Casual Employment

All employees have minimum rights and entitlements - including casual employees.

What is casual employment?

Usually this is employment “as and when” required, with no guarantee of set hours or continuation of employment.  In practice, some employees who are described as “casual”, may in fact have an ongoing employment relationship with an employer.

Employment agreements

All employees are required to have written employment agreements under the Employment Relations Act, and this includes casual employees. The employment agreement should set out the hours and place of work, as well as any other agreed terms and conditions.

Casual employees (who have not been previously employed by the same employer) may be employed on a probation period; or a trial period of up to 90 days if the employer employs 19 or fewer employees on the day the employment agreement is entered into.  Probation or trial periods must be agreed to in good faith and recorded in a written employment agreement.

If a “casual” employment relationship changes to a more permanent one, it is good practice to update the employment agreement to reflect that change.

To help create an employment agreement you can use our Employment Agreement Builder.

Annual holidays

Casual employees are entitled to paid annual holidays. How these are remunerated depends on the arrangement between you and your employee.

Many employees who are described as “casual” are actually part-time employees with established employment patterns. Supermarket or hospitality workers, for example, may be perceived as casual employees and yet have regular work based on a fortnightly roster. These employees are entitled to at least four weeks’ annual holidays.

Pay-as-you-go arrangements

For some employees it is not practicable to provide them with four weeks annual holidays, this tends to be workers who are called in on a strictly as needed basis and where the work is entirely unpredictable. This would, for example, be the case with flood clearance or restoration work.

This can also apply to employees who also work only when the opportunity or need arises and who don’t have steady work. This may, for example, be the case for employees who do telephone survey work or help out in a store only as and when there is opportunity.

If this is the case, you may agree with your employee to pay 8% of their gross wages as annual holiday pay.

This arrangement must be included in the employment agreement, and the 8% annual holiday pay should appear as a separate and identifiable amount on the employee's payslip, wage and time records.

At the end of the employment relationship, no additional pay for annual holidays is due.

If you have an arrangement like this, it is a good idea to keep it under review to see whether a regular cycle of work has developed. If this occurs, you and your employee should agree to alter the employment agreement so that the 8% payment for holiday pay is replaced by an entitlement to four weeks’ paid annual holidays. After 12 months of continuous employment, the employee will become entitled to four weeks’ annual holidays.

For more information on annual holidays and pay-as-you-go arrangements, please see:

• Annual_holidays
• Pay-as-you-go

Public holidays

Employees are entitled to at least time and a half if they work on a public holiday. It doesn't matter whether they are paid on a salary, wage, piece rate, or commission basis.

If an employee normally works on the day that the public holiday falls, they are also entitled to an alternative holiday on pay (previously known as a day in lieu). 

If the employee does not work the public holiday (and the day would otherwise be a working day) they are entitled to be paid for the public holiday at the rate of their ‘relevant daily pay’.

If an employee is employed to only work on public holidays, they will not be entitled to an alternative holiday, but still would be entitled to be paid time and a half.

The concept of what would otherwise be a working day is key to determining an employee's entitlement regarding public holidays.  The question to ask is “Would the employee have worked on that day anyway?”

While, in most employment situations whether a day would otherwise be a working day is clear because the working week or roster is constant, this is sometimes not clear with “casual” employment. 

Where the employer and the employee cannot agree whether a day would otherwise be a working day they should consider the following issues:

• what the employment agreement says
• the employee's usual work patterns
• the employer's rosters or other similar systems
• the reasonable expectations of the employer and employee as to whether the employee would work on the day concerned
• whether the employee works for the employer only when work is available
• any other relevant factors.

For more information on public holidays please see our annual holidays page.

To help work out entitlements under the Holidays Act, you can use our Holidays On-Line Tool.

Sick leave and bereavement leave

Most employees are entitled to sick and bereavement leave whether they are full- or part-time, permanent or fixed-term employees, providing that they have completed six months' continuous employment.  These qualifying criteria generally apply to permanent employees.

Under the Holidays Act, once an employee becomes eligible for sick and bereavement leave, they receive:

• five days’ paid sick leave for every 12 month period
• three days’ paid bereavement leave in the event of the death of an immediate family member
• one day of paid bereavement leave in the event of a death outside the immediate family that causes an employee to suffer a bereavement, and the employer accepts that the employee has suffered a bereavement.

The hours test

The Holidays Act also provides sick and bereavement leave entitlements after six months to employees whose employment is not continuous if, during those six months, they have worked for the employer for:

• an average of at least 10 hours per week, including
• at least one hour per week or 40 hours per month.

The payment for sick or bereavement leave would be made where it is a day the employee would otherwise have worked, and would be made at the employee's relevant rate of pay for the day.

If the employee has worked for the employer over the last six months and qualifies through the hours test, they become entitled to five days’ sick leave for the next 12 months of employment.  This means the entitlement to five days’ sick leave is retained for the next 12 month period, regardless of whether the employee keeps working at the minimum number of hours required. If the employee has, for example, worked for the employer intermittently for the last nine months, whether or not they are entitled to sick leave depends on whether their pattern of work in the first six months of employment satisfies the hours test.

The entitlement to subsequent lots of five days’ sick leave is triggered every 12 months after the original six month qualifying period (i.e. after 18 months of employment, 30 months of employment etc). In the case of an employee whose employment is intermittent, the entitlement to each new lot of five days’ sick leave depends on whether the employee continues to satisfy the hours test looking at their last six months of employment. If not, the employee can still access any unused sick leave from their last entitlement as any unused entitlement is carried over.

For more information on sick and bereavement leave, please see:

• Sick_leave
• Bereavement leave

Ending an employment relationship

To dismiss a casual employee, the employer must follow the same dismissal procedures as for any other employee.  This includes having reasonable grounds for dismissal, discussing this with the employee and allowing reasonable opportunity for the employee to respond.

For more information on ending an employment relationship, visit our Ending employment relationship page.

Holiday and Leave Entitlements for Employees

This page was last updated on: 14-Dec-2009 and is current.