1.1m casual employees left without higher pay or benefits

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December 09 2020
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Workers are being misclassified as casual employees despite working full-time hours, leaving them without benefits and without casual loading, a report has revealed.

1.1m casual employees left without higher pay or benefits

A study conducted by Griffith University found that as many as 1.1 million Australians are not being paid the 25 per cent loading rates, despite working as casual employees.

Another quarter of all these workers had no claim to leave entitlements, regardless of whether they were casual or not.

Professor of employment relations centre for work, organisation and wellbeing at Griffith University David Peetz pointed out the high rate of casualisation of the Australian workforce.

He noted that the poor classification of casual employees is leaving Australians without the security of permanent employment or the benefits of higher casual pay.

“The features of leave-deprived employees do not, on the surface, appear to be the characteristics of flexible, casual employment. The common feature appears to be low power,” Professor Peetz said.

He explained the widespread misclassification of workers classed as casual even when their employment was not.

“Casual employment reduces employee power and reduces employee entitlements – often without any offsetting ‘loading’ – under the guise of providing necessary flexibility,” he continued.

Commenting on the findings was ACTU secretary Sally McManus, who said the report shows that casualisation is a systemic issue in the Australian workforce – the majority of people who are casual should not be and do not receive any of the supposed benefits of casual employment.

“One in four Australian employees [does] not have any leave entitlements, leaving us lagging behind most other OECD countries,” she said.

“These are the workers who have carried us through the pandemic.”

“Casualised jobs with no access to paid leave was our weakest link in our efforts to stop the spread of COVID in our communities. We now need to turn that around, not make it worse.”

The unions highlight these casual workers are working the same hours every week, but with none of the entitlements that permanent workers can rely upon.

“They are being ripped off,” Ms McManus said.

“The proposal from the Morrison government will not only entrench this, it will take rights off casual workers.”

“On top of the lower pay and reduced rights, casuals also contend with the constant stress of having no job security.”

The union pointed to the half a million casual Australian employees who lost their jobs during the pandemic.

“Insecure work meant that these workers and their families had nothing to fall back on during a crisis. We are calling on the government to work with unions to halve the rate of insecure work,” she said.

The report follows the proposed changes by the government which will include new settings for casual workers that give them more rights for ongoing employment, and also give employers limited liability on paying benefits such as casual leave loadings.

It is also likely the bill will address the issue of “double dipping” whereby employers may be required to pay sick leave and other leave entitlements on top of the 25 per cent casual loading meant to compensate for such benefits.

Attorney-General and Industrial Relations Minister Christian Porter said the casual employment definition is likely broader than some business groups wanted, but also noted that the unions are likely to say the definition should be even broader.

“The business community estimates, among others, that if you don’t have that common sense fair offset provision, that the financial impost on the business community going back six years could be upwards of $39 billion, which could cripple a whole range of businesses at precisely the time that those businesses are struggling and need government’s assistance to grow out of the COVID-19 pandemic,” he said.

“So, this is about fairness, it’s about creating a clear distinction so that an employer knows, an employee knows, are they being employed as a casual and thereby receiving their 25 per cent loading, or are they being employed in some other way, as a permanent part-time or permanent full-time employee.”

About the author

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

About the author

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

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