Late in 2010, a decision of the Federal Court specified that a casual employee may not actually be a casual employee, and may be entitled to a permanent employee’s entitlements such as annual leave. Even though this decision was made under the Workplace Relations Act 2006, not the current Fair Work Act 2009, the principle may well hold, and employers should take note.
The employee was employed in the mining sector between November 2006 and December 2007, and he:
• was engaged on a casual basis
• was paid a ‘Flat Hourly Rate’ which compensated him for, amongst other things, a loading in lieu of paid leave entitlements
• was required to work 12 hour shifts on a two weeks on / one week off roster
• could be dismissed by the provision of one hour’s notice.
The employee was dismissed, and subsequently brought a claim in the Federal Magistrates Court seeking a payment from the employer for various amounts, including his unpaid accrued annual leave. Importantly, under the applicable legislation, a ‘casual’ employee was not entitled to a payment for annual leave.
The court considered several factors in coming to the decision that the employee was not really casual at all, including:
• the employee was expected to be available, on an ongoing basis, to perform the duties required of him
• the employee worked in accordance with a stable, organised and certain roster
• there were no significant fluctuations in the work
• the employee had certainty as to his working hours, with regular starting and finishing times.
The court then ordered that the employer make a payment to the employee for annual leave, and even though the employee had been paid a casual loading for the entire period of employment, the employer was not allowed to offset that against the annual leave payment. The employer was also fined $14,850.
Employers should review the manner in which they engage casual employees to determine whether those employees are, in reality, employed on a casual basis. In doing so, employers should consider whether the employees are working only on demand, or whether the employees have an advance commitment as to the duration of their employment or the days or hours they will work. If casual employees do not appear to be employed on a casual basis, employers should consider taking steps to reclassify the employees as part-time or full time employees.
For more detailed information about casual employment, or to discuss your particular situation, contact Emma Watt.
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