Casual employee case to have huge repercussions for employers
The High Court has dealt a blow to the rights of casual workers in what an expert has called a “shocking” ruling with “profound” implications for employment law.
The High Court’s ruling ended years of uncertainty about the rights of casual workers to claim paid leave, according to a report by The Australian. The High Court upheld a challenge by labour hire firm WorkPac to a ruling by the full Federal Court.
The Federal Court held that employees working regular and predictable shifts were not casual employees and had leave entitlements, The Australian reported. In a defeat for unions that was lauded by the Morrison government, the High Court tossed that decision.
Employer groups also welcomed the decision, which they said vindicated their campaign for legislation to stop workers who were paid a 25% casual loading from “double-dipping” by later seeking back-paid leave entitlements.
In the decision, the High Court overturned a ruling that production worker Robert Rossato was not a casual worker and was entitled to paid leave while working under a series of six contracts on rosters fixed well in advance, The Australian reported. The High Court ruled that Rossato was a casual employee and that his employment was expressly on an “assignment-by-assignment basis.”
“That Mr Rossato was to work in accordance with an established shift structure fixed long in advance by rosters did not establish a commitment to an ongoing employment relationship beyond the completion of each assignment,” the court said.
The court ruled that a casual employee was an employee who had no firm advance commitment from an employer about the duration of the employment or the days or hours they would work, and who gave no reciprocal commitment to the employer, The Australian reported.
University of Adelaide law professor Andrew Stewart said the comments in the court’s ruling were “shocking” and had “profound” implications for employment law. Stewart told The Australian Financial Review that the High Court had clearly signalled that it did not care about the protective intention of the Fair Work Act, and that inequali]ty of bargaining power doesn’t matter.
Stewart said the ruling also effectively disregarded a key decision in sham contracting claims, which said that courts need to look at the totality of the employment relationship when workers allege they are really employees and not independent contractors.
“This is not just a decision about who’s a casual,” Steward told AFR. “These are very, very clear indications that the High Court will be overthrowing [recent sham contracting rulings] and sending the strongest possible signal that you are what your contract says you are.”
Stewart said language in the ruling was “an open invitation to engage workers as independent contractors or volunteers rather than employees.”
Sally McManus, secretary for the Australian Council of Trade Unions, told The Australian that the decision was a further blow to workers “who have nothing left to give after 18 months of economic hell.” McManus said the government should move to “smash unscrupulous labour hire operators with their exploitative ‘permanent casual’ model of employment.”
The Morrison government, meanwhile, praised the decision.
Amanda Stoker, assistant minister for industrial relations, said the High Court’s ruling was “a win for casual workers and a rejection of the union movement’s double-dipping campaign.” She said the ruling “underscores the Morrison government’s reforms giving casual workers clarity on their entitlements, and their rights to convert to permanent part-time – which were vital to the viability of many casual workers’ jobs.”
Labor industrial relations spokesman Tony Burke said the ruling’s effect was limited, as the government had already passed changes that stripped rights from casual workers.
“A Labor government will overturn the government’s scheme, ending the rorts and restoring rights to workers,” Burke told The Australian.
Business groups, meanwhile, joined the Morrison government in supporting the ruling.
Australian Industry Group chief executives Innes Willox called on plaintiff law firms to withdraw class action claims against employers over casual employment matters, The Australian reported.
Jenny Lambert, acting chief executive for the Australian Chamber of Commerce and Industry, called the ruling a rejection of ACTU attempts to discredit casual employment as a legitimate employment practice.
