Landmark Decision For Employers With Casual Employees

aleisha Hey woman with long brown hair smiling at camera with long sleeve green blouse on

Aleisha Hey

Communications Bishop Collins Accountants

WorkPac Pty Ltd vs Rossato

On the 2oth May 2020, the full Federal Court of Australia handed down a decision regarding the conditions of “regular casual” employment and the entitlements of these casual employees.

In the case of WorkPac Pty Ltd vs Rossato (2020) it was declared that “permanent casual” employee Robert Rossato was entitled to paid leave. Mr Rossato, who works regular and predictable shifts, as a casual, for the firm WorkPac Pty Ltd, used the current conditions of the Fair Work Act to defend his case.

casual employees

The Act

Under the current stipulations of the Fair Work Act a casual employee: “does not have a firm commitment in advance from an employer about how long they will be employed for, or the days (or hours) they will work. A casual employee also does not commit to all work an employer might offer”. More notably the Fair Work Act also states:

A casual employee:

  • Has no guaranteed hours of work
  • Usually works irregular hours
  • Doesn’t get paid sick or annual leave
  • Can end employment without notice, unless notice is required by a “registered agreement”, award or employment contract

The importance of highlighting these casual employee conditions is crucial when considering the number of organisations who are finding ways to make permanent jobs casual.

Double Dipping

The ruling in favour of Mr Rossato, and other previous cases, has seen calls for legislative changes. Australian Industry Group Chief executive Innes Willox feels this decision may place a strain on organisations who may already be struggling from the impacts of the COVID-19 pandemic if there is a surge of claims by casuals. He believes that casuals are paid extra in lieu of entitlements and “with underpayment and unemployment rapidly increasing during the COVID-19 crisis, employers need to be encouraged to retain and take on casual employees – not deterred from doing so”. Mr Willox is also concerned that this case may lead to double-dipping from casuals if the Fair Work Act legislation is not reviewed and modified.

Double dipping occurs when the Casual Loading, which is provided to compensate an employee for the loss of leave entitlements, is not offset against claims for leave entitlements granted by the costs. Effectively providing the Casual Loading as well as the leave entitlement.

Employers must clearly understand this in determining how to structure the status of their employees.

employee rights

Casual Employees – Legislative Changes?

The government has placed a statement of the Fair Work Act Casual Employees webpage, stating they are reviewing the information within the Fair Work Act for Casual Employment to make sure it has not changed because of the outcome in the WorkPac Pty Ltd Vs Rossato case and will be updating with a message soon.

Tell Us What You Think

What are your thoughts on this case? Are you in favour of supporting “permanent casuals” with the benefits of part time or full-time employees? Or do you think this is a problem for businesses already paying the 24% loading in lieu of these entitlements?

We would love to hear your thoughts.

If you need any help with your staffing arrangements and your cashflow, Bishop Collins Chartered Accountants are Business Services specialists and we can help you.