Ruling Feared to Cost Businesses Billions OVERTURNED

Employers and employees have been granted certainty moving forward with the High Court effectively shutting down what could have been a pathway for long-term casual staff members to have the same rights as paid leave workers.

In a High Court decision, which overturned an earlier Federal Court ruling in the WorkPac v Rossato case, the court upheld WorkPac’s appeal which sought to establish that Mr Rossato was correctly employed as a casual worker.

Previously, the Federal Court had ruled that casual employees working regular and systematic hours with “predictable periods of working time” are entitled to personal leave, compassionate leave and public holiday payments.

That meant that regardless of what Mr Rossato’s contract said and regardless of the payment of casual loading, casuals could be considered permanent employees based on their nature of work.

The federal government had previously estimated that this decision, coupled with the ruling in a similar case WorkPac v Skene, could have cost businesses $39 billion in unpaid leave.

However, the High Court overturned this interpretation in a unanimous ruling on Wednesday. And while businesses have breathed a sigh of relief, for long-term casual staff, the decision has meant that those who want to go permanent will have to rely on the federal government’s new law.

Under changes to the Fair Work Act, that came into operation in March, some casuals doing regular shifts are able to convert to permanent status after a year of employment, unless they’re employed by small businesses which have been exempt.

The changes to industrial relations also included a new definition of casual work and ruled out ‘double-dipping’ backpay claims of employees getting paid casual loading as well as permanent work benefits.

The High Court’s decision does not change employers’ obligations to consider and in some cases offer conversion from a casual to a full-time employee after 12 months.

Should you have any queries in relation to the above, please do not hesitate to contact our office (08) 8431 1644.

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