse gave him login credentials to their project management system so he could more efficiently coordinate work with the in-house team.

• Over time, Liam’s project-based invoices became more structured, with a regular monthly payment amount, though he still technically issued invoices as a contractor.

• Eclipse suggested he use their corporate email address for client communication, but he also continued using his personal business email.

• Clients and staff began referring to him as “our social media guy,” though his title was never formally changed.

In November 2023, Eclipse introduced a new Client Confidentiality and Non-Competition

Policy, which applied to “staff and contractors performing ongoing services for Eclipse”. The policy prohibited individuals from working with Eclipse’s direct competitors or providing marketing services to clients outside of their assigned work with Eclipse. Liam was made aware of the policy but never formally signed it.

In January 2024, Eclipse discovered that Liam had been managing social media accounts for two of Eclipse’s existing clients under his personal freelance brand, without informing the company.

When confronted, Liam argued that he had always been an independent contractor and that the policy did not apply to him. Eclipse immediately terminated his engagement, citing a breach of its policy and a conflict of interest.

Assignment Questions (IRAC Method)

1. Has Liam’s employment status changed from an independent contractor to an employee? (20 marks)
2. If Liam is considered an employee, is the Eclipse policy enforceable as a contractual term, and has he breached it? (10 marks)
3. If Liam is considered an employee, has he breached any duty to Eclipse by managing social media accounts for other clients? (10 marks)