Casual workers don’t work fixed or regular hours and don’t have an ongoing obligation to work for the company. They work “on call” when you need them. A casual worker can also be working for fixed hours for a short-term contract. This contract must be for less than one year to fall into the criteria of “casual”. Casual workers can be paid 8% on top of their wages as holiday pay each time they receive their wages. Or they can accrue the value the same as a part-timer and be paid out their 8% on termination.
Casual workers are entitled to:
• Sick leave (if still working for the company after 6 months)
• Bereavement leave (if still working for the company after 6 months)
• Statutory holidays (immediately).
A word of caution, if you hire an employee as a casual worker and pay them 8% of their income as holiday pay it doesn’t let you off your obligations as an employer for annual leave. If that employee stays longer than a year, the employee was really part-time and is then entitled to 4 weeks paid holiday. You may have paid the employee their 8% all year, and then still end up paying them for 4 weeks holidays as well if they challenge it! We suggest you err on the side of caution and if there’s any doubt make them part time.
Part Time Workers
A part time worker is someone who works for you on a regular basis but the hours can be either the same or varied up to 30 hours per week. They have the same rights as full time employers. They are entitled to 4 weeks annual leave. If your part time work turns full time, there are no changes to make, except for adjusting the hours you pay them. Part time employees are entitled to the same rights as full time employees.
Employing a casual worker can come with some issues.
When paying casual worker wages including 8% as holiday pay, there are circumstances that can mean they are still entitled to 4 weeks of paid leave as well. Find out more information here
When you are first employing staff there are a number of things you can do to plan in advance and minimise stress so you can focus on the important things like growing your business.
Confusing contractors and employees is easy to do. But if you get it wrong, you can run into serious problems later (and not just payroll ones). Getting it wrong could mean anything from tax issues to legal action if employer and employee aren’t on the same page.