WRITTEN BY Gabrielle Sullivan and Alexander Kupa
The simplest of the changes is the new mandate in s 125B that employers must provide the Fair Work Ombudsman’s Casual Employee Information Sheet to casual employees before they start their job (or as soon as practicable thereafter).
For existing casual employees, a small business must provide the Sheet to them as soon as possible after 27 March 2021, (a small business employer is an employer that employs fewer than 15 employees). Non small business employers must provide the Sheet as soon as possible after 27 September 2021.
If the same employee starts different casual jobs with you within 12 months, the employer is not required to give it to the employee again.
The Sheet is updated regularly, and the up-to-date version must be the one provided. A permanent link to the most recent Sheet can be found here.
Whether an employee was a casual for the purposes of Fair Work Act benefits (such as access to paid annual leave, personal/carers leave (etc)), used to depend on the conduct of their employment – their regularity of hours, whether there was a commitment to indefinite future work. That is no longer the case.
The new, current, definition depends on the terms of the offer of employment they are given. Conduct once they are actually employed will not be taken into account. Whether an employee is a casual employee depends only on the offer of employment they received and accepted.
Under s 15A of the Act, to employ someone as a casual, the offer made must be on the basis that the employer is making no firm advance commitment to continuing and indefinite work according to an agreed pattern of work for the prospective employee.
There are four criteria looked at when considering whether an offer of employment renders an employee a casual employee:
If points (1)-(4) apply to the offer that an employer makes, it is likely they are legally hiring that person as a casual employee for the purposes of Fair Work Act.
As for the casual employees that are hired prior to the 27th of March 2021, if this new definition applies to the offer that was made to them, they will be considered casual employees for Fair Work Act purposes.
It is worth noting that these definitions do not automatically apply to the definition of casuals under Awards or Enterprise Agreements, so there will be some complexity here unless and until these instruments ‘catch up.’
The changes address the ‘double dipping’ problem for employees mischaracterised as casual when they were in fact permanent.
Where employees have been paid a 25% casual loading by an employer on the understanding that they are a casual, and a Court later found that they are not casuals (applying the test above), they then effectively became entitled to Fair Work Act benefits of permanent employees, on top of the loading they already received. These entitlements included personal leave, carer’s leave, compassionate leave as well as notice of termination and redundancy pay.
The new changes require the Court to take into account any loadings already paid in determining any award of compensation for non-payment of these entitlements.
The Government has altered the Act to provide for the conversion of some casual employees into permanent employees.
Some of the obligations apply to all employers, regardless of their size, while others apply only to non-small business employers (those with more than 15 employees).
All Employers –Considering an employee request to convert
The following obligations from ss 66F – 66J apply to all employers, including small business employers.
Casual employees who have been employed for 12 months, and who for the past 6 months have worked a regular pattern of hours on an ongoing basis, which they could continue to work as a part-time or full-time employee, can make a request to be converted to permanent employment.
Employers cannot refuse the request unless they consult with the employee, and there are reasonable grounds to refuse the request. Examples of reasonable grounds include (but are not limited to) the position ceasing to exist in the next 12 months or an incoming significant change to the position’s number of hours, particular days, or typical start-time, that would occur in the next 12 months.
A refusal of the request must be provided in writing and must include details of the reasons for the refusal. Whether an employer decides to accept the request, or refuse it, they must provide a response to the request within 21 days of it being made.
Non-Small Business Employers Only – Making a Conversion Offer
The following obligations from ss 66A – 66E apply only to non-small business employers.
If an employee is eligible to make a request to convert to casual employment under the above definition, the employer must make them an offer, in writing, to convert to full or part-time employment. The offer must be of full-time employment if for the past 6 months their hours have been those of a full-time employee.
However, an employer does not have to make such an offer if they have reasonable grounds not to make the offer. The definition of reasonable grounds is the same as for employee requests.
If an employer chooses not to make an offer, they must give written notice of this to the employee and include reasons.
Whether an employer makes an offer, or give notice that they are not making an offer, the employer must do so within 21 days of the employee having been employed for 12 months.
This brief fact sheet belies much of the complexity that lies beneath the employment of casuals.
If you have any questions about how these changes affect you, your business, or your casual employees, or if you have any other employment law queries, please do not hesitate to contact Gabrielle Sullivan via email@example.com