On 4 August 2021 the High Court delivered its decision in the Workpac Appeal. Workpac was successful with the High Court finding that earlier decisions by the Full Federal Court in matters of Skene v Workpac and Rossato v Workpac had been incorrectly decided.
The Federal Court had found that employees engaged by Workpac under contracts which described them as casual employees were in fact not casual employees and as such were entitled to normal benefits accruing to permanent employees such as annual leave and sick leave. The earlier decisions had been based largely on the fact that the employees worked under regular or systematic rosters.
The High Court found that the systematic nature of the work under the rosters was not decisive.
The High Court’s decision places considerable emphasis on the terms of the Employment Contracts entered into between the employer and the employee. The High Court accepted that it was necessary to consider the full nature of the relationship but highlighted that the critical issue is whether the contractual terms included a mutual commitment to an ongoing working relationship.
The main distinction between casual employment and permanent employment is that permanent employment involves a mutual commitment to an ongoing working relationship whereas casual employment does not. Following the High Court’s decision, the emphasis must be on the contractual requirements. That is, if the parties enter a properly drafted Employment Contract which describes the arrangements as casual then it is unlikely that it will be found to nevertheless involve a mutual commitment to an ongoing working relationship.
The decision serves to highlight the importance of written Employment Agreements. Employers who make regular use of casual employment arrangements but do not document the arrangements in a written Employment Agreement may still expose themselves to risk of challenge. To some extent risks have been reduced by amendments to the Fair Work Act, but the recent decision serves as a timely reminder to employers to review their Employment Agreements and make sure they do have written Employment Agreements in place.
If you would like more information or need assistance reviewing your Employment Contracts, please contact a member of our team.
