Legal Speak

KEEPING IT CASUAL?

A recent High Court decision has forced employers and employees to rethink the rules of casual employment.

On August 3, 2021, the WorkPac Pty Ltd v Rossato & Ors case came to a long-awaited decision. Overruling a Federal Court decision, it confirmed that employees engaged on a casual basis as stated by their contracts will not be considered permanent employees, and that obligations are not determined by post-contractual conduct.

Put simply, this means that the terms of an employee’s contract will be determinative in defining the employment relationship.

CASE BACKGROUND

Mr Rossato claimed he was a permanent employee, relying on the decision of WorkPac v Skene (2018) 264 FCR 536, which held that a casual employee is an employee who has “no firm advance commitment” to the duration of their employment or the days they are to work.

Rossato’s claim was that he had been given a firm advance commitment as he received a roster up to a year in advance and ongoing work due to having six contracts.

The High Court unanimously decided that the fact Rossato was provided rosters up to a year in advance was not a contractual promise that amounted to a firm advance commitment to work. Also, where there is a written contract containing the terms of the employment relationships, the parties are to adhere to those terms.

This decision reinforced the meaning of a “casual employee” in the Fair Work Act 2009 (Cth). The Fair Work Act now provides that an employee is a “casual employee” if: • An offer of employment made by the employer to the person is made on the basis that the employer makes no firm commitment to continuing and indefinite work according to an agreed pattern of work of the person

• The person accepts the offer on that basis

• The person is an employee as a result of that acceptance.

This means that regardless of post-contractual conduct suggesting otherwise, the terms of the employment contract will determine the legal relationship in a comprehensively written contract.

WHAT IT MEANS FOR EMPLOYERS

It is important for employers to ensure that they are clear with the terms stated in employment contracts, as the High Court ruling has shown that what is written in the contract defines the legal relationship of employment. Employers are able to rely on the written terms of their employment contracts.

It is important to ensure that the terms in casual employment contracts state that the employees are casual, and there is no ambiguity. Businesses are recommended to note these changes to avoid the risk that casual employees will later bring claims against them. Accordingly, it is recommended that employers should have their lawyers review their employment agreements and conditions of employment to ensure compliance with this latest legal development.

WHAT IT MEANS FOR EMPLOYEES

Employees are urged to ensure that they are aware of what is written in the terms of their employment contract, as employers are able to rely on the terms written in their contracts.

If there is a term or clause that they are concerned about or there are expectations that are not written in their contract, it is important to discuss that before signing.

If they are relying on the employment to be permanent and ongoing, ensure that it is written clearly in the contract.

The decision may also extend to other terms of the contract, so both employers and employees are recommended to carefully peruse their employment contracts to ensure that the terms within them are concise and unambiguous. ■

This article was prepared jointly by Frank Gambera and Bridget Vaughan of McMahon Fearnley Lawyers. Contact them through www.mcmahonfearnley.com.au