With the holiday season fast approaching, many small business owners are ramping up for the busiest time of year.

If your business needs more hands on deck, it’s critical you know what kind of employee will best meet your needs and have a clear understanding of the conditions of their employment. Here’s a look at the difference between temporary and casual employees, how to stay compliant as an employer, and why it’s time to act now to get staff on board.

Temps vs casuals: What’s the difference?

Employsure Senior Employment Relations Adviser, Michael Wilkinson, says small businesses need to be aware of the different requirements and responsibilities when hiring temporary workers and casuals. 

“When you use the word temp, you need to understand what that actually means,” he says. “It’s usually referring to a temporary contract, meaning a fixed-term employment agreement for a set period of time.” 

Temporary or fixed-term employees 

Employment New Zealand says a temporary or fixed-term employee is someone who is hired for a specific time period or when a particular event occurs, for example, a worker covering for another employee’s parental leave or a person engaged for a seasonal peak in trade. 

The employers must make the temporary employee aware of the genuine reason for their fixed term agreement i.e. the completion of a specific project, covering a fixed period of another employee’s absence, or working for a particularly busy period of time.  

Temporary employees have largely the same employment rights and responsibilities as permanent employees. If, for example, an employer wants to dismiss a temporary employee before the end of their job, there must be a legal reason for the termination.  

One area of difference can be the way in which annual holiday entitlements are paid. Where an employee has a fixed-term agreement of less than 12 months, they can agree on a pay-as-you-go basis instead of being provided with four weeks of annual leave.  

Seasonal employment is usually a type of fixed-term employment used in the agricultural sector for fruit and vegetable picking and can become a rolling, fixed-term arrangement whereby the employee is hired at the beginning of each season.  

Casual Employees

Casual workers are employed on an intermittent basis, without regular shifts or the obligation to accept the work. 

Under New Zealand employment law, casual workers need to know their work hours will vary and that they’re not obliged to come to work whenever the employer might need them. 

Like temporary workers, casual workers also have rights and responsibilities that employers need to be aware of. For example, if an employer sends a casual worker home before the end of a shift or reneges on a previously agreed shift, this could constitute a dismissal and, as such, is subject to the same dismissal rules as other workers. 

All employees, whatever their status, must have a written employment agreement. This should explicitly state if the employment has a fixed term and why, or whether it is of casual nature with an expectation of varying hours. 

“There’s no obligation to roster a casual employee, whereas a permanent or fixed-term employee needs to be provided with the hours guaranteed in their employment agreement.” – Michael Wilkinson 

Start planning your staff needs sooner rather than later 

Michael says small businesses should assess their staffing requirements for the holiday season and the predictability of their workflows, before hiring staff. 

Amid increasing unpredictability in retail trading, he explains, some employers choose the flexibility of casual staff so they can meet fluctuating customer demands. 

Where workflow is predictable, however, he says small businesses can engage a fixed-term worker to meet demand – provided they have a reason for the role to end. 

But Michael advises employers to consider what they are “locking themselves into”. 

“There’s no obligation to roster a casual employee, whereas a permanent or fixed-term employee needs to be provided with the hours guaranteed in their employment agreement,” he says. 

“There are always trade-offs.”

“Focus on helping your existing staff be as productive as possible by implementing processes and systems that empower them to do their jobs efficiently.” – Paul Watson  

Working with what you’ve got 

Paul Watson, director at Oxygen8 Business Consulting, advises small businesses to, where possible, work with their existing resources. 

While some businesses — those in retail and hospitality for example — can’t get through the seasonal peak without extra staff, for other businesses, taking on staff can be more trouble than it’s worth. 

“Training and managing casual staff can drain resources from the rest of the team,” says Paul. “Instead, focus on helping your existing staff be as productive as possible by implementing processes and systems that empower them to do their jobs efficiently.” 

With good leadership, as Paul explains, a high-performance team can achieve extraordinary results. The key is to make sure the systems are in place to reduce error and support productivity so you can make the most of your existing teams’ expertise. 

Consider the market 

If you can’t do without extra staff, be aware that, with unemployment at 3.9%, the labour market is tight and competition for casual staff to meet the demands of peak trade in retail and hospitality is stiff. 

Employers looking to make the most of the busy season may wish to act now to secure the resources they need to see them through. 

This article was originally published in November 2019 and has been updated with new information.