Casual employees and overtime

Hey there, congratulations on your new role and what you’ve heard is correct: casuals are entitled to overtime. That said, it’s important you check your Award for full details on casual employees and overtime. Here’s the background:

According to 2019 OECD figures, approximately one in four Australian workers are classified as casual employees.

Casual employees do not have a firm commitment in advance from their employer about how long they will be employed for, or the days (or hours) they will work.

Casual employees are paid for the hours of work they perform and receive a casual loading in addition to their base rate of pay. This loading is designed to compensate the casual employee for not receiving some of the benefits of full-time and part-time workers, for example, paid sick and annual leave. The casual loading is typically 25 per cent.

Prior to 2018, overtime rates only applied to full-time and part-time employees under a number of Awards. In January 2018, the Fair Work Commission revised a number of Awards in relation to overtime payments and casual employees now have an entitlement to overtime rates once they work in excess of 38 hours. These Awards include:

• General Retail Industry Award 2010
• Fast Food Award
• Hair and Beauty Award
• Hospitality Award
• Restaurant Award

Casual workers may also be entitled to penalty rates, allowances, and other loadings, depending on the Award. Such entitlements may come into play if the employee works:

• on weekends
• on public holidays
• outside the “spread of ordinary hours”. The spread of hours is the times of the day ordinary hours can be worked (e.g. between 7am – 7pm).

Payment for overtime depends on employee’s entitlements as defined under their Contract of Employment, Enterprise Agreement or relevant Award. As a rule, any hours worked in excess of the agreed daily or weekly hours are generally to be paid at overtime rates.

Interpreting the content of the current 122 Modern Awards that apply to Australian workplaces can be challenging and employment law is in a constant state of change. Why spend your valuable time trying to keep up? If you’d prefer to focus growing your business or getting a better work/life balance, why not give Bare Bones Consulting a call?

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