29/09/2021
Time to read
4 minutes

On 27 March 2021, changes were made to the Fair Work Act 2009 (the FW Act) that created a new definition of ‘casual employee’ and new ‘casual conversion’ arrangements in the National Employment Standards (NES).

When making the changes, the Government also asked the Fair Work Commission (FWC) to review all Modern Awards and ensure the new Casual NES did not conflict with relevant casual Award clauses or cause confusion. 

Master Builders Australia appeared in the review, arguing in support of the simple and clear approach where only the Casual NES would apply, by deleting the relevant Award clauses. The CFMMEU opposed these arguments, and instead argued for a return of casual conditions that were last applicable in the 1990’s. 

In a big win for Members, FWC agreed with Master Builders and rejected union arguments.

What does this mean for Members?

  • The Modern Award definition of ‘casual’ and relevant ‘casual conversion’ clauses have been deleted and no longer apply. These are now replaced by the Casual NES. 
  • Employers should review their employment policies and processes to make sure they are compliant with the Casual NES, which are summarised below.

Casual Conversion – Employer Offers

  • Employers in businesses with 15 or more employees must offer an eligible casual employee the right to convert to full-time or part-time employment unless there are reasonable business grounds for not doing so. In either case, the employer will need to formally notify the eligible casual employee in writing within 21 days of the employee becoming an eligible casual employee.
     
  • Under the NES, a casual employee will be an ‘eligible casual employee’ if they:
    • ​​​​​​have been employed by the employer for a period of 12 months; and
    • during at least the last 6 months of that period, the employee has worked:
    • a regular pattern of hours; and
    • on an ongoing basis such that, without significant adjustment, would allow the employee to continue to work as a full- time or part-time employee.
       
  • Under the NES, ‘reasonable business grounds’ include, but are not limited to, the following:
    • where the conversion would require a significant adjustment to the employee’s hours of work for the employee to be permanently employed;
    • where the  employee’s position will cease to exist in the 12 months after the conversion right arises; 
    • where the hours of work which the employee is required to perform will be  significantly reduced in the 12 months after the conversion right arises; and
    • if there will be a significant change in either the days or times on which the employee’s hours of work are required to be performed in the 12 months after the conversion right.
       
  • If an employer grants the request, the employer must within 21 days (and following consultation) give the employee written notice of the following: 
    • whether the employee is converting to full-time or part-time employment;
    • the employee’s hours of work after the conversion takes effect; and
    • the day the employee’s conversion to full-time or part-time employment takes effect.

Employee Requests for Casual Conversion

  • Although small businesses employers (i.e. less than 15 employees) are excluded from the requirement of offering casual conversion to eligible casual employees, all employers are required to respond in writing to a formal written request from an eligible casual employee to convert within 21 days.
     
  • An employer may refuse a casual conversion request on reasonable business grounds. In such circumstances, the casual employee retains a residual right to request casual conversion after a further period of 6 months as an eligible casual employee.

Casual Employment Information Statements

  • Employers must give each casual employee a copy of the Casual Employee Information  Statement (CEIS) published by the Fair Work Ombudsman, either before, or as soon as is reasonably practicable after, the employee starts employment as a casual employee with the employer. Note: This does not require the employer to give the employee the CEIS more than once in any 12 months.

Award Casual Conversion provision deleted

  • On and from 27 September 2021 the previous casual conversion award provisions contained at clauses 13 and 12 of both the Onsite Award and Joinery  wards respectively have been deleted – and replaced with a note referencing the NES. 

Reminder about previous ‘transitional’ obligations

  • Members are reminded that when the new Casual NES was created in March 2021, it also set a transitional period of 6 months during which businesses with 15 or more employees must:
    • have assessed whether existing casual employees who commenced prior to 27
      March 2021 are eligible for casual conversion under the NES.
    • have written to existing casual employees who commenced prior to 27 March
      2021 – to either:
      • offer conversion to eligible casual employees, unless there are  reasonable grounds not to do so; or
      • provide reasons why the conversion offer has not been made – i.e.  the reasonable grounds of refusal, or, that the employee is not  entitled to convert under the new rules.
    • provided all existing casual employees with a copy of the Casual Employee
      Information Sheet (CEIS) published by the Fair Work Ombudsman, as soon as is
      reasonably practicable at the end of the transitional period on 27 September
      2021. 

Should Members have any further enquiries regarding this matter, please do not hesitate to contact the Association’s Industrial Relations Department on 02 8586 3555.