Many businesses assume that hiring employees as “casual” workers will limit their risks of facing unfair dismissal claims. However, casual employees are entitled to make an unfair dismissal claim. If you fire an employee harshly, unjustly or unreasonably, you could expose yourself to an unfair dismissal claim. If the Fair Work Commission (the Commission) finds that you unfairly dismissed an employee, you could be liable to compensate your employee and/or reinstate them in their previous position. However, unlike full-time and part-time employees, casual employees must meet further requirements before they become eligible to file an unfair dismissal claim. This article explains what a casual employee must establish to succeed in an unfair dismissal claim and the factors a court will consider.
Who Can File A Claim For Unfair Dismissal?
An employee can make an unfair dismissal claim if they:
- have completed the minimum employment period, meaning they have worked in your business for at least 6 months, or 12 months if you are a small business employer;
- are covered by a modern award or an enterprise agreement; and
- earn less than the maximum high-income threshold, which is $167,500 as of 1 July 2023.
However, for casual employees, their period of service as a casual does not count towards their period of employment unless:
- you employed them on a “regular and systematic basis”; and
- during the period of service, they had a reasonable expectation of continuing employment on a regular and systematic basis.
What is A “Regular and Systematic Basis”?
There is no clear-cut definition of what employment on a “regular and systematic basis” is. Instead, the Commission will interpret from the facts and circumstances of each case, whether you employed a casual worker on a regular and systematic basis. Here are some examples to help explain.
Contract Work
Some businesses employ casual workers as their organisation depends on gaining contract work. The contract work may require casuals to work many hours for some periods and minimal during periods where there are no running contracts. This is common for many businesses in the construction or creative services industry.
The Commission presided over a case in 2016 where a contracted casual employee:
- worked each day;
- worked an average of 28-40 hours per week; and
- had to report to their employer if they were unable to attend work.
In these circumstances, they found that the employee was employed on a “regular and systematic basis”. The Commission highlighted the obligation of the employee to maintain contact with the employer and the fact that the engagements were an established sequence.
Seasonal Work
Many organisations require seasonal work when their need for labour depends on specific peak periods. This is very common in the agricultural industry, where there is more demand during the picking/packing season or, in the retail industry, during sales and holiday periods.
In a 2014 case, the Commission needed to determine whether a casual employee’s unfair dismissal application would be successful. In considering the nature of employment, the applicant had:
- a similar pattern of work each year;
- varied work depending on customer demands and the season;
- an employer who offered work to the employee and the employee could accept this work; and
- no work outside of the seasonal work.
Here the Commission found the employee was employed on a “regular and systematic basis”. Therefore, regular and systematic work can also be seasonal or irregular. The Commission stated that a continuing relationship was established between the employer and employee where the employee had come to rely on the offer of seasonal work each year.
As an employer, understand your essential employment obligations with this free LegalVision factsheet.
What Does This Mean For Employers?
Casual employees could be entitled to make an unfair dismissal claim if their employment is “regular and systematic”. Therefore, you should ensure all dismissals are fair.
Some of the ways you can conduct a fair dismissal include but are not limited to the following:
- having a valid reason for the dismissal based on the employee’s conduct or capacity to do the job, rather than dismissing them on the basis that you simply do not like them;
- providing your employee with a fair warning when they work for you on a regular and systematic basis;
- allowing your employee to respond to the warning; and
- above all, seek legal advice to get advice on how you should handle your employee’s specific circumstances.
Key Takeaways
Casual employees can file a claim for unfair dismissal where they meet the specific criteria of having completed the minimum employment period, are covered by a modern award or an enterprise agreement and
earn less than the maximum high-income threshold. However, they also have to work on a regular and systematic basis. Therefore, your casual employees could, for example, be able to make an unfair dismissal claim if you rely on contract work or seasonal work. You must ensure you understand when your employees can make a claim and that your dismissals for all staff are fair.
If you need help with an unfair dismissal claim, LegalVision’s experienced employment lawyers can assist as part of our LegalVision membership. You will have unlimited access to lawyers to answer your questions and draft and review your documents for a low monthly fee. Call us today on 1300 544 755 or visit our membership page.
Frequently Asked Questions
Unfair dismissal is when you fire an employee in a manner that is ‘harsh, unjust or unreasonable.’
Employees have 21 days from the day that you dismiss them to lodge a claim with the Fair Work Commission.
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