As a result of the recent Fair Work Commission Casual Employment Decision, changes will occur to 85 Modern Awards providing eligible causal employees an opportunity to request to convert to permanent full-time or part-time employment.
The changes have been in effect from 1 October 2018.
The remaining 30 Modern Awards with existing casual conversion clauses will continue to operate unchanged with no additional obligations imposed on employers.
The implication of this is that if you currently utilise an Enterprise Agreement, or you are covered by one of the 30 Modern Awards with an existing casual conversion clause, this change will have no impact on you. For all other businesses the change will have a direct impact and you must act to meet the obligations contained with the new casual conversion clause.
What will occur?
Employers are required to provide all existing casual employees with a copy of the new Modern Award provision by no later than 1 January 2019, however, all new casual employees are required to be issued with a copy of this clause within the first 12 months of their employment.
We recommend employers keep a record of how and when each employee is notified of the conversion clause (for example, via email) so that they have evidence of compliance with the notification obligation.
Who is eligible?
Not all casual employees will be eligible to convert to full-time or part-time employment.
Firstly, a casual employee must be engaged on a ‘regular’ basis. ‘Regular’ casual employees would normally have worked a pattern of hours over the last twelve months which, without any major adjustments, look similar to a full-time or part-time employee otherwise engaged under the Modern Award. A casual employee will need at least 12 months’ service and a regular work pattern to be eligible to make this request.
In addition, any request to convert to permanent employment must be put in writing by the employee with the requested alteration matching their current pattern of work. For example, if an employee works 15 hours per week on a casual basis and has done so for 12 months, they would be eligible to request to convert their employment to permanent part-time.
Dealing with a request
Once in receipt of a request, an employer is required to consider the request and can only refuse it on ‘reasonable business grounds’. ‘Reasonable business grounds’ need to be based on facts which are known and/or reasonably foreseeable. This can include:
- it would require a significant adjustment to hours of work;
- it is known or reasonably foreseeable that the regular casual employee’s position will cease to exist within the next 12 months;
- it is known or reasonably foreseeable that the hours of work which the regular casual employee is required to perform will be significantly reduced in the next 12 months; or
- it is known or reasonably foreseeable that there will be a significant change in the days and/or times at which the employee’s hours of work are required to be performed in the next 12 months which cannot be accommodated within the days and/or hours during which the employee is available to work.
Where an employer refuses a request to convert the employment to full-time or part-time, they must provide a written response to the employee within 21 days outlining the reasons for the decision being made.
We recommend records are kept for any requests for conversion, including any responses or correspondence given during the process. If a casual employee does convert to permanent employment, employers should implement a new part-time or full-time employment contract for the employee to recognise the new employment relationship.