Industrial law – contract of employment

In the High Court decision of WorkPac Pty Ltd v Rossato [2021] HCA 23 (4 August 2021), the High Court was required to determine whether the first respondent (Rossato) was employed by the appellant (WorkPac) as a casual employee for the purposes of s86 of the Fair Work Act 2009 (Cth) (the FW Act).

It is worth noting here that the precedential value of this case is somewhat limited because the FW Act has now been amended to insert a definition of “casual employee” where, before, no such statutory definition existed.

Rossato was an experienced production worker in the open-cut black coal mining industry employed by Workpac. On first commencing work with WorkPac, Rossato signed a single-page document containing general terms of his employment (General Terms). Rossato was then employed episodically, until his retirement, pursuant to a series of six contracts titled Notice of Offer of Casual Employment – Flat Rate (NOCE).

An enterprise agreement also regulated the terms of his work. In August 2018, the Full Federal Court of Australia delivered judgment in WorkPac Pty Ltd v Skene (2018) 264 FCR 536 (Skene). The Full Court held that Mr Skene, who was employed by Workpac in much the same way as Rossato and treated as a casual employee, was, in fact, not a casual employee for the purposes of the FW Act and the applicable enterprise agreement.

Relying on Skene, Rossato wrote to Workpac claiming that he had not been employed as a casual employee and sought payment of certain entitlements. WorkPac denied Rossato’s claims and commenced proceedings in the Federal Court of Australia.

Allsop CJ, pursuant to s20(1A) of the Federal Court of Australia Act 1976 (Cth), directed that the matter be heard by a Full Court. Allsop CJ also granted leave to the responsible Minister and the CFMMEU to intervene as well as the applicant in a class action against WorkPac.

The Full Federal Court, influenced by the decision in Skene, held that Rossato was not employed by Workpac as a casual employee. Both before the Full Court (and later the High Court) the parties agreed that the expression “casual employee” in the FW Act refers to “an employee who has no firm advance commitment as to the duration of the employee’s employment or the days (or hours) the employee will work” (see [32] of the High Court decision).

But, in determining the nature of the work relationship, the Full Court favoured the approach adopted in Skene, and advanced by Rossato, of looking at the course of dealing between the parties and not only the written terms of the contract. The Full Court concluded that Rossato was not a casual employee because he had a firm advance commitment to his working hours in the WorkPac roster.

WorkPac successfully appealed to the High Court. In a unanimous decision, the High Court held that Rossato was employed by WorkPac as a casual employee. The High Court rejected the approach in Skene of looking at the course of dealing between the parties.

Re-asserting the importance of freedom of contract, the plurality (Keifel CJ, Keane, Gordon, Edelman, Steward and Gleeson JJ), in their joint judgment, noted at [63] that “nothing less than binding contractual terms are apt to characterise the legal relationship between employer and employee”.

The plurality reviewed the General Terms, each of the NOCEs, and the enterprise agreement. The plurality concluded that, on a plain reading of the terms of these agreements, Rossato was a casual employee because there was no firm advance commitment of work, for either party, beyond each assignment.

Gageler J, in a separate, short, set of reasons, agreed with the plurality. And WorkPac’s appeal was allowed.

Dr Michelle Sharpe is a Victorian barrister practicing in general commercial, real property, disciplinary and regulatory law, p: 03 9225 8722, email msharpe@vicbar.com.au. The full version of these judgments can be found at www.austlii.edu.au.

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