Thinking | 24 June 2020

Don’t leave me out: WA casual entitled to long service leave

The recent Full Court of the Federal Court decision in Workpac v Rossato[1] has generated considerable discussion around casual employment. While employers are still grappling with the implications of the Rossato decision, hot on its heels is a decision of the Western Australian Industrial Magistrates Court which looks at the circumstances where a casual employee will be entitled to long service leave in WA.

Under the Long Service Leave Act 1958 (WA) (LSL Act) casuals are entitled to long service leave provided that they have 10 years of continuous employment with the same employer. The decision in Janine Callan, Department of Mines, Industry Regulation & Safety v Ubiquitous Holdings Pty Ltd[2] is the first in WA to consider what is meant by ‘continuous employment’ under section 6 of the LSL Act for casual employees.

Facts

The employer, Ubiquitous Holdings, operated a labour hire business in the aged care sector. The employee, Ms Derwort, was engaged by Ubiquitous Holdings under a casual employment contract as a personal care assistant over a 13 year period.

Over the course of those 13 years, Ms Derwort was placed with various hospitals for assignments that ranged in duration between a single day and up to five months, working for four or five days in most weeks. Ms Derwort had 15 periods of absence during that time, including two occasions in which Ms Derwort told the employer that she was not available for over two months.

Section 6 of the LSL Act sets out what constitutes ‘continuous employment’ for the purposes of the LSL Act. This includes periods of annual, personal and authorised leave. It does not however set out how periods of casual employment should be treated.

It was contended for Ms Derwort that, despite being employed as a casual, she had accrued over 10 years’ continuous employment when considered over the whole period of her employment and was therefore entitled to long service leave under the LSL Act.

This was disputed by the employer who said that the nature of casual employment was inconsistent with the notion of continuous employment because it is inherently irregular, with no commitment to ongoing employment. In particular, the employer argued that Ms Dewort’s employment terminated at the end of each assignment (severing her continuous employment), with no employment relationship subsisting between each placement.

Outcome

The Court disagreed with the employer, finding that the LSL Act affords casual employees the same entitlement to long service leave as full-time and part-time employees, and that the phrase ‘continuous employment’ in section 8 of the LSL Act is capable of including a period of casual employment arising from a single casual employment contract.

In reaching its decision, the Court cited two features of the employment contract as being particularly significant. First, the employer was found to have an ongoing obligation to offer Ms Derwort work. This was due to a term which provided that the employer would offer her work ‘where there is a suitable assignment with a client’. If and when a suitable assignment arose, the employer was required to offer it. Secondly, the Court found that Ms Derwort was unable to freely refuse any offer of an assignment as the terms of the contract provided that the employer may terminate the contract if she did so.

Crucially, it was found that the effect of these clauses was that the employment contract did not terminate at the end of each assignment. As a result, the relationship remained on foot during the intervening periods when Ms Derwort was held to be on authorised periods of absence and her employment was deemed to be continuous.

Key takeaways

While casual employees are generally not entitled to annual leave and paid personal leave, it is important for employers to be aware that this may not be the case for long service leave and they should turn their minds to the long service leave laws in the relevant state or territory.

In light of this decision we recommend WA employers:

  • review the terms of their casual employment contracts to identify any terms which point towards a single continuous employment contract;
  • assess whether any long-standing casual employees are likely to have accrued sufficient continuous employment to qualify for long service leave; and
  • ensure financial accounts reflect long service leave liabilities for long-standing casual employees.

[1] [2020] FCAFC 84
[2] 2020 WAIRC 00250

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