Case

Which case won?

casea
The case for the employee
  • My hours were regular, predictable and set 12 months in advance.
  • My employment was continuous.
  • I was paid a flat hourly fee without any casual loading.
  • My employment was facilitated by a fly-in, fly-out arrangement. Flights and accommodation were provided by my employer at no cost to me.
  • It is obvious that because of the fly-in, fly-out arrangement, I was unable to leave the mine during my seven day β€œon” period and was expected to be available on an ongoing basis during that period. It was not possible for me to elect not to work on a particular day that I was rostered on.
  • The court should find that I was a regular employee who was entitled to accrue annual leave and be paid this accrual at the termination of my employment. My employers should also be penalised for breaching the Fair Work Act.
caseb
The case for the labour hire company
  • The employee signed an agreement that clearly stated he was a β€œcasual” employee.
  • The employee was paid by the hour.
  • His employment could be terminated upon only one hour’s notice.
  • In the section of the Fair Work Act that deals with annual leave, the term β€œcasualβ€œ should be interpreted in its common industrial meaning, ie the employee was a casual because his agreement designated him as such.
  • Accordingly, he was also a casual employee under the relevant section of the Fair Work Act.
  • The court should find that the employee was not entitled to annual leave because he was employed as a casual.

So, which case won?

Cast your judgment below to find out
Case A Case B

Case A won. You were right!

How people voted
case a74%
case b26%

Expert commentary on the court's decision

Emily Wittig
Emily WittigLawyer
β€œThis case is the landmark case that every employer who employs casuals must be aware of. There comes a point when a casual employee is no longer casual.”
Court finds in favour of employee

TheΒ case was originally heard in theΒ Federal Circuit Court, inΒ Skene vΒ WorkpacΒ Pty LtdΒ [2016] FCCA 3035Β andΒ Skene vΒ WorkpacΒ Pty Ltd (No.2)Β [2017] FCCA 525, before making its way to theΒ Full Court of the Federal Court, inΒ WorkpacΒ Pty Ltd v SkeneΒ [2018] FCAFC 131.Β Β 

The appeal judges agreedΒ with the worker,Β MrΒ PaulΒ Skene, rejecting the arguments of the labour hire company,Β WorkPacΒ Pty Ltd,Β that Mr SkeneΒ shouldΒ notΒ be paid annual leave accrual on termination.

Does the term β€œcasual employeeβ€œ have more than one meaning?

The case hinged on the definition of the term β€œcasual employee” and the application ofΒ section 86Β at the beginning of Division 6 of theΒ Fair Work Act.Β Division 6 deals with annual leave. Section 86 states: β€œThis Division applies to employees, other than casual employees.” 

WorkPacΒ argued that the term β€œcasualΒ employee” in section 86 should be understood not in its usual legal sense, butΒ as having its β€œcommon industrial meaning”, thatΒ a casual employee is an employee designated as such by the applicable industrial instrument.Β Β 

WorkPacΒ contended that this was an β€œentrenched notion” of what had been commonly understood to beΒ a casual employee by federal industrial tribunals for the past 70 years.

Meaning of β€œcasualβ€œ is consistent throughout Fair Work Act

In makingΒ itsΒ decision,Β theΒ court dismissedΒ WorkPac’sΒ arguments and said that there was no β€œcommon industrial meaning” applicable to the term β€œcasual” in section 86Β of theΒ Fair Work ActΒ andΒ that it was incorrectΒ to suggest that the section contained a different meaning than other parts of the Act.

TheΒ judgesΒ held thatΒ Mr Skene was unable to leave the worksite due to the nature of his work, was expected to be at work for the entirety of his rostered time and was given the expectation of at least a year of rostered days.

Specifically, theΒ court said thatΒ Mr SkeneΒ had no choice inΒ hisΒ daily working arrangements and that there wasΒ β€œno opportunity for him to choose not to work any particular shift or hours offered to him” by his employer.

WithΒ an arrangementΒ of this nature,Β Mr SkeneΒ had a reasonable expectation of his job being more than a mere casual engagement. For the purposes of section 86,Β he wasΒ entitled to annual leave.Β 

β€œEssence of casualnessβ€œ in employment law

The judgment referred to a previous case, inΒ which theΒ β€œessence of casualnessβ€œΒ was described as theΒ β€œabsence of a firm advance commitment as to the duration of the employee’s employment or the days (or hours) the employee will work.β€œΒ (SeeΒ HamzyΒ v Tricon International Restaurants trading as KFCΒ [2001] FCA 1589.)Β 

The appeal court also quashed the primary judge’s reasons not to impose a fine onΒ WorkpacΒ and remitted the matter to the Federal Circuit Court for determination of the compensation amount payable to Mr Skene and the penalty amount to be imposed onΒ WorkpacΒ for breaches of theΒ Fair Work Act.

Employers must ensure workers receive correct entitlements

Employers must be careful to ensure that their employees are correctly determined as either β€œfull time”,Β β€œpart time” or β€œcasual”. Employers must be aware that there is no such thing as a β€œfull time casual” employee and such titles are confusing for all parties.Β 

If a casual employee has a reasonable expectation that their engagement will continue into the foreseeable future, it is prudent to review your practices to ensure that employees are receiving their correct entitlements.Β A good review to do is to look at your payroll.

In the example case, the employee was being paid a flat rate for all hours worked. Casual employees should receive a distinct casual loading on top of their base rate. Paying a flat rate could be confused with a rateΒ forΒ full-timeΒ orΒ part-time employees. Casual employees are paid a loading in exchange for not accruing annual leave and personal leave.

Casual employees are good to fillΒ gapsΒ in your labour force,Β butΒ if they start to work regular, full time hours (38Β hours per week or more) over aΒ lengthyΒ period, you should seek legal advice about the status of the employee.Β IfΒ a worker hasΒ little choice inΒ his or herΒ working arrangements, they are probably not a casual employee.

Casual conversion clauses in modern awards

Further, in some industries (theΒ vehicleΒ industry,Β for example), theΒ modernΒ awardΒ covering the industryΒ may contain β€œcasual conversion” clauses.Β 

This meansΒ that if a casual employee is working the same hoursΒ orΒ days for longer than six months, they are entitled to request to be madeΒ a permanent employee. Employers must have valid reasons for refusing such requests and should be carefulΒ aboutΒ refusing.

Designating a worker as a casual will not help employers

The crux ofΒ WorkPacΒ v SkeneΒ is that describing the employment relationship asΒ β€œcasualβ€œΒ isΒ not of itself determinative. An employment contract might specify that a worker is aΒ β€œcasualΒ employeeβ€œ, but this will not override the true legal relationship which is determined by a full consideration of the circumstances.Β 

Michael Black QC, inΒ Re Porter;β€―Re Transport Workers Union of AustraliaΒ said it perfectly:Β β€œThe parties cannot create something which has every feature of a rooster, but call it a duck and insist that everybody else recognises it as a duck.”

For information about a related case, please see Casual worker rights can include annual leave and sick leave, says Federal Court.

For further information about workplace agreements, please see our 2023 article Shelf life of zombie agreements set to expire shortly.

See also:

Contractor or employee – the grey area of the gig economy

Former Uber Eats courier paid $400,000 in out-of-court settlement

Are you employed in casual work but doing the same job as a permanent employee?

NOTICE: This article is accurate as at the time of publication and does not constitute legal advice. Please see our legal notices page for more information. Information related to coronavirus can be outdated very quickly.

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