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Breaking News: Federal court upholds casuals 'double-dipping'

The Full Federal Court has determined that casual employees working regular and systematic hours with predictable periods of working time are likely to be considered permanent employees, regardless of the payment of casual loading.

As a result of the WorkPac Pty Ltd v Rossato judgement, Workpac has been ordered to pay Mr Rosato unpaid annual leave, personal leave, compassionate leave and public holiday payments which were owing on the basis that he was, in fact, a permanent employee of Workpac — even though he was engaged as a casual.  

The WorkPac v Rossato decision also supported the key principles of the WorkPac v Skene decision back in August 2018, which determined that work which is regular, on-going and permanent in nature is not genuinely ‘casual’ and therefore attracts entitlements such as paid annual leave.

What does this mean for employers? 

This decision continues to put at risk the status of Australia’s 2.6 million casual employees, more than 60% of which have been engaged for more than 6 months on a regular and systematic basis.

With big job losses and unemployment rapidly increasing during the COVID-19 pandemic, employers should be encouraged to retain and take on casual employees — not discouraged from doing so. 

For many small to medium businesses who are hanging by the thread, the prospect of having to defend up to six years’ worth of back-pay claims from former casual employees is the last thing they need.

Given the implications of the judgement for employers across all industries, the judgement is likely to be appealed to the High Court. In the meantime, employers engaging casuals on a regular basis must review their contracts and ensure that they are compliant. 

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Check your casual contracts for compliance  

With the renewed focus and the uncertainties on the nature of casual employment, any business employing casual employees should regularly review and monitor their workforce. If your casuals do not have a casual contract of employment in writing then the law may “imply” a number of terms and conditions.

If you already have a casual contract in place, it’s important to review it for compliance and update in consideration of the WorkPac v Rossato decision.

HR Advance’s casual contracts are modernised and will help minimise the risk your business may be exposed to for back payment from both current and former employees who may have been engaged on a casual basis but worked on a long-term, regular or predictable basis.

Employers with award/agreement covered employees should also ensure they comply with any casual conversion requirements in the relevant award/agreement.

HR Advance has two versions of the casual contract – a simple and comprehensive version.

  • The Contract of Employment - Casual (comprehensive) is ideal for positions that are technical, specialist or ‘complex’. This contract provides employers with maximum coverage.

  • If you would prefer something shorter for your casual employees, we recommend using the Contract of Employment - Casual (simple) which is only 3 pages in length and written in plain English. The simple contract is designed for use by small businesses with uncomplicated employment arrangements.

Otherwise, it may be worthwhile considering updating to a part-time contract.

Unsure and need further advice?

If you need help understanding the recent Federal Court Judgement relating to casual employee entitlements, our team can help. Find out more here.

Disclaimer: The information in this article and the links provided are for general advice only and should not be taken as legal advice. 

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Catherine Ngo

Senior Editor and Content Writer – Business Australia

Catherine is passionate about unravelling the latest news and insights to help entrepreneurs, small business owners and employers.