The Federal Court ruling on the benefits for casual employees has affected over a third (34.5 per cent) of businesses in a Roy Morgan survey of 881 Australian companies.

The Federal Court recently decided that some casual workers, which it held were permanent employees, are entitled to payment of holiday pay and sick pay, in addition to their casual loading, for all time worked during the past six years.

According to the Roy Morgan survey, a quarter of businesses (567,000) said that the casual work ruling will ‘Deter them from hiring casual employees’, while one-in-10 (245,000) said it will have a ‘Large financial impact’.

About 123,000 (5.5 per cent) businesses said they will be ‘forced to close’.

They survey showed that Queensland is the most impacted out of all states, with nearly half (45 per cent) of businesses affected. Western Australia comes in second with 39per cent, followed by NSW (33 per cent) and Victoria (28.5 per cent). South Australia (24.5 per cent) is the least affected State.

Small and medium sized businesses, particularly in agriculture, manufacturing and retail, will be among the hardest hit.

“It is incumbent upon the business community and the union movement to come together and reach a truly equitable and sensible outcome about how to handle the industrial relations implications of this decision in the interests of a healthy Australian jobs market,” Roy Morgan CEO Michele Levine said.

“The biggest direct impact forecast by around a quarter of businesses is that they will be deterred from hiring casual employees in future. Many businesses mentioned “double-dipping” and the fact that “casual workers already get a 25 per cent loading for sick pay and annual leave etc.”

Some businesses who participated in the survey said that they are already struggling with penalty loading, while others said that high labour costs for unskilled workers already surpasses what the buying customer is willing to pay.