The perils of employing casuals has hit the media again. Back in 2018, the Federal Court determined in WorkPac Pty Ltd v Skene that a casual employee may be able to claim annual leave and personal leave even though they were knowingly engaged as a casual employee and were paid the applicable loadings. Or in simple terms – double dip. Naturally enough, this set off alarm bells for employers with casual team members but a case that was decided this month has further ramifications.
The full bench of the Federal Court delivered a ruling last week on Workpac Pty Ltd v Rossato. There are some multifaceted legal considerations but the bottom line is that they confirmed the decision in Skene enabling casual employees to receive their loading AND claim entitlements generally reserved for permanent employees. But more than this, the decision went further by dismantling “set-off” clauses enabled under a Fair Work Commission amendment that allowed employment contracts to include clauses that stopped casuals from accessing leave entitlements.
Workpac argued that the employee (Rossato) was purposely employed as a casual and this was reflected in the employment contract. However, the court determined that the nature of the employment relationship was not casual irrespective of the contract. In making this decision, Workpac had to show that there was no ‘firm advance commitment’ to continuing employment for Mr Rossato. To be truly casual, Workpac had to show that there was an ‘irregularity, uncertainty, unpredictability, intermittency and discontinuity to the pattern of work.” Basically, Mr Rossato knew he had an ongoing, predictable roster of work and the classification of casual within his employment contract wasn’t worth the paper it was written on.
WILL THIS CHANGE?
This decision has serious ramifications for employers. It is understood that casuals make up approximately 20% of the Australian workforce and the level of backpay that could be claimed is believe to be in excess of $8 billion! For this to be truly resolved, an amendment of the Fair Work Act that provides clarity as to the nature and application of casual work must occur. We are truly in a ‘watch this space’ position following this court decision.
WHAT DOES THIS MEAN FOR EMPLOYERS NOW?
As an employer, you need to assess whether or not your current positions are truly casual or if you need to consider offering affected employees a permanent position and transitioning them across. If you do wish to continue offering casual roles, you must ensure that work patterns are irregular and that there is no ongoing roster that would provide predictability.
This is a complex matter and if you currently employ casuals and are unsure of what you should be doing, please talk to us. The HR Staff n’ Stuff team is here to help when you need us.
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