Double Dipping – Another Big Win for Casual Workers in Landmark Court Ruling
22 May 2020
In another controversial decision, the Federal Court has again confirmed that casual employees working ‘predictable periods of working time’ and regular and systematic hours are likely to be considered permanent employees entitled to leave, irrespective of what their contract says and regardless of evidence that a casual loading was paid.
WorkPac Pty Ltd was challenged in the Full Federal Court (WorkPac Pty Ltd v Rossato  FCAFC 84) by a former employee seeking leave entitlements. Mr Rossato, who was engaged under multiple casual contracts of employment over a period exceeding three years, and was regularly rostered to work on a 7 days on/7 days off basis, claimed the nature of his employment relationship with Workpac reflected that of a permanent employee, not a casual as stated in his contract. The Court agreed with Mr Rossato finding that he is a permanent employee entitled to paid annual, personal/carer’s and compassionate leave, plus payment for public holidays.
Significantly, the Court also determined that – despite Mr Rossato’s contracts expressly stating that Workpac paid him a 25% casual loading in lieu of leave, notice and redundancy entitlements – this additional amount could not be set-off against the claim for unpaid leave entitlements. Effectively this decision entitles Mr Rossato to both a loading and leave entitlements.
This case reinforces a previous decision in September 2018 also involving Workpac. CCER provided advice to members after the decision handed down by the Full Federal Court (WorkPac Pty Ltd v Skene  FCAFC 131) left employers exposed to potential claims from casuals seeking back-payments for annual leave and other benefits.
What Does this Mean for Employers?
As a result of the Court’s decision, employers need to look more closely at their engagement of casuals and consider the following:
- Deeming an employee to be casual by relying on what’s written in the contract and paying a loading is not sufficient and, as this recent decision illustrates, all aspects of the employment relationship must be examined.
- A retrospective review of the employment relationship may also be necessary particularly where the parties may have initially entered into an employment relationship that was intended to be casual in nature but subsequent conduct changed the engagement to a permanent arrangement.
- A genuine casual employee has no guarantee to continuing and indefinite work. Long term rostering arrangements and regular and predictable hours may indicate a permanent employment relationship between an employer and employee.
- In the absence of a firm advance commitment from an employer, casual employment is characterised by uncertainty, discontinuity, intermittency of work, unpredictability and irregular work patterns.
- An employee may have a right to seek to convert from casual to ongoing employment under a modern award or enterprise agreement.
Where to Next?
In light of comments made by Industrial Relations Minister Christian Porter in the wake of the decision and the widespread consequences including claims for back-pay from employers across Australia, it appears likely the judgement will be appealed to the High Court. The Minister has also raised the possibility of legislative change.
In the meantime, CCER members need to be aware of the Court’s approach to determining entitlements to paid leave for casuals, who may be found to be permanent employees, particularly if there is a reliance in your workforce on casuals working on a regular and systematic basis.
If you have any questions on this issue or would like more details as to how we can assist you, please don’t hesitate to get in touch with one of our Employment Relations Specialists at email@example.com or (02) 9390 5255.
Disclaimer: CCER does not give legal advice and this information should not be taken as such.