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Casual Loading Explained

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Casual loading is extra pay on top of a casual employee's base hourly rate. It exists because casuals do not get the paid entitlements permanent employees receive, and they have no guaranteed hours. Under most modern awards the loading is 25% — but it is not free money, and it only beats a permanent rate while the work keeps coming. Run your own figures in the Casual Loading Calculator.

The 25% rule

The formula is simple:

casual rate = base rate × (1 + loading)

Most modern awards set the loading at 25%, so a $32.00 base rate becomes a $40.00 casual rate. The loading figure in the calculator is editable because some awards and enterprise agreements set a different figure — if yours does, change it rather than trusting the default.

Worked example

Base rate $32.00 an hour, loading 25%, 38 ordinary hours a week:

What the loading replaces

The loading is paid in lieu of exactly these entitlements:

Under some awards it is also in lieu of paid public holidays not worked. That is the whole trade: the higher hourly rate stands in for the security and paid time off that permanent employees get.

What casuals still get

Casual employment does not mean no entitlements at all. Casuals still get:

Note the distinction that matters most at the end of employment: unused personal/carer's leave is not paid out on termination. The Personal Leave Calculator shows that $0 line explicitly.

The break-even story

Break-even weeks answer the question the hourly rate hides: how many weeks of casual work a year does it take to match a permanent income?

Break-even weeks = 52 × base rate ÷ casual rate. At 25% loading this is 41.6 weeks, and it does not depend on how many hours a week you work.

Same $32.00 base rate and 38 hours a week, only the weeks change:

The break-even point sits between those two results. Work fewer weeks than 41.6 in a year and the permanent job pays more cash, before job security is even counted.

Part-time hours work the same way

Base rate $28.50 an hour, loading 25%, 20 ordinary hours a week: the casual rate displays as $35.63 (exact $35.625), and weekly pay is casual $712.50 vs permanent $570.00. Hours change the weekly amounts, not the break-even weeks.

Try your own hours and weeks in the Casual Loading Calculator — especially the weeks figure, because that is the input most people guess wrong.

Penalties and overtime

Whether penalty rates and overtime are calculated on the base rate or on the loaded rate is set by the award, so there is no single answer that fits every job. For that reason the calculator covers ordinary hours only and no tax is computed on this page or in the calculator. If penalties or overtime are a large part of your pay, check your award before relying on an ordinary-hours comparison.

Converting to permanent

Under the employee choice pathway, in place since 26 August 2024, a casual can give written notification of wanting to convert to permanent (full-time or part-time) employment after 6 months with the employer — 12 months if the employer is a small business with fewer than 15 employees — provided they have worked a regular pattern of hours that could continue as a permanent employee. The employer must respond in writing within 21 days and may refuse only on fair and reasonable operational grounds. On conversion the loading stops and paid-leave entitlements start. This section is a signpost only: it does not decide whether any individual is eligible. The Fair Work Ombudsman explains the pathway at Becoming a permanent employee.

Frequently asked questions

What is casual loading?

Casual loading is extra pay added to a casual employee's base hourly rate. It compensates casuals for the paid entitlements permanent employees receive, because casuals have no guaranteed hours and no ongoing employment commitment.

Why 25%?

Most modern awards set casual loading at 25% of the base hourly rate. It is the standard figure under most awards, not a universal law — some awards and enterprise agreements set a different figure.

What does the loading replace?

The loading is paid in lieu of paid annual leave, paid personal/carer's leave, notice of termination and redundancy pay. Under some awards it is also in lieu of paid public holidays not worked.

Do casuals get paid sick or annual leave?

No. Casuals do not get paid annual leave or paid personal/carer's leave. They do get 2 days' unpaid carer's leave per occasion and 2 days' unpaid compassionate leave per occasion.

Do casuals get superannuation?

Yes. Casual employees receive superannuation on their ordinary time earnings, like any other employee. Superannuation is not part of the loading and is not replaced by it.

What about public holidays?

Casuals are not paid for public holidays they do not work. If a casual works on a public holiday, the award's public holiday rate applies. Under some awards the loading is also treated as in lieu of paid public holidays not worked.

Do penalty rates apply on top of loading?

It depends on the award. Whether penalty rates and overtime are calculated on the base rate or on the loaded rate is set by the award, so there is no single answer. The Casual Loading Calculator covers ordinary hours only for exactly this reason.

Can I convert to permanent employment?

Possibly, under the employee choice pathway. Since 26 August 2024 a casual can give written notification of wanting to convert to permanent employment after 6 months with the employer, or 12 months if the employer is a small business with fewer than 15 employees, provided they have worked a regular pattern of hours that could continue as a permanent employee. The employer must respond in writing within 21 days and may refuse only on fair and reasonable operational grounds. This page does not decide whether any individual is eligible.

Is 25% always the rate?

No. Most modern awards set 25%, but some awards and enterprise agreements set a different figure. Check your award or agreement, and use the editable loading figure in the Casual Loading Calculator if yours differs.

What happens if my hours drop?

This is where casual pay can fall behind. At 25% loading the break-even point is 41.6 casual weeks a year: work fewer weeks than that and the permanent job pays more cash, before job security is even counted. A casual rate only beats a permanent rate when the work is actually there.

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LeavePayout gives estimates only. It is not legal or financial advice. Confirm your entitlement with your employer, your award or agreement, your state regulator or the Fair Work Ombudsman.