Change to Casual Employment

 

On Friday 26 March 2021, the Fair Work Act 2009 (FWA) was amended to change workplace rights and obligations for casual employees. The changes were made by the Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Act 2021 (Amendment Act).

 

These changes came into effect on Saturday 27 March 2021.

 

The Amendment Act introduces a:

  • definition of casual employment
  • pathway for casual employees to move to full-time or part-time (permanent) employment
  • Casual Employment Information Statement

 

All employers are affected by the changes, with transitional arrangements for employers (other than small business employers) which requires an assessment of all casual employees by 27 September 2021.

 

Casual Employee Definition

 

The FWA amendment now provides for a new definition of a casual employee being:

  • The person is offered a job
  • The offer does not include a firm advance commitment that the work will continue indefinitely with an agreed pattern of work
  • The person accepts the offer knowing that there is no firm advance commitment and becomes an employee.

 

In determining if an employer makes a “firm advance commitment to continuing and indefinite work according to an agreed pattern of work” for the person, regard must be had only to the following considerations:

  • whether the employer can elect to offer work and whether the person can elect to accept or reject work;
  • whether the person will work as required according to the needs of the employer;
  • whether the employment is described as casual employment;
  • whether the person will be entitled to a casual loading or a specific rate of pay for casual employees under the terms of the offer or a fair work instrument.

 

To avoid doubt:

  • a regular pattern of hours does not of itself indicate a firm advance commitment to continuing and indefinite work according to an agreed pattern of work.
  • the question of whether a person is a casual employee of an employer is to be assessed on the basis of the offer of employment and the acceptance of that offer, not on the basis of any subsequent conduct of either party.

 

Casual Conversion

 

Additional changes have been made that provides for a casual employee to subsequently become permanent after they have been employed.  The National Employment Standards now contain a casual conversion clause.

 

The NES entitlements are:

  • requires employers (other than small business employers i.e. the employer employees fewer than 15 employees), to offer eligible casual employees conversion to full-time or part-time employment (subject to the employer having reasonable grounds not to do so), and
  • allows eligible casual employees (including casual employees of a small business employer) to request conversion to full-time or part-time employment

 

Employer to offer permanent employment (other than a small business employer)

 

In most cases, existing casual employees who would have met the statutory definition at the time of the offer of employment, will be casual employees for the purposes of the new provisions of the FWA. All casual employees (other than those of small business employers) must be offered to convert to permanent employment if the employee:

  • has worked for their employer for 12 months employment
  • during the last 6 months, the employee has had a ‘regular pattern of hours on an ongoing basis’
  • could continue working those hours as a permanent employee without significant adjustment.

 

The offer must be made in writing within the period of 21 days after the end of the 12 month period of employment.

 

A casual employee has 21 days to respond to the offer in writing, stating whether the employee accepts or declines the offer.  If an employee fails to give the employer a written response within 21 days, the employee is taken to have declined the offer.

 

Within 21 days after the acceptance of the offer has been received (and after discussions with the employee), the employer must give written notice of the following:

  • whether the conversion is to full time or part time employment
  • the employees hours of work after the conversion takes place
  • the day the employee’s conversion takes effect (which will be the first day of the first full pay period that starts after the day the notice is given unless the employer and employee agrees otherwise)

 

An employer does not have to offer casual conversion if

  • the employer has reasonable grounds for not doing so, or
  • the employee is not eligible.

 

“Reasonable grounds” for deciding not to make an offer includes:

  • the reasonable grounds are based on facts that are known, or reasonably foreseeable, at the time of deciding not to make the offer
  • the employee’s position will cease to exist in the period of 12 months after the time of deciding not to make the offer;
  • the hours of work which the employee is required to perform will be significantly reduced in that period;
  • there will be a significant change in either or both of the following in that period:
    • the days on which the employee’s hours of work are required to be performed;
    • the times at which the employee’s hours of work are required to be performed;

which cannot be accommodated within the days or times the employee is available to work during that period;

  • making the offer would not comply with a recruitment or selection process required by or under a law of the Commonwealth or a State or a Territory.

 

If an employer will not make an offer of casual conversion and the casual employee s has been employed for 12 months, the employer must advise the employee in writing that the employer is not making an offer and include the details of the reasons for not making the offer, i.e.:

  • any grounds on which the employer has decided, and/or
  • that there has not been a regular pattern of hours on an ongoing basis

 

Transition arrangements for employers (other than small business employers)

 

The transitional provisions of the FWA provide employers with a 6-month transition period (until 27 September 2021), during which they are required to assess all existing casual employees to determine whether they are eligible to be offered permanent employment.  If the causal employee does not meet the requirements because the casual employee has not been employed for 12 months, the employer must tell the casual employee in writing within 21 days of making the assessment.

 

Casual employee to request permanent employment (all employers)

 

After 27 September 2021, a casual employee can request to become a permanent employee if the employee:

  • has been employed for at least 12 months by the employer
  • worked a regular pattern of hours in the last 6 months on an ongoing basis
  • regular hours could continue as a permanent employee without significant changes
  • has not refused a previous offer to become a permanent employee in the last 6 months
  • the employer has not told the employee in the last 6 months that they will not offer a casual conversion on reasonable grounds
  • the employer has not already refused a requested from the employee based on reasonable ground in the last 6 months.

 

The request to either part time or full time employment (based on the hours worked in the previous 6 months) must be made in writing within the period of 21 days after the end of the 12 month period of employment.

 

The employer must give the employee a written response to the request within 21 days stating whether the employer grants or refuses the request.

 

If the employer refuses the request, the response must include the details of the reasons for the refusal.  An employer must not refuse the request unless:

  • the employee has been consulted
  • there are reasonable grounds to refuse the request (see above)

 

If the employer grants the request, the employer must within 21 days after receiving the request (and after discussions with the employee), the employer must give written notice of the following:

  • whether the conversion is to full time or part time employment
  • the employees hours of work after the conversion takes place
  • the day the employee’s conversion takes effect (which will be the first day of the first full pay period that starts after the day the notice is given unless the employer and employee agrees otherwise)

 

Casual employment information sheet (CEIS)

 

Employers must provide every new casual employee a CEIS before, or as soon as possible after, they start their new job.

 

Small business employers need to give their existing casual employees (employed before 27 March 2021) a copy of the CEIS as soon as possible after 27 March 2021.

 

All other employers have to give their existing casual employees (employed before 27 March 2021) a copy of the CEIS as soon as possible after 27 September 2021.

 

Here is a link to the casual employment information sheet

 

Review of casual provisions in modern awards

 

The recent amendments also requires the Fair Work Commission to review and vary modern awards on the basis of their interaction with the new casual employee definition and casual conversion arrangements in the FWA.  This review will be conducted  in stages. The following initial group of 6 awards will be considered in the first stage of the casual terms review:

  1. General Retail Industry Award 2020
  2. Hospitality Industry (General) Award 2020
  3. Manufacturing and Associated Industries and Occupations Award 2020
  4. Educational Services (Teachers) Award 2020
  5. Pastoral Award 2020
  6. Fire Fighting Industry Award 2020

 

Issues raised by the review of this initial group of awards are likely to include:

  1. whether existing award definitions of ‘casual employee’ or ‘casual employment’ should be retained in some form, or replaced with the new statutory ‘casual employee’ definition or a reference to it;
  2. whether award model casual conversion clauses should be retained in some form, or replaced with a reference to the new casual conversion NES;
  3. whether award-specific casual conversion clauses should be retained in some form, or replaced with a reference to the new casual conversion NES;
  4. what other types of ‘relevant terms’ must be considered in the casual terms review; and
  5. the implications of any award variations for existing employment arrangements and whether transitional arrangements may be needed.

 

The Fair Work Commission must complete its review by 27 September 2021. Of the 155 modern awards, only 3 make no reference to ‘casual’ employment or ‘casual’ terms and conditions, so you will need to periodically check awards that relate to your employees over the next 6 months.

 

Please contact hr@ucaqld.com.au if you have any questions.

Regards,

Grant Weaver

Manager People and Culture