If you are an employer, you may have a range of different contracts to suit various employment arrangements with your staff, from full-time to part-time, casual and even freelance staff however, when it comes to casual or part-time employees, many employers are surprised to realise that there are key differences between these arrangements which can affect the way you engage your employees.
Deciding whether you employ casual or part-time staff is a critical decision that can impact the way your business is structured as well as your rights as an employer. Whether you are an established business or just starting out, it is important to understand the legal ramifications of different employer contracts. Failure to treat your employees as specified in their contracts can lead to legal disputes and penalties from bodies such as the Fair Work Ombudsman (FWO).
It can be difficult to decide what kind of employee arrangement you would like to set up from the beginning. This is especially true if you are hiring for a new role and are still undecided about the requirements of the role. Ideally, you also want to come up with Arrangements that would be attractive to potential employees.
In this article, we will discuss the advantages and disadvantages of different types of employment, and outline employees’ legal rights as well as your legal obligations as an employer.
Part-time employment is very similar to full-time employment except the employee works a different number of hours. Part-time employees can work up to 38 hours per week and are entitled to similar benefits as full-time staff, such as sick leave, leave for public holidays, annual leave, parental leave and redundancy pay. They also have similar rights when it comes to giving or receiving a notice of termination. Typically, part-time staff work fewer hours than full-time employees, however, they normally work a set number of hours per week on a regular timetable.
This kind of employee arrangement still provides security and structure for the employee while at the same time offering them some flexibility in terms of hours worked. Part-time employees can be more invested in the company and may have a stronger sense of morale and productivity. They are more inclined to feel as if they are part of a team and, unlike casual employees, they must provide adequate notice.
Part-time working arrangements provide the employer with greater flexibility when it comes to scheduling work within their organisation as they know the hours the employee will be working however, an employer is unable to unilaterally reduce the hours worked by a part-time employee if the employer’s requirements change. Hiring a part-time employee is a commitment and there is risk if the employer’s needs and requirements change.
Casual employees typically work irregular hours, which can change from week to week depending on the needs of the business or the availability of the staff. Casual employment can be very attractive to employees because of the higher hourly rates and flexibility. Casual employees receive a greater hourly rate than part-time employees and often receive loadings for working overtime, public holidays and weekends. However, they do not receive many of the benefits that part-time employees are privy to, such as public holiday leave, sick leave, annual leave, and other benefits.
Employers do not need to employ casual employees to work set hours, and, in fact, there is no requirement to allocate casual employees regular work at all and unless the contract specifically says otherwise, the termination of a casual employee can occur with no notice at all. This typically means that there is a much lower risk of an employee filing an unfair dismissal claim. The general perspective of casual employment is that the employee is contracted ‘from engagement to engagement’.
While this provides employers a certain amount of flexibility, it does not give employees any job security, and it means that staff can leave without providing notice. If you have a roster of several casual employees, this may not have an impact on your business however, it may have a large impact on your business if you are depending on a small pool of casual employees.
Casual or part time employment
When it comes to deciding on whether you will employ casual or part-time employees, there are many factors to take into consideration. These might depend on your business structure, industry, and whether you need seasonal workers or long-term employees. You will also want to consider the hours required within the role, and how often the hours might change.
For example, industries such as hospitality, events, and retail are highly dependent on seasonal demand. It is quite common for employers in these industries to employ casual workers for the holiday season in order to account for the seasonal demand.
If you are a start-up or a new business you should always bear in mind that your requirements might change in the future as the business grows. If you are just starting up a new business, you might just want to start with a few employees employed on casual employment contracts to allow your business the flexibility to change or to increase hours where needed. Once you have a greater understanding of the requirements of your business, you can be more certain when making decisions about your employee arrangements. At this stage, you may decide to employ more part-time employees to improve staff turnover, boost productivity, and provide more certainty for the future.
Changing contracts and employee arrangements
As a business owner, as long as your employees are amenable, you have the freedom to provide new employee contracts or change employee arrangements.
You will also need to ensure that your employees are open to changing their contracts if necessary. For example, if you want to transition an employee from a casual arrangement to a part-time contract, you will need to ensure that you are communicating any benefits when it comes to casual or part-time employment. Some employees prefer the flexibility of a casual contract and may not want to change. Others prefer the job security that part-time employment offers.
If you have a valued casual employee and you have a need for consistent work, you may want to consider transitioning the employee to a part-time contract, if they are willing to make the change. Accordingly, it is important to talk the matter through with your employee. This will give both you and the employee a more permanent arrangement that will make future planning easier.
Always consult with an expert employment lawyer
If you are in business or you are a contractor and you wish to create or amend employee contracts, you should firstly consult an experienced employment lawyer. As an employer, it is important to understand what your employees are entitled to, as this will dictate the details you need to include within your employment contracts.
It is also important for both employers and employees to understand employee entitlements, as well as knowing what is required when employees give their notice and cease work. Certain legislation in Australia even specifies that businesses of a certain size need to allow employees the opportunity to transition to a permanent contract if they meet certain conditions. It is up to businesses to be aware of these conditions.
On the other hand, if you are an employee and believe that you have a case for unfair dismissal or have a workplace or contractual difficulty, get in touch. Our expert employment lawyers can help you navigate employment contracts, unfair dismissal claims, and other issues related to employment law. To start the process, contact the team at Maguire & McInerney Lawyers or phone us directly on 02 4228 5911 to learn more.