Keeping up to Date with Employment Laws: Casual Employees

In recent years, the relationship between Casual Employees and Employers has come under the microscope, in particular the right to leave entitlements and conversion to full time status. For many employees despite working regular and consistent hours over a long period of time, they are still classified as casual employees without the security or benefits of a permanent employee. In light of this, the Fair Work Act 2009 has been updated and the amendments came into effect on 27th March 2021.
 
What does this mean for me as an Employer?
The Fair Work Act 2009 has been widened and an Employer must now provide to every Casual Employee that commences in their employment the Casual Employee Information Statement before, or as soon as possible after, they start their new job.
 
Small Business Employers need to give their existing casual employees a copy of the statement as soon as possible after 27 March 2021 while other employers have to give their existing casual employees a copy of the CEIS as soon as possible after 27 September 2021.
 
The PDF Information Statement Download Link is provided below:
 
https://www.fairwork.gov.au/ArticleDocuments/724/casual-employment-information-statement.pdf.aspx
 
*** A small business employer is an employer with fewer than 15 employees at a particular time. If an employer has 15 or more employees at a particular time, they are no longer a small business employer. When counting the number of employees, employees of associated entities of the employer are included. Casual employees are not included unless engaged on a regular and systematic basis.
 
For those Employers who are not considered to be a Small Business Employer they must by 27 September 2021 assess whether any of their existing casual employees are eligible to be offered to convert to permanent employment.
 
Affected Employers need to:

  • make a written offer to convert their casual employees to permanent employment (this must be done within 21 days after making the assessment), or

  • write to employees explaining why they won’t be made an offer (this needs to be done within 21 days of making the assessment but by no later than 27 September 2021).

To accept an offer to convert, employees need to respond in writing within 21 days after getting the offer. If they don’t respond, employers can assume that they’ve declined the offer.

What is a Casual Employee?
The Fair Work Act 2009 has also been amended to provide a clear definition as to who is 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 become a permanent employee through:

    • casual conversion, or

    • being offered and accepting full-time or part-time employment, or

  • they stop being employed by the employer.

Casuals who were employed immediately before 27 March 2021 and whose initial employment offer meets the new definition continue to be casual employees under the FW Act.

How do I determine if an Employee is eligible to convert?
An Employer can offer Conversion, 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

  • could continue working these hours as a full-time or part-time employee without significant changes.

The offer needs to be for the employee to convert to:

  • full-time employment, if the employee’s hours worked for at least the last 6 months have been the same as full-time hours, or

  • part-time employment (consistent with the employee’s regular pattern of hours worked for at least the last 6 months), if the employee’s hours worked for at least the last 6 months have been less than full-time hours.

If an employer (except a Small Business Employer) decides not to offer casual conversion, the employer needs to write to the employee within 21 days after the employee’s 12 month anniversary. The only reasons for not making an offer are:

  • the employee hasn’t worked a regular pattern of hours:

    • on an ongoing basis for at least the last 6 months

    • which they could continue working as a full-time or part-time employee without significant changes

  • the business has reasonable grounds for not making an offer

  • Small Business Employers don’t have to offer to convert their casual employees to permanent employment.

Small Business Employers don’t have to offer to convert their casual employees to permanent employment.

Can an Employee Request Casual Conversion?
An eligible casual employee (except if they are employed by a small business employer) can make a request 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.

An employee isn’t eligible to make a request if, in the last 6 months:

  • they’ve refused an offer from their employer to convert to permanent employment

  • their employer has told them in writing that they won’t be making an offer of casual conversion because there was a reasonable ground not to make the offer

  • their employer has refused another request for casual conversion because there was a reasonable ground to refuse the request.

Casual employees who believe they’re eligible to become a permanent employee can make a request for conversion every 6 months.

What happens after an Employee Converts?
Before a casual employee converts to permanent employment, their employer has to discuss with the employee their:

  • type of employment (full-time or part-time)

  • hours of work as a permanent employee

  • start date as a permanent employee

The start date for the permanent hours is on the first day of the first full pay period after the employer has written to their employee, unless the employer and employee agree to another day. For example, if an employee’s pay period ends on Tuesday and the employer writes to the employee on Friday, then the start date for their permanent hours would be the following Wednesday.
 
Where do I go to get help with the new Employer Obligations?
If you feel that the above may apply to your current employment arrangements either as an Employer or Employee or you have concerns as to how it may affect you in the future please contact one of our offices and our experienced accountants can walk you through the process and help determine your obligations.

Furthermore, the Fair Work Website has provided significant material on this matter with helpful links and fact sheets. The link to the key information pages are provided below:
 
https://www.fairwork.gov.au/about-us/news-and-media-releases/website-news/reforms
 
https://www.fairwork.gov.au/employee-entitlements/types-of-employees/casual-part-time-and-full-time/casual-employees/becoming-a-permanent-employee#existing-casuals
 
https://www.fairwork.gov.au/employee-entitlements/types-of-employees/casual-part-time-and-full-time/casual-employees/becoming-a-permanent-employee

Dominique Schuh