In a recent case decided by the Federal Circuit Court of Australia this year, the Court determined that an employee who was purportedly employed as a casual employee was in fact permanent and was owed payment of 15 years’ worth of annual leave payments. The case is a salient reminder to employers to ensure that they check the terms of any applicable award or enterprise agreement and ensure the appropriate written contract is in place, when engaging casuals.
In Apostolides v Mantina Earth Movers & Construction Pty Limited, there was no written contract of employment or written terms setting out the contract. The employee had worked full time hours with substantial amounts of overtime for 15 years, he hadn’t been paid for public holidays over the course of his employment and there was never any suggestion that he may not be required to work each day or that he had the option to decline work. Further, his payslips contained no reference to “casual” or that there was casual loading applied to his wage but he was listed as “casual” on the employer’s payroll system. Looking at the objective facts, the Judge found that the employee was really a permanent employee for the purpose of the applicable award and the employee was expected to be available for 38 hours a week plus overtime. Suffice to say, the employer was shocked to pay a significant amount of annual leave dating back 15 years.
The flexibility afforded to businesses in having casual employees is well known. Approximately 1 in 5 Australian workers are engaged on a casual basis. However, many businesses are unaware of the entitlements that casual employees must be provided and many believe that all that is required is a casual loading. This is not just the case and some casual employees will also have additional entitlements including in some circumstances, unpaid parental leave, long service leave, a right to request flexible working arrangements and an entitlement to file an unfair dismissal application.
What is a Long Term Casual Employee
There is also something under the Fair Work Act called a “long term casual employee”. A long term casual employee, is defined under the Act as an employee who is casual and has been working on a regular and systematic basis during a period of at least 12 months. What “a regular and systematic basis” means is not defined. However, as a general rule of thumb, where there is an expectation that the employee will continue to be offered work there is a tendency to find that the employee worked regularly and systematically. The relevant Award is also very important to understand here as under some Awards, a long term casual employee has the right to elect to have their employment converted to full time or part time employment, and the employer may refuse the request if there are reasonable grounds for doing so.
The employment of casuals is very attractive to businesses particularly those where the business carried on is uncertain or ebbs and flows. It is important to understand when hiring casuals you get the terms right otherwise, they could come back to bite you.
If you require any further information in relation to employment of casuals or have an employment inquiry, please do not hesitate to contact Walter MacCallum of Aitken Lawyers 0n 02 8987 0000.