Employment & Safety Update – 25 August 2021

WorkPac Pty Ltd v Rossato [2021] HCA 23

High Court Clarity on Casual Employees

On 4 August 2021, the High Court of Australia handed down its decision in the case of WorkPac Pty Ltd v Rosatto [2021] HCA 23. The recent insertion of a definition of “casual employee” in the Fair Work Act means that the decision does not have the broad ranging impact on casual employees that was anticipated.

Nonetheless, the decision provides guidance on the orthodox approach to determining whether an employee is “casual” or otherwise. The decision shows that:

  • the express terms of an employment contract are key to determining the nature of the employment relationship; and
  • employers should be confident that regular and systematic engagement of casual workers will not be enough to “morph” a causal worker into a permanent employee.

You can access a copy of the decision here.

Background to Mr Rosatto’s case

Mr Rosatto was employed by labour hire firm WorkPac. He was employed by six separate and consecutive employment contracts to work in open cut black coal mines operated by Glencore between July 2014 and April 2018. Under each employment contract, and the WorkPac Enterprise Agreement, Mr Rosatto was categorised as a casual employee.

In 2018, Mr Rosatto wrote to WorkPac claiming, due to the regularity of his shifts and the long-term nature of the rosters he worked under, he was not a casual. He claimed he was entitled to be paid for untaken annual leave, public holidays and personal leave under the National Employment Standards.

WorkPac applied to the Federal Court for declarations to the effect that Mr Rosatto was a casual employee and thus not entitled to those NES entitlements, or alternatively that the casual loading paid to him should be “set off” against the entitlements.

Both the Federal Court, and the Full Court of the Federal Court, found that Mr Rosatto was not a casual employee and thus entitled to paid annual leave and paid personal/carer’s leave. A key aspect of both decisions was that Mr Rosatto was engaged to work regular, consistent hours on rosters that were set long in advance.

WorkPac appealed to the High Court.

What did the High Court say?

The High Court overturned the earlier decisions and determined that Mr Rosatto was a casual employee. As such, he was not entitled to annual leave or paid personal/carer’s leave.

The High Court confirmed that the essence of casual employment was the absence of a “firm advance commitment as to the duration of the employment or the hours that will be worked”. This was consistent with the earlier decisions. However, the High Court squarely rejected the approaches of the lower Courts, so far as those decisions placed emphasis on the parties’ conduct after the contract (such as setting work rosters) demonstrated that there was a ‘firm advance commitment’.

Where there is a written contract, the absence of a firm advance commitment is to be assessed based on the express terms of the employment contract – not necessarily the production of work rosters or the setting of regular hours. In Mr Rosatto’s case, it was critical that his role was described in a series of written contracts as casual; and that he received a casual loading.

The High Court confirmed that the absence of a “firm advance commitment” is key to whether an employee is casual. Post contractual conduct, falling short of a valid contractual variation, won’t be enough to create that “firm advance commitment”.

Key takeaway

Combined with the definition of ‘casual employment’ in the Fair Work Act, Courts should now give significant weight to the contractual description of the employment relationship agreed by the parties, even if there are regular and systematic shifts provided on rosters.

It is a good reminder to review current employment contracts to ensure that any casual employees are properly described and receiving the correct casual loading.

More information

If you have any queries or would like further information regarding this update, please contact:

Joe Mullavey
Principal
M: 0416 794 061
E: jmullavey@pageseager.com.au

Audrey Clarkson
Lawyer
T: (03) 6235 5125
E: aclarkson@pageseager.com.au

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