Understanding the Thongkhamchanh Application (UC2025/1) – Landmark Unfair Contract Term Case
Somphong (Em) Thongkhamchanh initiated the first application under Australia’s Fair Work Act’s new unfair contracts jurisdiction (Section 536ND) in January 2025. This case, designated as UC2025/1, is poised to establish crucial precedents for interpreting the Closing Loopholes amendments, which were designed to safeguard independent contractors from unfair contractual provisions.
The application specifically challenges Rasier Pacific Pty Ltd, Uber’s operating entity in Australia. Mr. Thongkhamchanh, in his capacity as an Uber driver, has highlighted specific contractual clauses that he contends create unfair disadvantages for drivers. His comprehensive application includes extensive documentation, featuring numerous phone screenshots, and addresses alleged violations across consumer law, competition law, and the Fair Work Act. The application’s request for $50,000 in compensation underscores the significant financial impact that unfair contract terms can have on independent contractors.
Recognising the case’s pivotal importance for interpreting the Commission’s newly granted authority to modify, set aside, or vary unfair terms in service contracts, the Fair Work Commission has convened a Full Bench. Stakeholders must submit their responses by August 1, 2025, with proceedings scheduled for September 1, 2025. This case has garnered significant attention from various sectors, including gig economy participants, platform operators, and legal professionals.
Details can be found in “UV20251 – Further Particulars of Application”
Table of Contents
The Core of the Dispute
The case centers around an Uber driver who approached the FWC, asserting that persistent technical malfunctions in the Uber app severely impacted his ability to work. The driver contended that these technical disruptions effectively constituted unfair dismissal by preventing platform access and income generation.
Driver’s Argument:
- The driver maintained that the app malfunctions occurred through no fault of his own and that Uber failed to provide adequate technical support.
- He argued that the inability to access the app due to technical issues was tantamount to wrongful termination, directly affecting his income potential.
Uber’s Position:
Uber, represented by legal firm Ashurst, contests the FWC’s jurisdiction over the unfair dismissal claim, arguing that the contested contract terms fall outside workplace relations matters. Additionally, Uber points out that the driver hasn’t specifically identified which contract terms are allegedly unfair.
He is seeking:
- Implementation of contractual amendments requiring Uber to expedite technical issue resolution and improve driver communication; and
- Compensation of $50,000 covering lost income, unrealised performance bonuses, and emotional distress allegedly resulting from Uber’s negligence.
Section 536ND: Fair Work Act 2009
The Fair Work Act 2009 (Cth), updated as of February 26, 2025, establishes Australia’s comprehensive workplace relations framework. This legislation has undergone significant reforms to enhance protections for employees, contractors, and gig economy workers. The Act encompasses crucial aspects of employment relationships, including workplace conditions, rights and obligations, dispute resolution procedures, and enforcement mechanisms. Notable recent amendments include provisions for workers to disconnect from work related communications outside business hours, restrictions on fixed term contractual arrangements, and enhanced standards for workers in transport and digital platform sectors.
A key addition is Section 536ND, which empowers low income contractors to contest unfair service contract terms through the Fair Work Commission.
Implications for Gig Economy Workers
The Thongkhamchanh case represents a watershed moment for Australia’s gig economy workforce. Previously, these workers operated under contracts offering minimal safeguards and limited options to challenge unilateral platform modifications or account deactivations. The FWC now provides a more accessible avenue for contesting unfair contractual provisions.
This case could establish vital precedents defining fair treatment standards for platform workers, particularly regarding performance evaluation and contract termination protocols. Platforms may be required to enhance transparency in their algorithmic management systems, ensure workers aren’t disadvantaged by technical issues, and implement more comprehensive review procedures before restricting platform access.
The case also underscores growing recognition that despite their technical classification as independent contractors, gig workers often face significant power imbalances in their working relationships, potentially leading to inequitable outcomes. The substantial $50,000 compensation claim highlights the severe financial impact that unfair contract terms can have on platform dependent workers.
Monitoring the Case
Stakeholders can track this landmark case’s progress through the FWC’s case management system. The Commission maintains a dedicated webpage for Application UC2025/1, where relevant documentation will be published as proceedings advance. Interested parties can subscribe to updates here.
The progression of this application through the FWC system may significantly influence unfair contract terms jurisprudence and reshape relationships between digital platforms and gig workers across Australia, with potentially far reaching implications for the nation’s gig economy.
Conclusion
The UC2025/1 case powerfully demonstrates the critical importance of fair contracting practices in Australia. If you believe you’re affected by unfair contract terms, seeking advice and taking action is both your right and responsibility under the law.
For expert guidance on unfair contract terms, reach out to Workclaims Australia. Our dedicated legal professionals stand ready to secure your rightful workplace entitlements.
