Important decision affecting casual employment

From 1st October 2018, ensure your business is prepared for the important change to the definition of ‘casual employment’.

Recently, the Full Federal Court delivered a judgement on a case (Workpac Pty Ltd v Skene) in favour of the employee. The court recognised that the employee worked a ‘week on, week off’ implying a level of certainty, regularity and predictability; this is inconsistent with ‘casual’ employment.

The ruling has caused concern for many businesses who realise they now need to reassess the relationship they have in place with several employees engaged on a casual basis.

Moving forward from 1st October, the following points must be adhered to for employment to be considered casual:        

  • there should be no certainty about the period over which the employment is offered; and,
  • there should be an informality, uncertainty and irregularity about the engagement.

Even if you’ve paid your employee at the higher loading typical of casual employment, it still won’t be seen as enough evidence to determine the engagement as ‘casual’.  

Therefore, if you haven’t reviewed your staffing relationships, now would be the time to do so immediately. There may be many employee situations that, under the new ruling, could be considered permanent given the regularity of the working pattern.

The nature of initial casual employment can organically change into a form of ‘permanency’ over time but without actual recognition.

If now deemed ‘permanent’, these staff members will automatically become entitled to:           

  • paid annual and personal leave (accumulating for each year of their service);
  • notice of termination; and
  • redundancy entitlements.

Therefore, ensure your workplace has made any adjustments to your casual staffing structure by this date or penalties may arise.