Overtime rates extended to casual community workers

Casual home and community care workers should be entitled to the same overtime penalty rates as part-time and full-time employees, the Fair Work Commission has ruled.

In a decision handed down on Monday, the FWC revised the modern award covering the social, community, home care and disability services (SCHCDS) sector to give casual employees the same overtime entitlements as other workers, which will be paid as a substitution for casual loading.

The FWC said there was no sound rationale for casual employees to be excluded from overtime penalty rates or evidence it would represent a significant cost issue for employers.

The Commission said the provision would also end the use of cheaper casual employees to perform overtime work.

“No party was able to advance any reason why the SCHCDS Award should contain a bias in favour of casual employment and against full-time and part-time employment,” the Commission wrote in its determination.

The FWC said the omission also did not provide a fair and minimum safety net of terms and conditions for casual employees and therefore did not meet the objectives of the modern awards.

The application to address the disparity in overtime entitlements was made by the Australian Services Union and was supported by the Health Services Union. Employer representatives, including aged care peaks LASA and ACSA, contested the change to the award.

Associate Professor Sara Charlesworth from the Centre for Work + Life at the University of South Australia said the changes were positive and would bring the SCHCDS Award into line with the Aged Care Award provisions for casual employees.

She said casual workers would not be disadvantaged by the change as the weekend and overtime penalty rates were higher than the casual loading. She said the change might also discourage casualisation within the workforce as there was no longer an advantage for employers to employ only casual staff on weekends.

The determination

In the determination made by the FWC, casual employees working in excess of 38 hours per week or 76 hours per fortnight will be paid at an overtime rate of time and a half for the first two hours and double time after that. On Sundays, overtime will be paid at a rate of double time and public holidays at double time and a half.

The same penalty rates will apply to casual employees that work more than 10 hours per day.

However, the overtime rates will be paid as a substitute to shift premiums and casual loading rather than as an addition, which is favoured by employers but not supported by the unions.

The FWC said  it took a conservative approach to this question but emphasised that further consideration was necessary to determine, as a general principle, whether weekend and overtime penalty rates should be paid in addition to or as a substitute for the casual loading.

It said this was a difficult question to resolve and the four yearly review process under the Fair Work Act which will review all of the modern awards would provide an opportunity to revisit this issue.

The Comission said the Aged Care Award was also not clear on this matter.

However, the FWC said even without the addition of the casual loading, the provision of overtime penalty rates for casual employees would be a significant benefit to casual employees who work overtime, and would equalise the cost of employees under the award. It concluded that the omission in the award had been an oversight.