New Obligations for Casual Employment
Have you ever wondered what the rights of a casual employee are? Recent amendments to the Fair Work Act 2009 (Cth) (FW Act) have given casual employees additional workplace rights and adds a new entitlement to the National Employment Standards (NES) in relation to casual conversion.
The Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Act 2021 (the Amendment Act) instituted three key changes.
These changes are:
- A Casual Employment Information Statement;
- A definition of casual employment; and,
- Guidance on the casual conversion process.
Casual Employment Information Statement
The Casual Employment Information Statement (CEIS) is a formal document that needs to be given to casual employees, in addition to the usual Fair Work Information Statement.
The CEIS contains pertinent information on:
- what being a casual employee means and looks like;
- a casual employees’ rights to convert their employment to permanent – that is, either full-time or part-time;
- how disputes concerning casual conversion are handled; and,
- guidance for employers on how to offer permanent employment, and how a casual employee can request to become permanent.
For employers who are “small business employers” (that is, have less than 15 employees), the CEIS must be given to existing casual employees (those employed before 27 March 2021) as soon as possible.
For employers who have 15 or more employees, the CEIS is to be given to their existing casuals (employed before 27 March 2021) as soon as possible after 27 September 2021.
Moving forward, any employer who is going to employ a casual employee, the CEIS must be given to that employee, before, or as soon as possible after, their commencement of employment. The CEIS can be delivered by hand, post or email (if the employee agrees).
What a casual means
The Amendment Act has inserted a definition of a casual into the FW Act.
Essentially, a casual employee is defined as an employee who has accepted an offer of employment where there is “no firm advance commitment to ongoing work with an agreed pattern of work” and the employee has accepted the offer on that basis.
Therefore, the casual employment relationship will continue until such time as:
- They become a permanent employee:
- through the casual conversion process; or,
- when an offer is made and accepted as to full-time or part-time employment;
- Their employment ceases.
The conversion process
The Amendment Act also provides guidance on the casual conversion process that an employer needs to undertake to convert a casual engagement to a permanent one. Different processes apply if the business is a small business employer.
The process which needs to be undertaken by employers with 15 or more employees is summarised as follows:
- The employee:
- must be employed for 12 months;
- worked a regular pattern of hours for at least the previous six months on an ongoing basis;
- could continue to work those hours as a permanent employee without any significant changes.
- If the above criteria is met, the employer must make an offer of permanent employment.
- The employer must make the offer, in writing, before 27 September 2021, or within 21 days of the employees’ 12-month anniversary with the business, whichever is the later.
- The employee will have 21 days to accept the offer to convert to either full-time or part-time. Acceptance of the offer must be communicated by the employee to the employer in writing.
- Issuance of updated employment documentation.
As has been the case, if a business has “reasonable grounds” not to offer an employee the opportunity to convert his/her employment, they do not have to do so. However, an employer will need to ensure that they have evidence to support that this is the case and communicate this to the employee.
Small business employers are exempt from offering casual conversion. However, an employee can make a request to convert his/her employment to either full-time or part-time, if the following occurs:
- The employee:
- makes the request after 27 September 2021;
- has been employed for 12 months;
- worked a regular patter of hours for at least the previous six months on an ongoing basis;
- could continue to work to work those hours as a permanent employee without any significant changes;
- has not refused previous offers to become permanent in the past six months;
- has not been informed by the employer that they cannot offer permanent employment because of “reasonable business grounds”;
- has not previously been refused a request by the employer in the past six months.
- If the above criteria is met, the employee will need to make his/her request in writing and 21 days after the 12 month anniversary.
- The employer has 21 days from receipt of the request to respond.
- If there is acceptance, new documentation should be offered by the employer.
- If the request is rejected, the employer must consult and advise the employee in writing, indicating the “reasonable business grounds” for doing so. The employee will be unable to make a further request until after 6 months has passed.
Disputes about casual conversion
If a dispute arises about casual conversion, and an employee is covered by a Modern Award or Enterprise Agreement, the dispute resolution clause must be followed.
For an employee who is not covered by an Award or Enterprise Agreement, the matter should be discussed at a workplace level first (e.g discussion with manager/s) and if the matter is unable to be resolved, intervention from the Fair Work Commission can be requested.
The Federal Circuit Court has also been given powers to determine casual conversion disputes. For example:
- employee eligibility requirements for being offered conversion; or
- the validity of an employer’s refusal to offer or request for conversion.
In addition to providing a new employee with a Fair Work Information Statement, the CEIS will also needs to be provided to a casual employee. Employers are only required to give a casual employee a copy of the CEIS once every 12 months, and depending upon whether the criteria is met, offer conversion to full-time or part-time employment.
As can be seen from the above, the Amendment Act imposes greater burden on the parties to document steps for offering and requesting casual conversion, as well as providing “reasonable grounds” for not offering or rejecting conversion. Further, it imposes obligations on both parties to consult and try and resolve the issues at a workplace level before the dispute is escalated through a court process. Hopefully, such changes will foster open and collaborative discussions on a mutually beneficial outcome.
If you have any questions about the new changes and legislation, please do not hesitate to contact a member of Coleman Greig’s Employment Law Team, who would be more than happy to assist you today.