‘Casual’ or ‘Part-time’
The Blurred Line between ‘Casual’ & ‘Part-time’ Employment
Many employers in the Fitness, Leisure, Retail and Hospitality sectors require maximum flexibility to ensure the continuing success of their businesses. Significant numbers have plumped for ‘casualised’ workforces when faced with dynamic market conditions for their goods or services. In the process, some have fallen foul of recent developments in workplace law by overlooking obligations they assumed they did not incur through engaging (regular) casuals.
A casual employee has traditionally been viewed as an employee who is employed to perform work on an “as needs” basis, without a regular work pattern. Each time a casual is engaged they enter a separate and distinct contract. In other words, their employment comprises a series of contracts as opposed to one continuous contract and there is no guarantee of continued employment. However, confusion lies in the fact that there is not a strict legal definition of a casual employee. The High Court of Australia has held that “the term “casual worker” is not a precise legal term but rather a colloquial expression. In the absence of a definition, the facts of each arrangement would need to be examined on a case by case basis in order to determine whether a worker is a casual.”
The Application of Modern Awards
The contents of awards have usually been a significant determination of the nature of the employment relationship; a typical example being, Clause 13 of the Fitness Industry Award 2010 provides that: “A casual employee is an employee engaged and paid as such.”
On the face of it, a fairly straightforward proposition.
Further, at clause 12.1, the award goes on to say that:
“A part-time employee is an employee who:
(a) Works less than full-time hours of 38 hours per week;
(b) Has reasonably predictable hours of work; and
and clause 12.5 “An employee who does not meet the definition of a part-time employee and who is not a full-time employee will be paid as a casual employee in accordance with clause 13 –Casual employment.”
Again, an apparently straightforward proposition, that is until you look at how the Courts have viewed the nature of casual employment in recent times.
In practical terms, casual employment involves employment for fewer hours than the normal full-time working week (38 hours), usually arranged in a non-regular pattern (a concept carried through in the excerpts of the award quoted above).
Where a court finds that a “casual” employee is actually a permanent employee, the employee will be entitled to all the legal protections available to permanent employees on termination. They may also make a claim for any unpaid leave entitlements (reserved for permanent employees), back to the point in time that the Court finds that the permanent employment actually began. A matter of considerable “financial shock” to employers faced with bills for back-payment of Long Service and Annual Leave, and possibly redundancy and termination notice periods.
It is not uncommon that a relationship ‘morphs’ over time from a “true” casual to that of a “permanent part-time” employee, as the parties get into a regular (comfortable) pattern of hours, suitable to both parties.
Matters to be considered
In a recent Federal Magistrates Court decision, it was found that even though the employee’s contract described them as being casually engaged, and paid accordingly, on a proper analysis of their working situation, they were not a “true casual”. The key factors the Court took into account to reach this conclusion included that the work was regular and performed in accordance with a stable, organised and certain roster, which was published significantly in advance, and that the employee in question was to work on an ongoing basis until the contract came to end. Importantly, the employee was not free to refuse work on the basis of other commitments.
Employers who seek to codify the terms and conditions of ‘casuals’ through making them parties to a formal “employment contract”(as opposed to an Enterprise Agreement or Individual Flexibility Agreement), are inadvertently pushing the ‘flavour’ of the relationship from casual to ‘weekly’ (part-time, or fixed-term), as the work patterns defined in the “contract” will make the employment more regular, stable, and organised.
So even though the intention of the parties (particularly the employer), may fit nicely with the contents of the definition found in the applicable Modern Award, it is the close examination of the totality of the relationship that will ultimately determine the true employment relationship.