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Employing Casuals is Cost Effective but mind the Traps

Small businesses are frequently employing casuals to meet fluctuating workloads. It makes sense. Despite having to pay casuals employees 25 per cent loading to compensate for no paid leave entitlements, casuals provide flexibility and are cost effective as you only pay for the hours that they work.

There are a few traps though. Often a casual will start off with a few shifts when new in the job. They settle in and soon start to provide their worth. Before long, the casual is working regular days or hours each week or fortnight. A regular work pattern emerges. And once a regular work pattern emerges, the employee no longer falls under the definition of "casual".

So what should a business do when a regular work pattern becomes evident for a casual employee? There are two options:

  • mix up the casuals hours/days or

  • consider offering the employee a more permanent arrangement - full-time, part-time or a fixed term employment period.

Option number two is not considered often enough, yet it's a good, safe option for businesses of 15 employees or less as a small business can legally terminate new hires within the first 12 months of their employment without being at risk of an unfair dismissal claim.

Next week see our next installment for the costly traps to avoid.

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