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Not So Casual: The Fair Work Act Now Defines Casual Employment

by | Apr 9, 2021 | Workplace & Employment

With recent amendments to the Fair Work Act 2009 (Cth), it is now time for employers to review the status of their casual employees.

From 27 March 2021, as a result of the amendments, there is now:

  1. a definition of casual employment, which applies retrospectively;
  2. the ability for casual employees to convert to permanent employment; and
  3. the ability for employers to offset casual loading payments in circumstances where employers incorrectly classify permanent employees as casual.

The definition of casual employment provides that an individual is a casual employee if:

  • the employer makes an offer of casual employment;
  • that offer is made by the employer without a firm advance commitment to indefinite and ongoing work according to an agreed pattern of work; and
  • the employee accepts that offer.

Further, employers are bound to provide any new and existing casual employees with a copy of the Fair Work Ombudsman’s Casual Employee Information Statement.

Employers must now offer all casual employees the option to transfer to permanent employment, either part or full-time where the employee:

  • has completed 12 months employment with the employer;
  • for the last 6 months or more, the employee has worked a regular pattern of hours; and
  • is able to remain working those hours on a permanent basis with limited variation.

This requirement does not apply to small business employers, who at the time employ less than 15 employees.

Some employers may decline making offers of conversion on ‘reasonable grounds’, such as the employee’s hours of work reducing after the conversion, and likewise, employees may decline if an offer is made.

In relation to offsetting casual loading, where employees are incorrectly described as casual and are paid a casual loading, but a court finds they are not in fact casual employees, the court must reduce any entitlement payable to them as full-time or part-time employees by reference to the casual loading.

If you as an employer or employee would like further advice on the effect of the amendments to casual employment, please contact our experienced team of workplace relations lawyers on 03 9614 7111 or melbourne@nevettford.com.au.