The Federal Government has implemented a new Fair Work regulation to ensure that casual employees who receive a casual loading in their hourly rate are prevented from claiming paid leave entitlements, such as annual leave and personal or carer’s leave, under the National Employment Standards (NES) and awards. Essentially, the new regulation clarifies that the loading paid to a casual employee can ‘offset’ any subsequent claim for certain paid leave entitlements under the NES.
The new regulation has been in effect from 18 December 2018, but also applies to employment periods that occurred before this date.
The move by the Federal Government is in response to a recent Federal Court of Australia decision which ruled that a casual labour hire employee was entitled to annual leave as he had worked regular hours in his role for four years. The Federal Court decision caused major concerns for employers across Australia as it appeared to enable regular casual employees to claim additional payments from leave entitlements that were normally reserved for full-time and part-time employees. Small business employers were especially concerned that this decision could lead to subsequent ‘double-dipping’ claims from other regular casual employees and forced the Federal Government to act to protect employers against such back-pay claims. The Federal Court decision is being appealed and we will continue to closely monitor this.
The need for proper documentation is therefore even more essential in defending against such claims. Employers need to ensure that the ‘casual’ status of engagement is confirmed with the employee, and that they are paid an identifiable casual loading which is in lieu of leave entitlements that a casual employee is not entitled to.Members unclear on the differences between full-time, part-time and casual employment should contact the MTA’s Workplace Relations (WR) Department who can provide the information and necessary documentation to deal with casual employees. Click here to contact WR.