On 20 August 2018, Moray & Agnew provided an outline of a decision of the Full Bench of the Federal Court, where it was held that a labour hire employee engaged as a casual was in fact a permanent employee and entitled to accrued annual leave (WorkPac Pty Ltd v Skene [2018] FCAFC 131).

Since then, WorkPac has filed a separate action seeking a declaration that another employee, Mr Rossato, is a casual employee and is not entitled to leave.

The Commonwealth proposes to intervene with reference to concern on behalf of employers of the impact of accrued entitlements and ‘double dipping’ with reference to the casual loading.

Background

The Federal Court confirmed in WorkPac Pty Ltd v Skene [2018] FCAFC 131 that an agreement or contract with an employee does not determine the true legal nature of the employment relationship on its own. The court will look at the nature of the relationship beyond the words of the contract.

Mr Skene was hired under a casual contract. It was held that his work arrangements had the characteristics of permanent employment. The Full Bench held that casual employment involves irregular, uncertain, intermittent and unpredictable work patterns. Casual employment necessarily involves an absence of a firm advance commitment as to the duration, days and hours of work. The payment of a casual loading is not a determining factor, although it is one consideration.

Current proceedings

WorkPac has filed a separate action seeking a declaration that another employee, Mr Rossato, is a casual employee and is not entitled to accrued leave. WorkPac seeks to establish that where a casual loading has been paid and a subsequent entitlement to accrued leave is established, employers have the right to offset the casual loading against the leave entitlements.

Industrial Relations Minister, the Hon Kelly O’Dwyer, has made an application to join the Commonwealth as a party in support of the WorkPac position. It is reported that Ms O’Dwyer said that the Australian Government had decided to intervene because of the ‘considerable concern across Australia’s three million small businesses and given the impact it could have on job creation and existing jobs’.

The Construction, Forestry, Maritime, Mining and Energy Union, which brought the original action on behalf of Mr Skene, responded with reference to an alleged systematic unfair casualisation of permanent jobs by big business that exploits workers.

On 18 October 2018, the Court ordered that the matter be listed for a case management hearing on 8 November 2018.