High Court Overturns Casual Employment Ruling

OWEN WEBB - AHA|SA WORKPLACE RELATIONS MANAGER

In a significant matter concerning the nature of casual employment the High Court has unanimously allowed an appeal from a judgement of the Full Court of the Federal Court of Australia, resulting in the Federal Court’s ruling on casual employment in the Rossato Decision being overturned.

A summary of the background of the case, the Appeal and the High Court’s decision is outlined below.

BACKGROUND

Between 2014 and 2018, Mr Rossato was engaged by WorkPac (being a labour hire company) to work for Glencore in one of its Queensland coalmines. Over the course of 4 years, Mr Rossato was issued with 6 separate and consecutive employment contracts. During each period of engagement, Mr Rossato was engaged as a casual “Field Team Member” (FTM).

In 2018, following his retirement and relying on the decision in WorkPac v Skene [2018] FCAFC 131 (Skene), Mr Rossato wrote to WorkPac claiming he was entitled to payment of his leave entitlements in addition to the entitlements contained in the WorkPac Pty Ltd (Coal) Industry Enterprise Agreement 2012 (the Agreement).

WorkPac subsequently commenced proceedings in the Federal Court seeking declarations confirming Mr Rossato:

1. was a casual employee rather than a permanent one; and

2. if Mr Rossato is found to have leave entitlements owed to him, could WorkPac off-set these entitlements against payments made to Mr Rossato in the past.

FULL FEDERAL COURT DECISION

In the Full Federal Court’s decision in WorkPac Pty Ltd v Rossato [2020] FCAFC 84 (Rossato Decision) Justices Bromberg, White and Wheelahan JJ, considered, in detail, the legislative framework regarding casual employment in Australia and re-affirmed the submission in Skene: “the indicia of casual employment referred to in the authorities [being] irregular work patterns, uncertainty, discontinuity, intermittency of work and unpredictability – are the usual manifestations of an absence of a firm advance of commitment”.

Further, the Court submitted that that the description parties use to categorise their relationships is not determinative nor conclusive of the entirety of the employment arrangement: “the assessment of whether a person is a “casual employee” is to be conducted by a characterisation of all of the relevant facts which speak to the type of employment that existed at the time the entitlements in question accrued.”

Their Honours then turned their attention to how Mr Rossato worked under his 6 various contracts, specifically: working predictable and systematic rosters which operated on a 7 days on/7 day off basis, with some rosters being set some 12 months in advance. The Court was critical of this and noted this conduct was indicative of a “firm advance commitment” on the part of the parties to be engaged on an “on-going” indefinite employment rather than a casual one.

In conclusion, their Honours “found that Mr Rossato was not a casual FTM under the [Agreement], noting that the circumstances of his employment could not be distinguished in a material way from those of Skene”.

The decision meant, Mr Rossato, who was engaged as a casual employee was entitled to claim, and be paid entitlements to annual leave, personal/carer’s leave and compassionate leave as contained in the Fair Work Act 2009 (Cth) (Fair Work Act).

WORKPAC’S APPEAL

WorkPac sought special leave to appeal the Rossato Decision in the High Court. The High Court granted WorkPac special leave to appeal.

The basis of WorkPac’s appeal was:

1. That the Full Court ought to have held that Mr Rossato was a casual employee for the purposes of the Fair Work Act and the Agreement.

2. Alternatively, that the Full Court erroneously rejected its claims in relation to set off and restitution.

HIGH COURT DECISION

In both the Skene and Rossato Decision’s the parties accepted that the expression “casual employee” under the Fair Work Act refers to an employee who has no “firm advance commitment as to the duration of the employee’s employment or the days (or hours) the employee will work”. (1)

The pivotal question to the resolution of the Appeal for the High Court was to determine whether such a firm advance commitment existed in respect to Mr Rossato’s employment. As part of the Appeal WorkPac submitted that:

• the characterisation of an employee as “casual” depends entirely on the express or implied terms of the employment contract and (in the case of wholly written employment contracts) without reference to post-contractual conduct.

• The Fair Work Act explicitly recognises that casual employment can be “long term”, and can involve “a reasonable expectation of continuing employment … on a regular and systematic basis”’

• No firm advance commitment was evident in the express or implied terms of any of the six employment contracts or otherwise.

• That in the Rossato Decision, White J, erred in the significance he accorded to the rosters pursuant to which Mr Rossato worked, contending that regularity of work is consistent with casual employment.

• That it was not obliged by the contracts to offer any assignments to Mr Rossato and that he could accept or reject any offer of an assignment.

• That Mr Rossato had been categorised as a casual for the purposes of the Agreement (2).

Mr Rossato submitted that:

• He had a firm advance commitment to his working hours, agreed by roster, such that neither he nor WorkPac ever had to confirm or query whether he was required for work or whether he would attend work on a particular day.

• The work he was employed to perform was ongoing and indefinite and that WorkPac’s need for him to perform this work was stable and predictable.

• He was engaged to work a standard work week, according to rostered hours, and alongside full-time employees.

• That he worked at the mine on a drive-in, drive-out basis and stayed in accommodation arranged by WorkPac in advance (3).

Having reviewed Mr Rossato’s contracts of employment, the High Court determined that the contracts expressly provided that Mr Rossato’s employment was on an “assignment-by-assignment basis”, with Mr Rossato entitled to accept or reject an offer of an assignment and WorkPac were under no obligation to offer any further assignments. Further, the High Court determined that there was no basis for any suggestion that the contracts provided a firm advance commitment to continuing work (4).

The High Court heard submissions in relation to the significance of the rostering system under which Mr Rossato was obliged to work. The High Court ultimately determined that Mr Rossato’s working hours fixed by roster was of limited significance and that the Full Court erred in attributing such significance to these rosters. The High Court found that despite the rosters, there was still an absence of a firm advance commitment to continuing work beyond the completion of each employment contract 5 .

In conclusion the High Court found that:

• The contractual arrangements between WorkPac and Mr Rossato did not include a mutual commitment to an ongoing working relationship between them after the completion of each assignment. The express terms of the relationship between WorkPac and Mr Rossato were distinctly inconsistent with any such commitment. Mr Rossato’s entitlement to remuneration was agreed in that basis (6).

• That the performance of Mr Rossato’s obligations was organised in accordance with Glencore’s rosters and thereby exhibited features of regularity and constancy did not establish a commitment between the parties to an ongoing working relationship after each assignment was completed. In carrying out each assignment, Mr Rossato worked as a casual employee (7).

The High Court allowed WorkPac’s appeal on the basis that Mr Rossato was a casual employee of WorkPac and accordingly the orders of the Full Court be set aside.

IMPLICATIONS FOR MEMBERS

The High Court’s decision on the appeal of the Rossato case, together with recent Federal Government amendments to the definition of casual employment in the Fair Work Act have provided a greater level of certainty for employers in relation to casual employment.

Members are reminded of the importance of providing casual employees with a written employment contract upon their commencement and in particular clearly articulating in the contract that there is no firm advanced commitment to an ongoing pattern of hours of work. The AHA|SA has contract of employment templates available for Members to utilise.

To download a copy of the full decision please click on the link: https://eresources.hcourt.gov.au/downloadPdf/2021/ HCA/23

Endnotes

(1) WORKPAC PTY LTD v ROSSATO & ORS [2021] HCA 23, see para 32. (2) Ibid, see para [42]-[44]. (3) Ibid, see para [45]-[47]. (4) Ibid, see para [88]. (5) Ibid, see para [96]. (6) Ibid, see para [105]. (7) Ibid, see para [106].