While the use of casual labour is a common way of managing peak workloads in many agricultural industries, uncertainty around what constitutes ‘casual’ poses a significant risk to employers.
In 2016, more than 2.5 million employees were engaged on a casual work basis, comprising almost 25% of the national labour force. While casual workers are generally hired on a flexible basis, some arrangements could be considered permanent and should therefore, be remunerated as such.
One of the major issues with the legalities surrounding casual employment is the lack of an adequate definition of casual work. There are definitions under both common law and the Fair Work Act, however they are vague and inconsistent.
Adding another dimension to the conundrum is the recent Federal Court decision which ruled that a fly-in, fly-out worker was not a casual staff member, despite being engaged as one. The court defined casual work as having irregular work patterns, uncertainty, discontinuity and intermittency of work and unpredictability.
The employer was ordered to back pay leave entitlements, plus an additional civil penalty, yet to be decided.
Overtime for Casuals on the Horizon
Despite heavy opposition from industry groups, the Fair Work Commission is currently amending the Horticulture Award to make casual employees entitled to overtime payments.
Draft changes suggest that employers will have to pay 50% of the casual rate for every hour worked over 304 hours per eight-week period. In addition, hours outside the standard 6am – 6pm Monday – Friday working week (and Saturday by agreement) will also be considered overtime.
The National Farmers’ Federation together with the Voice of Horticulture hired a barrister in 2015 to rebut the claims of the Australian Workers Union (AWU) that casual employees were entitled to overtime. The case was heard by the Fair Work Commission which ruled that overtime should be applicable to casual employees.
Avoiding The Risk
For employers looking to avoid miscategorising employees, Lander & Rogers Workplace Relations and Safety recommend monitoring employment conditions to ensure permanent employees aren’t being treated as casuals.
- review existing casual agreements to limit the risk of repaying casual employees certain entitlements; for example, by checking if the agreements have appropriate set off clauses;
- be more diligent in classifying casuals, as employees who work set, inflexible hours with a degree of certainty about ongoing work are unlikely to be ‘casual’;
- review and monitor your casual workforce: employment arrangements may change during employment and if a casual is no longer a casual, consider converting their employment status to permanent to mitigate any potential exposure (particularly where a casual employee is covered by a modern award containing a casual conversation clause); and
- determine whether casual employees are required: employing a “long-term” casual can be significantly more expensive than a permanent employee, and they do still have rights (e.g. they may have rights to protections from an unfair dismissal).