This year has seen a significant focus on casual employees in the Australian workplace, raising more questions than has been answered.
The controversial WorkPac decision of the full Federal Court (WorkPac Pty Ltd v Skene [2018] FCAFC 131) has rejected the commonly understood position that an employee designated as a casual under an award or enterprise agreement is a casual for all purposes.
This decision brought uncertainty for employers who previously treated casuals on the assumption that they were not entitled to any leave or termination entitlements. It also opened the possibility that employers could face significant penalties for not paying their staff the correct entitlements. (See our article on 'Are your casual employees actually casuals').
Shortly after the WorkPac decision, the Fair Work Commission model casual conversion clause came into operation from 1 October 2018 into more than 80 effected modern awards.
This followed the Fair Work Commissions landmark ruling in July 2017 in which it determined to provide certain casuals with a right to request conversion to permanent employment. The new changes required employers to notify casual employees of their right to request to convert by 1 January 2019 if they are an existing employee or within the first 12 months of the employee's first engagement to perform work. While this right existed in a few modern awards, the extension to over 80 awards has significantly increased the rights of casual employees who having worked a pattern of hours on an ongoing basis for 12 months, without significant adjustment, could request that the business convert them to permanent employment.
An employer receiving the request would have to consult with the employee and only refuse the request in writing within 21 days of the request being made, on the basis of 'reasonable grounds'. For more information see our article 'Casual employees can now request to be permanent'.
And further complications for employers arose out of the Fair Work Commissions decision in the Foodora case where the commission found a worker was not an independent contractor but more likely was a casual employee. Although that case depended on the particular facts of the matter, including that the worker was swapping 'shifts' with other delivery riders it exposes a weakness for employers looking to engage labour other than as causal employees. The administrator for Foodora estimated workers had been underpaid $5.5million based on a conclusion that 'it is more likely than not that the delivery riders and drivers should have been classified as casual employees instead of contractors'.
And most recently the Federal Government has indicated it may look to announce significant changes to casual worker arrangements to provide legislative certainty and safe guards for employers around casual employment.
In 2019, employers will need to closely follow developments in this area if they are to ensure they maintain a flexible workforce with minimal risk of breaching workplace laws.
This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.
