Issue 19 2021 - High Court overturns leave for casuals


The High Court has overturned the landmark decision in WorkPac Pty Ltd v Rossato.[1] finding that Mr Rossato was a casual employee and therefore not entitled to paid leave under his enterprise agreement or the National Employment Standards. The ruling largely reflects the recent changes to the Fair Work Act and should provide a degree of comfort for employers.



Background

Previous EMA Notes reported on the earlier Full Federal Court decision. That ruling established that an employee could be categorised and paid as a casual employee under an enterprise agreement, contract or award – but not be a casual for the purpose of NES entitlements such as annual leave. One controversial aspect of the decision was that Workpac was unable to offset the “casual loading” against the leave entitlement under the contracts in that case.


The high-profile case sparked changes in employment contracts and changes to the Fair Work Act and awards to clarify the definition of casual and remove the potential for a “double dip”. [2]


The High Court ruling

On 4 August, the High Court unanimously ruled that (even under the earlier version of the Fair Work Act), Mr Rossato was a casual employee and not entitled to paid annual leave. The court found it unnecessary to rule on whether the employer was able to offset the casual loading and therefore made no finding on that.


A summary of the decision can be accessed through the link. The full decision is also available here.


What it means for you

It is important that this case was decided on the facts and documents in Mr Rossato’s specific case. In summary, what are the key points?

  • The contractual provisions stating that Mr Rossato was employed as a casual prevailed over any subjective “expectation” – so contracts must be properly drafted.

  • There must be an absence of firm advance commitment in the contract of employment, but that is different to "expectation of ongoing employment". The parties must have the contractual ability to offer, accept or decline assignments. Even when prepared in advance a roster does not mean on its own that there is a firm commitment to indefinite employment.

  • Employers must comply with the terms of the contract they enter. Future conduct is only relevant if it contradicts what the contract says sufficiently to equate to the parties’ agreement to a new or varied contract.

This EMA Note is a high level review of the key practical takeaways. It is not a substitute for the full decision and is not advice about your specific situation.


Require further information/assistance?

f you require further information or advice, please contact your Consultant.


[1] [2020] FCAFC 84

[2] This is for national system employers under the Fair Work Act 2009 (Cth)

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