When is a casual employee not a casual?

It is a $64 million dollar question that always delivers varied responses and interpretations. Surprisingly casual employment is an issue that is still widely misunderstood and entangled with age old myths.

On a statistical note, more than two million Australians are employed casually. Women account for just over half of all casuals and 40% of casuals are aged 15-24 years.

Unfortunately even with the vast amount of legislation surrounding the employment relationship, there is no standard definition of a casual employee. Legislatively, it is understood that a casual employee is an Employee that works on an irregular and unsystematic basis and has little or no expectation of the continuation of work or guaranteed income and has the ability to accept and reject work as they see fit.

This seems simple enough however the ‘market or industry’ definition of a causal employee has morphed the common casual into something significantly different. Today we have casuals that work to fixed rosters, work full time equivalent hours and have an expectation of the continuation of work and income. This is a true case of where the legislative definition and the market definition don’t meet in the middle, this in turn opens the doors for misinterpretation and confusion as to if they are a casual employee or not.
 

So what are these common myths…..

 

1. Casuals can be dismissed at any time for any reason
 

Reality: The Fair Work legislation contains a reference to employees being unable to claim unfair dismissal for a dismissal that occurs within the minimum employment period. Outside of this minimum engagement period, casual employees have just as many rights as a full time or part time employee. Once this minimum employment period has been past, the Employer should essentially discipline or performance manage all employees in the same manner.

 

2. Casuals get a higher rate of pay so don’t get any penalty rates or overtime

 

Reality: The new modern award system prescribes a default casual loading of 25%. However many individual awards contain or prescribe for penalty rates, overtime and allowances to be paid to all employees including casuals.

 

3. Casuals don’t get leave

 

Reality: Whilst casual employees are not entitled to paid annual leave or paid personal leave, they are able to access time for these purposes without pay. Employers need to ensure they do not penalize or treat the employee any differently for taking leave from the workplace for these purposes – even though they are casual. Casual Employees are entitled to paid Long Service Leave and can access unpaid parental, jury / community service leave.

The reality is casuals have been afforded many of the rights of full time and part time employees and in most cases should not be treated any differently. As an Employer you should consider the following questions when looking at your casual workforce requirement:
 

1. Why does this position require a casual employment status
2. What are the award provisions for casual employment – in particular does the award prescribe for casual conversion to full time or part time after a specified period
3. Is the casual status being used because of the ‘myths’ stated above
4. What is it costing the business to have a casual employee (25% loading v’s full / part time entitlements)

Whilst there is no dispute that there will always be a need for true casual employees, Employers should be cautious of using the casual status for the wrong reasons. Either way, adequate documentation including letters of appointment, should be prepared to ensure that both parties are aware of the intent of the Employment relationship.


For further information, please contact Australian Business Consulting & Solutions on 1800 505 529 or via email