Changes to the Fair Work Act Requiring Casual Conversion
Changes made to the Fair Work Act 2009 (Cth) earlier this year have introduced provisions to provide a pathway to permanent employment for casual employees.
Employers now have an obligation to make an offer to convert a casual employee to either full-time or part-time employment (based on their regular work patterns) in circumstances where the employee:
- has been employed by the employer for 12 months; and
- during the last six months, has worked a regular pattern of hours on an ongoing basis which, without significant adjustment, the employee could continue to work as a full-time or part time employee (based on their regular work patterns).
While the obligation does exist, an employer is not required to make an offer where there may be “reasonable business grounds” to not do so. Businesses may rely on reasonable business grounds including:
- the employee’s position will cease to exist in the period of 12 months after the time of deciding not to make the offer;
- the hours of work which the employee is required to perform will be significantly reduced in that period;
- there will be a significant change in either or both of the following in that period:
- the days on which the employee’s hours of work are required to be performed;
- the times at which the employee’s hours of work are required to be performed;
which cannot be accommodated within the days or times the employee is available to work during that period;
- making the offer would not comply with a recruitment or selection process required by or under a law of the Commonwealth or a State or a Territory.
Employers will need to provide casual employees with notice of their decision to not make an offer within 21 days following the end of the employees first 12 months of employment. Any such notice should indicate that an offer will not be made and provide detailed reasons as to why.
What Does This Mean For Small Businesses?
While small businesses, being those employers who employ less than 15 employees, are not required to offer conversion to casual employees, casual employees are entitled to request casual conversion if they satisfy the grounds to do so.
When Does This Come Into Action?
A six-month transition period is in place, so employers must assess whether casual employees employed before 27 March 2021 are eligible to convert to permanent employment by 27 September 2021.
If you would like assistance with these changes to casual employees, start a conversation with our dedicated Workplace Relations team: