Are employers too casual about their engagement of workers?

The Australian Federal Court recently decreed that a casual worker employed by a labour hire company was not in fact casual and consequently entitled to leave provisions under the National Employment Standards (NES).  The case was based on the workers systematic and regular engagement as an employee throughout the term of his employment.  The Court ruled that the employer, Workpac, is required to pay their employee Paul Skene accrued annual leave upon termination of his appointment as a result of the finding.

Martin Nally, Director of People Solutions at AB Phillips, AAT Australia’s partner of choice for HR services and support to members said “the Federal Court’s decision means the worker has entitlements, such as annual leave, as if they had been engaged as a permanent employee.

This ruling comes after a five-member Full Bench of the Fair Work Commission decided to incorporate a ‘model casual conversion’ clause into 85 modern awards, including in the retail, restaurant, banking, aged-care, agriculture, airline, mining, maritime and transport industries.  The details include:
•  The proposed clause allows a casual employee after 12 months of regular service to request their employer to convert their employment to part-time or full-time employment.  An employer may refuse the request on reasonable grounds after there has been consultation with the employee.
•  The model clause requires the employer to provide all casual employees a written copy of the conversion clause within the first 12 months of their first engagement to perform work.

“This recent Federal Court decision is a warning about the common use of ‘permanent casuals’ and the dangers of engaging a casual under a pattern of regular work” said Mr Nally.

Employer bodies and trade unions are both calling for the Fair Work Act to include a clear definition for casual work to provide clarity to both employees and employers.

Mr Nally warns that “in the interim, the engagement of casual workers needs to be carefully examined and applied to avoid their systematic and regular engagement and now, because of the Federal Court decision, access to leave entitlements.  The specifics of each award which is applicable should be examined as no blanket rule applies yet”.

Watch this space as AAT is set to launch a HR Support Program with AB Phillips next week for bookkeepers and accountants.