What you need to know when employing casual staff in Australia

Key takeaways

  • Employers do not need to give a reason for termination, but it is recommended that a fair reason is stated in writing to protect you from unfair dismissal action
  • Casual employees are entitled to loading to compensate for not being entitled to paid annual and personal leave
  • Ten top FAQs, which cover all areas.

If you are a business owner relying on casual staff, you might find the rules and regulations around this form of employment a bit confusing.

Hiring people on a casual basis affords you flexibility as the business owner if you need to terminate or cancel shifts or leave. Keep in mind, however, that the same flexibility is extended to the employee.

This set of FAQs is intended to help employers of casual employees to understand their rights and responsibilities, under the Fair Work Act, in employing casual staff.

  1. As an employer, do I have to pay loading to casual employees?

In short, yes. Due to the nature of casual employment, as casual employees are not entitled to be paid annual or sick leave, their hourly rate must be increased to compensate them accordingly. According to Fair Work, adequate compensation is 25% on top of the minimum full-time wage for that employee (referred to as 'casual loading'). If you do not pay your casual employees 'casual loading', you may be unnecessarily exposing yourself to a claim in the future.

As part-time employees accrue annual and personal leave, they are not entitled to leave loading on top of their wage.

  1. Do I have to give reason for termination of a casual employee?

No. Terminating a casual employee's employment does not require giving them a reason, or warning, of the termination. However, unfair dismissal, adverse action and anti-discrimination laws still apply to casuals so caution should be given when terminating casual employees without cause. See Question 7 for further explanation.

  1. Do casual employees get superannuation?

Employers are required to pay superannuation contributions of 9.5% for all employees whether casual, part-time or full- time where they have:

a) been paid at least $450 before tax in a month; and

b) are over 18; or

c) under 18 and working more than 30 hours a week.

  1. Are casual employees entitled to annual leave?

Casual employees are not entitled to be paid for annual leave. However, casual employees do have certain entitlements to unpaid leave. For example, within a 12 month period, casual employees can have:

a) two days of unpaid carers leave;

b) two days of unpaid compassionate leave;

c) five days of unpaid family and domestic violence leave; and

d) unpaid community service leave.

  1. Can casual employees call in sick?

Yes. Casual employees are able to call in sick with minimum notice. There is no requirement to pay casual employees sick leave and employers usually will not require a medical certificate. However, an employment agreement can set the circumstances when a medical certificate is required.

  1. Can casual and part-time employees get long service leave?

Both casual and part-time employees can be eligible for long service leave after 10 years of continuous service. While casual and part-time employees are eligible, the length of their long service leave available is calculated pro-rata according to their ordinary hours of service during the period of employment.

It is very important to accurately record casual time and wages to ensure correct entitlement and calculation of long service entitlements.

  1. Can casual and part-time employees claim unfair dismissal?

Yes, all employees can apply for unfair dismissal as long as they have been employed for at least six months.

Although you do not have to provide a reason or notice to terminate the employment of a casual worker, it must not be harsh, unjust or unreasonable or as a result of discrimination or an employee exercising a workplace right.

Because of the risk of claim for unfair dismissal, it is a good idea to provide a termination letter when ending a casual's employment outlining the basis for their termination.

  1. Can casual employees quit without notice?

Yes, casuals are entitled to terminate their employment without notice. This also applies to the employer who can terminate casual employment without notice.

  1. Can casual employees cancel their shifts?

Yes, a casual employee can simply say they are not showing up for their shift. The same flexibility employers look for in hiring a casual employee (in being able to cancel casual employees’ shifts or hours without notice) is also afforded to, and exercisable by, the casual employee. This also applies for a request for time off, as a casual employee is not required to seek approval before taking any holidays.

  1. Can casual employees get maternity leave?

If a casual employee has been employed for at least twelve months with the employer, they are entitled to unpaid parental leave.

Top tip: Just because you specify an employee as 'casual' on their employment agreement does not necessarily mean they are a casual employee. If the employee has been working regular, systematic and consistent hours for a period of time, they may actually be classified as a part-time or full-time employee.

The information in this blog is intended only to provide a general overview and has not been prepared with a view to any particular situation or set of circumstances. It is not intended to be comprehensive nor does it constitute legal advice. While we attempt to ensure the information is current and accurate we do not guarantee its currency and accuracy. You should seek legal or other professional advice before acting or relying on any of the information in this blog as it may not be appropriate for your individual circumstances.