Following the High Court decision of WorkPac Pty Ltd v Robert Rossato & Ors [2021] HCA 2021 earlier this month, employers now have some certainty about the status of casual employees.

The Federal Court had previously held that an employee of WorkPac, Mr Rossato, should have been classified as a permanent worker as he was given regular and ongoing shifts. This meant that he was entitled to all of the benefits of a permanent worker, such as annual leave and personal leave. The Federal Court did not permit Workpac to set off or recoup any of the casual loading already paid to Mr Rossato. Employers were extremely concerned as they feared it would lead to double dipping – where workers receiving a 25% casual loading would then claim the benefits of a permanent employee on top of that amount. The 25% casual loading is intended to compensate for an employee not being entitled to benefits of permanent employment.

On 27 March 2021, the Fair Work Act 2009 (the ‘FWA’) was amended to include a definition of “casual” for the first time. Section 15A was drafted to mirror Workpac’s argument in the Federal Court. Section 545A was added to the FWA in March, which introduced a protection for employers who had misclassified casual workers, by allowing them to plead a set-off. Both sections were expressed to operate retrospectively.

On 4 August 2021 the High Court ruled that a casual is

“an employee who has no firm advance commitment from the employer as to the duration of the employee’s employment or the days (or hours) the employee will work and provides no reciprocal commitment to the employer”.

The High Court accepted that the above test can only apply when there are enforceable terms of an employment contract to that effect.

Employers should ensure that written employment contracts for casual employees include express provisions about the nature and scope of the relationship. They should also be mindful of the recently introduced obligations of section 66B of the FWA, which require employers to offer casual employees the option of becoming a permanent employee once they have been employed for 12 months and provided that they have worked regular and systematic patterns in the previous six months.

If you have a family law issue, please contact Eve Lynch