[Australia] Changes to casual employment regulations

In 2024, amendments to Australia’s Fair Work Act will change the definition of casual employment and the casual employment relationship overall, Employment Law Handbook reports.

The Fair Work Act 2009 (Cth) (FW Act) was amended in March 2021 to add:

• a definition of casual employment; and
• minimum rights to request conversion from casual to permanent employment.

Now new FW Act amendments reportedly mean that these provisions will change from August 26, 2024.

The changes

The new definition will keep the current approach of distinguishing casual from permanent employment by the fact the employer does not give a casual worker a firm advance commitment to offer continuing and indefinite work. But under the amendment, this assessment will become objective and the various relevant factors will be expanded.

Relevant factors would include:

• whether there is a mutual understanding or expectation between the employer and employee;
• whether the employee can elect to accept or reject work;
• the future availability of continuing work;
• whether other employees performing the same work are part-time or full-time employees; and
• whether there is a regular pattern of work.

The assessment should consider the real substance, practical reality and true nature of the employment relationship, rather than a single factor in isolation.

A casual employee who has a regular pattern of work may reportedly continue to be a casual employee if there is no firm advance commitment to continuing and indefinite work.

Changes to casual conversion rights

According to Employment Law Handbook, under current laws, the right to request conversion requires the employee to have been employed for at least 12 months and worked a regular pattern of hours in the last 6 months on an ongoing basis which, without significant adjustment, the employee could work as a full-time or part-time employee. 

Under the new test, the employee must have at least 6 months’ employment to exercise this right (12 months for employees of a small business). They will not be able to exercise this right within 6 months of having a prior notification rejected. The employee can simply notify their employer that they no longer believe they are a casual employee under the FW Act definition. This is reportedly known as the new ‘employee choice’ pathway.

The positive obligation on employers to offer conversion to eligible employees will cease to operate on August 26, 2024 (February 26, 2025, for small business employers).

The Fair Work Commission (FWC) will have the power to determine, by mandatory arbitration, whether an employer has reasonable grounds to refuse a request for casual conversion.

Employers will continue to be required to provide the Casual Employment Information Statement to casual employees at the start of their employment but must also do so at 6 and 12 months and the anniversary of the employee’s start date thereafter. Small business employers need only provide the statement at the end of the first 12 months.

The prohibition against misrepresenting employment as casual employment will reportedly be removed. However, employees will still have protections against the intentional misuse of casual employment, including against them being dismissed to be re-engaged as a casual employee (to break the service period qualifying them for conversion to permanent employment) and knowingly making false statements to engage a person as a casual employee.

Any period of employment that occurred before these changes took effect will not count when determining whether an employee has met the eligibility requirements.

The right to request casual conversion for employees who are engaged as casual employees on August 26, 2024, will be preserved to ensure existing casual employees retain a mechanism in the FW Act to request conversion to full-time or part-time employment until they can access the new employee choice pathway. The employee choice pathway will become available on December 31, 2024 (or July 1, 2025, for casual employees employed by a small business).

Enterprise agreements and employment contracts may reportedly make different provisions for casual conversion but they cannot undercut the FW Act provisions.

Source: Employment Law Handbook

In 2024, amendments to Australia’s Fair Work Act will change the definition of casual employment and the casual employment relationship overall, Employment Law Handbook reports.

The Fair Work Act 2009 (Cth) (FW Act) was amended in March 2021 to add:

• a definition of casual employment; and
• minimum rights to request conversion from casual to permanent employment.

Now new FW Act amendments reportedly mean that these provisions will change from August 26, 2024.

The changes

The new definition will keep the current approach of distinguishing casual from permanent employment by the fact the employer does not give a casual worker a firm advance commitment to offer continuing and indefinite work. But under the amendment, this assessment will become objective and the various relevant factors will be expanded.

Relevant factors would include:

• whether there is a mutual understanding or expectation between the employer and employee;
• whether the employee can elect to accept or reject work;
• the future availability of continuing work;
• whether other employees performing the same work are part-time or full-time employees; and
• whether there is a regular pattern of work.

The assessment should consider the real substance, practical reality and true nature of the employment relationship, rather than a single factor in isolation.

A casual employee who has a regular pattern of work may reportedly continue to be a casual employee if there is no firm advance commitment to continuing and indefinite work.

Changes to casual conversion rights

According to Employment Law Handbook, under current laws, the right to request conversion requires the employee to have been employed for at least 12 months and worked a regular pattern of hours in the last 6 months on an ongoing basis which, without significant adjustment, the employee could work as a full-time or part-time employee. 

Under the new test, the employee must have at least 6 months’ employment to exercise this right (12 months for employees of a small business). They will not be able to exercise this right within 6 months of having a prior notification rejected. The employee can simply notify their employer that they no longer believe they are a casual employee under the FW Act definition. This is reportedly known as the new ‘employee choice’ pathway.

The positive obligation on employers to offer conversion to eligible employees will cease to operate on August 26, 2024 (February 26, 2025, for small business employers).

The Fair Work Commission (FWC) will have the power to determine, by mandatory arbitration, whether an employer has reasonable grounds to refuse a request for casual conversion.

Employers will continue to be required to provide the Casual Employment Information Statement to casual employees at the start of their employment but must also do so at 6 and 12 months and the anniversary of the employee’s start date thereafter. Small business employers need only provide the statement at the end of the first 12 months.

The prohibition against misrepresenting employment as casual employment will reportedly be removed. However, employees will still have protections against the intentional misuse of casual employment, including against them being dismissed to be re-engaged as a casual employee (to break the service period qualifying them for conversion to permanent employment) and knowingly making false statements to engage a person as a casual employee.

Any period of employment that occurred before these changes took effect will not count when determining whether an employee has met the eligibility requirements.

The right to request casual conversion for employees who are engaged as casual employees on August 26, 2024, will be preserved to ensure existing casual employees retain a mechanism in the FW Act to request conversion to full-time or part-time employment until they can access the new employee choice pathway. The employee choice pathway will become available on December 31, 2024 (or July 1, 2025, for casual employees employed by a small business).

Enterprise agreements and employment contracts may reportedly make different provisions for casual conversion but they cannot undercut the FW Act provisions.

Source: Employment Law Handbook