The new Casual Conversion clause – what does it mean for Employers?

Following extensive consultations, the Fair Work Commission has inserted a model casual conversion clause into 84 Modern Awards taking effect from the 1 October 2018. The clause allows an eligible employee to request an employer to be transferred from casual to permanent employment.

As it is a clause that is inserted into modern awards (as opposed to the National Employment Standards), if your business is not covered by an award the changes will not affect you.

In order to be eligible, the employee must be a regular casual employee which is defined as an employee who has in the preceding period of twelve (12) months worked a pattern of hours on an ongoing basis that reflects that of employee engaged on a full-time or part-time basis (and can continue to work such a pattern without significant adjustment).

The employee must request, in writing to be transferred to permanent employment. The employer may refuse the request but can only do so on reasonable grounds and after consulting (in accordance with the relevant award) with the employee.

Reasonable grounds to refuse casual conversion include:

  • It would require significant adjustment to the causal employee’s existing hours of work.
  • It is known or reasonably foreseeable that the casual employee’s position will cease to exist within the next twelve (12) months.
  • It is known or reasonably foreseeable that the hours of work required to be performed by the regular casual employee will change.
  • It is known or reasonably foreseeable that there will be significant change in the days or time which the employee’s hours are required to be performed
  • Any other ground of refusal which is reasonable and based on known or reasonably foreseeable facts.

If the employer refuses the request, the employer must provide written reasons within 21 days of the request being made. If an employee is aggrieved by a refusal, they may deal with the refusal in accordance with the dispute resolution clause under the award. If it is not resolved between the employer and employee, the matter may be referred to the Fair Work Commission to be resolved.

Should the employer accept the conversion request, the agreement must be recorded in writing (specifying whether it is a conversion to full-time or part-time) which will take effect from the next pay cycle unless otherwise agreed upon.

Employers are reminded that they have a new obligation to provide existing casual employees with a copy of the relevant casual conversion clause by 1 January 2019. New casual employees (i.e. starting after 1 October 2018) must be provided with a copy of the relevant casual conversion clause within twelve (12) months of their commencement of work.

The new clause does not apply to all award covered industries (as they have pre-existing casual conversion clauses) and there are some industries that vary the model clause. An example of this is the Manufacturing and Associated Industries and Occupations Award 2010, which reduces the qualifying period of a regular casual employee from twelve (12) months to six (6) months.

This may cause some strain for Employers – so please ensure you reach out to a professional to assist if needed.

Are you an award covered employer with casual employees? Do you need advice on the new casual conversion clause? NB Lawyers, the lawyers for employers can offer an obligation free consultation to discuss how we can assist you.

Written By

Jonathan Mamaril
Principal
NB Lawyers – Lawyers for Employers
jonathanm@nb-lawyers.com.au
+61 (07) 3876 5111

ASSISTED BY

Dan Chen
NB Lawyers – Lawyers for Employers
danc@nb-lawyers.com.au
+61 (07) 3876 5111

About the Authors

Jonathan Mamaril is the principal and director of NB Lawyers, the lawyers for employers, and a specialist in employment law. Over the last ten years, Jonathan has helped hundreds of employers understand their legal requirements, mitigate risk and liability, protect their reputation and achieve their goals for business growth and expansion.

Dan Chen is a lawyer at NB Lawyers, the lawyers for employers, and specialises in employment law. Dan is passionate about assisting business owners, small and large understand their obligations under Australia’s complex workplace relations system.