Recent amendments to the Federal Fair Work Act 2009 have changed the workplace entitlements and obligations for casual employees. The changes came into effect on 27 March 2021. There are 3 broad changes to the Fair Work Act:
- a new definition of casual employment;
- a path for casual employees to become full-time or part-time (permanent); and
- a “casual employment information statement”.
Definition of casual employment
A person is now a casual employee if they accept a job offer knowing that there is no firm advance commitment to continuing and indefinite work according to an agreed pattern of work.
The High Court case of Workpac Pty Ltd v Rossato  HCA 23 has held recently clarified that a casual employee is one who has no firm advance commitment from the employer as to the duration of the employee’s employment or the days (or hours) the employee will work, and provides no reciprocal commitment to the employer.
Further, where parties have a written contract and adhere to those terms, the requisite firm advance commitment must be found in the binding contractual obligations of the parties; a mere expectation of continuing employment on a regular and systematic basis is not sufficient.
Once employed as a casual, an employee will continue to be a casual employee until they:
- become a permanent employee through what is termed “casual conversion”;
- are offered and accept full-time or part-time employment; or
- stop being employed by the employer.
For existing employees, an employee will be deemed a casual employee if they met the new definition of casual employee when they were originally employed.
Obligations to offer casual conversion
The National Employment Standards now includes an entitlement for a casual employee to become a full-time or part-time (permanent) employee in certain circumstances. This is known as casual conversion.
Except for small business employers (employers with less than 15 employees), employers are required to offer casual employees who have been employed for 12 months the option to convert to full-time or part-time (permanent) if the employee:
- has worked a regular pattern of hours on an ongoing basis for at least the last 6 months; and
- could continue those hours as a full-time or part-time (permanent) without significant change to their hours of work,
…unless the employer has reasonable grounds not to make an offer.
The offer must be made within 21 days of the employee’s 12 month anniversary. The amount of hours that the employee has worked over the previous 6 months will determine if the offer is for full-time or part-time (permanent) basis.
Right to request casual conversion
Eligible casual employers (except those employed by a small business employer) can also ask to convert to permanent employment from 21 days after their 12 month anniversary.
An eligible casual employee who works for a small business employer can make a request at any time on or after their 12 month anniversary.
To be an eligible the casual employee must:
- have been employed by the employer for at least 12 months;
- have worked a regular pattern of hours on an ongoing basis for at least the last 6 months; and
…be able to continue those hours as a full-time or part-time (permanent) without significant change to their hours of work, and none of the following must apply in the previous 6 months:
- the employee must not have refused an offer to convert to permanent employment;
- the employer has advised in writing that an offer of casual conversion will not be made as there are reasonable ground;
- the employer has refused another request for casual conversion based on reasonable grounds;
- that an offer of casual conversion will not be made as there are reasonable ground.
An employer is required to respond to that request in writing within 21 days. If the employer refuses the request, they must tell the employee why in their written response. Employers cannot refuse a request unless they have consulted the employee and have reasonable grounds to refuse the request.
Reasonable grounds for refusal
Reasonable grounds for not making an offer include if, in the next 12 months, the employee’s:
- employees position won’t exist;
- hours will significantly reduce; or
- days and times of work will significantly change and can’t be accommodated within the employees days or times for work.
If an offer is not being made the employer must still write to the employee within 21 days of the employee’s 12 month anniversary explaining that no offer will be made along with the reasons why.
Existing casual employees
Except for small business employers, employers must assess whether any of their existing casual employees who, employed prior to 27 March 2021, are eligible to convert to permanent employment.
Within 21 days of the assessment occurring the employer needs to make a written offer to convert employment or an explanation as to why that offer will not be made. The assessments and any explanation made must occur by 27 September 2021.
Employees must respond to any offer within 21 days of receiving the offer. If no response is given an employee is deemed to refuse the offer. Small business employers are not required to make an offer to convert their casual employees to permanent employment.
Small Business Employer
A small business employer is not required to offer casual conversion to eligible casual employees.
However, if an employee has been employed for 12 months, worked a regular pattern of hours on an ongoing basis for 6 months and could continue working these hours as a full-time or part-time employee without significant change then the employee may ask for casual conversion.
In that case the business must consider and respond in writing within 21 days. Any refusal must first be discussed with the employee and be on reasonable grounds.
Casual employment information statement (CEIS)
The CEIS has information about:
- the definition of a casual employee;
- when an employer is and is not required to offer casual conversion;
- when a casual employee can request casual conversion;
- casual conversion entitlements; and
- the role of the Fair Work Commission to deal with disputes.
The CEIS can be downloaded from the Fair Work website. There has already been, at least, 2 versions of the form published, so businesses need to ensure they are using the most current form.
A CEIS must be provided to each new casual employee before or as soon as possible after the employee starts their new job.
Small business employers are required to give existing casual employees a copy of the CEIS as soon as possible after 27 March 2021. Other employers are required to give their existing casual employees a copy of the CEIS by 27 September 2021.
What does this mean for you?
Management rights operators (operators), like all businesses, will need to consider on what basis they employ their staff and how they will make offers for employment in the future.
If an operator wants to engage an employee on a casual basis then it must be made abundantly clear from the outset and that offer must be accepted by the employee.
Operators must ensure that a CEIS is provided to all current casual employees.
Operators with 15 staff or more must offer casual conversion to its eligible staff or give a written explanation as to why such an offer is not being made. They must ensure that these assessments, and any offers, have occurred by the end of September 2021.