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Contract of Employment - Casual (Comprehensive)

Version 1.3 Updated 2 Feb 2023
Contract Recruitment

Who can use this contract?

This contract can be used by all employers throughout Australia, except the following excluded employers:

  • Non-constitutional corporation employers in Western Australia;

  • State public sector employers (ie employees of a Minister, the Governor or the Crown) except in Victoria; and

  • Local Government employers - except in Tasmania and Victoria.

If any of the excluded employers wish to use this Contract of Employment - Casual (Comprehensive) ('the contract') they should seek legal advice, as the contract complies with federal legislation which may be more or less generous than that which applies to those employers.

Commentary

This contract is suitable for all casual employees.
 
It is a comprehensive contract which is approximately 10 pages in length. If you would prefer something shorter for your casual employees, we recommend using the ‘simple’ version of this contract (Contract of Employment - Casual (Simple)) which is only 3 pages in length.
 
Coverage
 
This comprehensive contract includes coverage of the following matters:

  • nature and status of employment
  • reason for the contract
  • commencement date
  • casual loading being in compensation for permanent employment entitlements
  • compensation for all legal entitlements 
  • position
  • reporting relationship
  • location of employment
  • hours of work
  • remuneration
  • confidential information
  • performance and expectations
  • superannuation
  • workplace surveillance (computers, camera and tracking)
  • policies and procedures
  • leave (where it applies to casuals under the Fair Work Act 2009 (Cth))
  • notice and termination


The comprehensive contract also includes optional clauses concerning:

  • new employees
  • existing employees
  • award/agreement covered employees
  • providing mobile phone, laptop and other electronic equipment
  • vaccinations
  • work related expenses and reimbursement for such expenses
  • the requirement to wear and launder a uniform
  • the requirement to hold a drivers licence
  • zero tolerance of drugs and alcohol in the workplace
  • returning the employer’s property on termination
  • the protection of the employer’s intellectual property and moral rights
  • post-employment obligations including non-solicitation of customers, employees and suppliers

 
Particular matters to consider
 
Certain classes of employee


There could be legal issues concerning certain classes of employees where you should obtain specific legal advice, including:

  • employees subject to awards and enterprise agreements
  • employees employed in a sales capacity
  • employees under the age of 18 years
  • employees employed by public sector organisations
  • shift workers.


Circumstances for making the contract

The reason for making a contract of employment will differ depending on the circumstances. This will, in turn, affect a number of clauses. So, for example, a new employee will be entitled to either accept or reject the contract of employment. However, an existing employee who does not receive any benefits from signing the contract (e.g. additional remuneration) may decline to enter the contract. Importantly, you should be aware that, even if an existing employee accepts the contract, if the employee is not given any additional benefits in exchange for entering into the contract, the new contract may be unenforceable.

The nature of casual employment
 
Employers must ensure they clearly define casual loading provisions and compensation for all legal entitlements clauses in contracts to maximise the ability to recover any payments, should a casual employee later claim they were in fact a permanent employee.

The drafting in this contract will help minimise the risk your business may be exposed to for back payment from both current and former employees who may have been engaged on a casual basis but worked on a long-term, regular or predictable basis.

Employers with award/agreement covered employees should also ensure they comply with any casual conversion requirements in the relevant award/agreement and the Fair Work Act 2009.

Non-compliance with award/enterprise agreement obligations

The contract is generic in nature and specific advice may need to be obtained before using it for award/enterprise agreement covered employees since non-compliance with the provisions of a specific award/enterprise agreement exposes the employer to a number of legal claims.
 
The employer should be familiar with the terms of the award/agreement such as payment frequency of wages (fortnightly, weekly etc.) before issuing this contract to a casual award/agreement covered employee. If the employer is unsure about the terms of the award/agreement and whether this contract complies, please contact Australian Business Lawyers & Advisors Pty Limited.

This contract is not intended to override award/agreement obligations. The award/agreement referred to in the contract is not intended to form part of the employee’s contract of employment, in an effort to protect employers from potential claims by employees for breach of contract arising out of unintended breaches of the relevant award/ agreement.  
 
An employer who is using the contract for award covered or enterprise agreement covered employees may wish to supplement the contract with an Individual Flexibility Agreement (IFA) which is available in the Document Library page of the Workplace website.
 
Compensation for all legal entitlements

The compensation for all legal entitlements clause will automatically appear in this contract.
 
This clause seeks to offset an employee’s total remuneration against any entitlement he or she may have under any law or industrial instrument. Adopting this approach will not extinguish an employer’s obligations under an industrial instrument or alter the fact that technically an industrial instrument was been breached, nor can it protect an employer from prosecution and imposition of a penalty for that breach. However, it does give the company good grounds to argue that an employee has been compensated in full for all entitlements and the employee should not be permitted to ‘double recover’ the amounts.

You should be aware that it is not possible to ‘contract out’ of an industrial instrument using a contract of employment. Accordingly, if an employee is entitled to minimum conditions of employment in accordance with an industrial instrument, you should comply with the relevant industrial instrument.

You should therefore carefully consider whether you will be able to rely on this clause and whether full compliance with the award, use of an IFA or enterprise agreement, are better options.

COVID-19 Vaccinations 

In response to the COVID-19 pandemic, we have included a clause that allows employers to mandate vaccination for new employees if that is a path your business wants to take. 

Mandating vaccinations is easy for new employees as you can make vaccination a condition of employment (subject to the applicant having a genuine medical contraindication which will need to be assessed on a case by case basis). Mandating vaccination for existing employees is trickier and may requires an assessment on whether that mandate is a reasonable and lawful direction in the circumstances. 

If your business plans to collect evidence of vaccinations, your business will also need to consider the requirements of the Commonwealth Privacy Act 1988 and the Australian Privacy Principles.  

This is obviously a new and difficult area so you may want to seek legal advice before implementing such a vaccination mandate.

Post-employment restraints

Depending on the nature of the duties being performed by the employee who will be subject to the contract, it may not be necessary to require a casual employee to agree to a post-employment restraint. You should seek to customise the restraint to relate to the specific employee.

In order for a post-employment restraint to be enforceable it must be 'reasonable' in the circumstances of the particular employee’s employment. This may mean it is not necessary to have a post employment restraint clause at all for a casual employee who only performs small amounts of work for the business and does not have access to clients or confidential information.
 
Specifically, the restraint must be reasonably required to protect the legitimate business interests of the employer, having regard to the activities sought to be restrained, the geographic area, and the duration of the restraint. The courts will not enforce restraints that impose an unreasonable restraint of trade on an employee, or that extend beyond protecting the legitimate business interests of an employer.

The particular restraint clause included in the contract includes provisions enabling a court, if it is to review the contract, to read down the covenants in relation to the employee if they are found to be void, invalid or otherwise unenforceable. ‘Reading down’ the strict wording of an unreasonable clause means to modify it until the clause is expressed in a way that is legally enforceable.

In NSW only, the Restraint of Trade Act 1976 gives the NSW courts power to read down the provisions of a restraint that would otherwise be unreasonable and thus unenforceable, unless the restraint is manifestly unreasonable on its face. That is, the employer should not include a clearly unreasonable restraint in a particular employee’s contract hoping it will simply be read down.

If the contract is intended to be used for employees who are situated outside NSW, the courts in other states are unable to read down the provisions of a restraint and therefore must apply the clause as it is drafted or delete offending provisions. For this reason, we have drafted the restraint to include cascading provisions that can be severed to the extent that they are unreasonable or unenforceable.

When writing restraints for potential employees it is advisable to obtain specific legal advice from Australian Business Lawyers & Advisors Pty Limited.

Policies and procedures

There is an increasing willingness of courts to incorporate policies into employees’ contracts of employment. Contracts of employment that do not expressly exclude such incorporation may cause problems for employers. While this contract contains an express exclusion, it is important that employers both comply with and broadly word their policies and procedures, to further reduce this legal risk.

Other matters

This commentary is not intended to be provided to the employee.

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