The Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Act 2021 now defines that casual employment exists when “the employer makes no firm advance commitment to continuing and indefinite work according to an agreed pattern of work for the person”.
Critical components to the casual arrangement are set in the legislation as:
- The employer can offer work and the employee can elect to reject work
- The employee will work based on the employer’s needs
- The employment is described as casual
- The employee is entitled to casual loading or a rate specific to casual employees under the terms of the employee’s contract or the relevant fair work instrument.
Section 15A clarifies that a regular pattern of work is not of itself evidence of a firm advanced commitment. The relationship is to be determined at the time the employment contract is entered (a contract can be oral or in writing but a written contract is easier to prove). Once casual status is satisfied, the casual employee forgoes annual leave, personal leave, payment in lieu of notice, payment for public holidays, and redundancy but does receive a causal loading.
The new provisions are to act retrospectively unless there has been a binding decision by a court.
It is now a requirement that employers (except employers with less than 15 employees) must provide the opportunity to casual employees to convert to permanent employment where the employee has been employed for 12 months, and for at least the last 6 months have worked regular hours, that without significant adjustment can continue. The employee has a right to request casual conversion.
Reasonable grounds to not offer casual conversion include:
- The employee’s employment will cease within 12 months of the refusal to offer casual conversion;
- The hours of work will be significantly reduced in the 12 month period;
- There will be significant change in days and hours in the following 12 month period which can not be accommodated within the days and times the employee is available to work; or
- Making the offer would not comply with a recruitment process required under a commonwealth or state law.
Method of conversion
The conversion offer must be in writing and consistent with the working pattern previously worked. The offer is to be made within 21 days of the 12 month anniversary of employment.
The Amendment to the Act contemplates the conversion of other categories of previously defined casuals who now do not fall into the strict category of “casual” as defined under the Amendments.
Employers (with more than 15 employees) have a grace period up to 27 SEPTEMBER 2021 to:
Assess existing employees as to the category they fall into;
- Offer conversions if required (unless there are reasonable grounds not to); and
- If no offer of conversion is made, provide a notice to any employee explaining why an offer has not been made (including if they do not satisfy the criteria of not being employed for 12 months).
A CASUAL INFORMATION STATEMENT MUST BE PROVIDED TO NEW AND EXISTING CASUAL EMPLOYEES
Wait for our next blog as to how the amendments address double dipping.
If you require assistance with the assessment and conversion of your casual employees, please contact our Workplace law team.