Types of Employment Relationships and the Relevant Entitlements
It is important for an employer, as well as an employee, to understand their employment relationship to ascertain their rights, obligations and entitlements. The different types of employees and the entitlements available to them are discussed below in this article.
There are different definitions for employers and employees in the Fair Work Act 2009 (Cth) (the FWA), depending on their rights, duties and entitlements available under different parts of the FWA. Part 2-2 of the FWA contains the National Employment Standards (the NES) which provides for various entitlements available to employees, including pay, leave, termination and redundancy.
This is a general discussion and the rights and duties of the employer and the employee can vary, depending upon which modern award or enterprise agreement covers their employment relationship or upon the terms of the employment contract, or the provisions of the FWA and the NES.
Full-time or Part-time Employees
Employees who are employed on fixed term basis or permanent basis can either be full-time or part-time employees (the Permanent Employees). The working hours of a Permanent Employee are set out in the employment contract or may be pursuant to the relevant award applicable to the employee. Generally, pursuant to section 20 of the FWA, a full-time employee works for 38 hours per week, and a part-time employee works for less than 38 hours per week.
Pursuant to the NES, the Permanent Employees must generally be provided with the following entitlements:
• annual leave, parental leave, personal carer’s leave, compassionate leave, community service leave and long service leave;
• public holiday and entitlements; and
• notice of termination and redundancy pay.
Casual Employees
Pursuant to the decision in WorkPac Pty Limited v Skene [2018] FCAFC 131 (the WorkPac Case), a casual employee is an employee who has:
• irregular work patterns;
• uncertainty as to the period over which employment is offered;
• discontinuity; and
• intermittency of work and unpredictability.
Furthermore, pursuant to the decision in WorkPac Case and section 86 of the FWA, a casual employee does not receive the leave entitlements which are available to Permanent Employees, as discussed above. Further, casual employees are not entitled to paid annual or sick leave but are entitled to casual loading. Casual loading means that they are entitled to a higher pay rate than equivalent full-time or part-time employees.
Notwithstanding the above, casual employees are generally entitled to the following:
• 2 days of unpaid carer’s leave, per occasion;
• compassionate leave, per occasion;
• 5 days of unpaid family and domestic violence leave; and
• unpaid community service leave.
Casual Employee’s Entitlement to Paid Annual and Sick Leave
There are specific circumstances when a casual employee may be considered under the law to be a Permanent Employee and may be eligible to the entitlements which are available to the Permanent Employees, such as paid annual leave and sick leave.
Pursuant to the decision in Workpac Case, it is not enough that the employer pays someone as a casual employee, in accordance with an award or enterprise agreement, if the arrangement does not have the characteristics of a casual employment, as discussed above.
Additionally, a casual employee is eligible to the entitlements which are available to a Permanent Employee, including annual leave and other accrued entitlements, if:
• there is a firm commitment by the employer to provide continuing and indefinite work (subject to the rights of termination) to the employee; and
• there is an agreed pattern and arrangement of work.
Next Steps
If you think your casual employee may be deemed a permanent employee, feel free to contact us for a free consultation on (02) 9262 5495 or (03) 8899 7870; visit our Website; Like our Facebook Page.
This article is written by Nyeilza Dutt and settled by Damin Murdock. This article is not legal advice and should not be relied upon as legal advice. All articles found on this website are intended to provide informative information, nevertheless, in many instances legislation and case law has been simplified and/or paraphrased. If you would like personal legal advice based on your current circumstances, you should contact MurdockCheng Legal Practice for a free consultation.