High Court win for employers over casuals

High Court decision is a major win for employers and a defeat for unions.

ACTU secretary Sally McManus. Picture: Getty Images

The High Court has ended four years of uncertainty about the rights of casual workers to claim paid leave, delivering a big victory to employers by upholding a challenge by labour hire firm WorkPac to a landmark casuals ruling.

In a defeat for unions that was welcomed by the Morrison government, the High Court overturned a full Federal Court decision that employees working regular and predictable shifts were not casual employees and had leave entitlements.

Employer groups hailed a decision they said vindicated their vocal campaign to have the ­Coalition legislate earlier this year to stop workers who were paid a 25 per cent casual loading from “double-dipping” by later seeking backpaid leave entitlements.

In its decision on Wednesday, the High Court overturned a ruling that production worker Robert Rossato was not a casual and was entitled to paid leave while engaged under a series of six contracts on rosters fixed well in advance. Finding Mr Rossato was a casual employee, the court said his employment was expressly on an “assignment-by-assignment basis” and he was entitled to ­accept or reject any offer of an ­assignment.

“That Mr Rossato was to work in accordance with an established shift structure fixed long in advance by rosters did not establish a commitment to an ongoing ­employment relationship beyond the completion of each assignment,” it said.

The court found that a “casual employee” was an employee who had no firm advance commitment from an employer about the duration of their employment, or the days or hours the employee would work, and gave no reciprocal commitment to the employer.

“Where parties commit the terms of their employment relationship to a written contract and thereafter adhere to those terms, the requisite firm advance commitment must be found in the binding contractual obligations of the parties; a mere expectation of continuing employment on a regular and systematic basis is not sufficient for the purposes of the (Fair Work) Act,” the High Court said.

ACTU secretary Sally McManus said the decision was another blow to workers “who have nothing left to give after 18 months of economic hell”.

She said the government should legislate to “smash unscrupulous labour hire operators with their exploitative ‘permanent casual’ model of employment”.

Assistant Minister for Industrial Relations Minister Amanda Stoker said the decision was “a win for casual workers and a rejection of the union movement’s double-dipping campaign It underscores the Morrison government’s reforms giving casual workers clarity on their ­entitlements, and their rights to convert to permanent part-time – which were vital to the viability of many casual worker’s jobs.”

Labor industrial relations spokesman Tony Burke said the judgment’s effect was limited as the government had teamed up with One Nation to pass changes that extinguished the rights of ­casual workers.

“A Labor government will overturn the govern­ment’s scheme, ending the rorts and restoring rights to workers.”

Australian Industry Group chief executive Innes Willox said plaintiff law firms, supported by litigation funders, should now withdraw the class action claims against employers over casual employment matters.

Acting Australian Chamber of Commerce and Industry chief executive Jenny Lambert said the High Court had rejected the ACTU’s ongoing attempts to discredit casual employment as a legitimate and lawful employment practice.