Christmas Casual vs Fixed-Term Employees during busy periods

Christmas casual vs fixed-term employee: which is the right choice for businesses hiring during busy periods?

It’s hard to believe that the Festive Season is upon us. After the last two years, we are finally seeing businesses bouncing back. The lead up to this year’s Festive Season is expected to be bigger than ever. Which leads to the question: as a business owner, do you hire a Christmas casual or a fixed-term employee during the busy period?

For some business owners, the holidays might mean hiring additional resources to help over the busier period. Especially if you have been on a merry go round of hiring. Prior to the pandemic, it was hard to find the right employees, now it’s even harder. So if you’re looking for Festive Season employees, now is the time to start planning. Part of this equation is consideration how you employee them.

There are a couple of different ways in which you can go about this.  Now Actually can help you decide the matter of Christmas casual vs fixed-term employee when it comes to busy periods.

There are a few ways that this can be done. But it will come down to the inherent requirements of the role. Obviously with both situations there are advantages and disadvantages of picking one over the other, but nonetheless each should not be dismissed without consideration.

Casual vs Fixed-Term Employment

Fixed-Term Employment

Fixed term refers to someone you hire for a specific, determined amount of time. It usually from one period to another. It might even be to cover someone on maternity leave or to complete a specific project. The way that this contract is made up, can be of mixed variables. It might be full time for a period of 3 months, or it might be part time for a period of 2 years.

The hours of employment are guaranteed for a specified period. At the end of that period, both parties understand that the engagement is terminated unless otherwise discussed. For example, you may only be hiring someone for one month in the interim whilst you find a permanent employee. Perhaps you are only hiring someone in December until the festive season is over. Or perhaps you’re just hiring someone to help with a specific project and it will be for the duration of that project. However long it is, , it is important to clarify these terms in writing with your employee.

Casual Employment

A casual employee is not guaranteed a certain number of hours. The definition of a Casual Employee is that their hours of work are irregular and unsystematic. In practicality it means they are not obligated to be available for work at specific days and times. In other words, they can work for you when you need them and when they are available. A genuine casual employee should have irregular hours and using this is done via a rostering system.

Hiring Casual Employees Over Busy Periods

During busy Festive Seasons, engaging employees on a casual basis will usually provide employers with the most flexibility in relation to fulfilling their supply needs. Due to the nature of casual employment, casual employees generally have no guarantee of hours and can be called upon as required by the Employer.

The advantages that relate to Casual Employment include:

• Flexibility to increase or decrease the hours worked to meet the outcomes for the task.
• There is no obligation to retain the employee long time (unless they meet the Casual Conversion threshold)
• There is no onus to pay leave entitlements, and whilst casual loading is applied, it might be a more cost effective resource for sporadic tasks.

The disadvantages that relate to Casual Employment include:

• Casuals will attract a higher hour rate of payment to incorporate the entitlements not granted to them.
• Casuals may depending on the nature of the work, be required to be engaged for a minimum period per shift depending on the relevant award.
• If a Casual is employed for a specific period ( commonly 6 months) then some awards require them to be offered a permanent position. (Casual Conversion)
• Casuals can reject shifts that they do not wish to work.
• Casuals can be difficult to retain and less committed to the business long term.
• Casuals who are employed long term may be eligible for additional entitlements like full time and part time employees. Read about Casual Conversion here.

Hiring Fixed-Term Employees Over Busy Periods

Employing an employee for a fixed-term period (e.g. Christmas holiday period) may provide employers with a more cost-efficient option (lower hourly rate than casuals) and attract a larger pool of potential employees due to the guarantee of hours over for a fixed period.

You can engage employees on a full-time or part-time basis under this option. Depending on how the contract is also structured, the potentially for additional hours for a part time employee is also achievable.  Additionally employees engaged on a fixed-term basis are generally excluded from access to unfair dismissal processes provided their employment is terminated at the end of the specified period.

The advantages that relate to Fixed Term Employment include:

• Fill an immediate gap in your workforce
• You can engage a specialist, already competent in a particular skill or project
• More accurate budgeting and resource planning
• Can be a great way to trial an employee before offering permanent work

The disadvantages that relate to Casual Employment include:

• There is generally less flexibility in varying the hours a fixed term employee works, as set hours are guaranteed, but they can increase from time to time if it’s a part time employee.
• Fixed-term employees will be entitled to personal and annual leave on a pro rata basis
• Fixed-term employees rostered to work on a public holiday are generally required to be paid even if the business is not operating
• Part time fixed term employees are also often required to be engaged for a minimum period per shift under the relevant award
• Continuously extending or rolling over a fixed-term contract of employment may risk the position being considered permanent and then other provisions will need to be provided.

Conclusion: Hiring Casual vs Fixed Term Employees during busy periods

When it comes to hiring during the busy season and Christmas casual vs fixed term employee, we have the following advice. Regardless of how the employee is engaged, a clear documented employment contract is essential. The contract will outline the type of agreement and how the agreement has been structured. Failing to have this could expose the business to potential claims.

Working out the best strategy for you is one that has many considerations. You need to review your current employees before making any decisions. Thinking big picture will assist in this process. We know it can be confusing and there might be an overlap in why you might one or the other, so why not let us help you work out what is best for you.

For some help in the planning stage, let us know. Or, if you need a contract to support these positions in your business, Now Actually can assist.