Changes to workplace entitlements and obligations for casual employees
New changes to the Fair Work Act 2009 (FW Act) relating to casual employment came into effect on 27 March 2021.
The changes stem from the Australian Government’s JobMaker plan, part of which was to explore reforms to the industrial relations system to regrow jobs lost in the COVID-19 pandemic.
The Fair Work Act 2009 was amended to include:
- requirement for employers to provide a Casual Employment Information Statement
- new definition of ‘casual employee’
- pathway for casual employees to become permanent employees
- protections for employers against ‘double dipping’ claims.
Employers who take on casual employees must give them a Casual Employment Information Statement (CEIS) before or shortly after they start their new job.
Casual Employment Information Statement
The Fair Work Ombudsman has published a new Casual Employment Information Statement (CEIS) that covers:
- the criteria used to determine whether someone is a casual employee
- the process for becoming a permanent employee (‘casual conversion’)
- how to resolve disagreements between employers and employees.
For employers with pre-existing casuals, the requirements are:
- small businesses (fewer than 15 employees) – with existing casuals employed before 27 March 2021 must give them the CEIS as soon as possible
- other businesses (15 or more employees) – with existing casuals employed before 27 March 2021 must give them the CEIS as soon as possible after 27 September 2021
Definition of a casual employee
The FW Act has been amended to include a new definition of ‘casual employee’.
Basically, a person is a casual employee if they:
…accept a job offer from an employer knowing there is no firm advance commitment that the work will continue indefinitely with an agreed pattern of work.
For example, if an employee is employed as a casual, their roster changes each work to suit their employer’s needs, and they can refuse or swap shifts, that could mean they’re a casual worker.
Pathway to becoming a permanent employee
The National Employment Standards now give casual employees the ability to become full-time or part-time (permanent) employees in some circumstances. This is known as ‘casual conversion’.
The rules regarding conversion offers (from employers) and conversion requests (by employees) differ according to the size of the business.
Small businesses (Fewer than 15 employees)
Small businesses are not required by the FW Act to offer casual conversion to their casual employees.
However, casual employees can make a request to their employer for casual conversion if, among other things:
- they’ve been employed by them for at least 12 months.
- they’ve worked a regular pattern of hours in the past six months on an ongoing basis.
- their regular hours could continue as a permanent employee without significant changes.
Other businesses (15 or more employees)
Other businesses are required under the new legislation to offer their casuals permanent employment if they meet the abovementioned criteria, among others.
Protections for employers against ‘double dipping’ claims
The FW Act now provides employers with protection against ‘double dipping’ claims by casual employees who argue they have been misclassified and may have been entitled to receive permanent employment entitlements (e.g. paid annual leave, paid personal leave, etc).
If a casual employee wishes to claim back these entitlements, the employer is allowed to offset the amount the employee has received in casual loading against any claim they make for omitted entitlements.
If an employer and their casual employee have a disagreement about casual conversion, entitlements, etc, they can take the following steps to try to resolve the dispute:
- if the employee is covered by an award, agreement or employment contract, use the relevant dispute resolution process
- if they are not covered by an award, etc, the employee and employer need to try to resolve the dispute their own way
- in both scenarios, if no resolution is possible, they can refer the matter to the Fair Work Commission.
What employers need to do now
If your business currently employs casual staff, we suggest you consider doing the following as soon as possible:
- provide all your casual staff with the CEIS
- review your casual employees’ employment details to confirm whether any are entitled to ‘casual conversion’
- review your current hiring practices and employment agreements, to ensure they comply with the new legislation.
For more information, visit the Fair Work Ombudsman’s web pages regarding:
- Casual Employment Information Statement
- Casual employees
- Becoming a permanent employee
- Effective dispute resolution
We’re here to support you through the changes. From making the most of the stimulus initiatives, through to managing the risks associated with the impact of the Coronavirus, the Modoras team is here to help you build a resilient business. Make well-informed business decisions; contact us on 1300 888 803 or book a catch up with a Modoras professional.
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