Am I in the State or Federal System?

Most people who work in Western Australia are covered by the federal Fair Work system, because most employers are trading companies. But if you work for a sole trader, a partnership of individuals, a family trust with no company trustee, a WA local government, a WA government department, or a charity or association that does not really trade, you are probably in the WA state system instead.

The answer depends on who your employer is as a legal entity, not what kind of work you do or what the business calls itself. This page explains how to work it out, and what to do if you still cannot tell.

Why It Matters

The two systems have different laws, different tribunals and different deadlines. Get it wrong and you can lose your claim.

	WA state system	Federal system
Main law	Industrial Relations Act 1979 (WA) (IR Act)	Fair Work Act 2009 (Cth)
Tribunal	Western Australian Industrial Relations Commission (WAIRC)	Fair Work Commission
Unfair dismissal deadline	28 days	21 days
Minimum period of employment before you can claim	None	6 months (12 months for a small business)
General protections claims	Not available (narrower protections instead)	Available
Minimum wage and conditions	State Minimum Wage and the Minimum Conditions of Employment Act 1993 (WA)	National minimum wage and the National Employment Standards

Nothing about the job itself needs to be different. Someone employed by "Joe Smith trading as Joe's Plumbing", a sole trader, is in the WA state system and has 28 days to bring an unfair dismissal claim in the WAIRC. Someone doing the same job for "Joe's Plumbing Pty Ltd" is in the federal system and has 21 days to go to the Fair Work Commission.

Western Australia is the only State that never handed its private sector industrial relations powers to the Commonwealth. In every other State, sole traders and partnerships are in the federal system. In WA they are not.

Quick Guide: Which System Are You In?

Your employer is…	System
A sole trader (a person, including "John Smith trading as…")	WA state system
A partnership where every partner is a person, not a company	WA state system
A trust where the trustee is a person, not a company	WA state system
A household employing you to work in a private home	WA state system
An incorporated association, charity or not-for-profit that does not substantially trade	WA state system
A company that does not trade, such as a grant-funded company limited by guarantee providing a free service	WA state system
A WA government department, agency, public hospital or public school	WA state system
A WA local government or regional council, if you were dismissed on or after 1 January 2023	WA state system
A Pty Ltd or Ltd company that trades	Federal system
A trust with a trading company as trustee, or a partnership with a company as a partner	Federal system
A charity or association whose trading is substantial	Federal system
The Shire of Christmas Island or the Shire of Cocos (Keeling) Islands	Federal system
A university established by State law	Federal system
The Commonwealth or a Commonwealth agency	Federal system

The rest of this page explains the harder cases.

Step One: Find Out Who Your Employer Really Is

Ask the question about the legal entity that employs you, not the brand on the shopfront or the name of your manager.

1. Look at your payslip, employment contract, letter of offer or income statement from the ATO. The name of the employer there is usually the legal entity.
2. Check that name on the government's ABN Lookup website. It will tell you the entity type: for example "Individual/Sole Trader", "Partnership", "Discretionary Trading Trust", "Australian Private Company" or "Other Incorporated Entity".
3. If it is a trust, find out who the trustee is. The trustee is your employer. If the trustee is a company, you are usually federal.
4. If you work through a labour hire agency or a group training organisation, the agency is your employer, not the business where you do the work (IR Act s 7). Run the check on the agency.

An ABN on its own tells you nothing about which system applies. Many sole traders and partnerships have ABNs.

Companies, Charities and Not-for-Profits

A company is only in the federal system if it is a trading or financial corporation. Most ordinary businesses that are companies trade, so they are federal without any need for further inquiry. The difficult cases are charities, associations, clubs, community organisations, private schools and companies that mostly rely on grants.

The WAIRC decides whether an organisation is a trading corporation by looking at what it actually does, not why it exists. The Industrial Appeal Court set out the test in Aboriginal Legal Service of Western Australia (Inc) v Lawrence (No 2) [2008] WASCA 254. In plain terms:

• trading does not have to be the main activity, but it must be substantial and not just peripheral;
• "trading" includes selling services and earning revenue, not just buying and selling goods;
• making a profit is not necessary;
• a charitable or public-benefit purpose does not stop an organisation from being a trading corporation;
• it is a question of fact and degree, looking at current activities and the organisation's purpose.

The decided cases show how this plays out:

• A charity funded by government that delivered services and earned substantial revenue from them was a trading corporation, so it was in the federal system: Ridge v Morrgul Pty Ltd [2023] WAIRC 00832.
• St Vincent de Paul in WA, whose retail and distribution sales made up a large share of its revenue, was a trading corporation: Courtenay-Clack v St Vincent de Paul Society (WA) Inc [2023] WAIRC 00691.
• A private school that charged tuition fees was a trading corporation: Independent Education Union of Western Australia v The Moerlina School Inc [2025] WAIRC 00150.
• A family violence service funded almost entirely by State government grants was not a trading corporation, so it was in the WA state system: Genovesi v The Patricia Giles Centre Inc [2023] WAIRC 00228.
• An Aboriginal community whose housing maintenance was paid for by accountable grants was not a trading corporation: Johnston v Looma Community Inc [2024] WAIRC 00330.

The dividing line is often grant funding against paid work. Accountable grants to deliver a free service point towards the state system. Fees charged to users, or government work won by competitive, price-based tender, point towards the federal system.

The question is asked as at the date your claim is filed, so an organisation's status can change over the years as its funding changes. If you work for a not-for-profit, its annual financial statements (which are often public) are the best evidence. Sorting its income into grants, fees, sales and contracts is usually the first thing we do.

WA Local Governments

All WA local governments and regional councils moved out of the federal system and into the WA state system on 1 January 2023, whether or not they trade. The change was made by IR Act s 80A and a list of 145 declared employers (137 local governments and 8 regional local governments) in Schedule 4 of the Industrial Relations (General) Regulations 1997 (WA), with the Commonwealth's agreement: WASU v City of Kalamunda [2024] WAIRC 00071.

What that means for you:

• If a WA council dismissed you on or after 1 January 2023, your unfair dismissal claim goes to the WAIRC within 28 days.
• If you were dismissed before 1 January 2023, it was a Fair Work Commission matter.
• The Shire of Christmas Island and the Shire of Cocos (Keeling) Islands were not declared and remain in the federal system.
• A council-owned company or regional subsidiary that is not on the list is assessed under the ordinary trading corporation test.
• Enterprise agreements and modern awards that applied to councils on 1 January 2023 carried over as State instruments and continue until they are replaced (IR Act s 80BB).
• Council employees are not public sector employees. The public sector disciplinary rules and standards do not apply to them.

Senior council staff. A chief executive officer or senior employee who is not covered by any award or agreement, and whose contract salary is above the salary figure ($212,800 from 1 July 2026), cannot bring an unfair dismissal claim in the WAIRC. That happened to a regional council CEO in Frodsham v Western Metropolitan Regional Council [2024] WAIRC 00173. Whether a State award now covers a particular senior role needs to be checked carefully before assuming you have no claim.

Fair Work general protections and councils. Whether a WA council can still be sued under the federal general protections laws is contested. The Fair Work Commission's own website says councils may still be covered if they are trading corporations, but the Commission has recorded that its earlier decisions found WA local governments are not constitutional corporations. Until that is settled, the WAIRC claims are the safer route, and lodging anything in the Fair Work Commission carries a real risk (see "Not Sure? Lodging in Both Systems" below).

The WA Public Sector

People employed by WA government departments, agencies, public hospitals and health services, and public schools have always been in the WA state system: Carter v Department of Education [2022] WAIRC 00741. Some watch-points:

• A separately incorporated government trading enterprise (for example in water, power or ports) may be a trading corporation and so in the federal system. Each one needs its own check.
• Universities are in the federal system.
• A private hospital or private school is not public sector. The trading corporation test applies to it.
• Police officers, prison officers and youth custodial officers have their own appeal rights.

Public sector employees have special routes into the WAIRC, including for disciplinary decisions and redeployment. See WA Public Sector Employees.

Are You an Employee? Contractors and Casuals

Only employees can bring unfair dismissal and most other state system claims. Since 31 January 2025, IR Act s 7A says whether you are an employee depends on "the real substance, practical reality and true nature" of the relationship, looking at both the written contract and how it worked in practice. A contract that calls you a contractor is not the end of the question.

In Bignold v The Orange Card Pty Ltd [2026] WAIRC 00149, a worker with a written contract for services was found to be an employee because in practice he worked full-time hours for a fixed weekly salary, with payslips, tax withheld, superannuation and approved leave.

If your employer says you were not an employee, it is up to the employer to prove that, both in the WAIRC (IR Act s 24A) and in the Industrial Magistrates Court (IR Act s 81CAA). These rules are new and the WAIRC has not yet decided on appeal how far they reach arrangements that started before 31 January 2025.

Casuals. IR Act s 7B applies the same real-substance test to whether you are a casual. Separately, a casual can only be "dismissed" if there was one continuing employment relationship. If each shift was a separate contract, simply not being offered more shifts may not count as a dismissal, as happened with a casual pool worker in Amuta v Department of Communities [2025] WAIRC 00881. If you are a casual, keep your roster history and anything that shows you expected ongoing work.

Not Sure? Lodging in Both Systems

Sometimes it is genuinely unclear which system applies, usually with charities and not-for-profits. You are allowed to lodge in both the WAIRC and the Fair Work Commission while that is sorted out: Jones v The Trustee for Vadakkumchery Family Trust [2026] WAIRC 00214. But you have to manage the federal claim carefully.

Under IR Act s 29AA(1), the WAIRC must not decide your unfair dismissal claim while you have any application with the Fair Work Commission about the same dismissal. That bar only lifts if the federal application is withdrawn, or is rejected or dismissed because the Fair Work Commission has no jurisdiction (s 29AA(2)).

In short:

• lodge in the WAIRC within 28 days;
• if the federal system is also arguable, lodge in the Fair Work Commission within 21 days;
• as soon as the position is clear, withdraw the claim in the wrong forum, or have it dismissed for want of jurisdiction;
• never leave a Fair Work Commission application to lapse or be dismissed for not responding.

For Employers

If you run a business as a sole trader, a partnership of individuals or through a trust with an individual trustee, or you run a community organisation that is mainly grant funded, your employees are probably in the WA state system. That means the State Minimum Wage and the Minimum Conditions of Employment Act, WA awards, 28-day unfair dismissal claims with no minimum period of employment and no small business exemption, and enforcement in the Industrial Magistrates Court. If you have been following Fair Work Ombudsman guidance, some of it may not apply to you. See Minimum Conditions in WA.

How MKI Legal Can Help

Working out which system you are in is the first thing we do in every WA employment matter, because it decides the deadline, the forum and what you can claim. We can check your employer's legal status quickly, including the harder cases involving charities, councils and trusts, and make sure your claim is lodged in the right place in time. Contact us for a free, no-obligation and confidential discussion about your circumstances.