In March 2021, changes to the Fair Work Act 2009 (Cth) (FWA) significantly altered the definition and entitlements of casual employees. The Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery Act 2021 (Cth) (Amendment), embodies the changes and introduces the following five key changes:-
Clear, legal definition of a casual employee
Casual employee is defined in the Amendments as follows:-
“A person is a casual employee of an employer if:
This means that an employee is a casual employee if they meet the following criteria:-
To determine that there is no firm advance commitment, the following factors are considered:-
Not all four of these factors are required for there to be no firm advance commitment. The factors must be weighed up in order to make the decision that there is no firm advance commitment and the employee is therefore a casual employee. For example, where three of the four factors apply there is no firm advance commitment and the employee is a casual employee.
Conversion from casual to permanent employment
Casual employees can now access a pathway to a permanent role if they are eligible. This is called casual conversion. Employers that are not small business (i.e. have 15 employees or over) must assess all casual employees once they have been employed for 12 months. They must either then offer to convert the employee to permanent employment or give written reasons as to why not. The test is whether there is no firm advance commitment, and this can be determined by weighing up the four factors previously outlined in this article.
More information on casual conversion can be found on the Fair Work Ombudsman’s website.
Casual Employment Information Statement
Employers need to give all casuals a Casual Employment Information Statement (CEIS) before, or as soon as practicable after, the employee commences employment as a casual. The Statement helps casual employees understand their rights and entitlements.
Simpler legal process for casual conversion court disputes
Whether an employer decides not to offer a permanent role, or decides not to accept a request for conversion to a permanent role and a casual employee disagrees with the decision, there are steps they can take.
Where a dispute resolution process doesn’t exist, the first step the employee should take is to discuss the decision not to offer, or to refuse the request for, permanent employment with their employer. An employer may also seek to have their concern resolved by a court.
Offsetting casual loading in Court disputes
An employee can apply to a court to make a decision about their employment status, if their employment is described as casual but they believe it is not. If a court determines that they are not a casual, the employer could be asked to pay any leave entitlements the employee did not receive. The court must now recognise identifiable casual loading payments and deduct them from any amount owed to the employee.
What happens if employers don’t comply?
The CEIS and casual conversion form part of the National Employment Standards. Civil penalties can be imposed for employers that do not comply with the requirements. These penalties can be up to $66,000 for a corporate entity and $13,320 for individuals involved in a breach.
Employers should also be mindful of the General Protections (Adverse Action) provisions of the FWA. The Adverse Action provisions prevent an employer from treating an employee less favourably because they have exercised, or chosen not to exercise, a right to casual conversion.
Recommendations for employers
If you require assistance in understanding and/or complying with your new legal obligations as employers, contact Gavin Parsons of Gavin Parsons and Associates on (02) 9262 4471 or at firstname.lastname@example.org.