Rest and relaxation is no holiday for casual employees' minimum employment period

By Shae McCartney and Brett Thompson
21 Feb 2020
The Fair Work Commission will closely examine the terms of enterprise agreements to determine the true nature of an entitlement, which may lead to unexpected outcomes – so check your employment and rostering arrangements.

A recent decision of the Fair Work Commission has confirmed the status of rostered rest and recreation (R&R) in calculating continuous service – opening the way for a casual employee's unfair dismissal claim – and demonstrates that carefully drafted enterprise agreement terms cannot be relied on to avoid the application of legal protections.

Rostered on, R&R'd off – permanently

In Stuart Mclennan v MAS Australasia Pty Ltd [2020] FWC 15, Mr Mclennan a casual scaffolder on a fly-in fly-out roster, made an unfair dismissal application after he was dismissed by MAS Australasia Pty Ltd (MAS).

Mr Mclennan was employed on a fly in fly out (FIFO) roster, which comprised of two weeks of "rostered on" time and two weeks of unpaid R&R "leave", as set out in the MAS Australasia Pty Ltd Employee Agreement 2016.

MAS objected to the application on jurisdictional grounds, arguing that Mr Mclennan had not served the minimum employment period, which was six months of continuous service as required under the Fair Work Act 2009 (Cth). The Fair Work Act also provides that, subject to certain exceptions, periods of unpaid leave or unpaid authorised absences do not count toward continuous service.

MAS argued that Mr Mclennan had not satisfied the minimum employment period because the periods of R&R "leave" did not count toward continuous service as they were periods of "unpaid authorised absence".

Neither unpaid leave nor unpaid authorised absence

Deputy President Beaumont rejected the employer's objections, finding that the periods of R&R were neither unpaid leave nor unpaid authorised absence and that having met the minimum employment period, Mr Mclennan was entitled to make his unfair dismissal application.

Citing Federal Court and Fair Work Commission authority, the Deputy President stated that R&R is properly characterised as a "block of authorised non-work time which forms an integral part of the work cycle". In particular, equating R&R with leave ignored key attributes of leave which R&R does not share, such as:

  • on leave the employee is no longer participating in the work cycle;
  • leave is taken at the employee's discretion, whereas R&R cannot typically be postponed; and
  • in respect of annual leave it is not paid out on termination.

It was also noted that by facilitating the compression of work and non-work time on roster cycles, R&R is a significant element of fly-in fly-out arrangements.

The Deputy President was also not swayed by the fact that the Agreement which she described as "cautiously worded" referred to rostered R&R as "leave". Importantly, while terms providing other leave entitlements included accrual, notice, requests, evidence, and deductions, the Agreement contained no comparable provisions in relation to R&R.

Check your rostering arrangements

This case again highlights the implications of employers' roster practices, particularly when it comes to casual employees.

It also demonstrates that the Commission will closely examine the terms of enterprise agreements to determine the true nature of an entitlement, which may lead to unexpected outcomes.

Following the 2018 decision of WorkPac Pty Ltd v Skene ([2018] FCAFC 131), employers should have reviewed their casual arrangements carefully to identify potential risk areas. However, if you have not, this case is a further reminder that you cannot be complacent when engaging casuals or generally arranging your workforce.

Therefore, we encourage you at a minimum, to:

  • consider your rostering arrangements and whether they are exposing you to potential risks;
  • understand your employees' rights and entitlements (under legislation, Modern Award, Enterprise Agreement or contract) and ensure your practices align with your obligations;
  • review your workforce and consider the true nature of your employees' engagement; and
  • establish a system of monitoring and review to identify risks before they arise.

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