Casual employees' eligibility to vote on an enterprise agreement

2 March 2023

Summary: AHEIA has issued a bulletin to guide members regarding an important aspect of enterprise-agreement making: the eligibility of casual employees to participate in voting. The bulletin specifically addresses agreements resulting from bargaining processes conducted before the Fair Work Act amendments which took effect on June 6, 2023.

Given the complex employment status of casual employees, issues arise concerning their eligibility to vote. The criteria for casuals to vote centres around their employment during the access period and the day the voting commences.

The Purpose of this Bulletin

The purpose of this bulletin is to provide general guidance to AHEIA members with respect to one aspect of enterprise agreement making. Namely, casual employees’ eligibility to vote on enterprise agreements. This bulletin relates to all agreements arising from a bargaining process which started before forthcoming amendments to the Fair Work Act commence on or before 6 June 2023. The approach for agreements made following a bargaining process which commences subsequently is expected to be clarified by the Fair Work Commission (Commission) in May 2023.

How the issue arises - the need for genuine agreement

An enterprise agreement cannot be approved by the Commission if the Commission is not satisfied the agreement was ‘genuinely agreed’. Broadly, the Commission cannot be satisfied that an enterprise agreement was genuinely agreed unless a majority of employees who are eligible to vote cast a valid vote approving it.[1]

What is meant by "eligibility to vote"?

Employees are eligible to vote on an enterprise agreement if they:

1. “are employed at the time” the employer requests they vote on the enterprise agreement; and
2. will be covered by the enterprise agreement.

“The time” at which employees must be employed to be eligible to vote is the period:

1. beginning at the start of the access period; and
2. ending immediately after the start of the voting process.

Currently, an enterprise agreement’s access period is the period of 7 clear days before the voting process commences. Consequently, only employees who will be covered by the agreement and who are employed on the day voting starts, or during the 7 clear days preceding it, are eligible to vote.

Employees whose employment ends before the commencement of the access period or who commence employment after voting starts, are ineligible to vote. This raises complexities in the context of the engagement of casual employees.

When are casuals 'employed at the time'?

Casual employees do not have continuing contracts of employment. Each ‘shift’ they work is a separate contract of employment, which begins at the start of the shift and ends with that shift. There is no contract of employment between a casual employee’s shifts. This can be problematic when considering voting eligibility. It is not unusual for a casual employee who regularly works for an employer to not be rostered on to work during the access period or on the day voting starts. Based on the current state of the law, these casual employees would be ineligible to vote on the enterprise agreement.This issue was illustrated by the 2015 Full Federal Court decision in NTEU v Swinburne University of Technology [2015] FCAFC 98. In that case, Swinburne University allowed all casual employees who had worked at any time in the previous year, and who had not left the university’s employment, to vote, even if they were not rostered on during the access period or when voting started.The majority of the Full Court upheld the NTEU’s challenge to the agreement’s approval on the basis that this voting cohort included casual employees who were ineligible to vote on the agreement. The un-rostered casuals would not have been employed “at the time”. The subsequent Full Bench of the Commission decision in Appeal by SDA [2019] FWCFB 7599 clarified that the relevant “time” during which casual employees must be rostered is the period beginning at the start of the access period and ending immediately after voting commences. The voting roll effectively ‘closes’ once voting commences.

Category of casual employee/Eligible?

• Employed before, but not during access period or day voting commences – No
• Employed during access period but not day voting commences –Yes
• Not employed during access period, but employed day voting commences – Yes
• Not employed during access period or day voting commences, but employed during the remainder of the voting period – No
• Not employed during the access period, or voting period, but employed afterwards – No

The Full Bench of the Commission departed from the approach in Swinburne and Appeal by SDA in the decision of McDermott Australia Pty Ltd v AMWU [2016] FWCFB 2222. In that case, the employer employed a number of purportedly casual employees who were promised work in accordance with a particular roster. Not all of these employees were working at the time of the access period or at the commencement of the vote. Nevertheless the Full Bench in that case held these employees were eligible to vote. However, recent Commission decisions have doubted McDermott. In the 2018 decision in Noorton,[2] the Full Bench questioned the decision in McDermott, suggesting that it had been incorrectly decided and indicating that it should actually be seen as a case where the employees were eligible because they were not truly casual employees. Since Noorton, the Commission has only cited McDermott with disapproval on this issue.[3] In light of that, McDermott cannot be relied upon by employers and Swinburne and Appeal by SDA remain the leading authorities on the issue.

Who is a casual?

Notwithstanding recent treatment of McDermott, the case does illustrate the importance of determining whether an employee is casual when assessing whether they are eligible to vote in respect of an enterprise agreement. If an employee is in fact a permanent employee, they will be eligible to vote irrespective of whether they worked during the access period or the day voting commenced. Whether an employee is properly characterised as a casual depends on whether their contract of employment demonstrates a firm advance commitment to continuing work. If the contract indicates that they are engaged by the hour, only work when required by the employer, and are not required to accept work when offered, they are likely to be correctly characterised as casual.[4]This issue has been considered by the Commission in two recent cases.

Case 1. In Charles Darwin University [2023] FWC 233 the Commission considered the voting eligibility of a group of purportedly casual employees who were employed under ‘fixed-term contracts’. While the decision provides limited detail regarding these arrangements, it appears the contract provided for an ‘outer-limit’, during which an employee (who was described as casual) may or may not be required to work. The Commission held that these arrangements did not result in the employees being other than casual because, under the contracts, they continued to be engaged by the hour with no guarantee of future employment. This meant the relevant employees were only eligible to vote on the enterprise agreement if they were employed during the access period or on the day voting commenced.

Case 2. A similar outcome was reached in St John of God Health Care Inc [2023] FWCA 87. There, the casual employees’ contracts provided that they were engaged by the hour. Their contracts also said their employment would terminate if they did not work for 3 months. The Commission held that, even though their contracts could be read as providing that their employment continued for 3 months after their last shift, the employees were casual.

Practical considerations

The following practical considerations can mitigate the risk of potentially ineligible casuals voting:

1. Selecting the voting cohort: Before inviting casual employees to vote, the employer should:
   
   - Review their workforce and exclude casual employees who ‘are on the books’, but no longer perform
          work for the employer (in this circumstance casual employees are clearly ineligible to vote);
   -      Develop clear parameters for determining whether a casual employee is working during the access
          period or on day the vote starts. These may be based on rosters published in advance, casual
          employees’ regular working days (evidence of which might be collated from timesheets, or
          supervisors/managers). If an employee is rostered but ultimately doesn’t end up work, they would
          be considered ineligible to vote;
   -      Identify cohorts of casual employees who are more likely to have unpredictable hours and take
          measures to mitigate this.
   
   
2. Offering shifts: When offering casual employees specific shifts during the access period or on the first day of voting, employers should be aware that this will make those employees eligible to vote on the enterprise agreement.
3. Voting methodology: Employers could consider using a voting methodology which can only be accessed by casual employees who are actually working during the access period or at start of the vote (for example, a system accessible only via the University intranet).
4. Timing the vote: The rules relating to casual employees’ eligibility has implications for the timing of the vote. For example, it may be preferable to hold the vote during teaching semesters as casual employees are more likely to be rostered on during this time.
5. Collecting voting data: If a challenge is made to the validity of the vote, employers must be able to break down the voting data to demonstrate that any ineligible votes would not have changed the outcome. Employers can do this by using a voting method which collects the following information:

• whether the voter is casual;
• whether the voter voted in favour of the agreement; and
• whether the voter worked during the access period or on the day that voting commenced.[5]Collecting voting data is particularly important. Even if the agreement is not challenged, the Commission may require evidence from employers which demonstrates that a valid majority of eligible voting employees approved the agreement.

Including ineligible employees in the voting cohort will not necessarily result in the enterprise agreement not being approved. The agreement can still be approved if it can be shown that any ineligible votes did not change the outcome.[6]

References

[1] Fair Work Act 2009 (Cth), sections 188(1)(b), 182(1) and 181.

[2] Construction, Forestry, Maritime, Mining and Energy Union v Noorton Pty Ltd T/A Manly Fast Ferry [2018] FWCFB 7224 (‘Noorton’).

[3] Application by The Northcott Society [2021] FWC 2964; National Union of Workers v Lovisa Pty Limited [2019] FWC 2885; National Union of Workers v Lovisa Pty Limited [2019] FWC 2571; St John of God Health Care Inc [2023] FWCA 87.

[4] Workpac v Rossato [2021] HCA 23; Section 15A of the Fair Work Act 2009 (Cth) also provides a definition of casual employment for the purposes of provisions of the Fair Work Act which use that expression.

[5] It is critical to keep in mind that the roll of voters effectively closes when voting commences and should not be added to as voting continues, see appeal by SDA [2019] FWCFB 7599.

[6] See, for example, Appeal by SDA [2019] FWCFB 7599 at [44]. There, an agreement was genuinely agreed despite 1,422 ineligible employees voting because those votes could not have changed the outcome; 21,191 out of 23,110 voters approved the agreement.