“Casual Conversion” reminder from Fair Work as change to employment law kicks off

The Fair Work Ombudsman has issued a detailed reminder to employers, including those in the early childhood education and care (ECEC) sector, to help them manage the transition to the new casual employment laws that take effect from 27 September, 2021. 

 

The new law, which was included in the slimmed down IR Omnibus Bill that was passed by the senate in March 2021, provides organisations with a clear definition of what characterises a casual employment arrangement, guidelines for transitioning casual employees to full time employment and also clarified how any claims for entitlements would be managed thereafter. 

 

Who is impacted by the new casual conversion requirements?

 

From an organisational perspective, any employing entity that employs more than 15 employees must offer casual conversions. 

 

From an employee perspective, any casual employee that meets the eligibility criteria and has worked for their employer for more than 12 months is to be part of the processes. 

 

What must employers do to comply with the new casual conversion requirements?

 

Employers need to make a written offer to convert a casual employee to permanent employment within 21 days after the employee’s 12-month anniversary, if the employee:

 

• has been employed by the employer for 12 months

 

• has worked a regular pattern of hours on an ongoing basis for at least the last six months

 

• could continue working these hours as a full-time or part-time employee without significant changes.

 

The offer needs to be for the employee to convert to either a full time or part time role that is consistent in terms of hours worked as a casual. 

 

And what about existing casual employees, how must employers engage with them?

 

By 27 September 2021, employers need to assess whether any of their existing casual employees employed before 27 March 2021, are eligible to be offered to convert to permanent employment.

 

The employer needs to:

 

• make a written offer to convert their casual employee to permanent employment (this must be done within 21 days after making the assessment), or;

 

• write to their employee explaining why they won’t be making an offer (this needs to be done within 21 days of making the assessment but by no later than 27 September 2021).

 

Casual employees receiving and accepting an offer need to respond to their employer in writing within 21 days after getting the offer. If they don’t respond, their employer can assume that they’ve declined the offer.

 

What about if an employer declines to make an offer to an existing casual?

 

If an eligible employer decides not to offer casual conversion, 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 reasons for not making an offer are:

 

• the employee hasn’t worked a regular pattern of hours on an ongoing basis for at least the last 6 months which they could continue working as a full-time or part-time employee without significant changes

 

• the business has reasonable grounds for not making an offer which include;  

 

the employee’s position won’t exist or their hours of work or times of work will change significantly or;

making the offer would not comply with a recruitment or selection process required by or under a Commonwealth, State or Territory law or;

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.

 

Can employees request casual conversion themselves?

 

Yes, an eligible casual employee (except if they are employed by a small business employer) can make a request to convert to permanent employment from 21 days after their 12 month anniversary.

 

An eligible casual employee who works for a small business employer can make a request at any time on or after their 12 month anniversary.

 

What are the eligibility requirements for an employee to request conversion?

 

To be eligible to request casual conversion, a casual employee:

 

• needs to have been employed by the employer for at least 12 months

 

• needs to have worked a regular pattern of hours on an ongoing basis for at least the last six months

 

• could continue working these hours as a full-time or part-time employee without significant changes.

 

Are there any actions that an employee might take to render them ineligible?

 

Yes, an employee isn’t eligible to make a request if, in the last six months:

 

• they’ve refused an offer from their employer to convert to permanent employment

 

• their employer has told them in writing that they won’t be making an offer of casual conversion because there was a reasonable ground not to make the offer

 

• their employer has refused another request for casual conversion because there was a reasonable ground to refuse the request

 

• Casual employees who believe they’re eligible to become a permanent employee can make a request for conversion every 6 months.

 

Sometimes employees can still make a request even if their employer has told them in the last six months that they won’t be making an offer of casual conversion. Employees can only do this if they didn’t get an offer because they hadn’t worked a regular pattern of work in the six months before their earlier request, but they now have.

 

And can existing casual employees request conversion?

 

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.

 

The request has to be in writing and be for:

 

• full-time employment, if the employee’s hours worked for at least the last 6 months have been the same as full-time hours

 

• part-time employment (consistent with the employee’s regular pattern of hours worked for at least the last 6 months), if the employee’s hours worked for the last 6 months have been less than full-time hours.

 

Does the employer have to respond to a request to convert?

 

Yes they do. 

 

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.

 

And what happens once a request or offer has been accepted?

 

Before a casual employee converts to permanent employment, their employer has to discuss with the employee their:

 

• type of employment (full-time or part-time)
• hours of work as a permanent employee
• start date as a permanent employee.

 

If a casual employee accepts an employer’s offer to convert, the employer needs to then confirm this information in writing to their employee within 21 days after the employee accepts their offer.

 

If an employer accepts a casual employee’s request to convert, the employer needs to then confirm this information in writing to their employee within 21 days after the employee has requested to convert. This can be in the same notice as when the employer tells the casual employee that they are accepting their request.

 

When will be the first day under the new permanent contract arrangements?

 

The start date for the permanent hours is on the first day of the first full pay period after the employer has written to their employee, unless the employer and employee agree to another day. 

 

For example, if an employee’s pay period ends on Tuesday and the employer writes to the employee on Friday, then the start date for their permanent hours would be the following Wednesday.

 

If a casual employee converts to permanent employment, they will be a full-time or part-time employee, even if a contract or other agreement entered into when their employment started says they are casual. 

 

For more information about permanent employment, including hours and entitlements, go to:

 

• Full-time employees
• Part-time employees.

 

To review the Fair Work Ombudsman’s detailed advice please click here.