As an employer, you will likely engage workers in various work arrangements, including full-time, part-time, or casual work. Engaging workers on a casual basis can offer flexibility for your business and allow you to save costs when rostering. This is because your casual workers are only required to work according to the hours your business sets, not per an agreed minimum amount contained in an employment contract. When business is slow and you no longer require lots of staff, the steps to terminating a casual employee are much simpler than for a full-time employee. Still, there are legal considerations to note. This article explores legal considerations when terminating a casual employee.
What is a Casual Employee?
Casual employees are hired on an ad-hoc basis, which means that your business has no firm advance commitment to give the employee ongoing work.
According to the Fair Work Act 2009, an employee is casual if:
- they receive a job offer;
- the offer is not a commitment to an agreed pattern of work; and
- the employee is aware of the above point upon acceptance of the offer.
To determine whether there is a firm advanced commitment to ongoing work, consider the following points:
- Does the employer choose to offer work, and does the employee have a choice to accept or decline this work?
- Is the employee offered work when the business needs them to work?
- Do you, as the employer, consider the person a casual employee?
- Does the business pay the person a casual loading?
What are Casual Employees Entitled To Receive?
The National Employment Standards provide some protection for casual employees. However, none of these relates to termination. Casuals should receive the following entitlements:
- access to become a permanent employee (in certain circumstances);
- 2 days unpaid carer’s leave and 2 days unpaid compassionate leave per occasion;
- 5 days unpaid family and domestic violence leave (in a 12-month period); and
- unpaid community service leave.
How Much Notice is Required for Termination?
Under the Fair Work Act, there is no notice requirement for casual employees. This is because the very nature of casual employment is that the employment relationship effectively ends after each shift. Unless an industrial instrument or modern award says otherwise, your business can simply stop offering further shifts if you wish to terminate a casual employee’s employment.
However, there may be notice requirements under an applicable industrial instrument. A modern award may also impose a minimum engagement period for casual employment. If a casual employee is terminated following a scheduled shift, you must pay them for at least the minimum period for that day.
Can Casual Employees Bring an Unfair Dismissal Claim?
Casual employees can bring an unfair dismissal claim in the following circumstances:
- they have been employed on a regular and systematic basis for a period of at least six months; and
- there is an expectation of ongoing employment.
Regular and Systematic
The notion of “regular and systematic” takes into account the nature and frequency of the employee’s labour.
- The term “regular” refers to a pattern that repeats itself and does not imply that it is common, frequent, uniform, or consistent.
- The term “systematic” refers to engagement that could legitimately be considered a system, method, or plan.
Casual contracts are unique because the employment relationship effectively ends after each shift. However, for unfair dismissal, the period of service is relevant rather than the period of employment. Therefore, it is important to ensure that your casual employees are only regarded as such if they are not engaged in work on a regular and systematic basis. If you require consistent work, consider putting your employee on a different contract.
As an employer, understand your essential employment obligations with this free LegalVision factsheet.
Key Takeaways
Casual employment can offer flexibility, but you must be mindful of legal considerations when terminating these contracts. There is no notice period requirement for casual workers under the Fair Work Act 2009. However, you should be mindful of any industrial instrument that applies, including modern awards and enterprise agreements, which may provide an entitlement or minimum period of employment. It is also important to remember that casual employees have access to unfair dismissal claims if:
- they have been working on a regular and systematic basis; and
- they have reached the minimum period of employment.
For more information about your rights when terminating a casual employee, our experienced employment lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page.
Frequently Asked Questions
Yes, casual employees can make an unfair dismissal claim if they have been working on a regular and systematic basis for at least 6 months (or 12 months if the employer is a small business).
You do not have to give your casual employee notice of termination as the employment relationship ends after each shift. However, depending on the circumstances, a casual employee may be entitled to bring an unfair dismissal claim.
We appreciate your feedback – your submission has been successfully received.
