Engaging casual employees rather than permanent workers may be most appropriate for your business situation. However, you still owe your casual employees certain entitlements and fair treatment. In this article, we touch on three key considerations to keep in mind when engaging casual employees on a regular basis.
1. Entitlements Owed to Casual Employees
A casual employee is entitled to:
- two days each of unpaid carer’s and compassionate leave;
- unpaid community service leave; and
- a higher hourly rate than their equivalent full-time or part-time colleagues.
If your employee is covered by a modern award, you may owe them additional entitlements to those listed above. The award will also specifically define the pay rate. For example, a casual employee covered by the Hair and Beauty Industry Award who works outside standard hours would receive:
- the ordinary hourly rate plus 50%; or
- an additional 100% on top of the ordinary hourly rate on Sundays.
Tip: The FWC has a pay rate calculator that can be used to determine casual rates of pay.
A casual employee does not:
- have a guaranteed number of hours
- have guaranteed regular hours
- get paid carer’s, sick or annual leave; or
- need to give notice to end the employment relationship (although their award or contract may require them to give notice). However, this means that employers can terminate without notice as well.
2. Long-Term Casuals
Some casual employees will work with their employer:
- over a long period of time; and
- with an expectation of ongoing work.
These employees are “long term casuals”. They still receive the same entitlements. But they can also request flexible working arrangements and take parental leave if:
- they have worked with the same employer for a year; and
- it seems likely they will continue.
What Does ‘Regular’ Work Mean?
Working ‘regularly’ for an employer does not necessarily mean weekly or fortnightly shifts. In some contexts, ‘regular’ work will be seasonal (e.g. fruit picking). In others, there may be breaks between periods of work (e.g. during the school holidays).
The Fair Work Commission (FWC) takes into account the following factors when determining whether a casual employee is employed on a regular and systematic basis:
- Did the employee regularly accept work? Did the employer regularly offer work?
- How many hours did the employee work?
- Did the employer generally expect the employee to accept work when they offered it?
- Did both parties expect that the work would be ongoing?
Additionally, the FWC will look at the entire relationship rather than just what the parties agreed upon at the start of employment. This is because sometimes, parties might enter the relationship thinking it would be a standard casual employment relationship. However, over time this can change.
The recent decision of the Full Federal Court in WorkPac Pty Limited v Skene further discusses the importance of employers reviewing how they are engaging casual employees in practice. In some cases, your long-term casuals may be considered permanent staff.
3. Performance Management for Casuals
Performance management may be appropriate for casual employees engaged on a regular and systematic basis.
What is Performance Management?
The aim of performance management is to improve the employee’s performance in all aspects of their employment. It involves:
- collaborative meetings;
- appraisals; and
You should document all discussions. If a former employee brings an unfair dismissal application against you, the FWC will look at what steps you took to manage that employee’s performance.
Note: In order for a casual employee to bring an unfair dismissal claim, they must have been working for you for at least six or twelve month (depending on the number of workers you employ).
Initiating Performance Management Procedures
As discussed above, some casual employees will come to have an expectation of ongoing work. If you are considering terminating the employment of a long-term casual worker, seek legal advice before starting performance management or the termination process.
When engaging casual employees, different regulatory bodies may review your employment practices. The Fair Work Ombudsman may investigate businesses who do not pay their employees their lawful entitlements, and may order them to back-pay this money. Additionally, the Fair Work Commission may investigate where an employee was a true casual.
If you want further information on how to engage casual employees on a regular basis, contact LegalVision’s employment lawyers on 1300 544 755 or fill out the form on this page.
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