Your legal obligations: Part-time vs casual workers

In today’s competitive job market, more employers are thinking outside the square to attract and retain the workers they need. This may include hiring more part-time or casual workers – but what’s the difference between these two types of employment?

The rights of all workers are protected in law, but their benefits and conditions depend on how they’re employed.

We’ve asked an employment lawyer to explain the differences between part-time and casual workers to help you understand your legal obligations.

Here’s what you need to know.

Eloise Callister-Baker, a solicitor at MinterEllisonRuddWatts, explains that when you engage a worker on a part-time basis, they’re either a permanent or fixed-term employee, but they don’t work full-time hours. A ‘casual employee’, on the other hand, isn’t defined in employment legislation. But ‘casual’ usually refers to an employee who has no guaranteed hours of work, no regular pattern of work, and no ongoing expectation of employment.

“Casual employees are employees who work on an ‘as and when requested’ basis. This means that casual employees only work when they accept work that is offered to them,” says Callister-Baker. “Employers are not required to provide work to casuals, and casuals are not required to accept work.”

While part-time employees work a set number of hours per week, the hours that casuals work may vary – and you are not required to guarantee the hours. This can create more flexibility, especially during busy periods when you need more workers on an ad-hoc basis.

“Unlike casual employees, part-time employees have guaranteed hours of work and they must work those hours,” says Callister-Baker. “Their employment relationship with their employer continues even once they finish working their hours for the week.”

“When a casual employee accepts work, they are only employed for the period of that work assignment. When the work ends, the employment relationship ends.”

Part-time employees earn a consistent wage based on their ordinary hours of work and, in most cases, they’ll be automatically enrolled in a KiwiSaver scheme.

Casual employees are paid on an hourly basis and are not automatically enrolled in a KiwiSaver scheme, unless they’ve have been working for an employer for 28 days continuously, or they let the employer know that they want to opt in.

Callister-Baker adds that there are no legal requirements around length of shifts for casuals and part-timers, except when health and safety considerations come into play.

“Employers have the same health and safety obligations for casuals and part-time workers as they do for full-time employees,” she says.

One of the key differences between part-timers and casuals is leave entitlements. Callister-Baker explains that part-time workers become entitled to four weeks’ annual leave after 12 months’ continuous service with their employer – and a ‘week’ is based on what an ordinary working week is for them.

“Casuals, on the other hand, are typically paid holiday pay at a rate of 8% of their gross earnings,” says Callister-Baker. “This must be a separate identifiable component of their remuneration. This is on the basis that casual work is so intermittent or irregular that it is impracticable for the employer to provide the worker with four weeks’ annual leave.”

You are required to provide sick leave, bereavement leave and family violence leave, if a worker has either completed six months’ continuous service, or if they work a certain pattern of hours in the preceding six months (at least an average of 10 hours a week, and at least one hour each week or at least 40 hours each month).

“Part-timers will typically become eligible for these leave types after being employed for six months,” says Callister-Baker. “But casuals, whose employment is not continuous, will only be eligible if they work the qualifying pattern of hours.”

Employers are entitled to dismiss a worker with good reason – such as performance issues or serious misconduct – but you must always follow the proper process.

“Dismissing a part-time employee at any time or dismissing a casual employee who has accepted a work assignment, is the same as dismissing a full-time employee,” says Callister-Baker. “For the dismissal to be justified, it will need to be an action that a fair and reasonable employer could have taken in all the circumstances.”

Callister-Baker adds that the situation is different for casual employees who are not in the middle of a work assignment and have not accepted an offer of work.

“In this case, there’s no employment relationship on foot, so the employer would not need to undertake a dismissal process. Instead, the employer could simply choose not to offer further work to the person.”

Employers are required to give workers a copy of their employment agreement in writing. It must include terms and conditions that are at least as good as the minimum rights in the law. You must not change any part of the employment agreement unless an employee agrees to it.

Callister-Baker adds that employers can’t require casuals to accept offers of work.

“If a casual is required to accept work, but they do not have guaranteed hours of work, this would constitute a ‘zero-hour contract’, which is unlawful in New Zealand,” she says.

As an employer, you are required to provide all workers with appropriate training and information to enable them to work safely. You also have a legal responsibility to ensure that everyone who works for you is treated fairly and with respect.

If any employee feels they have been unlawfully discriminated against, they can bring a claim before the Employment Relations Authority if informal discussions and/or mediation are unsuccessful.

“Alternatively, the employee could make a complaint to the Human Rights Commission, but will need to choose whether to bring a claim before the Authority or make a complaint to the Commission — they won’t be able to do both for the same matter,” says Callister-Baker.

More information about part-time versus casual employment can be found at Business New Zealand or employment.govt.nz. Callister-Baker says, union representatives, employment advocates or employment lawyers can also provide support.

Hiring part-time or casual workers can add valuable skills to a team and bring greater flexibility to a business’ staffing needs. Understanding the difference between these two employment types can help you meet your obligations and source the workers you need.

Information provided in this article is general only and it does not constitute legal advice and should not be relied upon as such. SEEK provides no warranty as to its accuracy, reliability or completeness. Before taking any course of action related to this article you should make your own inquiries and seek independent advice (including the appropriate legal advice) on whether it is suitable for your circumstances.