Workpac Pty Ltd V Rossato – To be or not to be a Casual

On 20 May 2020, the Federal Court of Australia handed down a decision which had the potential to disrupt how employers in Australia employ casuals.

WorkPac Pty Ltd (“WorkPac”) employed Mr Rossato between 28 July 2014 and 9 April 2018 and supplied his labour to companies within the Glencore Group. During the period in which Glencore was asked to consider the contracts, Mr Rossato was employed under six consecutive contracts.

WorkPac sought declarations that Mr Rossato was not entitled to make claims with respect to paid annual leave, personal/carer’s leave, and compassionate leave entitlements under the National Employment Standards because he was a casual employee.

In the event that the Full Bench of the Federal Court made a decision that Mr Rossato was not a casual employee, WorkPac sought declarations that it was entitled to restitution of the casual loading which it claimed was included in the hourly rate it had paid to Mr Rossato. WorkPac argued that Mr Rossato was a casual employee on the basis that there was an absence of “firm advance commitment as to the duration of the employee’s employment or the days/hours the employee will work”.

The court decided that the presence or absence of the “firm advance commitment” may be assessed by regarding the employment contract as a whole including by considering:

• whether it provided for the employment to be regular or intermittent;
• whether it permitted the employer to elect whether to offer employment on a particular day;
• whether it permitted the employee to elect whether to work; and
• the duration of the employment.

The court found that the description of the classification of an employee given by the parties as to the nature of their relationship is relevant but not a conclusive consideration.

The court found:

• Mr Rossato was not a casual employee for the purpose of the Fair Work Act 2009.

• That the parties had agreed on employment of indefinite duration which was stable, regular and predictable such that the postulated firm advance commitment was evident in each of his six contracts.

• That WorkPac was not entitled to restitution of the casual loading which it claimed was included in the hourly rate paid to Mr Rossato. There was no relevant mistake, no failure of consideration such as would support restitutionary relief.

• WorkPac sought to rely on relation 2.03 A of the Fair Work Regulations 2009 and the court found that WorkPac could not rely on that regulation as that regulation only applied when the employee brought a claim in lieu of one of the relevant National Employment Standard entitlements, not when the employee sought payment of them.

• Mr Rossato was entitled to the entitlements he had claimed under the Fair Work Act 2009 with respect to paid annual leave, paid personal leave, paid compassionate leave and payment of public holidays.

As a consequence of this decision all employers should:

• Review their casual contract arrangements including their contractual ability to set off casual loading payments made against any claim for full‑time / part‑time entitlements;

• Review their rostering arrangements and their payslip arrangements;

• Ensure that they are doing all they can to ensure that their casual arrangements are ones where there is an absence of firm commitment as to the duration of the employee’s employment or the days or hours the employee will work.

• Ensure they can pursuant to their arrangements elect whether to offer employment on a particular day and an employee can elect whether or not they wish to work on that day.

Assistance can be provided with your review by our Workplace Relations team.