"Today's decision of the Full Federal Court in the Workpac v Rossato case highlights the need for urgent legislative reform to provide certainty to businesses and casual employees, and to prevent double-dipping claims by casuals who have been paid additional remuneration in lieu of the entitlements of permanent employees," Innes Willox, Chief Executive of the national employer association Ai Group said today.
"Casuals make up around 20% of the Australian workforce, providing vital flexibility to employers and employees. The Fair Work Act needs to be urgently amended to define a casual employee in a simple and clear manner to address the uncertainty caused by the Federal Court's Workpac v Skene decision, and now the Workpac v Rossato decision. The current laws, as interpreted in these decisions, operate as a major deterrent to the employment of casuals.
"The expression 'casual employee' needs to be defined in the Fair Work Act, in line with the common definition included in modern awards – that is, 'a casual employee is an employee engaged and paid as such'. An employee engaged as a casual and paid a casual loading (or a loaded rate that accounts for a casual loading) should not be allowed to turn around years later and claim the entitlements of a permanent employee, like annual leave.
"With unemployment and underemployment rapidly increasing during the COVID-19 crisis, employers need to be encouraged to retain and take on casual employees – not deterred from doing so.
The following statistics highlight the implications of today's decision for the Australian economy:
- At least 1.6 million of the 2.6 million casuals in Australia work on a regular, ongoing basis;
- The potential cost impacts on employers of the Federal Court's decisions, for annual leave alone, are between $5.7 billion and $8 billion;
- Over 50 per cent of casuals work for businesses with less than 20 employees and over 80 per cent work for businesses with less than 100 employees.
"Parliament needs to act now, to address the uncertainty caused by the Federal Court's Workpac v Skene and Workpac v Rossato decisions, and to preserve fairness for all parties," Mr Willox said.
