Upcoming Changes to Casual Employment

A few changes to casual employment will be introduced on 26 August 2024 that employers need to be aware of. They include a new definition of casual employment, new guidelines around when to provide the Casual Employment Information Sheet, and a new process for casual employees converting their employment to a permanent position.

The New Definition

Under the Fair Work Act (2009), the new definition of a casual employee is an employee who

• Is entitled to receive a casual loading or a specific casual pay rate, and
• Has no firm advance commitment to continuing and indefinite work. There are several factors to consider when assessing this point, including:
  • The true nature of the employment relationship,
  • The real substance and practical reality must be considered to ascertain whether what is written in the contract is actually what is occurring.

Firm Advance Commitment

To assess whether, in practice, there has been a commitment to continuing and indefinite work, along with the factors that determine the new definition of casual employment, it needs to be considered whether:

• the employee has a regular pattern of work
• the employer can offer or not offer work to the employee (is this happening?)
• the employee can accept or reject work
• there is a reasonable likelihood of future work available based on the nature of the business
• there are full or part-time employees performing similar work to the casual employee

Under the new definition, employees on a casual contract (including those on casual contracts before 26 August 2024) will stay casual until their employment status changes through a conversion process (or Fair Work Commission order) or acceptance of an alternative employment offer.

New Conversion Process to Casual Employment

When the new legislation comes into effect, a new pathway will open for eligible casual employees to convert from casual to permanent employment should they want to.

Eligible employees

Employees can notify their employer of their intention to move to permanent employment if:

• They have been employed for at least six months (or 12 months if working for a small business)
• They believe they no longer meet the requirements of casual employment under the new definition

Notification of the intended change from casual employment to permanent must be in writing and addressed to the employer.

Ineligible employees

Employees will be unable to notify employers of their intention to move to permanent employment if:

• They are currently engaged in an active dispute with their employer about casual conversion,
• They have been employed for less than six months (12 months for a small business)
• In the last six months:
  • their employer has already refused a notification from them to move to permanent employment or
  • they have resolved a dispute over a casual conversion with their employer.

Employers responding to a casual conversion notification

Before responding to a conversion notification, the employer must consult with the employee and discuss the details that will change if the notification is accepted and the employee is no longer a casual.

The employer must respond to the employee in writing within 21 days of receiving the employee’s notification, either accepting or refusing the change.

Accepting the change

If the employer accepts the change, their response should include:

• the new employment status – full-time or part-time
• the new hours of work
• the new pay rate (if there has been a change, given they are no longer eligible for casual loading)
• when the change will take place

Rejecting the change

Should the employer refuse the change, their response must include reasons for the refusal.

A refusal can be made on the following grounds:

• the employee meets the new definition of casual
• if accepting the change means the employer is not complying with laws around recruitment and selection
• there are fair and reasonable operational grounds for not accepting the notification. These could include:
  • a significant impact on the employer’s business operations
  • substantial changes would need to be made in the way the employer’s business is organised
  • extensive changes would be necessary to the employee’s employment conditions to ensure the employer doesn’t break any rules that might be in an award or agreement that apply to the employee

Disputes

If a dispute arises, it should first be dealt with in the workplace. However, if no resolution can be reached, the Fair Work Commission can hear the dispute.

Initially, the Commission will try to resolve the issue informally, but if that is unsuccessful, it can proceed to a more formal process, resulting in a legally binding decision.

Casual Employment Information Sheet

The Casual Employment Information Sheet contains information about employment conditions and must be given by the employer to all new casual employees.

If employed by a small business, the casual employee will need the Casual Employment Information Sheet to be provided to them

• before they start their role, or as soon as possible after starting, and
• after 12 months of employment

If the casual is employed by a business that is not considered a small business, the document should be provided:

• before they start their casual position or as soon as possible after starting
• after six months of employment
• at 12 months of employment, and
• every 12 months of employment after that

Do you need help preparing for these upcoming changes? Contact the Strawberry Seed team. Click here to learn how we work and to schedule a meeting.