Many employers have contacted us worried about the impact of the recent Workpac¹ decisions upon their own casual workforce. Following the decisions at Federal Court level, legislative change was introduced to the Fair Work Act 2009 (Cth) which addressed some of those concerns and introduced some additional obligations on employers in relation to casual employees.²
One of the changes requires employers who are not small business employers (those who have more than 15 employees) to assess whether any of their existing casual employees are eligible to have their employment converted to permanent employment.
The employee is eligible for conversion and the employer must make an offer in writing to the casual employee to convert their employment to permanent if that employee:
1. has been employed for a period of 12 months or more;
2. in the previous 6 months has worked a regular and systematic pattern of hours without significant adjustment; and
3. could work those hours as a permanent employee without significant changes.
For employees employed prior to 27 March 2021 this must be done by no later than 27 September 2021.
Can the employer choose not to make an offer?
However, employers are not obliged to make an offer to convert a casual employee’s employment if there are “reasonable business grounds” not to make such an offer. “Reasonable business grounds” means:
1. the position will end in the period of 12 months after the time of deciding not to make an offer;
2. the hours of work that the employee is required to perform will be significantly less in the following 12-month period;
3. there will be a significant change in either or both of the following in the following 12-month period;
a. the days the employee’s hours are required to be performed; and
b. the times the employee’s hours are required to be performed.
4. making an offer would not comply with a selection or recruitment process required by law.
Please note that this list is not exhaustive and other circumstances may apply.
If the employer is not making an offer to convert the casual employee’s employment to permanent, even in circumstances where they do not meet the criteria, the employer must still write to the employee explaining why they will not be offered conversion to permanent employment.
If you require assistance in relation to these changes, please get in touch for advice specific to your circumstances.
MORGAN COUZENS LEGAL
1 WorkPac Pty Ltd v Rossato  FCAFC 84; WorkPac Pty Ltd v Skene  FCAFC 131.
2 Noting that some modern Awards required conversion from casual to permanent employment which predated these legislative changes.