Sections of the Fair Work Act relating to casual employees were amended earlier this year and these changes to casual employment came into effect on 27 March 2021. Some requirements have an immediate effect while others come into effect on 27 September 2021.
What do you need to know about the changes to casual employment?
The changes that will come into effect from 27 March 2021 are:
- The definition of casual employment (and set-off provisions) have changed
- Small business employers (fewer than 15 employees) must provide the Casual Employment Information Statement (CEIS) to all new and existing casual employees as soon as practicable.
- Eligible casual employees of small business employers can request casual conversion.
- All other employers (who are not considered a small business) must commence providing the Casual Employment Information Sheet to all new casual employees as soon as practicable.
The changes that will come into effect from 27 September 2021 are:
- All other employers (who are not considered a small business) must provide the Casual Employment Information Sheet to all existing casual employees as soon as practicable.
- All other employers (who are not considered a small business) must offer casual conversion to eligible casual employees.
- Eligible casual employees of all other employers can request casual conversion.
To ensure you are implementing the changes to casual employment correctly, firstly we must understand ‘What is a casual employee?’
A person is now considered a casual employee if they accept an offer of employment knowing that there is no firm advance commitment to ongoing work which has an agreed pattern of work.
Whether an employer makes ‘no firm advance commitment’ under this definition is to be determined only by whether the:
- Employer can elect to offer work and whether the person can elect to accept or reject work
- Person will work only as required
- Employment is described as casual employment
- Person will be entitled to a casual loading or a specific rate of pay for casuals under the terms of the offer or a fair work instrument.
Conversion to permanent employment – a new National Employment Standard entitlement
Under these changes, employers (that are not small businesses) will be required to offer casuals conversion to permanent employment after 12 months of employment, where in the previous six months the employee 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.
The employer must give the offer within 21 days of the 12-month anniversary, and the employee must accept or decline the offer within another 21 days.
If an employer (except a small business) decides not to offer casual conversion to permanent employment the employer needs to write to the employee within 21 days after the employee’s 12 month anniversary, telling them:
- That they aren’t making an offer of casual conversion
- The reasons for not making the offer.
The only reasonable grounds for not making an offer of casual conversion may include that, in the next 12 months:
- The employee’s position won’t exist
- The employee’s hours of work will significantly reduce
- The employee’s days or times of work will significantly change, and that can’t be accommodated within the employee’s available days or times for work.
Reasonable grounds can also include:
- Making the offer would not comply with a recruitment or selection process required by or under a Commonwealth, State or Territory law
- The employer would have to make a significant adjustment to the employee’s work hours for them to be employed full-time or part-time.
Requests for casual conversion by existing casual employees
Existing casuals working for a small business employer before 27 March 2021 can make a request to convert to permanent employment at any time, if they are eligible.
Existing casuals working for an employer (other than a small business) before 27 March 2021 can make a request to convert from 28 September 2021, if they are eligible.
An eligible casual employee can request to convert to permanent employment from 21 days after their 12 month anniversary, but effectively requests can only be made every six months.
Employers need to respond in writing to an employee’s request within 21 days and tell the employee if they have or haven’t accepted the request. If the employer refuses the request, they also have to tell the employee their reasons why in their written response.
Employers can’t refuse a request unless they have discussed the request with the employee and have reasonable grounds to refuse the request.
Casual Employment Information Statement
The changes to casual employment also introduce a requirement for employers to give each casual employee the Casual Employment Information Sheet before, or as soon as practicable after, the employee starts employment as a casual employee with the employer. The information sheet is only required to be given once every 12 months. Small business employers need to give their existing casual employees a copy of the information sheet as soon as possible after 27 March 2021 and all other employees must give the information sheet to casual employees as soon as possible after 27 September 2021.
If you need assistance in determining if your obligations to your casual employees, contact Small Business Society.
The information provided in this document is for your guidance only and is general in nature. It does not constitute as legal advice. It is the responsibility of the individual to seek legal advice where required. If you are a small business with less than 15 employees your obligations may vary from the advice provided.
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About Kate Tongue
Kate Tongue is the founding Director of Small Business Society.
She is a qualified and experienced Human Resources professional with more than 10 years of experience across the private and public sectors.
Her particular interest and experience is in managing the employee life cycle, delivering process improvements, and Human Resource strategy.
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