The law concerning casual employment in Australia has changed as a result of recent amendments to the Fair Work Act 2009 (Cth) by the Federal Parliament. These changes will affect all employers who employ casual employees, and will often require employers to take immediate action to ensure compliance with the updated legislation.
The changes to the legislation mean that:
- There is now a statutory definition of what casual employment is,
- Employers are now required to provide the Casual Employment Information Statement to employees to casual employees (including providing the statement to existing employees),
- There is a new National Employment Standard that allows casual employees who have been employed for 12 months and who are working a regular pattern of hours to convert to part time or full time employment, and
- There are new provisions allowing the Fair Work Commission to assist with the resolution of disputes involving casual conversions to part time or full time employment.
Statutory Definition of Casual Employment
Previously there was no statutory definition of casual employment. As a result of the legislative amendments, the Fair Work Act now provides that a person is a casual employee where:
- An employer offered to employ a person on the basis that the employer is not making a firm advanced commitment that the work will continue indefinitely with an agreed pattern of work, and
- The person accepted employment on that basis.
Generally, therefore, a casual employee would have either:
- No agreed consistent work pattern, and/or
- No firm expectation of ongoing employment in the medium to long term.
The motivation for a statutory definition of who is a casual employee follows the important decisions of the Full Court of the Federal Court of Australia in Workpac Pty Ltd v Skene and Workpac Pty Ltd v Rossato. The new statutory definition will give employers and employees greater certainty than existed previously.
Casual Employment Information Statement
The Fair Work Act now requires employers to provide their casual employees with a copy of the Casual Employment Information Statement prepared by the Fair Work Ombudsman before or as soon as practicable after they commence employment.
The Casual Employment Information Statement includes information about who is a casual employee and the casual conversion provisions of the Fair Work Act.
Employers should make it their practice to provide the Casual Employment Information Statement to casual employees at the same time that they provide the Fair Work Information Statement.
Employers who have existing casual employees should provide the Casual Employment Information Statement to their casual employees as soon as possible.
The Fair Work Act now includes a new National Employment Standard which provides mechanisms for casual employees who work a regular pattern of hours to convert to full time or part time employment.
Employers who are not small business employers (i.e. employers with 15 or more employees) must make a written offer to casual employees offering that employee the option to convert to full or part time employment where the employee:
- has worked for 12 months, and
- in the last 6 months, has worked a regular pattern of hours.
Employers of existing casual employees must assess whether their existing casual employees would meet the criteria and make any necessary offers by 27 September 2021.
In addition, employees, including those of small businesses, can request to convert their employment to full or part time employment, where they have worked for an employer for 12 months or more and have worked a regular pattern of hours in the previous 6 months.
However, an employer does not need to offer or accept a request to convert to full time or part time employment where they have reasonable grounds to do refuse. Reasonable grounds include:
- The employee’s position will cease in the next 12 months,
- The employee’s hours of work will be significantly reduced in the next 12 months, or
- There will be a significant change in either the days or times than the employee will be required to work in the next 12 months.
If an employee has made a request to convert to full time or part time employment, the employer must consult with the employee before making a decision to refuse the request.
An employer must give written notice to a casual employee if the employer does not offer or accept a request for conversion to full time or part time employment, whether because the employee has not worked a regular pattern of hours in the last 6 months, or because they have reasonable grounds for not making or accepting the request.
We have summarised the requirements below:
Notices need to be provided within 21 days.
Many Awards already included casual conversion clauses, which we expect the Fair Work Commission will now remove given the inclusion of casual conversion provisions in the Fair Work Act.
We recommend employers prepare template letters to address the notice requirements of these casual conversion provisions and carefully diarise the relevant dates.
Casual Conversion Dispute Resolution
Awards, Enterprise Agreements and some employment contracts include dispute resolution procedures which apply to disputes arising under the National Employment Standards. Where a dispute resolution procedure is contained in an employee’s Award, Enterprise Agreement or employment contract (or other written agreement), disputes with respect to casual conversion should be dealt with using that procedure. Typically, this would include the right to have the Fair Work Commission conciliate the dispute, though specific industries and employers may have different procedures.
If an employer and employee do not have a dispute resolution procedure pursuant to an Award, Enterprise Agreement or employment contract (or other written agreement) that applies to them, then the Fair Work Act now includes a default procedure which allows the parties to refer the dispute to the Fair Work Commission. The Fair Work Commission can:
- Mediate or conciliate the dispute,
- Make a recommendation or express an opinion on the dispute, and
- If the parties agree, arbitrate the dispute (i.e. make a binding decision in relation to the dispute).
It is important to note that the Fair Work Commission cannot make a legally binding decision with respect to a dispute unless the parties agree. If there is no resolution reached through the dispute resolution procedure, and the parties do not consent to the Fair Work Commission arbitrating the dispute, an aggrieved party (usually the employee) would need to make an application to a court to resolve the dispute.
How can Sharrock Pitman Legal help?
The changes to the Fair Work Act have been well received generally, and should help both employers and employees navigate the complex area of casual employment. The changes do require employers to be proactive in identifying casual employees who could become full time and part time employees. If you require any assistance in this regard please do not hesitate to contact our employment lawyers on 1300 205 506 or get in touch by filling in the contact form below.
The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.
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Samuel is a Senior Associate at Sharrock Pitman Legal.
He deals with areas of Commercial Law, Employment Law and Charities & Not-for-Profit Law. For further information, contact Samuel on his direct line (03) 8561 3316.