An employer’s guide to the 3 primary types of employment

Understanding the difference between full-time, part-time, and casual employment can be confusing for even the most seasoned of professionals. And while it can be difficult to choose which employment type is best for your business and your employees, classing your employees accurately is vital. If you don’t class your employees’ status correctly, you can be faced with serious consequences such as breach of a modern award or underpayment. 

To break it down there are three primary types of employment: 

1. Permanent full-time;
2. Permanent part-time; and
3. Casual. 

A full-time employee has permanent, ongoing employment and works an average of 38 hours per week. In contrast, a part-time employee also has permanent, ongoing employment but works less than 38 hours per week, with set hours and days each week. 

Permanent employees have several entitlements, including but not limited to: 

• Paid annual leave; 

• Paid personal/carers leave (including sick leave); 

• Unpaid parental leave; 

• Long service leave; 

• Community service leave; 

• Paid family and domestic violence leave; 

• Payment for being absent on public holidays; 

• Paid notice upon termination; and 

• Redundancy payment. 

The main difference between casual and permanent employment is that a permanent employee has an expectation of ongoing work. In particular, with respect to part-time employees, many modern awards require part-time employment contracts to outline the days, hours and start and finishing times of part-time employees. Failing to do so constitutes a breach of the award, and can attract civil penalties. 

In contrast, the Fair Work Act 2009 (Cth) defines a casual employee as follows:

Section 15A(1) A person is a casual employee of an employer if: 

(a)  an offer of employment made by the employer to the person is made on the basis that the employer makes no firm advance commitment to continuing and indefinite work according to an agreed pattern of work for the person; and 

(b)  the person accepts the offer on that basis; and 

(c)  the person is an employee as a result of that acceptance. 

A casual employee has no guaranteed hours of work and no expectation of ongoing work in the future. Casual employees provide businesses with a great deal of flexibility as they can be hired on an as-needed basis. Casual employees are not entitled to the same benefits as a permanent employee and don’t receive entitlements such as: 

• Annual leave; 

• Paid personal/carers leave; 

• Notice upon termination; 

• Redundancy pay; and 

• Guaranteed hours of work. 

However, casuals are entitled to two unpaid days of carers leave per year, and two days of unpaid compassionate leave per occasion, and will be entitled to paid family and domestic violence leave in line with the recent changes. Casuals may also be entitled to long service leave, depending on their State’s legislation. To compensate casual employees fairly, they’re entitled to a 25 per cent loading on top of their base rate of pay in lieu of permanent entitlements.  

The terms and conditions of employment for permanent employees and casual employees can vary greatly, and as such employers need to know where they stand concerning their obligations. 

Contact us today 

Do you need more information on casuals or are you unsure whether your employees are classified as casuals? Citation HR offers a 24/7 HR Advice Line where you can receive advice from our experienced workplace relations consultants. Contact us today for a free no-obligation chat to see how we can help your business.