Getting it right with casual workers

Casual workers make up a big part of the Kiwi workforce and yet many employers are not aware of the difference between part-time, casual and fixed-term employees and their respective entitlements, according to recent government information.

Aimed at those thinking about hiring an employee on an irregular or sporadic basis, the latest Business.govt.nz newsletter from the Ministry of Business, Innovation & Employment (MBIE) spells out what a casual worker actually is and what that means for employers.

Although not defined in law, casual workers are employees who work only when they are required, usually for one-off business needs or ongoing, irregular work which can’t be accurately anticipated. This means they do not have any guaranteed hours or income, unless an individual employer specifies them.

Casual workers are different to fixed-term employees who are employed on the understanding that work will finish at a certain date or after a certain event has occurred, the newsletter said.

However, they have the same employment rights and entitlements as all Kiwi workers – including holiday pay, sick pay, bereavement leave, and a certain amount of paid leave. They are also subject to the same OHS requirements as other workers and, importantly, need to have a written employment agreement.

Key HR takeaways:

• While a casual worker is unlikely to work over 40 hours a week for more than a short period of time, it is not necessary to restrict the amount of hours offered to a casual worker. If they are doing a good job and set hours are available, it is possible for a casual worker to become a permanent one – although this requires a new employment agreement.
• A written employment agreement ensures casual workers know what is expected from them and what their duties are, and protects all parties. To change a worker’s agreement in any way (eg: their hours of work), it is necessary to get their agreement. The MBIE has an Employment Agreement Builder [link: http://dol.govt.nz/Tools/EmploymentAgreementBuilder/Builder/] available to help businesses with their responsibilities in this area.
• Even if a casual worker will only be employed for a short time, it is still necessary for them to complete a Tax code declaration (IR330) form. Employers also need to provide the start and/or finish date of each worker on the relevant Employer monthly schedule (IR 348).