Casual workers win big on annual leave, sick leave in landmark ruling
A landmark court ruling has confirmed some “casual” workers are actually entitled to paid leave, bolstering a set of class action lawsuits seeking hundreds of millions of dollars from employers.
It has also reignited claims from employer groups that casual workers across the economy will be able to “double dip” by claiming both annual leave and casual loadings typically worth 25 per cent of their pay, which one industry group said could cost employers up to $8 billion if those workers’ annual leave had to be paid out.
The Federal Court found on Wednesday that “casual” workers who worked regular and predictable shifts with a firm advance commitment to work were not casuals despite how they were described in employment contracts and therefore were entitled to paid annual, sick and carer’s leave.
Mining union national secretary Tony Maher, whose union had intervened in the case, said the decision was “fantastic”, saying it rebuked employers who called their workers casuals but employed them on full-time hours.
“Employers must now stop with the nonsense that calling a worker a casual makes them so,” Mr Maher said. “When a job is full-time, regular and ongoing, it is permanent and deserves the security and entitlements that come with permanent work.”
The Australian Industry Group, which represents 60,000 employers, said the decision would discourage employers bringing on casual workers and hurt the economy.
“Today’s decision … highlights the need for urgent legislative reform to provide certainty to businesses and casual employees, and to prevent double-dipping claims by casuals who have been paid additional remuneration in lieu of the entitlements of permanent employees,” the group’s chief executive Innes Willox said.
“An employee engaged as a casual and paid a casual loading … should not be allowed to turn around years later and claim the entitlements of a permanent employee, like annual leave,” he said.
Three Federal Court judges found Robert Rossato, a black coal mine worker, was employed for three and a half years until 2018 by the labour hire company WorkPac across different projects as a permanent worker despite being labelled a “casual” in his contract.
Mr Rossato worked on Glencore mines across six contracts and was paid what WorkPac described as a 25 per cent casual loading built into his wage, but the court found he still had an entitlement to leave that could not be offset through the wage bump because it did “not have a close correlation” to the leave entitlements.
Under at least one of his contracts, Mr Rossato worked seven days on, seven days off with 12 hour shifts set in advance, which Justice Mordecai Bromberg found pointed to him having work that is “regular, certain, continuing, constant and predictable” and not casual.
The court’s decision affirms a 2018 case on the same topic, also against WorkPac. The company did not appeal it but instead started a separate case against Mr Rossato. The decision is a big win for the class action firm Adero Law, which has brought seven class actions against major labour hire companies in the sector seeking to recover between $400 and $450 million.
Rory Markham, the firm’s managing principal, said those lawsuits had been in a holding pattern waiting on this case but he hoped they would now be resolved in favour of the class action claimants.
“We’re ecstatic for the 30,000 to 40,000 group members that will benefit from this finding,” Mr Markham said.
The mining division of the CFMMEU, of which Mr Maher is secretary, has also launched a class action over the issue.
Attorney-General and Minister for Industrial Relations Christian Porter said the decision “has immediate practical implications for the bottom line of many Australian businesses”.
“Given the potential for this decision to further weaken the economy at a time when so many Australians have lost their jobs, it may also be necessary to consider legislative options,” he said in a statement.
Labor’s industrial relations spokesman Tony Burke said the Morrison government should not overturn the decision through legislation.
“If there’s any ‘double dipping’ going on here it is being performed by the employers – they’re taking advantage of the insecurity of casual work while still getting permanent hours out of their workers,” Mr Burke said.
Extracted from The Sydney Morning Herald