What is temporary employment?
Temporary employment refers to roles that are limited in duration but still considered part of the broader category of employees. These roles may be full-time or part-time, but they are not permanent. A temporary employee is typically hired to fill a short-term need, such as covering parental leave, supporting a seasonal peak or managing a specific project. The arrangement is often defined by a set time period or linked to the completion of a specific task.
Temporary employees are entitled to most of the same benefits as permanent employees under the National Employment Standards (NES). This means they may accrue leave, be covered by unfair dismissal protections and receive superannuation contributions. The key distinction is the finite nature of their contract.
For example, an administrative assistant hired for six months to provide support during a system migration would be considered a temporary employee. Although their role is not ongoing, their entitlements during that period are similar to those of any other employee working comparable hours.
What is casual employment?
Casual employees work without guaranteed hours or ongoing commitment. Employers typically engage casual workers to respond to unpredictable or fluctuating demand. The defining feature of casual work is flexibility, as employers can roster casual staff as needed, and workers can in turn choose whether to accept shifts.
Casual workers are entitled to a casual loading, which is typically 25%, instead of benefits like paid sick or annual leave. They are also covered by minimum wage provisions and work health and safety laws, but they are not entitled to redundancy pay or notice of termination in most cases. However, casuals are still protected from unfair dismissal if they meet eligibility criteria based on regular and systematic employment.
If a casual employee works regular hours over a period of time, they may become eligible to request a permanent position under the casual conversion provisions in the Fair Work Act.
What is the difference between temporary and casual employment?
The main difference between the two role types comes down to the level of commitment and the benefits involved. Temporary employees are hired on fixed-term contracts and usually receive the same entitlements as permanent staff. Casual workers, on the other hand, are employed on an ad hoc basis and compensated with a loading in place of certain entitlements.
From an employer’s point of view, temporary staff offer stability for a set period, with clearly defined hours and duties, while casual staff offer greater day-to-day flexibility. Choosing between them depends on the nature of the work, how predictable your staffing needs are and any legal requirements under the relevant award or agreement.
For instance, if your business needs someone to manage a three-month backlog, a temporary worker with fixed hours might be the best option. If you simply need extra help during unpredictable busy periods, a casual worker who can step in as needed might be a better choice.
Contractor vs temporary worker
Another important distinction is between temporary employees and independent contractors. Although both may be hired for short-term projects, their legal status is very different.
Importantly, independent contractors are not employees but are engaged to perform work using their own tools, methods and schedules. Contractors typically issue invoices for their services, manage their own tax obligations and are not entitled to leave, superannuation or other employee benefits (unless otherwise specified by a contract or other agreement).
Employers need to be careful not to blur the line between a contractor and an employee. If a contractor is closely supervised, given fixed hours or becomes part of the regular team, it may cross the line into what is known as sham contracting, which is unlawful under the Fair Work Act.
Temporary workers, by contrast, are employees hired for a specific period or task, but their working relationship is governed by employment law. This means they are entitled to superannuation, leave (if applicable) and other standard employee benefits. Their pay is typically processed through payroll rather than being invoiced like a contractor’s would be.
Casual vs part-time employment
Employers sometimes confuse casual and part-time work, particularly when a casual employee begins working regular shifts. Both arrangements can involve fewer hours than full-time work, but there are some key differences in terms of commitment and benefits.
On the one hand, part-time employees are assigned a fixed number of hours per week and have a predictable schedule. They are entitled to paid leave on a pro rata basis and generally enjoy the same protections as full-time employees. A part-time contract formalises the ongoing nature of the role, even if the hours worked are less than 38 per week.
Casual workers, on the other hand, have no guaranteed hours. Even if they are working similar shifts each week, they are still classed as casual unless the arrangement is formally changed. This affects their rights, notice requirements and long-term job security.
As an employer, it is important to monitor long-term casual arrangements and consider whether it makes sense to offer casual workers a permanent role. This can reduce legal risk and give staff a clearer understanding of their entitlements.
Pros and cons of temporary employees
Hiring temporary workers can offer businesses the ability to manage workload fluctuations without committing to permanent hires. Temporary staff can step in during peak periods or cover for absent employees without the long-term obligations associated with permanent roles.
Another benefit of recruiting temporary staff is access to specialist skills for a defined period. If you are launching a new product or system, for example, a temporary hire with the right expertise can help you deliver results without the need to retrain your permanent staff.
However, there are limitations. Temporary staff can take time to get up to speed and may not always feel part of the team. If their contract is short, they might also be less motivated to invest in long-term goals or engage with the company culture.
Pros and cons of casual employment
Casual employment offers flexibility for both the employer and the worker. It is especially useful for industries with fluctuating demand, such as hospitality, event services or retail, in particular during peak periods like Christmas. By hiring casuals, employers can adjust staffing levels quickly without breaching contracts or managing leave accruals.
For workers, casual employment can be appealing because of the higher hourly pay and the flexibility to choose shifts, despite having less certainty around income and job security.
For employers, casual roles can keep staffing costs flexible and make it easier to respond to changing needs. Relying too heavily on casual staff can create instability and may affect morale, especially if casual workers feel left out of team development or growth opportunities.
It is also worth noting that if a casual employee starts working regular and predictable hours, they may accrue certain entitlements and become entitled to additional benefits. That is why it is important to keep accurate records and review employment arrangements regularly.
When to choose each option
Selecting the right employment type – temporary, casual or contractor – depends on the needs of your business and the specific circumstances of the role.
Use temporary employment when:
- you need coverage for a set period (e.g. parental leave or long-service leave)
- a defined project requires fixed staffing for a set duration
- you want to offer most employee benefits but without the long-term commitment.
Use casual employment when:
- your workload is unpredictable or seasonal
- you need flexible coverage at short notice
- you are unsure of future staffing requirements and want to avoid unnecessary commitments.
Use independent contractors when:
- you need highly specialised services or project-based work
- you want to avoid managing payroll, superannuation or tax for the role
- you are comfortable with the contractor setting their own hours, tools and methods.
Each model has its advantages, but it is important to choose the one that best suits your business needs and to take care that your hiring practices comply with Australian workplace laws.
Legal and compliance considerations
Regardless of the arrangement you choose, staying up to date with your legal obligations as an employer helps you avoid compliance issues down the track.
Temporary and part-time employees need to be paid in line with the relevant award or enterprise agreement. They are also entitled to superannuation, notice periods and leave entitlements. Any temporary or part-time employment contract needs to clearly outline the terms of the role, including start and end dates, hours and conditions.
Casual employees have to be paid at least the minimum rate for their classification, including casual loading. Employers are also obliged to offer casual conversion, if eligible under the Fair Work Act, and must not misrepresent a casual role as something more permanent.
Contractors need to be truly independent. A written agreement needs to clarify the nature of the engagement, rates, scope of work and termination clauses. Keep in mind that incorrectly classifying a worker as a contractor when they are really an employee can lead to serious penalties, including having to back pay entitlements and pay fines.
Regardless of the arrangement, employers still have to meet their duties when it comes to workplace safety, maintain accurate records, fulfil tax obligations and uphold employee rights.
Finding the right balance in your workforce
In practice, many Australian employers use a combination of full-time, part-time, casual and contract workers to manage their changing business needs. The important thing is to be clear about how each role is set up, and to check in regularly to make sure those arrangements still suit your needs.
When managed well, a flexible team structure can be a real strength. It gives you the ability to adjust quickly, tap into a wider range of skills and support both day-to-day operations and long-term plans.
