The peak body for the recruitment sector says there is a need for a new class of worker – a hybrid of a permanent and casual employee – in the wake of a landmark federal court case that found a casual truck driver was entitled to annual leave.

The full federal court of Australia in August ruled in favour of Paul Skene, a Queensland truck driver employed by a labour-hire company as a casual. The court found Skene was not a casual employee under employment law, because of his regular and continuous pattern of work during more than two years.

Unions say the case highlights how employers are “using broken workplace laws” to keep workers on casual contracts and in insecure conditions, even when they work regular hours.

Charles Cameron, the head of the Recruitment, Consulting and Staffing Association, told Guardian Australia that Skene’s claim amounted to “double dipping” and that casuals were paid a higher rate in lieu of receiving entitlements.

Cameron said conservatively the decision could result in $13bn in claims for unpaid entitlements from workers in similar situations.

“This opens the door for entitlements to paid personal leave, paid public holidays, redundancy pay, paid notice,” he said. “You pretty quickly understand that even with some relatively conservative calculations you’re talking billions in back pay and potential fines.”

“No one dismisses that there are some workers throughout Australia that want a less risky, more permanent arrangement. We absolutely believe we need to consider whether there are some cases where businesses have become complacent about offering casual employment when they could be offering permanent employment.

“But insecurity is not just a one way street, the reality is that many businesses, they don’t have the confidence to put people on on a permanent basis.

“We probably do need to start thinking about is there something that sits between casual and permanent work that can meet the needs of business and can meet the needs of workers as well.”

Sally McManus, the Australian Council of Trade Unions secretary, said casual work was a “huge contributor to insecure work in Australia”.

“Employers are exploiting our broken workplace laws and using casual employment to keep workers in insecure work even when they work regular hours,” McManus said.

“Australia has one of the highest rates of insecure work in the OECD, and nearly half of all Australians are affected by some level of work insecurity – either through casualisation, labour-hire, sham contracting or the gig economy.

“We need to change the rules so that casual work is for casual workers, and people who work regular hours on an ongoing basis are not forced to go without leave and other entitlements simply because employers don’t want to pay.”

WorkPac, the company that employed Skene, is understood to be considering an appeal to the high court. Cameron said business groups were urging the company to appeal.