Politics

Casual Workers Could Be In For Massive Payday After Court Rules They’re Entitled To Paid Leave

This one goes out to all you permanent casuals out there.

by Rachael Conaghan  22 May 2020
ATO scam

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When the coronavirus crisis hit, casual workers quickly emerged as one of the most vulnerable groups.

With no annual leave or sick leave to fall back on during the pandemic, they were more or less left to fend for themselves as businesses shut their doors, while their permanent counterparts fell back onto their entitlements.

Casuals have also been largely left out of Jobkeeper — only those who’ve been at their job for more than a year are eligible for the $1500 wage subsidy.

But this week, finally, casuals have been given some good news. If you’ve been working full-time hours the Federal Court says you should be entitled to the same paid leave entitlements as full-time employees, 25 percent loading be damned.

That could impact more than one million workers — and could cost businesses $8 billion in sweet, sweet backpay.

Before you go storming your bosses office for a chunk of it, here’s what you need to know.

What Was The Court Case?

The case centred around Queensland mine worker Robert Rossato, and the labour hire firm that employed him.

WorkPac kept Rossato on rolling contracts for more than three years and paid an extra 25 percent loading to keep him as a casual.

However, the Federal Court decided that because he was essentially working as a permanent employee, he should be given the same rights as one.

They found since Rossato’s shifts were rostered in advance and were “regular, certain, continuing, constant and predictable”, he should not have been considered a casual — so he’ll now be backpaid for all the entitlements he should have earned, like annual leave and sick leave.

WorkPac argued that Rossato would be “double dipping” by accessing benefits on top of his 25 percent leave loading, but the court disagreed.

They said his entitlement to leave wasn’t offset by his extra wages because it did “not have a close correlation”. So, as an added bonus, he won’t have to pay back that extra leave loading he earned as a casual.

It’s not the first time this has happened — in 2018 WorkPac lost a similar case when the court granted annual leave entitlements to another another casual employee.

There are also a series of similar class actions against other employment firms in the works.

What Does This Mean For You?

Basically, the decision redefines what it means to be “casual”.

It won’t automatically apply to all casuals — but those who are working permanent hours could rightfully ask whether they’re entitled to the benefits of a permanent employee.

The implications of that could be huge.

According to the Australian Industry Group there are around 2.6 million casual workers in Australia, and 1.6 million of them are in steady work. If businesses are forced to backpay entitlements they say it could cost $8 billion.

That’s making industry groups very nervous, and they’re now trying to justify why the government should step in to stop this happening.

“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,” their chief executive Innes Willox said.

Tony Maher, head of miner’s union the CFMEU, said the court outcome was fantastic.

“Employers must now stop with the nonsense that calling a worker a casual makes them so,” he said.

“When a job is full-time, regular and ongoing, it is permanent and deserves the security and entitlements that come with permanent work.”

So Am In For A Massive Payday?

Not quite yet.

Apparently, the government is horrified at the thought of more people having access to paid leave during a pandemic. They’re already considering backing any appeals.

Industrial Relations Minister Christian Porter said the decision would be bad for businesses that have already taken a huge coronavirus-related hit.

“Given the potential for this decision to further weaken the economy at a time when so many Australians have lost their jobs, it may also be necessary to consider legislative options,” he told AAP.

But Labor’s IR spokesman Tony Burke said they weren’t going to stand around and let the government run “a protection racket” for businesses owing unpaid benefits.

“If the government thinks after all the insecurity that people are living in Australia at the moment, that he wants to change the law to give people less job security — we’re there for that fight,” he said.

It’s shaping up to be a bit of a political battle, so we’ll have to wait and see whether the government will move to make legislative changes to protect businesses before any floodgates open.