‘Regular and systematic’ casual employment: the black hole locking young workers out of JobKeeper

Anthony Forsyth, RMIT University and Labour Law Down Under Blog

The Young Workers Centre at Victorian Trades Hall Council has been running hard lately on the plight of young casual workers excluded from the JobKeeper income support scheme.

Workers at retail companies like Cotton On, David Jones, General Pants Co and Decjuba have been denied JobKeeper by their employers, on the basis that they were not ‘regular and systematic’ casuals.

The barrier, according to these employers, is the fact that the workers concerned took a break from their casual employment in the 12 months prior to March this year.

After concerns were raised about this on ABC 7.30, Cotton On agreed to review the exclusion of casuals from JobKeeper on the basis that they had gone on a holiday or had a study break: https://www.abc.net.au/news/2020-05-08/cotton-on-reviews-jobkeeper-eligibility-for-workers/12215758

A subsequent 7.30 program highlighted the exclusion of casuals at David Jones and General Pants Co. It noted that employers appeared to be interpreting the ‘regular and systematic’ requirement as meaning that employees who had a break of more than 8 weeks could be denied JobKeeper: https://www.abc.net.au/news/2020-06-04/casual-workers-excluded-from-jobkeeper-for-taking-holidays/12317894

The Young Workers Centre argues that similar practices have occurred at Decjuba stores: https://www.megaphone.org.au/petitions/decjuba-opt-us-into-jobkeeper

All of this shines a light on several problems with the JobKeeper scheme: the rules are in some respects unclear about casual employees’ eligibility, although there is a compelling view that an interruption to casual engagement does not disqualify someone from JobKeeper.

However, there is little scope for employees to challenge an employer’s interpretation knocking them out of the scheme. And the Fair Work Commission has no jurisdiction to resolve disputes about employee eligibility.

‘Regular and systematic’ and interruptions to casual engagement

The JobKeeper Rules allow a ‘long term casual employee’ to access JobKeeper from an eligible employer – that is, someone who ‘had been employed by the [employer] entity on a regular and systematic basis during the period of 12 months’ prior to 1 March 2020.

The term ‘regular and systematic’ is well-known in employment law. It is used, for example, to determine whether an employee is a long-term casual and therefore eligible to bring an unfair dismissal claim under the Fair Work Act. For those purposes, a casual must also be able to show that they have a reasonable expectation of continuing employment.

There have been several Fair Work Commission decisions establishing that an employee can be considered ‘regular and systematic’ despite interruptions to their casual engagement.

For example, in Gaete v Healthcare Australia [2018] FWC 6349, the FWC determined that a series of interrupted periods of casual engagement could count towards the qualifying period for unfair dismissal, if there was a sufficiently regular pattern of shifts.

In Shortland v The Smiths Snackfood Co Ltd [2010] FWAFB 5709, a Full Bench of FWC held that a casual’s service was not broken by a period of leave or absence due to illness or injury, and further:

“continuous service by a casual employee who has an established sequence of engagements with an employer is broken only when the employer or the employee make it clear to the other party, by words or actions that there will be no further engagements”.

The approach taken in these and other decisions to the interpretation of ‘regular and systematic’ should logically apply also to the application of that term for purposes of JobKeeper eligibility.

That argument is further strengthened by the Explanatory Statement for the JobKeeper Rules, which state that:

“A casual employee is likely to be employed on a regular and systematic basis where the employee has a recurring work schedule or a reasonable expectation of ongoing work.”

A better process is needed for resolving JobKeeper eligibility disputes

According to the Young Workers Centre, JobKeeper has been denied to retail casuals in circumstances where they had been working regular shifts (sometimes for quite a few years); took approved leave last year to travel or focus on study (in some cases, for as long as 8 or 9 weeks but also for shorter periods); then returned to their positions, all with the agreement of their employer.

In many of these instances, the Australian Taxation Office has advised the employees that they are eligible for JobKeeper. Yet their employers persist with the opposite interpretation, and often, deny these employees any access to shifts and therefore the opportunity to earn income.

At present, these employees have nowhere to go to have the issue resolved. The FWC was given the role to resolve disputes that arise between employers and employees about other aspects of JobKeeper, such as the new employer powers to stand down staff or reduce their hours of work.

However, the tribunal has no jurisdiction over whether an employee is eligible to receive JobKeeper in the first place. The FWC has been knocking back case after case where employees have tried to agitate this.[1]

There is a very simple solution here: give the FWC the power to resolve disputes over employee eligibility for JobKeeper. It has the expertise to deal with these issues, such as the regular and systematic test and its application to casual eligibility for unfair dismissal claims.

Without this change, young workers are left with no way of challenging employers unfairly denying them access to much-needed income support in a harsh economic environment.

[1] See for example Baptista v Pomegranate Interior Design & Decoration Pty Ltd [2020] FWC 2623 (https://www.fwc.gov.au/documents/decisionssigned/html/2020fwc2623.htm).