Why Australia needs casual workers

Mon 16 Oct

Australians pride themselves on their laid-back casual attitude to life, but when it comes to the workforce, the word ‘casual’ can produce fierce debate.

There has been a push over the past 20 years for many sectors to find efficiencies and increase competitiveness by ‘casualising’ its workforce, where possible.

But this push has some groups – notably unions and the Australian Labor Party (ALP) – concerned about job security and the impacts on those doing the work arguing that casual and contract work are destabilising the Australian workforce and that the worst culprit at this is the labour hire sector.

It has become one of the hot-button topics with strong arguments for and against having a casual workforce. But the fact is, as the Australian workplace evolves, along with lifestyles, so too do labour practices.

For some businesses, it simply does not make sense to have a workforce which is locked in on a full-time basis, with nowhere to move in the event of market volatility or changes in business conditions.  In short, there is a place for casual employment in Australia and having one in five workers employed on a casual basis, and not increasing, isn’t alarming nor a crisis.  It’s just a way business stays competitive and individuals choose a work-life balance.

The Fair Work Commission’s Ruling

Adding fire to the debate about a casualised workforce, was a ruling handed down by Australia’s Fair Work Commission on July 5 this year extending the right of casual employees, who have worked regular hours for a consecutive 12 months, to request permanent employment.

Union leaders had been pushing for the mandatory conversion of casual positions to permanent positions after only six months of working regular hours.

The Fair Work Commission compromised agreeing casual staff across all sectors can now request permanent employment after working regular hours over a 12 month period, covering some 85 separate awards.

Employers retain the right to deny requests for permanent employment on reasonable grounds such as the belief the position will not exist in the next 12 months or there would need to be a significant adjustment to the hours worked by the employee.

In its ruling, the Fair Work Commission said: “We have decided that it is necessary that modern awards contain a provision by which casual employees may elect to convert to full-time or part-time employment, subject to specified criteria and restrictions.”

“We accept the proposition advanced by the ACTU that the unrestricted use of casual employment without the safeguard of a casual conversion clause may operate to undermine the fairness and relevance of the safety net,” the Fair Work Commission continued.

The Commission says in some instances, employees may accept casual employment for a variety of reasons “including principally that it is the only form of employment available to them at the relevant time or that it suits their personal or economic circumstances”.

The Commission added that given the uncertain nature of casual work in terms of the irregularity of hours worked and when “employees accepting casual employment will usually not be doing so on a fully informed basis”.

However, this fails to take into account the benefits of casual hours and labour-hire for some members of the workforce and some types of work in particular.

Why casual working arrangements work

In order to attract – and keep – the staff you want, the need for flexible and casual working conditions has never been greater. Employees in Australia want casual working relationships and employers need them to keep up with the balance of their workload.

In fact, there is a lot to be said for offering staff casual – flexible – working arrangements.

Jeff Borland, a highly regarded academic from the University of Melbourne, recently released new research which discredits links between having a casual workforce and job insecurity.

Borland’s independent research relied on the HILDA and ABS Labour Force Survey data. For those who have not read his research report, here is a summary of his findings:

  • Union claims of increased job insecurity in Australia cannot be substantiated
  • Data shows Australian workers are staying in their jobs longer now (10 years or more) than they were in the 1980s
  • There has been a decline in the number of staff in short duration jobs (less than 12 months) since the 1980s
  • There has been a decrease in the number of Australians working for labour-hire firms since the early 2000s
  • The number of staff expecting to be in a different job in the next 12 months has decreased slightly
  • There has been a slight decline in the number of workers who expect to lose their job because of business down-sizing or seasonality

While Australian unions claim labour hire growth is out of control, Borland’s research shows that rather than casual employment and labour-hire increasing, they are in fact, decreasing.

Data from the Australian Bureau of Statistics supports Borland’s research, indicating that the level of casual employment in Australia has remained at a steady 20 percent for the last 18 years.

In light of this, it is clear Australia needs less fear, less misinformation and more constructive thinking about how to achieve the right balance between flexibility and responsibility to its workforce.

We have found time and again, that Australian workers want the choice of flexible working hours to suit their needs and lifestyles.

And Australian employers want the flexibility of being able to call on staff during peak periods of business allowing them to calibrate their workforce with customer demand and, critically, to remain competitive.

As with all things in business, there is no one-size-fits-all solution to staffing. For some businesses, a casual or contract workforce is the only paradigm which makes sense. Taking away such an option would be catastrophic and short-sighted which is why there must be ongoing engagement between business and peak bodies when it comes to legislation affecting how organisations engage their staff.

- Charles Cameron, RCSA CEO