New rules on casual employment and conversion

New rules on casual employment

The Fair Work Act 2009 was recently amended to change workplace rights and obligations with respect to casual employees effective from Saturday 27 March 2021 with some obligations for business with 15 or more employees deferred to 27 September 2021.

New casual employee definition

The Fair Work Act now provides that 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 accepting an offer of full-time or part-time employment, or
• Stop being employed by the employer

New Casual Employment Information Statement

From 27 March 2021, all new casual employees have to be provided with a Casual Employee Information Statement (CEIS) before or as soon as possible after commencing employment. This is now a National Employment Standard so it is mandatory.

For existing casual employees as at 27 March 2021:

• Small business employers need to give their existing casual employees a copy of the CEIS as soon as possible after 27 March 2021.
• Other employers have to give their existing casual employees a copy of the CEIS as soon as possible after 27 September 2021.

New National Employment Standard on Casual Conversion

Various rights and obligations come into play once a casual employee:

• Has worked for their employer for 12 months
• Has worked a regular pattern of hours for at least the last 6 months on an ongoing basis
• Could continue working those hours as a permanent employee without significant changes

In the case of a small business employer:

• There is no obligation to make an offer of casual conversion at any time
• An eligible employee (i.e. a casual employee who satisfies the above 3 conditions) can apply for casual conversion at any time from 27 March 2021 onwards

In the case of a larger business employer, for any casual who meets the above 3 conditions, the employer must either:

• make a written offer of casual conversion before 27 September 2021 or within 21 days of the employee’s 12 month anniversary whichever is later or
• advise the employee in writing within 21 days that they are not eligible for conversion or there are reasonable business grounds for deciding not to make the offer.

If a larger business employer elects not to offer conversion to a casual employee, the employee can request conversion in writing and the employer has to respond in writing within 21 days.

What happens if the matter is in dispute?

If a casual employee is aggrieved by a decision by their employer not to offer casual conversion or not to agree to a request for casual conversion, the matter can be taken to the Fair Work Commission in line with the provisions in the relevant award or enterprise agreement or directly to the Federal Court.

If there is an employment agreement that contains a dispute resolution procedure, that procedure could also be used.

Interaction with awards

Most modern awards include casual conversion provisions.

For the moment, it appears that the new National Employment Standards governing the CEIS and casual conversion apply alongside the casual conversion provisions in modern awards meaning that there are two different sets of rules applying at the same time. That means that there are two separate and different obligations applying at the same time – one from the Award and one from the Fair Work Act.

The Fair Work Commission has initiated a process to review all casual conversion clauses in modern awards with the aim of completing that before the 27 September 2021 action date for larger employers.

What employers need to do

1. Review the implications of the new rules on your casual employment practices re engagement and conversion.
2. Review your employment contracts to ensure that the basis of engagement as a casual is clear including that there is specific notation of the casual loading and the value/amount of that and that there is “no firm advance commitment to ongoing work with an agreed pattern of work”.
3. Provide current casual employees with a Casual Employment Information Statement and provide new employees with one on engagement. You can access the CEIS at https://www.fairwork.gov.au/employee-entitlements/national-employment-standards/casual-employment-information-statement
4. If your business is covered by an enterprise agreement, you should obtain advice as to how this legislation and relevant modern award provisions impact on your enterprise agreement and your business.

If you need assistance with any of this, please do not hesitate to contact us at enquiries@ridgelinehr.com.au