Employee a Casual Under the Enterprise Agreement but Not Under the Fair Work Act Court Finds

The Federal Circuit Court has determined that although a fly in fly out (FIFO) worker was a casual employee under the enterprise agreement that covered his employment with a labour hire company, he was “other than a casual” for the purposes of the Fair Work Act 2009 and was therefore entitled to payment of accrued annual leave when his employment terminated in April 2012.

The labour hire company, Workpac, employed Mr Skene to work as a dump truck operator at a client’s coal mines. His first engagement from April 2010 till July 2010 was at a mine six hours drive from his home in south Queensland.  Mr Skene then applied and was employed from July 2010 to work at a mine in central Queensland which involved him working seven days on and seven days off on a FIFO basis. He was paid a flat hourly rate inclusive of casual loading. All of his travel and accommodation costs were paid by his employer. He did not take any paid annual leave when employed at the mine but he did take a short period of unpaid leave.

Casual under the Enterprise Agreement

Judge Jarrett of the Federal Circuit Court referred to the Enterprise Agreement that covered Mr Skene’s employment which described a casual employee as one engaged by the hour. He also referred to a “Notice of Casual Employment” provided to Mr Skene before he started the FIFO assignment. In determining that Mr Skene was engaged as a casual employee under the Enterprise Agreement, his honour found that Mr Skene accepted that he was not engaged as a permanent employee and regarded his employment as being casual. The Enterprise Agreement allowed the employer to inform the employee of the status of his employment at the time of engagement.

Not a casual under the Act

Under the Fair Work Act, employees who are engaged “other than as casual employees” are entitled to accrue paid annual leave. The Act contains no definition of casual employee. His honour said “What is clear however, is that irrespective of which authority is considered, whether a person is a casual or some other type of employee is a question of fact to be determined having regard to the circumstances pertaining to the particular employee the subject of the Court’s consideration.”

A document signed by Mr Skene at the outset of his employment with Workpac was titled “Casual or Fixed Term employee – Terms and Conditions of Employment.” The document said that employment was offered on an assignment by assignment basis and that employees could accept or reject assignments. However, an employee could be required to compensate the mine for travel and accommodation costs if he or she left before the assignment he or she accepted was completed.  A probationary period applied to Mr Skene’s employment. Rosters produced by the mine showed Mr Skene’s shifts for the next 12 months.

In finding that Mr Skene was engaged “other than as a casual employee,” Judge Jarret had regard to the following characteristics of the employment that would suggest it was permanent:

  • it was regular and predictable. Working arrangements and shifts were set 12 months in advance in accordance with a stable and organised roster;
  • it was continuous except for one period of “leave without pay”;
  • It was facilitated by the FIFO arrangement and was inconsistent with the notion that Mr Skene could elect to not work on days that were offered;
  • There was an expectation that he would be available on an on-going basis in accordance with the roster until the assignment was completed;
  • The work did not fluctuate significantly from one day to the next.

Factors that were indicative of the employment being casual were:

  • Mr Skene was paid by the hour according to time sheets he submitted;
  • The employment could be terminated on one hours notice;
  • The employer designated Mr Skene’s employment as being casual.

In concluding that Mr Skene was employed other than as a casual for the purposes of the Act, Judge Jarrett said “There is no absence of a firm advance commitment as to the duration of Mr Skene’s employment or the days (or hours) he would work. Those matters were all clear and predictable. They were set 12 months in advance.”

Implications for Employers

The above judgement says little about the obvious “double dip” enjoyed by Mr Skene in that he was entitled to accrue and be paid annual leave despite also receiving a casual loading. Nor does it mention those provisions of the Fair Work Act, dealing with parental leave and unfair dismissal for example, that distinguish “long term casual employees employed on a regular and systematic basis” from casuals employed on an irregular basis and/or with no reasonable expectation of ongoing work on a regular and systematic basis (often referred to as ‘true casuals’).

In light of the above decision, it is advisable for employers to review their casual employment arrangements and if necessary seek advice. Placing casuals on long term rosters may entitle the employee to accrue and be paid annual leave and personal carers leave in accordance with the Act as well as be paid a casual loading under an Award or enterprise agreement that applies to them.

If you have any enquiries, please contact Jakov Miljak on 1300 361 099 or email jakov.miljak@neca.asn.au.