A Casual Discussion: Decasualisation for long-term casuals
There has been a growing concern at the number of casual employees in Australia. According to ABS figures about 27 per cent of workers are now employed as casuals.
Explanations for the growth in casual employment are relatively easy to find. Firstly, a high degree of labour flexibility, like that provided by casuals, allows business to more effectively respond to fluctuating demand for products and services. At the same time the flexible deployment of non-casual employees is discouraged by a regulatory system comprised of inflexible and complex awards. Finally, many employers have seen the employment of casuals as a way of minimising the risk of exposure to unfair dismissal laws.
Whilst many employers have embraced the use of casual labour, this appears to have occurred without due consideration being paid to the long-term implications of a significant reliance on casual employees. Legally, casuals are employed on an hourly basis and have no guarantee of tenure beyond their hourly engagement. This level of precariousness, for which employers pay a premium, suits many employers and employees across a range of industries. However, there are drawbacks where an employer has need for a longer term commitment and employees seek greater certainty of employment.
Casual employees are under no obligation to remain in employment beyond their hourly engagement and are generally associated with high rates of staff turnover. Businesses having to cope with a regular 'churning' of casual employees invariably suffer financially; most obviously with regard to increased recruitment and training costs, but also in terms of productivity. Customer service standards are likely to deteriorate where levels of experience and knowledge is constantly 'churned'.
In the case of 'long-term' casuals, as a result of recent changes to legislation and decisions of tribunals and courts, many can now request conversion to permanent employment and also access unfair dismissal laws.
Employing permanent staff under the award system is often however not a viable solution, given restrictions often imposed on the flexible use of non-casual employees. Rigid requirements relating to such things as span of hours, rostering, minimum length of shifts, meal breaks and rostered days off can severely limit an employer's ability to efficiently meet fluctuating business needs.
However, there is another way.
Relatively few businesses have made full use of the provisions of the Workplace Relations Act to achieve the degree of labour flexibility now possible with non-casual employees.
Australian workplace agreements (AWAs) can totally override awards and therefore offer significant scope for the tailoring of the full range of terms and conditions of employment. In a series of case studies conducted by my Office, employers who have embraced the conversion of employees from casual to non-casual through the use of AWAs describe how they have created more effective and efficient workplaces.
These employers operate in the retailing, hospitality and manufacturing industries and have found that with AWAs they are able to deploy labour at times needed by the business whether in response to seasonal patterns, or weekly fluctuations. They believe that converting existing casual employees to ongoing, non-casual employment has increased flexibility, reduced costs and resulted in a more loyal, skilled and committed workforce.
In the light of the greater regulatory freedom provided by AWAs innovative solutions can be found whereby employers gain exactly the type of flexibilities demanded by the business and employees can be provided with greater employment stability.
By making effective use of AWAs, labour flexibility appropriate to the needs of individual workplaces, business and employees can be achieved. This then provides opportunities for finding an optimal balance between the use of temporary and ongoing staff which can ultimately produce the best long term results for both employer and employee.