ACTU push to raise loading for casuals   

Financial Review
Feb 18, 2024

Unions are using a Labor-prompted review of minimum award conditions to call for an increase to the casual pay loading after questioning whether casuals are fairly compensated for the permanent benefits they trade away.

The ACTU has told the Fair Work Commission’s job security award review it should devote considerable time to ensuring casuals’ 25 per cent loading fully accounts for specific industry conditions or else introduce forms of paid leave for the workers.


ACTU President Michele O’Neil says the FWC hasn’t looked at the casual loading in more than 16 years.   

The review follows the Albanese government’s 2022 industrial relations reforms that required the FWC to promote job security in its decisions.

While the review is focusing on the seven most used industry awards, including fast-food, hospitality, administration and retail, changes could extend to all awards.

Australian Council of Trade Unions president Michele O’Neil said casual workers were among the lowest paid and faced the toughest time balancing work, care responsibilities and the family budget.



“Yet, the FWC has not examined the loading and entitlements of casual workers in over 16 years,” she said.

“The ACTU is calling for the safety net entitlements of casual workers to be improved and recognise that member unions are advancing specific proposals tailored to their members and industries.”

Casuals’ 25 per cent loading has come under the spotlight in recent years as some workplace lawyers argue it is probably only high enough to offset leave but not redundancy pay or notice of termination.

“There appears to be an assumption, which is not a legal or factual basis, that the payment of a loading at 25 per cent is sufficient to discharge the entitlements to annual leave, and so forth,” Adero Law principal Rory Markham, who led underpayment class actions on behalf of regular casuals, has said.

“In our experience, the loading would actually have to be somewhere in the order of 30 to 35 per cent. There is inevitably a shortfall.”

Australian Industry Group said union calls for the loading to be increased in some sectors would “impose unjustifiable and potentially unsustainable costs on employers”.

“Making casual employment more expensive won’t create more permanent work – it will just result in fewer jobs,” AiGroup chief executive Innes Willox said.

“Employers aren’t a magic pudding that can just keep delivering.”

He said given that the government had just redrawn the rules to provide casuals a pathway to permanent employment “there is no compelling case for making any further changes”.

As part of the FWC review the commission has asked parties whether casuals should continue to be excluded from national standards such as paid sick leave, given its job security objective, and whether awards should supplement these gaps.

The ACTU argues this question requires considering the adequacy of casual loading.

It says the FWC’s decision to fix casual loading at 25 per cent was based in part on the quantum being “sufficiently common” but did not involve any industry level analysis about what underpinned it.

“This is particularly the case given that some of the disadvantages of casual employment have not been analysed in terms of how they present differently in different industries,” its submission said.

“Comprehensively analysing these disadvantages on an award-by-award basis may reveal a mix of preferences for providing additional or improved forms of paid leave, raising the casual loading or adjusting other conditions (including restoring greater predictability and security to permanent work).”

Mr Willox said the awards’ 25 per cent loading had already increased entitlements for many sectors when it was imposed in 2010, “but at least the consistent approach delivered a level of simplicity”.

He said the unions’ changes would “add further complexity to an already ludicrously complex workplace relations system”.

‘Major loophole’
Among unions backing award change, the Australian Services Union has called for an overhaul of rostering requirements so that bosses must give at least two weeks’ notice for changes.

In particular, it says ground staff for airline operations, such as those at check-in desks or call centres, are effectively on call 24/7 and their rosters can change with only a few days notice “at best”.

ASU assistant secretary Emeline Gaske said that was “a major loophole” in workplace laws.

“When a roster changes with a few days’ notice, and suddenly you’re working on a weeknight, this has huge impacts on people’s lives, affecting child and other caring arrangements for example,” she said.

The union wants an industry minimum standard of 28 days’ forward rostering with a 14-day notice period for changes. Workers would be entitled to overtime pay for work outside the notified roster.

They also want limits of five consecutive days of work without a day’s break and a daily maximum limit of 12 hours work.

Unions and employers must file reply submissions by Wednesday and will hold consultation on their proposals from February 27 to March 18.

Adero Law founder Rory Markham said it was a fallacy that casuals’ 25 per cent loading would offset all entitlements.