Earn
Government defines casual work – but what does it mean for you?
While much of the government’s industrial relations reforms failed to please the Senate, the Morrison government was successful in seeing through the definition of a casual employee for the first time in history.
Government defines casual work – but what does it mean for you?
While much of the government’s industrial relations reforms failed to please the Senate, the Morrison government was successful in seeing through the definition of a casual employee for the first time in history.
The controversial IR Omnibus Bill was introduced to Parliament in December last year, containing provisions regarding casual work, wage theft, award simplification, enterprise bargaining and greenfield agreements.
The final bill passed both houses of Parliament last week, in a revised and significantly reduced form, and while it has been critiqued as a failure on many front, the bill did manage to introduce a definition of casual employment into the Fair Work Act 2009 for the first time.
“While key aspects of the bill were jettisoned last week, the passing of the bill remains a landmark development as it reforms a substantial and often problematic feature of the industrial relations system – casual employment,” managing director at Australian Business Lawyers and Advisers, Luis Izzo, said.
Casuals defined for the first time
The measures to define a casual staff member were introduced following a Federal Court case last year, which ruled that casual employees working regular and systematic hours with “predictable periods of working time” are entitled to personal leave, compassionate leave and public holiday payments.
The court ruled that regardless of what their contract says and regardless of the payment of a casual loading, casuals are likely to be considered permanent employees based on their nature of work.
Conventional wisdom has been that casuals do not accrue annual leave entitlements, because the casual loading sees them effectively paid a higher hourly rate in lieu of such accrued entitlements.
- offered employment without a “firm advanced commitment to continuing and indefinite work”; and
- the person accepts that offer,
then the person is a casual employee regardless of any changes in the employment relationship.
“That is, the assessment of whether a person is a casual occurs on the basis of the offer of employment, not on the basis of any subsequent conduct of the parties,” Mr Izzo explained.
Right to casual conversion
Another key aspect of the changing casual environment is the inclusion of casual conversion mechanisms, which will allow for the easier transition from temporary to permanent work.
“The offer must be to convert to either full-time employment (where the casual has worked the equivalent of full-time hours) or part-time employment consistent with the casual’s regular pattern of hours (where the casual has worked the equivalent of part-time hours),” Mr Izzo explained.
Employers must offer to convert a casual employee to permanent employment if the employee:
- has been employed for 12 months; and
- during the last six months, has worked a regular and systematic pattern of hours without significant adjustment.
Casual loading offset created
Mr Izzo also explained that the changing definition of a casual worker will help deal with the historical problem of workers being misclassified as casuals, which saw them miss out on accrued leave entitlements.
“Where an employee is found to have been incorrectly engaged as a casual (that is, they are at law a permanent employee), the bill creates an express right for employers to offset any leave entitlements owed to the employee against the casual loading that is often paid to the casual employees,” Mr Izzo said.
What should employers do next
According to the industrial relations lawyer, for employers these changes mean it could be time to "clean the house" in terms of the arrangements and instruments that business owners have in place governing casual employment.
Employers are advised to look at:
- introducing new casual contracts that align with the recent amendments; and
- introducing processes for dealing with casual conversion that ensure the employer’s operational requirements are considered whilst simultaneously ensuring compliance with the FW Act.
“For some businesses, it might also be time to reassess your workforce mix and labour strategies to determine whether your existing arrangements can be optimised having regard to the changed regulatory landscape,” Mr Izzo concluded.
About the author
About the author
Salary
Employers scrambling to prevent workplace brain drain
As workplace managers face a swiftly evolving employment market that’s increasingly favouring the demands of white-collar employees and jobseekers, bosses are falling under mounting pressure to pres...Read more
Salary
Unions back Albanese’s pledge to close gender pay gap
An electoral promise from Labor to make gender pay equity an objective of the Fair Work Act has been hailed as a “watershed moment” from industry peak bodies who have traditionally advocated for s...Read more
Salary
Coles asked to disprove $115m in alleged wage theft
One of Australia’s biggest supermarkets faces allegations that it underpaid more than 7,500 employees a total of $115 million. ...Read more
Salary
Gen Z left behind in progress to gender equality
Women under 25 may emerge from the pandemic in a worse financial position than when it began, new research has shown. ...Read more
Salary
Show me the money: I deserve a COVID recognition payment, and so do you
Staff are currently in high demand. But they’re also mostly overworked, overtired, underplayed and underpaid. ...Read more
Salary
Is Australia headed for the ‘Great Resignation’?
A wave of resignations from Australian workers is expected in the next six months. ...Read more
Salary
Earnings surge in lockdown, but is a slump ahead?
A new report from CBA has shown that it may actually pay to be in lockdown, as growth in household income surged ahead in NSW and Victoria. ...Read more
Salary
RBA sets sights on 4% unemployment
The RBA has updated its key objectives in order to jolt the Australian economy into growth, including a two-decade low unemployment rate of 4 per cent. ...Read more
Wrapping up an eventful 2021
Listen now
What Omicron means for property, and are units right for first-time buyers? What is equity crowdfunding? Are industry super funds tapping into member funds to save their skins?
Listen now
Will housing affordability improve in 2022? Will buy now, pay later become the norm? Why are Aussies staying in failing super products?
Listen now
Who really benefits from crypto ETFs? How will the RBA respond to rising inflation? Could a mandate help address unpaid super?
Listen now
Salary
Employers scrambling to prevent workplace brain drain
As workplace managers face a swiftly evolving employment market that’s increasingly favouring the demands of white-collar employees and jobseekers, bosses are falling under mounting pressure to pres...Read more
Salary
Unions back Albanese’s pledge to close gender pay gap
An electoral promise from Labor to make gender pay equity an objective of the Fair Work Act has been hailed as a “watershed moment” from industry peak bodies who have traditionally advocated for s...Read more
Salary
Coles asked to disprove $115m in alleged wage theft
One of Australia’s biggest supermarkets faces allegations that it underpaid more than 7,500 employees a total of $115 million. ...Read more
Salary
Gen Z left behind in progress to gender equality
Women under 25 may emerge from the pandemic in a worse financial position than when it began, new research has shown. ...Read more
Salary
Show me the money: I deserve a COVID recognition payment, and so do you
Staff are currently in high demand. But they’re also mostly overworked, overtired, underplayed and underpaid. ...Read more
Salary
Is Australia headed for the ‘Great Resignation’?
A wave of resignations from Australian workers is expected in the next six months. ...Read more
Salary
Earnings surge in lockdown, but is a slump ahead?
A new report from CBA has shown that it may actually pay to be in lockdown, as growth in household income surged ahead in NSW and Victoria. ...Read more
Salary
RBA sets sights on 4% unemployment
The RBA has updated its key objectives in order to jolt the Australian economy into growth, including a two-decade low unemployment rate of 4 per cent. ...Read more
