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Employment Classifications Matter: Casuals

Employment Law

Many businesses legitimately employ casuals when there are major variations in labour requirements. However in many situations, casuals end up working a regular pattern of hours of work over long periods of time.  When is a casual really a casual? Getting this detail right can have huge implications for both employers and works.

The recent decision of Workpac Pty Ltd v Skene [2018] FCAFC 131 (Skene) provides some key insights into this issue. Skene was employed as a ‘casual’ dump-truck operator in a Queensland mine. He received a flat hourly rate and worked regular days and hours. As a casual employee, he received a casual loading in lieu of benefits including annual leave and personal leave. His employer mistakenly believed that because Skene was a casual, they could simply terminate his employment without any consequences. They were wrong!

After his employment terminated, Skene applied to the Federal Circuit Court claiming that he was in fact a permanent employee and entitled to appropriate benefits. The court agreed with him – even though he was called a casual and paid as a casual, when the details of the arrangement were closely inspected, the truth was that his working hours were no different to those of a permanent employee.

Employers should review the nature of its relationships with casual employees. In Skene, the Court reiterated that indicators of a true casual employment relationship include: irregular work patterns; uncertainty as to the period of which employment is offered; discontinuity of work; and intermittency of work and unpredictability.

Employers should also review their contracts with casual employees. In Skene, the contract did not expressly identify whether a casual loading was included, how much of the rate the loading represents (for example, 25%), and what the loading is paid in lieu of (such as annual leave). It was then easier for the Court to find that Skene was not truly a casual employee.

Skene may yet be challenged in the High Court. However, it is worth employers reviewing its current arrangements with casual employees to ensure that they reflect a true casual employment relationship.  Please contact any member of the AV employment team if you have any enquiries.