When Housing is Not Wages: Court Awards $108,000 to Caretaker in Landmark Decision

In a significant reminder that wages cannot be replaced with “perks,” the Federal Court has upheld a ruling that a live-in caretaker was entitled to more than $108,000 in unpaid entitlements, despite having received housing as part of his role.

Between 2014 and 2021, the caretaker lived at the Umbarra Cultural Centre on the NSW south coast, owned by Merrimans Local Aboriginal Land Council. His duties included maintaining the cultural centre, performing handyman tasks, and helping with community events. Instead of being paid wages, Merrimans provided him with accommodation.

The Central Question: Was He an Employee?

Merrimans argued that the caretaker was not truly an employee, or at most was a casual worker. However, the courts disagreed. The position description itself referred to Merrimans as the “employer,” required him to report to the CEO, follow policies, undergo reviews, and take on “other duties as directed.” Justice Geoffrey Kennett of the Federal Court said these features showed a level of control consistent with employment, not an independent arrangement.

When Housing is Not Wages: Court Awards $108,000 to Caretaker in Landmark Decision

Part-Time vs Casual Employment

Another key issue was whether the caretaker was casual or part-time. Under the (now repealed) definition of casual work in the Fair Work Act, a casual employee is only paid when hours are specifically offered and accepted. In this case, the caretaker’s remuneration—rent-free accommodation—was regular and consistent, regardless of how many hours he performed. This consistency strongly pointed to a part-time arrangement.

Justice Kennett concluded that the caretaker worked an average of 20 hours per week and was entitled to the associated leave and superannuation.

Wages, Leave and Penalties

The compensation awarded included:

• $94,494 in unpaid wages,

• $10,572 in unpaid annual leave,

• $2,643 in long service leave,

• Superannuation, and

• A $65,000 penalty against Merrimans.

Although the Court set aside earlier findings that Merrimans breached payslip and award obligations, it confirmed they had breached the minimum wage provisions of the Fair Work Act.

Why This Matters

This case—Merrimans Local Aboriginal Land Council v Dwight [2025] FCA 991—is a cautionary tale for employers and community organisations alike. Housing or “in-kind benefits” cannot simply replace lawful minimum wages. Where duties are regular, supervised, and ongoing, the relationship will almost always be characterised as employment, not volunteer work or casual help.

For advocates and employees, the case reinforces the principle that rights to fair pay and entitlements cannot be sidestepped by informal arrangements. For employers, it highlights the real financial risks of failing to comply with the Fair Work Act.

At its heart, the case is a powerful affirmation: wages are not optional, and working people must be paid fairly for their labour—no matter how well-intentioned the arrangement may seem at the outset.