Changes to Casual Employment – Industrial Relations Reforms – March 2021

On Friday 26 March 2021, the Fair Work Act 2009 (FW Act) was amended to change workplace rights and obligations for casual employees. The changes were made by the Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Act 2021 (Amendment Act).

What does this mean for you?

While not as significant as first anticipated, the casual employee amendments will impact employers particularly in relation to casual employee engagement, casual employment contracts and processes relating to casual conversion.

The Amendment Act introduces a:

· Casual Employment Information Statement;

· Definition of casual employment; and

· Pathway for casual employees to move to full-time or part-time (permanent) employment.

Casual Employment Information Statement (CEIS)

In addition to the Fair Work Information Statement which must be given to every new employee, casual employees must also be given a copy of the Casual Employment Information Statement upon commencement or soon after.

Small business employers (fewer than 15 employees) must give their existing casual employees a copy of the CEIS as soon as possible.

Other employers (15 or greater employees) must give their existing casual employees a copy of the CEIS as soon as possible before 27 September 2021.

This can be effectively managed using the Employment Hero platform, or alternatively a bulk ‘BCC’ e-mail to all casual employees.

For current HR Partner clients, PeopleVision will action this task on your behalf. New casual will receive a Casual Employment Information Statement when onboarding in Employment Hero.

Definition of Casual Employment

Under the new definition, a person is a casual employee if they accept a job offer from an employer knowing that there is no firm advance commitment to ongoing work with an agreed pattern of work.

Tribunals and courts will now look at the offer of employment to determine whether an employee is casual. The employment contract will give numerous indications as to whether the employer makes no firm advance commitment to continuing and indefinite employment.

When determining whether or not an employee is a casual must be done at the time an offer is made. There are various considerations that must be regarded:

· Whether the employer makes a firm advance commitment that the work will continue ongoing with an agreed pattern of work;

· Whether the employer can elect to offer work and whether the person can elect to accept or reject that work;

· Whether the person will work as required according to the employer needs;

· Whether the employment is described as casual; and

· Whether the person is entitled to casual loading.

Casual Employment Contracts

Casual employment contracts must be reviewed to ensure they satisfy the new statutory definition of a casual employee. This includes ensuring that existing casual contracts are amended or replaced as the changes to the Fair Work Act will apply retrospectively.

It is essential that the casual contract of employment indicates sufficiently that the employment is casual, providing a clause outlining that the employee may accept or reject shifts within a certain timeframe and specifically detailing the additional casual loading.

For current HR Partner clients, PeopleVision will liaise with Employment Hero to ensure the casual contract templates capture these changes.

Casual Conversion (Pathway to Part-Time or Full-Time)

Small businesses (fewer than 15 employees) do not have to offer their casual employees to convert to full-time or part-time (permanent). However, the casual employees can make a request if they meet the requirements.

Other employers (15 or greater employees) must offer their casual employees to convert to full-time or part-time (permanent) when the employees meet the requirements.

Requirements are if the casual employee:

· Has worked for their employer for 12 months;

· Has worked a regular pattern of hours for at least the last 6 of those months on an ongoing basis; and

· Could continue working those hours as a permanent employee without significant changes.

Exceptions and rules do apply, including if an employer has ‘reasonable grounds’ not to make an offer to a casual employee for casual conversion. If this applies, it must be advised in writing.

It is crucial that employers have an organised process in place to ensure they comply with the new obligations. If an employer forgets and the employee would otherwise have been eligible, the employer will essentially breach a National Employment Standard which could lead to penalties.

Double Dipping

Employers no longer have to stress about the “double dipping” consequences if a casual employee is found not to be a casual employee.

Employers are protected from providing backpay relating to leave entitlements which the employee would have been entitled to if not classified as casual. If the Court does find a casual employee (employed as casual and received 25% casual loading) is not actually a casual employee, the Court must reduce any amount payable to the employee for the relevant entitlements (sick leave, annual leave etc.) by an amount equal to the loading amount.

In short, what do we need to do now?

1. Issue a copy of the Casual Employment Information Statement to all existing casual employees;

2. Ensure new casual employees receive a copy of the Casual Employment Information Statement;

3. Review and update all casual employment contract templates and in addition, re-issue new contracts to all existing casual employees;

4. Establish processes to ensure compliance with the new casual conversation obligations and in addition, do an immediate review of existing casual employees.

PeopleVision will liaise with all HR Partner clients to ensure compliance is achieved. Meanwhile, should you have any queries please contact me or Brett Size. Brett can be contact on 0412 303 170 or brett.size@peoplevision.com.au