Emil Ford Lawyers

Navigating the Murky Waters of Casual Employment

Flexible work arrangements and the extensive system of employee entitlements introduced by the Fair Work Act and the Modern Awards pose new problems for employers. Several of these problems relate to casual employment as this concept continues to evolve. In this article, we review several issues that have arisen in relation to casual employment.

Defining casual employees

Traditionally, the common law determined whether an employee was a casual according to all the circumstances of their employment and features such as:

  • the informality and irregularity of the employee’s pattern of work and working hours;
  • the expectation of ongoing employment;
  • the nature of work e.g. intermittent/seasonal.

Under the traditional approach, it was not enough to simply label an employee as casual and pay them as such. However, in recent decisions under the Fair Work Act, the Fair Work Commission has taken just this approach.  In a recent case, the Full Bench of the Fair Work Commission ruled that the term ‘casual’ in the Fair Work Act should be defined according to the Federal industrial instrument that applies to the employee, whether it be a Modern Award or Enterprise Agreement. For example, the Modern Awards define casual employees as employees who are engaged and paid as such (i.e. employees who are labelled casuals and paid a casual loading). In this case, the Full Bench overturned the decision of the Commissioner at first instance and held that, notwithstanding their regular pattern of work, because the Employer engaged its employees as casuals and paid them a casual loading, they should be construed as casual employees. This meant that the employees were not entitled to a redundancy payment, even though under the traditional approach their employment could be characterised by many of the features of permanent employees.

Long term casual employees

In the above decision, the casual employees were not entitled to a redundancy payment. However, in certain circumstances, casual employees may be eligible for other entitlements under the Fair Work Act. For example, section 67 provides that a casual employee is entitled to unpaid parental leave if they are a long term casual employee and would have a reasonable expectation of continuing employment by the employer on a regular and systematic basis but for the birth or expected birth of their child. A long term casual employee is defined under the Fair Work Act as a casual employee who has been employed on a regular and systematic basis for a sequence of periods of employment during a period of at least 12 months.

Similarly, under section 384 of the Fair Work Act, a casual employee can access the unfair dismissal provisions of the Fair Work Act if their employment as a casual employee was on a regular and systematic basis and the employee had a reasonable expectation of continuing employment by the employer on a regular and systematic basis.

Entitlement to vote on an enterprise agreement

Another issue that has arisen concerns whether casual employees are entitled to vote on an enterprise agreement. Under the traditional approach to defining casual employees, the employment of casual employees was considered to commence and finish at the start and end of each day’s work. This means that under section 181 of the Fair Work Act, a casual employee is only permitted to vote on an enterprise agreement if they are at work that day. This approach was taken in the decision of McDermott Australia Pty Ltd (2016) where the Fair Work Commissioner found that an enterprise agreement voting process was invalid because casual employees had voted on the proposal on days that they were not paid to work. The Full Federal Court reached a similar decision in NTEIU v Swinburne (2015) where it held that casual teaching staff were not entitled to vote on an enterprise agreement where the voting took place between semesters. This approach appears to be inconsistent with the Fair Work Act’s acknowledgment of long term casual employees that was discussed above. Nevertheless, it highlights to employers that the terms of engagement of employees can have complex implications for various aspects of the employment relationship.

It is therefore important that employers label and remunerate casual employees appropriately. Employers should also be aware of the additional entitlements of long term casual employees under the Fair Work Act.

If you have any questions concerning an employment matter, please contact , or .

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