Casual Loading

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What Is Casual Loading?

Casual loading is additional payment made on top of a casual employee’s fixed hourly wage. The percentile rate of casual loading is determined by the relevant award or agreement covering that specific job.

Casual workers are entitled to a higher rate of pay as they are not entitled to benefits enjoyed by permanent employees, such as paid leave (e.g. paid sick leave, annual leave and long service leave).

Calculating the Casual Loading Rate

To calculate the casual loading rate, you must multiply an employee’s permanent hourly rate by the percentage of the casual loading rate, as stated in the relevant modern award or enterprise agreement.

For example, if a casual worker is paid the current national minimum wage of $19.49 per hour, and their award or agreement stipulated a casual loading rate of 25%, the calculation would be as follows:

$19.84 (permanent hourly wage) + $4.96 (25% of the permanent hourly wage)
= $24.80 (total hourly wage)

Depending on the applicable Award, enterprise agreement or employment contract, casual loading rates can be anywhere between 15% to 25% of the normal hourly rate.

What is Casual Conversion?

Can casual employees convert to full-time or part-time work?

Do Casual Employees Get Paid Overtime?

Similar to full-time and part-time employees, when casual workers work on public holidays, weekends, overtime, or outside ordinary business hours, they are entitled to extra pay. These collectively are called penalty rates.

Keep in mind, casual loading on overtime and other instances do vary based on the industry. Some employees may be entitled to a total casual loading of 250% of their hourly rate if they work on a public holiday. The amount may be less for those covered by a different award or enterprise agreement.

Many awards and enterprise agreements allow employees to still receive casual loading on top of their penalty rates. This, however, is not always the case. Refer to your relevant award or enterprise agreement for clarification.

Many awards and enterprise agreements allow employees to still receive casual loading on top of their penalty rates. This, however, is not always the case. Refer to your relevant award or enterprise agreement for clarification.

Casual Employment Rights

As an employer, it is important to be fully aware of your workers’ casual employment rights. While paying your casual workers the correct wage is vital, you should also be aware of other aspects of your casual employment contract.

Below are a few of the areas that employers should be aware of in relation to casual employment rights:

Hours of Work

Casual workers are not guaranteed a set number of hours per work, and they may be required to work irregular hours. This means you can ask a casual worker to work with a shorter notice period, within reason.

On the other hand, casual employees are not obligated to say yes each time. However, if they do agree to come into work, you may have to pay them for a minimum number of hours even if they have worked less. This is called a minimum engagement period and is stipulated in the Award or Enterprise Agreement.

Sick Leave and Annual Leave

Casual employees are not entitled to paid leave, like sick or annual leave. However, they are entitled to a range of unpaid forms of leave, such as unpaid carer’s leave and unpaid compassionate leave.

Some casual workers may be entitled to long service leave depending on your state or territory laws.

Termination Notice

In most cases, you do not have to give a minimum amount of notice when you terminate a casual employee. Similarly, in most cases, a casual employee does not have to give notice when they resign. There are, however, exceptions in some awards, enterprise agreements, and casual employment contracts.

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Frequently Asked Questions

  • Are Casual Employees Paid Overtime?

    Similar to full-time and part-time employees, when casual employees work on public holidays, weekends, overtime, or outside ordinary business hours, they are entitled to extra pay. These collectively are called penalty rates.

    Keep in mind, casual loading on overtime and other instances do vary based on the industry. Some employees may be entitled to a total casual loading of 250% if they work on a public holiday. The amount may be less for those covered by a different award or enterprise agreement.

    Many awards and enterprise agreements allow employees to still receive casual loading on top of their penalty rates. This, however, is not always the case. Refer to your relevant award or enterprise agreement for clarification.

  • Do Employers Have To Pay Casual Loading?

    If an employer is employing a casual employee, then they do have to pay casual loading.

  • What Is the Minimum Wage For Casual Employees In Australia?

    The minimum wage in 2020-21 will increase by 1.75% per cent to $19.84 per hour.  Under the Fair Work Act, the casual loading is 25% so the Minimum Wage for an Adult Casual Employee is $24.80

  • Do You Pay Super on Casual Loading?

    Yes, you do. You generally don’t have pay casuals superannuation until they reach a monthly threshold of pay. When the employee reaches the threshold, you have to calculate the superannuation they are entitled to,  and pay them accordingly  The Australian Tax Office decides when to pay superannuation.

  • How Much Is Casual Loading In NSW?

    For employers under the national workplaces system (mainly employers in the private sector), casual loading is, broadly, 25% of the fixed hourly wage. However, depending on the Award, enterprise agreement or employment contract, this casual loading rate may change.

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