Types of Employment Contracts in Australia: Full-Time, Part-Time, Casual and More

Choosing between the types of employment contracts available in Australia affects pay, leave, termination rights and legal risk. The Fair Work Act 2009 (Cth) and the National Employment Standards (NES) set the minimum rules for every employee. Modern awards and enterprise agreements then add further rights for many roles. This guide explains full-time, part-time, casual and fixed-term employment, and how they differ from an independent contractor arrangement.

Full-Time Employment

Full-time employees work an average of 38 hours a week. An employer cannot require more than 38 hours unless the extra hours are reasonable. Full-time work suits ongoing roles with a regular schedule.

The full set of NES entitlements applies. These include four weeks of paid annual leave, paid personal and carer’s leave, and up to 12 months of unpaid parental leave. Full-time staff also receive 10 days of paid family and domestic violence leave each year. In many cases they also receive notice of termination and redundancy pay if the employer ends the job.

Part-Time Employment

Part-time employees work fewer than 38 hours a week, usually on a regular pattern. They receive the same minimum entitlements as full-time employees, calculated pro rata to their hours. Annual leave and personal and carer’s leave accrue in proportion to hours worked.

Paid family and domestic violence leave is the exception. Part-time staff receive the full 10 days, not a pro-rata share, and all 10 days are available upfront. Awards may add rules on minimum shift lengths and rostering, so check the award that covers the role.

Casual Employment

Casual employment suits work that is genuinely irregular. Since 26 August 2024, the Fair Work Act has defined a casual employee as someone with no firm advance commitment to continuing and indefinite work. A court looks at the real substance of the relationship, not just the label in the contract. A regular pattern of work alone does not create a firm commitment, but it counts as one factor.

What Casual Employees Receive

Casual employees receive a casual loading on top of their hourly rate. Awards usually set the loading at 25%. The national minimum wage from 1 July 2026 is $26.44 an hour, so the casual minimum is $33.05 an hour. Awards often set higher rates.

Casuals do not receive paid annual leave or paid personal leave. They do receive two days of unpaid carer’s leave and two days of unpaid compassionate leave per occasion. They also receive 10 days of paid family and domestic violence leave. Most casual employees do not receive notice of termination or redundancy pay.

Employers must give every new casual employee the Casual Employment Information Statement. The Fair Work Ombudsman publishes it.

Converting From Casual to Permanent

Casual employees can now choose to convert to permanent work. A casual who no longer meets the casual definition can give written notice after six months of employment. At a small business with fewer than 15 employees, the wait is 12 months. The employer must consult the employee and respond in writing within 21 days. An employer can refuse only for specific reasons. One is that the employee still meets the casual definition. Another is fair and reasonable operational reasons. Disputes can go to the Fair Work Commission.

The Risk of Mislabelling

Calling someone casual does not make them casual. If an employee has a firm advance commitment to ongoing work, they may claim the leave and other entitlements of a permanent employee. Where the employer paid an identifiable casual loading, the law lets a court offset it against the amount owed. The cost and the dispute can still be significant.

Fixed-Term Employment

A fixed-term contract ends on a set date or when a defined project finishes. It suits maternity cover, a specific project or a short-term need. Since 6 December 2023, restrictions limit how employers can use these contracts.

In general, a fixed-term contract cannot last more than two years, including any extension. It also cannot allow more than one extension. Exceptions apply, including for employees earning above the high income threshold, specialised and distinct tasks, training arrangements and covering temporary absences. If a contract breaches the rules, the end date has no effect and the law treats the employee as ongoing. Employers must also give the employee a Fixed Term Contract Information Statement. Our guide to the high income threshold explains the threshold.

Independent Contractors

A contractor is not an employee. A contractor runs their own business, sets their own methods and carries their own tax and insurance. They do not receive NES entitlements such as annual leave.

The law looks at the real substance of the relationship, not the title in the contract. If the arrangement is really employment, a business that calls it contracting may face sham contracting penalties. Our guide to independent contractors versus employees covers the test in detail.

Flexible Working and Workplace Safety

Every employee has the right to a safe workplace, and employers must prevent workplace injuries. Flexible working rights depend on service. An employee can request flexible arrangements after 12 months of service. A long-term casual with a reasonable expectation of ongoing work can do the same. The employee must also fall into a qualifying group, such as a carer, a person aged 55 or over, or a parent of a school-age child. The employer must reply in writing within 21 days and refuse only on reasonable business grounds. Read more in our guide to flexible work arrangements.

How to Choose Between the Types of Employment Contracts

Match the contract to how the work actually happens. If the person works regular hours and you expect the role to continue, a permanent full-time or part-time contract fits. Use casual and fixed-term contracts only for work that is genuinely irregular or short term. Put the terms in writing, check the award that applies, and give the required information statements. Review the arrangement whenever the role changes in practice, and update the contract to match. Employers must also pay superannuation within seven business days of each payday. Our guide to employment disputes for businesses shows what can go wrong.

Frequently Asked Questions

1. What are the main types of employment contracts in Australia?
The main types are full-time, part-time, casual and fixed-term employment. An independent contractor arrangement is not employment, but businesses often use it as an alternative.

2. What is the difference between part-time and casual employment?
A part-time employee has regular hours and receives paid leave, pro rata to their hours. A casual employee has no firm advance commitment to ongoing work. Casuals receive a casual loading instead of paid annual or personal leave.

3. Can a casual employee become permanent?
Yes. A casual who no longer meets the casual definition can give written notice after six months, or 12 months at a small business. The employer must respond in writing within 21 days.

4. How long can a fixed-term contract last?
Generally no more than two years, including any extension, and the contract can allow only one extension. Several exceptions apply, so check the rules before you rely on a longer term.

5. Do casual employees receive paid family and domestic violence leave?
Yes. All employees, including casuals and part-time employees, receive 10 days of paid family and domestic violence leave each year. The entitlement is not pro rata.

6. Does a written employment contract have to state the employment type?
Stating the type is good practice, but the label is not decisive. A court looks at how the relationship works in practice, so the contract must match the real arrangement.

Allied Legal drafts and reviews employment contracts for Australian startups and growing businesses. We can help you choose the right employment type. We also align the contract with the applicable award and fix arrangements that carry misclassification risk. Learn more about our employment contract and employment law services, or contact us on 03 8691 3111 / hello@alliedlegal.com.au.

This article is provided for general information only and does not constitute legal advice. You should obtain legal advice specific to your circumstances before acting on any information contained in this article.