In the last 12 months there has been considerable debate and angst over the proper characterisation of casual employment, and entitlements owed to long term casual employees. This uncertainty arose as a result of f the Full Court of the Federal Court of Australia decision in WorkPac Pty Ltd v Rossato  FCAFC 84 (“Rossato”), which followed the earlier decision of WorkPac Pty Ltd v Skene  FCAFC (“Skene”) (refer to our previous articles on these two cases in 2020 and 2019). We have previously cautioned that as a result of these judicial decisions there was a real risk that employers owed significant backpayments to long term casual employees.
Many labour hire and contract for service employers (such as commercial cleaning, security and maintenance companies) exist as a result of contracts they have with clients for their services, for which they engage staff. When these contracts come to an end, there is no need to retain the staff and as such their positions are redundant. It has been widely accepted that if this is the manner in which these businesses did business, and it was an ordinary and customary part of the business model, then the employer would not be liable to pay the employees redundancy pay as a result of the terminations due to loss of contracts. This idea has been enshrined in the Fair Work Act 2009 (Cth) which provides that redundancy pay is not required if the termination of employment is a result of the “ordinary and customary turnover of labour”. However, there has been much uncertainty as to when this actually applies and what these words mean. There has also been significant recent judicial scrutiny of the issue.
When the High Court decided in 2001 that an injured courier was, in fact, an employee rather than an independent contractor, the decision had a significant impact on the relationship between workers and business. This shift is occurring again in relation to the Gig Economy. In Hollis v Vabu Pty Ltd (2001) 207 CLR 21, the Court determined that what had once been assumed as an independent contractor, being a courier delivery rider, was determined to be an employee. The Court found that factors such as level of skill, control and work hours, presentation to the public, and tools of trade were all relevant to whether the legal relationship was one of contractor or employee. The Court in effect, developed the multi-factorial test to determine this issue, which has been applied consistently since to determine whether a worker is an employee or independent contractor. Later decisions have added other qualities, such as an ability to subcontract work, in determining the nature of an engagement.
As the Federal Government has recently announced, the COVID-19 vaccination rollout will commence in mid to late February, a full month ahead of the previously foreshadowed commencement schedule at the end of March 2021. As business and industry of all sizes has suffered during the pandemic, not to mention the complete shutdown of international air travel, many Australians, if not looking forward to the jab itself, are looking forward to a gradual return to normalcy and it is increasingly apparent that normalcy might only return once the majority of the population have been vaccinated.
Many employers engage casual employees who are often longstanding members of their workforce and/or work a regular pattern of hours. However, are these employees really engaged on a casual basis? This has been a vexed issue for some time and for legal questions such as access to the unfair dismissal jurisdiction and long service leave entitlements it has been recognised that casual employees who work regular and systematic hours, are to be treated in the same way as permanent employees. However, it has always been accepted that if casuals are paid a casual loading, they are not entitled to paid leave.
On 4 July 2019, the Fair Work Commission (“Commission”) finalised its decision in relation to the incorporation of new ‘annualised wage arrangement’ clauses, which will replace the existing annualised salary clauses in the modern awards already containing an annualised salary clause. The new terms will also be inserted into three modern awards (Pastoral Industry Award 2010, Horticulture Award 2010 and Health Professionals and Support Services Award 2010) which have not previously had an annualised salary clause.
It is often believed that “money talks” when it comes to hiring senior executives. But does a salary alone provide motivation to senior executives?
When it comes to senior executives, many businesses believe by paying a significant salary they will obtain the best out of the employee. However, this is not necessarily always correct. A number of other options should be considered by organisations to motivate their senior executives. It is a fact that the culture and success of any business starts with its people and most notably its senior people. If the senior managers are engaged, motivated and have the relevant leadership skills, the business is much more likely to succeed.
It is common knowledge that employers have a choice as to how they employ their employees. In circumstances where the employer does not need someone to work full-time hours, they can either employ the individual as a part-time permanent employee, or as a casual employee. However, many employers have abused the concept of casual employment by effectively retaining employees for long periods of continuous and predictable employment. We should also recognise that many employees prefer casual employment as they receive a greater rate of pay than they would otherwise as a permanent employee.
It is that time of year again. Employers are looking at the holiday period and how this is managed. Many employers will be closing down operations over the festive season and want employees to take this time as annual leave. However, employees are not always so willing to take annual leave at this time.
It is not uncommon that we receive queries as to whether employers can direct employees to take annual leave. This often arises when the business shuts down usually over the Christmas and New Year season. Conversely, it is not uncommon that we receive a query as to whether, and in what circumstances, employees are able to trade in a portion of their annual leave entitlement for cash.
For most employers, hiring casual employees has a number of advantages. Whether you are a small or large business, engaging casual employees can help increase flexibility in your workforce and afford you the ability to increase staffing levels during your busier months, whilst providing the ability to reduce headcount and/or wages during the quieter months.
However, in recent years there has been a significant focus on what casual employment actual means and it is now crucial that if businesses are engaging casual employees they are doing so on a genuine basis. To this end, employers that incorrectly classify an employee as a casual may leave themselves open to significant liability and potential risk.
“If I pay above minimum wage, does the modern award still apply”?
Many employers struggle with the complex myriad of legislative and regulatory requirements surrounding the employment and remuneration of workers. The role of modern awards and how they apply are one of the most misunderstood aspects of the Australian industrial landscape. Many employers do not properly understand their obligations and the requirements imposed on them by the operation of modern awards that cover their employees.
With the start of the new financial year and the annual increase in minimum wages, many businesses have most likely reviewed their pay rates and modern awards to ensure their company’s compliance in this regard. However, many businesses are failing to get some of the other basics right when it comes to record-keeping for their employees. In this week’s article we review an employer’s obligation in relation to payslips and employee records, the Fair Work Ombudsman’s current campaign on this issue and we review a recent decision which has imposed a record fine as a result of inadequate record-keeping.