Casual Employment Changes: What You Need to Know

What the High Court Decision about Casual Employment Means For You

The definition of "casual employment" has been a hot topic in the employment sphere over the last few years.  If you've read our previous article, Annual Leave for Casual Employees, you would know that in 2018, the Full Court of the Federal Court of Australia ruled that a casual employee, engaged on a casual basis yet working on a regular and systematic basis was properly characterised as a permanent employee (and therefore entitled to be paid annual and personal leave).  This was a historic decision, as it rejected the then widely accepted meaning of a casual employee (i.e. an employee who had no firm advance commitment of employment from his or her employee).  As one would expect, this had far reaching impacts for employers and employees alike.  In fact, the economic ramifications resulting from the decision were expected to exceed $35 billion.

Rossato v. Workpac

Shortly after that decision was handed down, another "casual" Workpac employee, Mr Rossato, made a claim against Workpac for unpaid annual leave entitlements, relying on the Federal Court's earlier decision.  That resulted in new proceedings being commenced, with the Full Court of the Federal Court of Australia ultimately affirming its earlier decision, and finding that Mr Rossato, who had been employed on a regular and systematic basis, was not a casual employee (and was thus entitled to paid annual leave entitlements).  Unsurprisingly, a number of other stakeholders (including the Federal Government) intervened in those proceedings (seemingly in support of Workpac's position), but to no avail.

That decision was appealed to the High Court of Australia, with the nation's highest court being asked to determine the meaning of the previously undefined reference to "casual employee" in the Fair Work Act 2009 ("the Act").  Employers and employees alike have been waiting, with baited breath, for the High Court to settle the matter once and for all.  In the interim, however, the Federal Government has made some significant and noteworthy changes to the Act, including the introduction of a definition of "casual employee", and casual conversion obligations.

Earlier this month, on 4 August 2021, the High Court handed down its much awaited verdict, ruling that casual employees are not entitled to paid leave benefits.  As such, the definition of a "casual employee" would revert to the earlier accepted meaning (i.e. an employee with no firm advance commitment), thus aligning with the newly introduced definition set out in the Act.  In essence, the employment contract reigns supreme, and a casual employee is limited to the benefits outlined in his or her employment contract.

While the High Court decision means that casual employees are not entitled to paid leave like their permanent counterparts, the takeaway for employers and employees alike is that the employment sphere is dynamic and ever changing.  As such, it is imperative that both employers and employees keep up to date with changes to the Act, or any modern award, and ensure same are implemented as necessary.

If you have any questions about your employment rights and/or obligations, we can assist!  Contact one of our employment law experts today.