High Court Overturns Controversial Casual Ruling

Aug 11th, 2021

The High Court has recently overturned the Federal Court’s decision that casual employees working regular and predictable shifts were indeed not casual employees, and as such had leave entitlements, upholding Workpac’s appeal of Workpac Pty Ltd v Rossato.

The High Court has determined that a casual employee has no firm advance commitment to ongoing work, and this is solely determined by an employee’s employment contract. While a casual employee can work for a long period of time, working regularly and systematically, the firm advance commitment is an enforceable promise, rather than a simple expectation on the worker’s behalf of ongoing employment.

This is in contrast to the Federal Court’s decision that, despite a contract being in writing, it is pertinent to consider the “entirety of the relationship” when characterising the exact nature of it, and that it is proper to look at the “real substance and practical reality” of the relationship.

The High Court’s decision makes the contract, when in writing, the sole factor for determining the nature of the employment relationship.

This decision is consistent with the recent amendment to the Fair Work Act 2009, wherein Section 15A provides for a new definition of a casual employee:

 (1)  A person is a casual employee of an employer if:

  1. an offer of employment made by the employer to the person is made on the basis that the employer makes no firm advance commitment to continuing and indefinite work according to an agreed pattern of work for the person; and
  2. the person accepts the offer on that basis; and
  3. the person is an employee as a result of that acceptance.
In response to the High Court’s decision, employers should take the following steps:
  • If they have not done so already, implement written employment contracts that:
    • Clearly define the employee as a casual employee, and
    • Specify the employee’s payment arrangements, including the receipt of casual loading
  • Review their current contracts to ensure they meet the requisite standards for a casual employment contract.
  • Ensure they are following the requirement to supply all casual employees with a copy of the Casual Employment Information Statement before, or as soon as possible after, they commence their new job.

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