Essential Corporate News: Week ending December 3, 2021
On November 26, 2021 the Financial Conduct Authority (FCA) published Policy Statement PS21/16, summarising feedback to a Consultation Paper (CP21/25) it published in July 2021
The Australian Securities and Investment Commission (ASIC) has issued a guidance note (Guidance) in relation to financial reporting and audit requirements under Chapter 2M of the Corporations Act 2001 (Corporations Act).1
The Guidance states that companies should:
The Guidance follows the recent Full Federal Court (Court) decision in WorkPac Pty Ltd v Rossato  FCAFC 84 (Rossato),2 which held that a person cannot be a casual employee where there is a firm advance commitment to on-going work. Any person who is employed on such a basis is a permanent employee and is entitled to paid leave rights accordingly.
The Court also held that the extra pay which the employee received as a result of being designated as a casual (the casual loading), could not be taken into account in determining the quantum of compensation payable because of the denial of paid leave rights. We considered this decision in our earlier publication.
WorkPac Pty Ltd has sought special leave of the High Court to appeal the Rossato decision. The Industrial Relations Minister, Christian Porter, has confirmed the Government would intervene in an appeal, stating the decision in the Court has created "confusion and uncertainty . . . during a period where businesses are facing their greatest ever challenge". The Minister has also said that it may "be necessary to consider legislative options".3
The Guidance indicates that for “past and present ‘casual employees’ who were employed in circumstances covered by the recent Federal Court decision” in Rossato, the following calculations and provisions should be made:
ASIC also indicates that while no provision would be required for casual employees who are unaffected by the decision, “a provision or contingent liability may be required for ‘casual employees’ employed in circumstances that were not clearly covered by the decision”.
Chapter 2M of the Corporations Act provides that a financial report and a directors' report must be prepared for each financial year by:
In light of the Guidance, employers who have obligations under Chapter 2M of the Corporations Act should:
Finally, given that under s544 of the Fair Work Act 2009 (Cth), the limitation period to bring a claim regarding underpayments of wages is 6 years, the above-mentioned provisions must be made for relevant casual employees employed within the past 6 years.
If in doubt, employers should seek legal advice or speak to us about strategies.
See the Australian Securities and Investment Commission’s Guidance, titled ‘COVID-19 implications for financial reporting and audit: Frequently asked questions (FAQs)’ here.
See the full decision here.
See related article here.
See section 292 of the Corporations Act 2001 (Cth) here.
Recent decisions by the Court of Justice of the European Union (CJEU), the EU’s top court, have abolished the rights that EU investors previously had to bring claims against EU member states in international arbitration.
© Norton Rose Fulbright LLP 2021