Business Blog No 25 – Casuals and Redundancy

Casual hours to count towards redundancy payouts

Last week, the full bench of the Fair Work Commission resolved that periods of regular casual employment will now be counted towards redundancy entitlement calculations. The advantage to employers in ‘casualising’ their workforce is slowly being eroded away, and this latest decision is another step in that direction.

The decision means that workers who start as casuals before their positions become permanent, either full-time or part-time, will have their full length of service recognised in the calculation of their final redundancy pay out.

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An appeal by the Australian Manufacturing Workers’ Union was upheld reversing a decision made earlier in the year which allowed a ship building company to only count the period of permanent employment in the calculation of redundancy payments.

To be included in the calculation of years of continuous service, the period of ‘regular and systemic casual employment’ must be part of the period of employment from which an employee is being made redundant. There can be no break between the period of regular and systemic casual employment and the transition to permanent employment.

The decision does not apply to employees who were casuals when their employment was terminated however.

If you are in this situation, you should talk to your Industrial Relations advisor to ensure you are calculating redundancy payouts correctly.

Ross – Virtual/Part-Time CFO

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