Casual 'double-dipping' overturned by High Court ruling

A High Court today ruled casual workers are not entitled paid leave benefits in line with permanent employment contracts.

It means the definition of a casual employee will return to closely align with the original Fair Work Act definition and casual employees will be entitled to the benefits outlined in their contract.

What happened?

A Federal Court ruling in 2020 found casuals working regular and systematic hours should be treated as permanent staff and are subsequently owed permanent entitlements.

CCIQ's advisers have been working with members to help them manage the rules around ‘casual conversion’.

Today the High Court overturned the Federal Court's decision and ruled casual workers are not entitled to paid leave while engaged as a casual on consecutive contracts.

Key findings

The High Court's decision clarifies the meaning of a 'casual employee', which aligns closely with the definition that was included in the Fair Work Act in March 2021.

The High Court held where there is a written contract of employment in place, entitlements will be met inline with that agreement.

Practical steps employers can take

We recommend employers take some practical steps to reduce the level of risk;

Ensuring casual employment contracts specify there is no entitlement to ongoing and regular and systematic work. Ensure employees are compensated with the 25% casual loading in lieu of annual leave and sick leave entitlements.

Comply with relevant Modern Award casual conversion clauses and document all conversions with employees who elect not to convert to part-time or full-time employment when offered.

Provide every new casual employee a Casual Employment Information Statement (the CEIS) before or as soon as possible after they start their job.

Comply with upcoming relevant Modern Award casual conversion clauses. From 27 September 2021, the Fair Work Commission will make changes to all Modern Awards in relation to the casual conversion process to align the changes inserted in the Fair Work Act in March 2021 because of the Fair Work Amendment (Supporting Australia's Jobs and Economic Recovery) Act 2021.

Offer casual employees part-time or full-time positions when they become available, again documenting all related correspondence.

Where possible, limit rosters to weekly or fortnightly.

Ensure employees tender their availability for rosters as to give casual employees control over when they work.

Have employees tender their availability and provide shifts using a workforce planning model that limits regular and systematic hours.

Having a statement on all rosters stating that casual hours are not a guarantee of ongoing, regular and systematic work. Furthermore, it can be changed, varied or cancelled dependent on operational requirements and staffing levels.

Ensure pay slips specify payment of the 25% casual loading.

Further assistance

Have questions about how these changes could impact your business? We’re here to help.

Call our Employer Assistance team on 1300 135 822 or email advice@cciq.com.au

 

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