The High Court provides clarity for casual workers
17 August 2021
The High Court decision in WorkPac Pty Ltd v Rossato [2021] HCA 23 (Rossato case) has provided clarity on when an employee relationship is casual.
The High Court in the Rossato case:
- considers the new definition of ‘casual employee’ under the Fair Work Act 2009 (Cth) (Act), and
- clarifies the circumstances when an employee is casual.
For an employee relationship to be casual, the terms of the contract with the employee must show there is no ‘firm advance commitment to ongoing work with an agreed pattern of work’.
In light of this decision, organisations should review their arrangements with casual employees and ensure they have written contracts in place that show the relationship is a casual one. For more information on employees, download our guide for community organisations ‘Employee, contractor or volunteer?’.
What happened in this case?
WorkPac (a labour-hire company) employed Mr Rossato as a mine worker under a number of contracts to perform work for a WorkPac client. Mr Rossato's employment was expressly on an assignment to assignment basis – he was entitled to accept or reject any offer of an assignment and, at the completion of each assignment, WorkPac was not obliged to offer Mr Rossato further assignments. WorkPac treated Mr Rossato as a casual employee – he wasn’t paid the leave and public holiday entitlements that employers owe to non-casual employees under the Fair Work Act 2009 (Cth) (Act) and the enterprise agreement which underpinned his employment.
Relying on an earlier court decision (WorkPac Pty Ltd v Skene [2018] FCAFC 131), Mr Rossato claimed he wasn’t a casual employee and was therefore entitled to be paid for annual leave he hadn’t taken, public holidays, and for personal leave and compassionate leave he’d taken during his employment. The Federal Court agreed with Mr Rossato and declared that he was entitled to the payments he claimed.
WorkPac appealed to the High Court.
The High Court’s decision
Since the Federal Court decision in Mr Rossato’s favour, an amendment to the Fair Work Act 2009 (Cth) (Act) now defined a ‘casual employee’ as a person who accepts a job offer from an employer knowing that there is ‘no firm advance commitment to ongoing work with an agreed pattern of work’.
Considering this new definition of ‘casual employee’, the High Court sided with WorkPac, holding that Mr Rossato was a ‘casual employee’.
In doing this, the High Court considered what is meant by ‘firm advance commitment’ in the casual employee definition and said:
- this commitment is an enforceable promise, and
- to be a ‘firm advance commitment’, it’s not enough that the parties only have an expectation of continuing employment on a regular and systematic basis
In addition, the Court held that where an employee's contract is wholly in writing:
- whether the employment arrangement has the necessary firm advance commitment is determined only by the terms of the employment contract, and
- the parties’ subsequent conduct during the employment cannot be taken into account in determining the true nature of the relationship
Mr Rossato worked a consistent shift structure, determined by rosters set well in advance. However, under the agreements, WorkPac wasn’t obliged to continue offering assignments to Mr Rossato and Mr Rossato had no obligation to accept or reject any assignments offered.
These facts, according to the High Court, did not establish a contractual promise that amounted to a firm advance commitment to work. In the circumstances, Mr Rossato was a casual employee.
Continuing employment on a regular and systematic basis is not enough to establish a firm advance commitment and is consistent with casual employment which can be for a long term.
For more information about casual employees, visit the Fair Work Ombudsman, or download our guide Employee, contractor or volunteer?.
