Hiring the right people starts with getting their employment status right. Many business owners confuse part-time and casual roles, but the distinction matters for compliance, cost, and continuity. Understanding the difference helps you manage your team with confidence and stay compliant with employment laws.
This article explains the key differences between casual and part-time employment – from pay and leave entitlements to working hours and termination rights – to help you make informed decisions when hiring and managing your staff.
What’s the difference?
Permanent part-time employees: Are those workers with guaranteed, regular hours each week that are less than full-time (i.e., under 38 hours).
Casual employees: From 26 August 2024, the Fair Work Act 2009 (Cth) (the Act) uses an updated definition of casual worker namely, a worker is casual only if there is ‘no firm advance commitment to continuing and indefinite work’, and they are paid a casual loading or specific casual rate under an award, enterprise agreement or employment contract.
Entitlements
These differences flow through to the entitlements available to each category of employee:
In additional to their hourly wages or salary, permanent part-time employees enjoy certain entitlements not available to casual employees including paid annual leave, paid carers leave, paid public holidays (if the holiday falls on their ordinary hours), and notice of termination and redundancy pay. These are the same entitlements enjoyed by full-time employees but calculated on a pro-rata basis.
By contrast, in lieu of many leave entitlements, casual workers are paid hourly plus casual loading (often 25%). That said, they are entitled to unpaid carers leave and like permanent part-time employees receive 10 days paid family and domestic violence leave per year (not pro-rated).
As part of the broader reforms to redefine casual employment a formal pathway to move from casual to permanent was introduced. This is described as an ‘employee-choice pathway’ to seek to seek conversion to permanent status (full-time or part-time), with processes and timeframes (longer for small business) and dispute avenues via the Fair Work Commission (FWC). Employers can refuse on reasonable grounds but must follow the statutory process.
Recently, new federal changes introduced a right to disconnect from unreasonable out-of-hours contact, enforceable via the FWC. This affects all employment types including casuals although in practice, casual employees often have less certainty around when their working hours are. This means the boundary between ‘during’ and ‘outside’ working hours can be fuzzier and more complex to demarcate when the right to disconnect kicks in.
Working hours and rostering
For a permanent part-time employee, the status of employment should be ongoing and predictable. They should generally be offered a consistent working schedule with set days and times. This limits the flexibility of permanent part-time employees, as their working hours should only be changed through consultation and approval from both parties. Any changes to working hours should be formally documented and overtime/penalties can apply when work is done outside the agreed pattern or beyond award thresholds.
Most modern awards require permanent part-time employees to be paid for a minimum of 3 hours per shift, even if they work less. This requirement cannot be altered through agreement with the employee. This means you can have your employee work less than 3 hours, but you must pay them for the full 3 hour minimum. Although, the Act does not require employers to provide permanent part-time employees with a specific number of working hours per week, the hours agreed between the parties must be regular.
Casual employees have no guaranteed hours. Work is offered and can be accepted or declined. However, many awards include minimum engagement periods (often 2–3 hours) even for casual workers.
In all cases, check the relevant modern award or enterprise agreement for minimum engagement and weekly hours, as these vary by industry
Contact us on (02) 9199 8597 or by email if you’d like help preparing tailored employment contracts with flexibility provisions that comply with your applicable award and accurately reflect the employee’s status.
Ending employment and protections (unfair dismissal and more)
The way employment ends, and the protections that follow, depend heavily on how the employee is engaged. While both casual and permanent part-time employees are covered by the Act, their rights at the point of termination differ in important ways.
Unfair dismissal: All employees, including casuals, can make an unfair dismissal claim if they satisfy the Act’s minimum service requirements. For most employers, that means 6 months’ continuous service; for small business employers (fewer than 15 staff), the qualifying period is 12 months.
However, casuals face an extra hurdle. To be eligible, a casual must have been employed on a regular and systematic basis and have had a reasonable expectation of continuing employment. It’s not enough to have worked a few scattered shifts, the FWC looks for a consistent pattern, such as weekly or rostered work that continued for several months.
For part-time employees, eligibility is more straightforward. Once the service threshold is met, they are automatically protected from unfair dismissal provided their dismissal wasn’t for a valid reason related to conduct or capacity, and was not harsh, unjust or unreasonable.
Notice and redundancy pay: Permanent part-time employees are entitled to notice of termination (ranging from 1 to 5 weeks depending on length of service and age) and, if applicable, redundancy pay. Casual employees, by contrast, are generally excluded from these entitlements because their employment has no guaranteed duration – each shift or engagement is effectively a separate contract.
That said, misclassification can create problems. If a worker described as ‘casual’ in name only is in reality working regular hours under an ongoing arrangement, they may later argue they were in fact permanent and entitled to those benefits. Employers should review engagement patterns regularly and convert employees where appropriate.
General protections and adverse action: Both casual and part-time employees enjoy protection under the general protections provisions of the Act. This means an employer cannot take adverse action (such as dismissal, demotion or reduction of shifts) because an employee has exercised a workplace right, for e.g., lodging a complaint, requesting flexible work, or taking leave.
These protections are broad and apply from day one of employment, not just after a qualifying period. They are also the primary avenue for challenging dismissals that are allegedly discriminatory, retaliatory, or connected to the exercise of workplace rights.
Practical implications
For employers, the takeaway is that the end of employment must always be handled with care, even for casual staff. If a casual has been working predictable, regular hours over many months, the line between ‘no ongoing commitment’ and ‘regular and systematic’ can become blurred. Documentation, clear communication, and consistent rostering practices are essential to defend against claims.
For employees, it’s worth understanding that ‘casual’ doesn’t always mean ‘unprotected’. If you’ve been working regular shifts and were suddenly dropped without good reason, you may still have recourse under the unfair dismissal or general protections provisions.
Which is ‘better’?
Whether casual or permanent part-time employment is the better option depends entirely on the nature of the business and the expectations of the role. Casual employment suits work that is genuinely intermittent, seasonal or unpredictable, where flexibility is essential and there is no firm advance commitment to ongoing work. The trade-off for that flexibility is a higher hourly rate via the casual loading, but no entitlement to paid leave or redundancy pay.
Permanent part-time employment, by contrast, provides structure and predictability. It’s the model of choice when work patterns are regular and the relationship is ongoing. Employers gain stability in staffing and lower compliance risk, while employees benefit from security, predictable income, and access to paid leave. Be warned however, businesses that engage casuals long-term but roster them like permanents expose themselves to claims of misclassification, back-pay of entitlements, and potential disputes about conversion rights or unfair dismissal.
In practice, the ‘best’ arrangement is the one that reflects the true nature of the working relationship. The FWC looks at substance, not labels, so it’s far safer to align the contract and rostering patterns with reality than to stretch the definition of ‘casual’ for convenience.
How we can help
Navigating the line between casual and permanent part-time employment is more complex than ever. With new reforms redefining casual employment, introducing the employee-choice pathway, and expanding the right to disconnect, it’s critical that your employment documentation and practices reflect how your people actually work.
At JFM Law, we assist employers across all industries to:
- Review and update employment contracts to ensure compliance with the latest legislative amendments, modern awards and enterprise agreements.
- Audit workforce classifications to identify and correct any casual/permanent misalignment before it becomes a liability.
- Draft policies and procedures covering communication outside working hours, conversion requests, and fair termination processes.
- Train management teams to understand when ‘reasonable business grounds’ apply, how to respond to conversion requests, and how to avoid unfair dismissal risks.
- Support dispute resolution if an employee raises concerns about classification, conversion, or dismissal, including representing employers in the FWC.
Our approach is both strategic and preventative. We ensure your employment structures are not only legally compliant but aligned with your business goals and workforce culture.
If your business engages casual or part-time staff, now is the time to review your arrangements.Contact us on(02) 9199 8597 or by email to arrange a confidential discussion about how these changes affect your workforce and what steps you can take to protect your organisation.Getting these foundations right protects your business, supports your people, and ensures you remain compliant in an evolving workplace landscape.
The information contained in this post is current at the date of editing – 1 October 2025.
