A leading financial commentator has called for an urgent end to Australia’s casual worker chaos, arguing that a recent Federal Court decision could entitle millions of casual workers to claim back pay for unpaid leave entitlements, despite already receiving the “casual pay premium”.
Judith Sloan, contributing Economics Editor for The Australian, called on the Government to “act with decisiveness” in clarifying the matter.
“While the government is consulting on a range of industrial relations issues, it needs to pull the issue of casual employment out of the list and deal with it expeditiously,” Sloan wrote in The Australian this week.
“The alternative is to have businesses continue to worry that they will be up for unaffordable amounts of back pay for their casual workers. It also may deter businesses from taking on any new casual employees given the uncertainty that prevails.”
Her calls comes after the contentious Skene v WorkPac decision, which allowed a casual employee to claim annual leave entitlements based on a regular pattern of work, despite having already been paid the standard 25% casual loading in lieu of such entitlements.
Dubbed the ‘double dipping’ decision, it has created a potential legal precedent that could cost the small business sector up to $8 billion in back payments to casual workers, according to the Ai Group. In August the Construction Forestry Maritime Mining and Energy Union (CFMMEU) launched a $12 million class action case against WorkPac seeking unpaid annual leave entitlements for casual its claims were ‘misclassified’.
Employsure’s Workplace Relations expert Michael Wilkinson has echoed the sentiments, saying that businesses needed urgent clarity around the issue.
“Small business owners are already facing a complex web of red tape and a raft of workplace relations legislation that is constantly being amended by the workplace relations tribunal.
“To complicate the matter further, the term ‘casual employee’ has no precise definition in the Fair Work Act, and is largely defined by court decisions, leaving small business without clarity.
“The viability of offering casual work is being actively reconsidered by many Australian businesses. The concern is that the uncertainty and proposed backflip to disallow the regulation, will reduce employment opportunities nationally as businesses explore alternatives.
“Casual work is about providing flexibility and productivity benefits for employers and employees. However, in this state, it is difficult to say that casual employment achieves anything more than meeting a very niche requirement for a small number of employers,” he said.