Despite the fact the majority of industrial reforms proposed by the Government in its Fair Work Amendment (Supporting Australia's Jobs and Economic Recovery) Bill 2020 ("Bill") have been stymied by the Senate, employers should welcome the fact long standing ambiguity surrounding the test for determining who a casual employee is, and what their entitlements are, has largely been resolved.

The Bill, first introduced into Federal Parliament on 9 December 2020, has succeeded in codifying the working arrangements and rights of casual employees by:

  • inserting a definition of casual employment into the Fair Work Act for the first time (that draws on established common law principles and focuses on the nature of the offer of employment);
  • preventing employers having to pay an employee twice for the same entitlement in the event an ongoing employee is misclassified as casual, to address any potential for 'double dipping';
  • providing the ability for regular casuals to become permanent after 12 months of employment provided that during at least the last 6 months of that period the employee worked a regular pattern of hours on an ongoing basis (however an employer can decide not to make an offer for casual conversion if there are reasonable grounds to do so);
  • requiring the Fair Work Ombudsman to prepare a Casual Employment Information Statement that contains information about casual employment and offers and requests for casual conversion; and
  • parties may refer disputes in relation to the new casual provisions to the Fair Work Commission (provided they are not resolved by discussions at the workplace level).

The changes in relation to casual employees represent one of five proposed areas of industrial reform that had been advanced by the Government. The other areas, primarily relating to enterprise bargaining and award flexibility, had been deeply unpopular with Labor and the unions and met with fierce resistance. Despite enjoying bipartisan support, the part of the Bill that dealt with criminalisation of wage underpayments was removed by the Government.

The passage of the Bill follows confirmation late last year that the High Court granted special leave to WorkPac Pty Ltd to challenge the Full Federal Court decision in WorkPac v Rossato [2020] FCAFC 84. In that decision, the Full Federal Court found casuals who have a firm advance commitment from their employer for ongoing work may have a claim to the same entitlements as permanent employees.

The amendments to the Fair Work Act are an opportunity for employers to reflect on how their casual employees are engaged and, in particular, whether there is consistency with the new definition of casual employee found in the Bill.

For futher information please contact:

Michael Byrnes, Partner
Phone: +61 2 9233 5544

Katrina Seck, Senior Associate
Phone: 02 9233 5544

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