Australian Resources and Energy Group AREEA has called on the Parliament to act on the hugely damaging uncertainty around casual employment entitlements in Australia, not await the outcome of a long and tortuous High Court appeal process.
AREEA welcomed confirmation last week that WorkPac has sought special leave to the High Court of Australia to appeal last month’s controversial Workpac v Rossato Federal Court decision, and that the Australian Government would intervene in the proceedings.
However, AREEA CEO Steve Knott AM (pictured) said this issue should be dealt with immediately through Commonwealth legislation.
“Australia’s business community and especially small businesses, which are most impacted by this uncertainty, need a legislative fix now,” Mr Knott said.
“Even without the devastating impacts of COVID-19, this issue left unresolved threatened to send masses of employers to the wall. But the pandemic has meant many employers are assessing on a daily basis whether or not they can survive, and deciding if it’s worth re-opening their doors.
“The last thing they need is the spectre of six years of back-pay, a liability now estimated at more than $14 billion across the economy, hanging over their heads. In the absence of swift action, more and more businesses will choose to raise the white flag and call in the administrators.
“They need some leadership from our elected representatives to fix this issue now. Who knows how long the High Court appeal will take and what the outcome will be?”
AREEA has been calling for a legislated solution to the casual employment uncertainty since the 2016 WorkPac v Skene decision first overturned the common understanding and longstanding practice of casual employment and associated entitlements.
Last month, the Federal Court in Rossato went a step further to not only reaffirm that employees are not necessarily ‘casual’ simply because their employment contract says so, but also to dismiss WorkPac’s attempt to offset the casual loading already paid against its liabilities to pay the entitlements owed.
“Allowing people to double dip on permanent employee entitlements, such as annual leave, personal leave and redundancy payments, while also being paid a casual loading simply does not pass the pub test,” Mr Knott said.
“All employers are asking for is if they have already paid the casual loading, that they can offset that against any entitlements owed if an employee was found to have been misclassified as a casual. Most people would see that as perfectly reasonable.
“This issue should also be put to bed by legislating a clear definition of casual employment, similar to that which already exists in dozens of industrial awards. This is something the Parliament can, and should, act on right away.”
On the day of the appeal announcement, Attorney-General Christian Porter confirmed that the government will intervene in the appeal to the High Court.
“This decision has caused confusion and uncertainty and has the potential to expose businesses to significant financial liability during a period where (they) are facing their greatest challenge,” he said.
WorkPac, which has engaged Bret Walker SC and Ian Neil SC, said the Rossato decision would “overturn the commonly accepted understanding of casual employment in Australia, where employees receive a higher rate of pay in lieu of leave entitlements”.
Casual employment issues, including its definition and the possibility for “double dipping”, is one of five areas of Australia’s industrial relations system being closely examined by a series of Australian Government-led working groups. See here for more information.
