The High Court has overturned a lower court judgment that paved the way for long-term casual workers to be paid leave entitlements.
The Federal Court in May 2020 found workers employed on a regular, permanent basis were not casual employees under the Fair Work Act and were entitled to annual, sick and other leave entitlements.
The court held that Robert Rossato was entitled to be paid by his former employer a 25 per cent casual loading along with leave entitlements because of his regular pattern of work, backing up an earlier court ruling.
But seven High Court judges on Wednesday unanimously allowed an appeal from labour hire company WorkPac, which had employed Mr Rossato as a production worker in Queensland’s open-cut coal mining industry.
The High Court held that a casual employee has no firm advance commitment from an employer about the duration of their employment, their days or hours of work, and the employee provides no reciprocal commitment to the employer.
Mr Rossato’s employment was expressly on an “assignment-by-assignment basis”, the court said.
He was entitled to accept or reject any assignment and the fact he was rostered long in advance did not establish a commitment to an ongoing employment relationship.
“The contractual arrangements between WorkPac and Mr Rossato did not include a mutual commitment to an ongoing working relationship between them after the completion of each assignment,” the High Court concluded.
“The express terms of the relationship between WorkPac and Mr Rossato were distinctly inconsistent with any such commitment. Mr Rossato’s entitlement to remuneration was agreed on that basis.”
In welcoming the High Court ruling, the Australian Industry Group said the Federal Court decisions had created $39 billion in cost risks for employers from potential “double dipping” claims.
“The decisions were also a major risk to the work patterns of the many Australian workers who prefer to work on a casual basis,” Ai Group chief executive Innes Willox said in a statement.
“These risks were comprehensively addressed through changes to the Fair Work Act that came into operation in March this year but the decision of the High Court is still very important.”
Mr Willox said it was time for all political parties to stop proposing changes to the definition of a casual employee under the act and for law firms, supported by litigation funders, to withdraw class action claims against employers over casual employment matters
The mining union that had intervened in the case argued the Federal Court had twice confirmed the “permanent casual rort” in the industry is unfair and unlawful.
“Casual mineworkers do the same work on the same rosters, but they are paid about 30 per cent less and have no job security or leave entitlements,” CFMMEU mining and energy general president Tony Maher said last year.