'Double dipping' claims were predicted to cost economy $39bn
The High Court has overturned the Federal Court ruling in the WorkPac Vs Rossato case which could’ve opened businesses up to a predicted $39bn in claims.
Today's full majority decision upheld WorkPac’s appeal, ruling that the employee Mr Rossato was correctly employed as a casual worker. Previously, the Federal Court had ruled that as Rossato was given regular, ongoing shifts he should’ve been classified as a permanent worker and awarded the associated benefits like annual leave and sick pay.
The decision caused panic for businesses over fears it would open thousands of employees up to ‘double dipping’ – being paid benefits of a permanent worker as well as the 25% leave loading offered to casuals.
Today’s decision has given employers more certainty and confidence in the definition of a casual worker. It ruled that a casual is “an employee who has no firm advance commitment from the employer as to the duration of the employee's employment or the days (or hours) the employee will work and provides no reciprocal commitment to the employer”.
Christa Lenard, a partner at Kingston Reid, Australia’s largest specialist workplace law firm, said employers will welcome the High Court ruling.
“When coupled with the Federal Government’s Omnibus legislation that became law in March 2021 (the High Court’s decision is consistent with this legislation), it finally gives employers the certainty they want around casual employment,” she said.
“Employers have long grappled with the difficulties around casual employment caused by the Federal Court decisions in WorkPac v Skene and Rossato, but the High Court’s finding will redefine the parameters of what constitutes a casual employee and what this means for access to double-dipping.”
The Fair Work Amendment Bill passed this year sets a legal definition of a casual employee for the first time. It also introduced a mechanism requiring employers to offer casual employees the choice to become permanent if they've been employed for 12 months and have worked regular and systematic patterns in the last six months.
HRD's Employment Law Masterclass being held later this year will cover the changes to casual employment and how employers can minimise their risks. Click here to see the full event agenda and register your place.
