High Court provides clarity on casual employment
05 August 2021
Our peak industry body for the staffing sector, the Recruitment, Consulting and Staffing Association (RCSA) recently shared this announcement:
Casual Employment Common Sense Prevails in the High Court of Australia
On 4 August 2021, the High Court unanimously allowed an appeal from the judgment of the Full Federal Court in the matter of WorkPac v Rossato & Ors. In doing so, the Court set aside the orders made by the Full Federal Court on 29 May 2020, and in their place, declared the following:
- Mr Rossato was a casual employee for the purposes of ss 86, 95 and 106 of the Fair Work Act 2009 (Cth) in respect of each of the six assignments with WorkPac Pty Ltd between 28 July 2014 and 9 April 2019; and
- Mr Rossato was a “Casual Field Team Member” for the purposes of the WorkPac Pty Ltd Mining (Coal) Industry Enterprise Agreement 2012.
In their judgment, the High Court held that a “casual employee” is one who has no firm advance commitment from the employer as to the duration of their employment or the days (or hours) they will work, and provides no reciprocal commitment to the employer. Where parties commit the terms of their employment relationship to a written contract and thereafter adhere to those terms, the requisite firm advance commitment must be found in the binding contractual obligations of the parties; a mere expectation of continuing employment on a regular and systematic basis is not sufficient for the purposes of the Fair Work Act 2009 (Cth). Essentially, the Federal Court “strayed from the orthodox path” in approaching the characterization of employment relationship by reference to the parties’ conduct rather than the written contract terms.
This judgment is fantastic news for not just our members, but for all casual employers in Australia. It is a correction of the errors of the Federal Court and reaffirmation of the Federal Government’s action in passing the Fair Work Amendment Act 2021 earlier this year. The Federal Court turned casual employment in Australia on its head and placed an enormous financial liability on the heads of countless businesses by allowing casual workers to ‘double-dip’ on entitlements where it was determined that the parties’ conduct outside of the contract constituted a “firm advance commitment”.
Without the Government’s actions, employers would have been waiting until today to once again employ casual workers with confidence and certainty. This was not a gamble we were willing to take. Australia’s economic recovery has been allowed to accelerate out of the downturn that COVID-19 placed us in because of the Government’s determination to right the unintended wrongs that came out of the court processes.
Employers of casual workers can now do what they do best with confidence, knowing that they have the full support of both our Parliament and the Judiciary. It is pleasing to see that when it comes to industrial relations in Australia, common sense has once again prevailed.
The High Court has released a summary of the judgment, as well as the full judgment.
Source: RCSA
Takeaway for employers
As previously highlighted in Horner’s Hr Connect newsletter and blog posts, the issue of “double dipping” by casual workers has been a significant concern for employers of casual workers following the previous Skene and Rossato decisions by the Full Federal Court which have now been corrected.
In light of this decision by the High Court, employers should seek advice to review their casual contracts of employment to ensure that the terms for casual employees support the characterisation of casual employment in the context of the work being performed, taking into account the key features of the High Court’s reasoning.
Employers should also keep in mind their obligations under the recently introduced section 66B to the Fair Work Act (FWA), which requires employers to offer casual employees the choice to become permanent if they have been employed for 12 months and have worked regular and systematic patterns in the previous six months.
Need assistance?
Please contact Horner should you need any advice or assistance in reviewing your contracts of employment for casual workers.
Contact Darren James, Manager – Business Development on 0417 519 669 or email horner@horner.com.au