CHANGES TO CASUAL EMPLOYMENT

Changes to Casual Employment 

Please be reminded that the amendments to the Fair Work Act 2009 changed the workplace entitlement and obligation for casual employment. By 27 September 2021, the employers need to assess whether their casual employees are eligible to be offered permanent employment.

 

Definition of Casual Employee

There is now a statutory definition of “casual employee” under the Fair Work Act. A person is a casual employee is they accept a job offer from an employer knowing that there is no firm advance commitment to ongoing work with an agreed pattern of work, in considering whether:

  • The employer can choose to offer the employee work and it’s the employee’s choice to work or not;
  • The employee will be offered work when the employer needs them to work;
  • The employment is described as casual; and
  • The employee will be paid a casual loading or a specific pay rate for casual employees.

 

Difference between Casual and Full-time or Part-time Employment

  • Full-time and part-time employees have an advance commitment to ongoing employment.
  • Full-time and part-time employees can expect to work regular hours each week. 
  • Full-time and part-time employees are entitled to paid leave and must give or receive notice to end the employment.

Please note that a regular pattern of work does not automatically mean an employee is under a permanent employment (either full-time or part-time).

 

Existing Casual Employees

Casual employees who were employed immediately before 27 March 2021 and whose initial employment offer meets the new definition continue to be causal employees under the Fair Work Act 2009.

A casual employee will become a permanent employee through casual conversion or accepting the offer of full-time or part-time employment. 

 

Becoming a Permanent Employee

The National Employment Standards (NES) now include an entitlement for casual employees to become permanent employment in some circumstance, which is known as casual conversion. A casual conversion can be done by either employers making an offer to convert or employees making a request.

  • Small Business (fewer than 15 employees)
OFFERS
Employer Making an Offer Not required

Small Businesses employers do not have to offer to convert their casual employees to permanent employment.

REQUESTS
Employees Making a Request General

An eligible casual employee in a Small Businesses can still make request to convert to permanent employment on or after their 12-month anniversary.

The request has to be in writing and be for either full-time employment or part-time employment.

Employed before 27 March 2021

Existing causal employees can make a request to convert to permanent employee at any time from 27 March 2021.

Respond to Request

The employers need to respond in writing within 21 days of receiving the request, and tell the employee whether their request is accepted or refused.

  • If the employer refuses the request, they have to tell the employee the reasons for the rejection on a reasonable ground.
  • Other Business
OFFERS
Employer Making an Offer Generally

The employers need to make a written offer to convert their casual employees to permanent employment within 21 days after the employee’s 12-month anniversary if the employee:

  • has been employed by the employer
    for 12 months;
  • has worked a regular pattern of
    hours on an ongoing basis for at least the last 6 months; and
  • could continue working these
    hours as a full-time or part-time employee without significant changes.

Employed before 27 March 2021

For existing casual employees, the employers need to assess whether they are eligible to be offered to convert to permanent employment by 27 September 2021.

Manner of Offer Offering Casual Conversion

The employers need to make a written offer to convert their casual employees to permanent employment within 21 days after making the assessment; or

Not Making an Offer

The employers need provide written explanation to their casual employees why they won’t be marking an offer on a reasonable ground within 21 days the assessment but no later than 27 September 2021.

Respond to Offer The employees need to accept the offer by respond in writing to their employer within 21 days after getting the offer. The employer can assume that they have declined the offer if they do not respond.
REQUESTS
Employees Making a Request Generally

An eligible employee can make a request to convert to permanent employment from 21 days after their 12-month-anniversary if the employee:

  • has been employed by the employer for 12 months;
  • has worked a regular pattern of hours on an ongoing basis for at least the last 6 months; and 
  • could continue working these hours as a full-time or part-time employee without significant changes. 

The request has to be in writing and be for either full-time employment or part-time employment.

If the employer has refused an employee’s request on the reasonable ground. The employee will not be able to make another request for 6 months. They can make a request after they meet the requirements. 

Employed before 27 March 2021

Existing casual employees can make a request to convert from 28 September 2021.

Respond to Request

The employers need to respond in writing within 21 days of receiving the request, and tell the employee whether their request is accepted or refused.

  • If the employer refuses the request, they have to tell the employee the reasons for the rejection on a reasonable ground.

Offer or Request Accepted

Before a casual employee converts to permanent employment, the employer has to discuss with their employee on: 

  • Type of Employment (full-time or part-time);
  • Hours of work as a permanent employee;
  • Start date as a permanent employee.

 

Reasonable Ground for Not Making an Offer or Refusing a Request

If an employer decides to not make an offer, or refuses to accept a request, for a casual employee to convert to permanent on reasonable grounds, the reasonable grounds they rely on have to be based on facts that are known or reasonably foreseeable.

Reasonable grounds for deciding not to make an offer can include that, in the next 12 months:

  • the employee’s position won’t exist;
  • the employee’s hours of work will significantly reduce;
  • the employee’s days or times of work will significantly change, and that can’t be accommodated within the employee’s available days or times for work.

Reasonable grounds can also include:

  • making the offer would not comply with a recruitment or selection process required by or under a Commonwealth, State or Territory law;
  • the employer would have to make a significant adjustment to the employee’s work hours for them to be employed full-time or part-time.

 

Taking Legal Action

Under the changes, some disputes about casual conversion can now be resolved through the Federal Circuit Court. 

Where an employee is described as a casual, but through court proceedings it’s determined that they aren’t, a court needs to reduce any amounts that the employee could be entitled to by reference to casual loading amounts already paid by the employer to the employee to compensate for those entitlements.

Chao Deng, Partner, Accredited Business Law Specialist, cdeng@mtpartners.com.au

Disclaimer:  This article is intended to provide general information only, and is not to be regarded as legal advice. Formal legal advice should be sought in relation to particular transactions or circumstances.

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