Recently, the Federal Court handed down its highly-anticipated employment decision in WorkPac Pty Ltd v Rossato [2020] FCAFC 84.
The decision concerned an employee of the labour-hire company known as WorkPac. The employee had been employed by WorkPac through a number of consecutive casual employment agreements for mining projects in Queensland. The employee entered into six different contracts within four years for works on two different coal mines. The key issue was whether not the employee was, in fact, a casual employee. The employee claimed that despite the contracts, he was not treated as a casual employee and was instead entitled to claim the leave entitlements under the Fair Work Act (the Act) and relevant Enterprise Agreement that would be available to a full-time employee.
What is a “casual employee”?
The Federal Court in WorkPac endorsed the definition of a casual employee put forward in the related case of Skene, to which WorkPac was also a party. A casual employee is therefore considered to be “an employee who has no firm advance commitment from her or his employer to continuing indefinite work according to an agreed pattern of work”. This makes firm, advance commitment to work a key distinguishing factor between casual and full-time employment.
The Decision in WorkPac Pty Ltd v Rossato [2020] FCAFC 84.
The Federal Court found that in each and every of the employee’s employment contracts with WorkPac, he was treated as “other than [a] casual employee” for the purposes of the Act, and as a Full-Time Employee for the purposes of the applicable Enterprise Agreement. The employee was therefore entitled to take paid annual leave, personal leave, compassionate leave, and was also entitled to payment for public holidays. In deeming the employee eligible for leave entitlements of a full-time employee, the Federal Court considered:
- the work performed by the employee which was found to be pre-planned well in advance. The employee was not performing work on-demand;
- the employee’s work, which was fixed by a roster;
- the obligatory nature of the employee’s roster. The employee was not free to pick shifts from an array of options; and
- the fact that the employee worked pre-determined shifts, making his work “regular, certain, continuing, constant, and predictable”. These were all held by the Court to be features of a firm advance commitment
What does this mean for the rights of casual employees?
Following this decision, casual employees who work regular, set shifts may be entitled to paid leave under the Act irrespective of what their employment contract says about their employment status. According to the Federal Court, whether a person is a casual employee will turn on the character of their employment as opposed to what was portrayed when they were first engaged.
What does this mean for employers?
Employers should be wary of the nature of the employment arrangements they have in place for their casual employees. The Federal Court in WorkPac granted leave entitlements to the casual employee despite the employee already receiving a casual loading of 25% and the existence of a contract which specified his position as casual. If you employ someone in a permanent, casual capacity they may be eligible for leave entitlements if their work is firmly planned out in advance. According to the Federal Court in WorkPac, indefinite employment with termination rights can be a feature of both full-time and casual employment.
Many commentators, including employer groups and unions, are calling for legislative reform to overturn the decision and make plainly clear the definition of casual employee and the entitlements they are eligible to receive. If pursued by the Government, it would likely involve a review of, and an amendment to, the Act which currently lacks an express definition for the phrase “casual employee”.
For advice on the applicability of this important decision to your specific workplace, contact Griffin Legal.