For the last three years, employers, unions, employment lawyers and the Federal Government have been closely following the WorkPac litigation, which in essence concerned the definition of "casual employment" not only for the mining industry, but for all private sector employment in Australia.

That litigation has now been ended by a unanimous High Court decision in favour of the employer interests. In essence, the Court said "look at the terms of the agreement, not what might have been the practical effect of what was agreed."

More details below.

Introduction

On 4 August 2021, the High Court handed down its decision in the matter of WorkPac Pty Ltd v Rossato.  This High Court case is an appeal by WorkPac against the decision of the Full Court of the Federal Court ("Full Court decision").  

Rossato was engaged by WorkPac (a labour hire company) under a series of six contracts to perform work for one of WorkPac's clients.  WorkPac treated him as a casual employee and paid him as such. 

Before the High Court, the appellant (WorkPac) contended that the Full Court fell into error in finding that Rossato was a casual employee.  The alternative basis for the appeal was that the Full Court wrongly rejected WorkPac's claims regarding set off and restitution. 

Please click here for our earlier article for further details on the Full Court decision and the factual background to this litigation. 

The High Court's findings

The High Court found that a casual employee is one who has no firm advance commitment from the employer as to the duration of the employee's employment or the days (or hours) the employee will work, and provides no reciprocal commitment to the employer. 

The High Court unanimously overturned the Full Court decision and found that Rossato ought to be characterised as a casual employee.  As a result, it was not necessary to make findings on set off and restitution. 

Meaning of "firm advance commitment"

In reaching its conclusion, the High Court said that the requisite "firm advance commitment" is to be found in binding contractual obligations of the parties to the employment relationship.  The requisite "firm advance commitment" cannot merely be an expectation or hope. 

The High Court analysed Rossato's contracts and found that there was nothing expressed in the contracts to indicate that there was a commitment to ongoing employment beyond the completion of the assignments in each of the contracts. 

New law regarding casual employment

A new law was passed earlier this year to provide a statutory definition of casual employment and other related matters.  The High Court's decision was made with regard to the laws that existed at the time of the Full Court decision, and it was not required to take the new law into account.  The High Court's decision is expected to have limited impact as the new law takes precedence going forward. 

The High Court did however say that the new law would apply retrospectively with some limited exceptions. 

Take away point

This High Court decision reinforces the importance of having an effective written contract. Although not required by law, failing to have a well-drafted written contract invites the substantial risk of uncertainties and arguments afterwards. The Workplace Law team at Carroll & O'Dea Lawyers is able to assist employers in preparing contracts tailored to their situation to ensure that they are enforceable as offers of casual employment.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.