THE widespread use of "permanent casuals" in the coal industry as a cost saving measure has been dealt a major blow with a full bench Federal Court decision going against the labour hire firm that brought the case.
A long-awaited verdict in WorkPac v Rossato was handed down at 4pm yesterday. It was praised by unions but employers want Canberra to intervene, saying it could cost $8 billion in extra annual leave costs alone.
It is also likely to strengthen the hand of class action firms such as Canberra's Adero, which has initiated a series of claims across a range of industries after starting with the Simon Turner case against Chandler Macleod at BHP's Mount Arthur coalmine in early 2018.
Adero says eight black coal class actions have been stalled for a year waiting for the long-delayed Rossato verdict.
Mr Turner last night called it "a good result", and he looked forward to resuming the class action.
The importance of the decision was underlined when Attorney General and Workplace Relations Minister Christian Porter said the government may decide to intervene if the decision was appealed.
"Given the potential for this decision to further weaken the economy at a time when so many Australians have lost their jobs, it may also be necessary to consider legislative options," Mr Porter said.
In a case summary, the three judges said that "casual" Queensland mine worker Robert Rossato was eligible to be paid "annual leave, paid personal/carer's leave paid compassionate leave and payment for public holidays" and that WorkPac could not seek "restitution" because of the money it had supposedly paid him in his hourly rate to compensate for those conditions.
This was because "Mr Rossato seeks payment of the NES (National Employment Standards) entitlements, not payments in lieu," they said.
The national president of the Construction, Forestry, Mining and Energy Union, Tony Maher, described it as a "fantastic decision that puts an end to the 'permanent casual' rort that has become a scourge in the coal mining industry and across the workforce".
"It's a decision that passes the pub test on what it means to be a casual and is consistent with community expectations that casual work is irregular and intermittent," Mr Maher said.
"Employers must now stop with the nonsense that calling a worker a casual makes them so."
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The Rossato decision follows a union victory earlier this month against BHP and its "in house" labour hire provider, Operations Services, when a full bench of the Fair Work Commission upheld a CFMEU appeal against two BHP OS enterprise agreements.
The union said the agreements were voted on by a small non-union iron ore workforce in Western Australia and used to push down wages and conditions in the NSW and Queensland mining industries, including at Mount Arthur.
In Wednesday's case summary, the three judges said WorkPac brought the Rossato case less than three months after losing a "similar" high-profile case in August 2018 - WorkPac v Skene.
Paul Skene, a Queensland mine worker, had fronted an original CFMEU action against WorkPac begun in 2016.
The union said WorkPac wanted to undermine the Skene case's definition of casual as "intermittent and irregular".
It said that rather than appeal the Skene verdict it lodged the Rossato case, funding the legal expenses on both sides.
It said yesterday's verdict reinforced the Skene decision.
Employer groups criticised the verdict and said the "mess" over casual employment would continue until the federal government legislated what the Australian Mines and Metals Group called "a clear, commonsense definition of casual".
It and the Australian Industry Group said the decision allowed "double dipping" of casual rates and permanent entitlements.
The union pointed out that the government had already intervened in the case, when then industrial relations minister Kelly O'Dwyer, lodged a submission supporting WorkPac.
AIG chief executive Innes Willox said that if yesterday's judgement stood, the flow-on cost to employers could be between $5.6 billion and $8 billion on annual leave alone, given that 1.6 million of Australia's 2.6 million casual employees worked on a "regular, ongoing basis".
"Casuals make up around 20 per cent of the Australian workforce, providing vital flexibility to employers and employees," Mr Willox said.
He said more than half of the nation's casual workers were employed at business with fewer than 20 employees: more than 80 per cent worked at businesses with under 100 employees.
"Parliament needs to act now, to address the uncertainty caused by the Federal Court'sdecisions, and to preserve fairness for all parties," Mr Willox said.
From its perspective, the CFMEU said that despite employer rhetoric about the Skene and Rossato decisions impacting on small businesses, it was most relevant to the employment practices of multinationals, with WorkPac and similar firms supplying labour to global mining giants including BHP, Glencore and AngloAmerican.
It said by upholding the principles in Skene, the Rossato decision would bolster efforts to "restore entitlements and security to jobs that have traditionally been permanently jobs".
In Wednesday's summary of the Rossato case, an "employment contract" needed to be looked at "as a whole".
This included considering whether "it provided for the employment to be regular or intermittent, whether it permitted the employer to elect whether to offer employment on a particular day, whether it permitted the employee to elect whether to work, and the duration of the employment".
"All members of the court have found that, even taking WorkPac's case at its highest, Mr Rossato was not a casual employee for the purposes of the Fair Work Act and for the purposes of the 2012 [WorkPac] enterprise agreement,'' the judges said in their case summary.
"The court has found that the parties had agreed on employment of indefinite duration which was stable, regular and predictable such that the postulated firm advance commitment was evident in each of his six contracts.
"All members of the court have found that WorkPac is not entitled to restitution of the casual loading which it claimed was included in the hourly rate it had paid to Mr Rossato.
"The members of the court have found that there was no relevant mistake, and no failure of consideration such as would support restitutionary relief."
The decision's main findings were summarised as:
"One: In his employment under each of the contracts, Mr Rossato was other than a casual employee for the purposes of the Fair Work Act and not a casual FTM (field team member) under the 2012 EA:
"Two: Mr Rossato is entitled to the entitlements that he claimed under the Fair Work Act and the 2012 EA with respect to paid annual leave, paid personal/carer's leave paid compassionate leave and payment for public holidays; and
"Three: WorkPac is not entitled to either restitution or to 'set off' against its liabilities any of the payments made under the six contracts of employment."
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