The Fair Work Amendment Act 2021 brought in a bunch of changes in relation to the rights and obligations of casual employees.
We’ve spent the last few weeks diving deeper into what this means and at a very practical level, what employers need to do.
Here’s what we’ve found:
- There are different rules for small businesses (those with less than 15 headcount employees) and large employers (15 or more headcount employees);
- While Fairwork is planning to update the modern Awards to align with the Act, as of right now, we still need to take into account whether an applicable modern Award has casual conversion clauses in it and, if it does, we have to make sure we adhere to any Award clauses that make the employee better off than the NES (the most common example of this is that some modern Awards allow casual employees to request conversion to permanent after only 6 months); and
- There are a range of factors that apply to both large and small, Award and non-Award covered employees.
So we are going to break it up for you. We’ll start with the common factors, which hopefully most of you are aware of by now.
And then, to give you more information and the practical implementation steps based on your size, we’re giving you 2 separate links to follow.
The definition of a casual employee
A person is a casual employee if 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.
Once employed as a casual, an employee will continue to be a casual employee until they either:
- become a permanent employee through:
- casual conversion, or
- are offered and accept the offer of full-time or part-time employment, or
- stop being employed by the employer.
The legislation has a list of factors that must be considered when determining whether at the time the casual offer is made there was no firm commitment to continuing work. This includes things such as:
- The person will work according to the needs of the employer
- The person is entitled to a casual loading or specific rate of pay for casual employees
- The employer can elect to offer work and whether the person can elect to accept or reject the work
This not an exhaustive list but gives you the key elements.
The question of whether a person is a casual employee is now assessed on the basis of the offer of employment and acceptance of that offer, not on the basis of any subsequent conduct of either party.
Casual Employment Information Statement
Along with the current Fair Work Information Statement, employers also need to give every casual employee a Casual Employment Information Statement before or as soon as possible after their employment starts.
Please see the link to the statement here, with further information Casual Employment Information Statement (fairwork.gov.au)
Permanent Engagement Eligibility
All casual employees are eligible to be considered for conversion to permanent if they meet the criteria:
- They’ve been employed for 12 months;
- During the last 6 months have worked regular and systematic pattern of hours without significant adjustment; and
- Could continue working those hours as a permanent employee without significant changes to their employment.
A note here though – if they are covered by a modern Award that states they can request conversion after 6 months, that overrides the 12 months in the new legislation.
The conversion to permanent employment is only required to match the type of hours provided to the employee in the 6 months of regular casual hours.
This means that if an employee has worked the equivalent of full-time hours during the preceding 6 months, then the offer (or request) is for full-time. If the employee has worked less than the equivalent of full-time hours, then the offer (or request) is for part-time.
Future Conversion Right
Casual employees who believe they are eligible to become a permanent employee can make a request for conversion every 6 months provided that they meet the eligibility criteria.
Now this is the point that it starts to differ.
So if you are a small business (less than 15 headcount including full-time and part-time employees and regular and systematic employees [including those employed in related entities]), click here to find out what applies to you and the practical steps to get started
If you are a large business (more than 15 headcount), click here to find out what applies to you and the practical steps to get started.