Looming changes for casual engagement

NATIONAL

The debate on what it means to engage casual employees in Australia has escalated in the past few years, culminating in the May 2020 Rossato Federal Court decision in that paved the way for casual employees to claim leave entitlements.

The discussion on casual engagement continues, and notable developments include the Morrison Government’s proposed IR Bill and the upcoming High Court appeal of the Rossato decision. Watch this space – MGATMA will keep members informed as these further developments come to light.

WorkPac Pty Ltd v Rossato & Ors

In May 2020, the full Federal Court in Rossato found in favour of a casual employee in its ruling that he was entitled to annual, personal/carer’s and compassionate leave entitlements, as well as payment for absences on some public holidays. In its finding, the presence of a “firm advance commitment to continuing and indefinite work” was considered paramount.

The employee in question was engaged as a casual worker pursuant to a number of employment contracts and worked consistent rostered hours for a period of about four years. The regularity and predictability of the employee’s work pattern, the effective inability to decline allocated shifts and the expression of an expected duration of employment were important in deciding that the employee was a non-casual employee and was hence entitled to the corresponding permanent employee entitlements.

The requirement to submit timesheets and the payment of an hourly rate of pay were found to be insignificant in themselves in deciding that the engagement was non-casual. However, a short termination notice period was found to be favourable of casual engagement.

Learning from Rossato

The implications of Rossato for employers are obvious – casual employees should not be provided a “firm advance commitment to continuing and indefinite work” in order to preserve the informality and irregular nature of true casual engagement.

An employer can reduce the risk of disputes surrounding the nature of a casual employee’s engagement by targeting factors that go toward establishing a “firm advance commitment to continuing and indefinite work”.

MGA TMA recommends implementing the following for new and existing casual employees:

• a contract of employment that clearly states employment on a casual basis, that hours of work are flexible and subject to change, and that the casual loading is paid in lieu of leave entitlements; • offering shifts to casuals on an at-needs and intermittent basis, or rostering casuals on short term rosters that require irregular hours; • ensuring that over time, casuals do not work a predictable or regular and systematic pattern of hours and days; • permitting casuals to decline shifts, with no disciplinary action taken for declining shifts; • avoiding engaging casuals for a fixed/expected duration or placing casuals on a probation period; and • ensuring that there is no obligation for either party to provide notice of termination.

Members that have existing casuals that work a regular and systematic pattern may consider offering casual conversion to permanent status. Further, casuals covered by the General Retail Industry Award 2020 that work an ongoing regular and systematic pattern for 12 months are also entitled to request casual conversion.

The MGA TMA Legal and IR Team can assist Members with preparing employment contracts for casual employees, as well as advising on casual conversion and how best to reduce risks in engaging regular and systematic casuals.

What’s next for casual engagement?

The Rossato ruling is due to be challenged in the High Court, although a hearing date is yet to be set. Although the Federal Court’s ruling in Rossato may be overturned, the decision stands at present and Members should continue to exercise caution in engaging casual employees.

Further, the proposed IR Bill, if passed by Parliament, may clarify the meaning of casual engagement and may create further entitlements for casual employees. This proposed Bill will be explored in the next issue of Independent Retailer.

For further advice tailored to your needs, please do not hesitate to contact

MGA’s Legal and Industrial Relations

team on 1800 888 479 (option 1)