Hiring Casual Employees

Employers have significant legal responsibilities

With summer shortly upon us, the up take in casual work is synonymous with school and university holidays. Despite the short-term nature of these roles, whether it’s seasonal fruit-picking, a retail Christmas-casual or a restaurant needing extra cover for busy nights, if you hire staff on a casual basis you still have significant legal responsibilities.

Hiring casual employees can provide beneficial working arrangements for both parties, with employers able to offer work on an ‘as needed’ basis and employees having the flexibility to decide when they wish to work and which shifts they would like to perform. 

However, as an employer you must remember that during ‘agreed periods of work,’ casual employees are entitled to similar protections to those to which permanent employees are entitled. 

This is highlighted in a recent case before the Employment Relations Authority (ERA).

Background

Mr Ford was employed by Haven Falls Funeral Home as a casual employee. It was agreed he would complete an initial eight-week training period.

Mr Ford completed about three weeks of this training in Northland before incidents occurred that led to him returning home to Whanganui. As a result, Haven Falls decided not to offer Mr Ford any future work and notified him via a phone call and a letter soon after. Haven Falls believed that because Mr Ford was a casual employee, he had no expectation of ongoing work and they could simply inform him he was no longer required. 

Mr Ford filed an application in the ERA claiming he was a permanent employee and had been unjustifiably dismissed. The ERA upheld Mr Ford’s casual employee  status and disagreed that he was a permanent employee. Nevertheless, his dismissal was still deemed to be unjustified. 

The ERA held that Mr Ford was dismissed by Haven Falls during a period of employment. This meant that despite being employed on a casual basis, whilst Mr Ford was engaged for his eight-week training programme, he was entitled to the same entitlements a permanent employee is owed – including a fair process of dismissal. (Haven Falls informed Mr Ford of his dismissal via a phone call and a follow up letter.) Haven Falls did not carry out an investigation of the incidents, nor was there consultation with Mr Ford before the company decided to dismiss him. Haven Falls also failed to give Mr Ford a reasonable opportunity to respond.

Due to Haven Falls’ failure to follow the fair process owed to an employee engaged for a period of work, it was ordered to pay the following amounts to Mr Ford:

•             Lost wages of four weeks’ pay for the remainder of the agreed training period

•             Eight per cent holiday pay on top of the lost wages

•             Interest on the lost wages from 11 March 2020, until payment was made, and

•             $20,000 compensation for humiliation, loss of dignity and injury to feelings.

Employers’ obligations

Previous cases have also stated that there are responsibilities to casual employees during periods of engagement. This case confirms that obligations are owed to a casual (or fixed term) employee during agreed periods of work. The high price for failing to meet these obligations is also shown in this case with, amongst other remedies being awarded to Mr Ford, an additional $20,000 compensation on top of the lost wages award.

The key outcome in this case is that when hiring casual workers or if you are signing up to a casual role this summer, be sure to keep these obligations and rights in mind. If you have any hesitation at all or if you are involved in a similar situation, please contact us.

DISCLAIMER: All the information published is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this article. Views expressed are those of individual authors, and do not necessarily reflect the view of this firm. Articles appearing in this newsletter may be reproduced with prior approval from the editor and credit given to the source. Copyright, NZ LAW Limited, 2019. Editor: Adrienne Olsen. E-mail: adrienne@adroite.co.nz. Ph: 029 286 3650 or 04 496 5513.