What is a true casual employee?

When is a casual employee truly a casual employee?

The answer to this question is context.

There is some controversy about the circumstances in which an employee who is employed as a casual employee happens to work a pattern of work which is such that the legal categorization of his or her status is in truth that of a permanent employee.

In WorkPac Pty Ltd v Skene [2018] FCAFC 131 the Full Federal Court upheld a judgement of a single judge to the effect that an employee whose contract specified that he was a casual employee had by reason of the nature of his work morphed at law into a permanent employee.

The employee was employed as a dump truck operator on a seven day on, seven day off continuous roster arrangement of 12.5 hours per shift. His roster for each year was set in advance. After working from July 2010 to April 2012, the employee was stood down, and subsequently dismissed. Under his employment contract, the employee was characterised as a casual employee which meant he had no annual leave entitlements under the relevant enterprise agreement. Following the termination of his employment, he claimed he was improperly characterised as a casual employee – the way he had worked meant he was a permanent full-time employee and, relevantly, had an entitlement to annual leave. The key issue in the proceedings was whether the employee was a permanent full-time employee and consequently entitled to payment in lieu of annual leave on his employment coming to an end.

In 2016, at first instance, Judge Jarrett held that the worker’s regular and predictable working arrangements meant he was an employee entitled to annual leave under the National Employment Standards even though the offer of employment gave the employee the status of ‘Casual Field Team Member’ with no annual leave entitlement under the employer’s enterprise agreement. Judge Jarrett found that the driver was entitled to payment for accrued annual leave under the NES on termination of his employment and ordered the employer to pay the worker compensation of $21,000 plus $6,700 interest.

On appeal, a Full Court of the Federal Court dealt with the main issue of the appeal which most lawyers regard as being did the Commonwealth Parliament in making the Fair Work Act in 2009 intend the words ‘casual employees’ in the Fair Work Act and NES to be used their in their ordinary, legal sense, or the specialised non-legal sense which the employer contended was common to federal industrial instruments?

The Full Court did not accept that there is a universally accepted specialised meaning of ‘casual employee’ referable to the use of that term in federal industrial instruments. Their Honours found:

  • the employer’s enterprise agreement did not designate the employee to be a casual;
  • even if the employee’s all up flat hourly rate included a casual loading, this by itself was not a legitimate basis for interpreting the NES in the manner which the employer contended,/ that is to sday even if the employee received a casual loading under an industrial instrument, it will not be determinative as to whether an employee is entitled to annual leave because the entitlement to annual leave is not purely financial, it is also about rest and relaxation;
  • ‘casual employee’ is an expression that has acquired a legal meaning – the employer’s construction required the expression to have a specialised industrial meaning and a legal technical meaning, which was ‘unattractive’; and
  • the ‘absence of a firm advance commitment as to the duration of the employee’s employment or the days or hours the employee will work is the essence of casualness’.