What should HR need to know about ending casual engagements?
The Fair Work Commission (FWC) recently dealt with an unfair dismissal case involving a casual worker whose shifts were gradually reduced to zero without explanation. The worker argued this constituted unfair dismissal, despite her casual employment status.
After lodging a discrimination complaint, the worker found herself without shifts while being repeatedly told she remained employed. She questioned whether a casual employee could be effectively dismissed by simply not being offered further work.
The case highlighted important questions about casual workers' rights and protections under Australian employment law, particularly when making workplace complaints.
The worker began her employment with Guzman Y Gomez (GYG) in February 2023, working regular shifts until July 2024 when her hours suddenly decreased. Having worked on a regular and systematic basis for more than a year qualified her for unfair dismissal protection despite being a casual employee.
When her shifts decreased, she attempted to obtain more work without success. In July 2024, she filed a discrimination complaint alleging unfair treatment in shift allocation. The complaint was handled by the HR representative for GYG's head office.
The latter explained that shift allocation was determined by local restaurant managers and reminded her that casual employees weren't guaranteed shifts. Despite receiving no further shifts, she was repeatedly assured she remained employed.
In September 2024, the worker lodged an application with the FWC regarding a general protections dispute not involving dismissal, alleging racial discrimination after her hours were reduced to zero.
GYG denied the discrimination allegation, claiming instead the worker "did not meet performance standards and there had been a breakdown in the working relationship." They provided no evidence to support these claims throughout the proceedings.
A Commission conference held in October 2024 to address the discrimination claim remained unresolved. During this conference, GYG finally clarified they had no intention of providing the worker with more shifts.
Despite evidence showing shifts were available after July 2024, GYG offered no explanation for not scheduling the worker. Meanwhile, ten of her colleagues provided statements attesting to her performance, describing her as "hardworking, reliable, efficient, and positive."
The FWC found no valid reason for the dismissal related to capacity or conduct. The Commissioner noted: "On the evidence provided by [the worker] I find that [the worker] was a hard working employee. [She] was considered a good worker by her colleagues. Her workmates at [the employer] describe her as hardworking, reliable, efficient, and positive."
The worker was neither notified of any reason for dismissal nor given an opportunity to respond, as required under section 387 of the Fair Work Act 2009. There were no discussions about the dismissal, giving her no opportunity to have a support person present.
The Commissioner found that GYG's approach to the worker's discrimination complaint contributed significantly to the unfairness:
"The unfairness that arose from the procedures followed is that [the employer's] delay in dealing with the discrimination claim and its failure to provide [the worker] with shifts while that claim was being processed left [the worker] in limbo. She was told she was employed but she was not provided with work, and she did not receive wages."
The FWC expressed specific concerns about the treatment of young workers in casual employment relationships. GYG employs over 10,000 workers in the fast food industry, many being young people in casual roles.
The worker raised important concerns about the impact of poor treatment on young employees beginning their careers: "This is lack of professionalism from management in dealing with employment disputes and completely failure of Duty of Care for an employee. I want to mention again that most of employees are under 18 years old. Many 14, 15 years old kids not experienced, first work experience."
The Commissioner identified three legitimate issues: the unprofessional handling of the employment dispute, the failure to consider the young makeup of their workforce, and the significant harm caused to the worker, concluding that "[the employer] has failed in these three areas and the consequences are that [the worker] has been treated harshly."
The FWC ordered compensation rather than reinstatement, as the worker "was treated poorly by [the employer] and understandably does not to wish to work for the company."
Using the "Sprigg formula" derived from the Australian Industrial Relations Commission Full Bench decision in Sprigg v Paul's Licensed Festival Supermarket (1998), the Commissioner calculated the worker would likely have earned approximately $34,000 had she continued working there for another 12 months. However, section 392(5) of the Fair Work Act limited compensation to the total remuneration received during the 26 weeks before dismissal, capping it at $10,252.35.
The Commissioner noted: "The manner in which the cap operates in this case is inequitable to [the worker]. [The employer] has effectively gained a benefit from its poor treatment of [the worker] by taking advantage of her casual status and refusing to provide her shifts for the last 10 weeks of her employment."
In the final determination, the Commissioner stated: "I find that [the worker] was unfairly dismissed. [She] was a hard worker who was treated poorly by [the employer]. [The employer] has led no evidence and made no submissions justifying or explaining its treatment of [the worker]."
