Casual employment legislation

Important changes to casual employment

With the JobKeeper subsidy now finished, you may be looking at casual employment as a practical solution to help deal with the ebbs and flows of your business.

However, all businesses that currently employ casual staff, or that are looking at engaging casual staff, need to be aware of some important changes introduced under the Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Bill 2021 (Bill).

Key Changes under the new legislation

1. Under statutory changes there is a new definition of casual employee.

A person will now be defined as a casual employee if they accept an offer with no firm advance commitment of regular work.

The following considerations will determine this issue:

  • whether the employee can elect to accept or reject work;
  • whether the employee will work as required according to the needs of the employer;
  • whether the employment is described as casual employment; and
  • whether the employee will receive a casual loading.

2. There is an obligation on employers with 15 or more employees to offer casual employees conversion to permanency after 12 months of employment where there has been a regular pattern of hours on an ongoing basis, during at least the last 6 months of that period.

Employers are not obliged to make an offer if there are “reasonable business grounds” not to, but they must notify the employee in writing of their decision not to make the offer.  Where an employee refuses an offer to convert, they no longer hold a right to request conversion at a later date.

3. A new Casual Employment Information Statement is to be provided to each casual employee when they start employment with their employer, in addition to the Fair Work Information Statement that employers already need to provide employees.

4. There is a new statutory offset rule that stops ‘double dipping’ by casual employees who are found to be permanent employees.

If an employee has been misclassified as a casual and has entitlements owing to them as result of the misclassification (such as annual leave), the Court can now offset the casual loading already paid to the employee against any entitlements owing.

Importantly, the offset provision can also apply to historical claims.

Next steps for employers

For employers who engage casuals we recommend you:

  • review your casual employment agreements, to ensure that the wording of the agreement and terms of the engagement means that their casual status will be recognised.
  • review systems for engagement of casual employees to ensure that the new legal requirements are met – such as providing all casual employees with the new Casual Employment Information Statement.
  • review whether your existing casual employees are entitled to convert to permanent employees and ensure your processes comply with the new casual conversion obligations.

Allan Hall Human Resources are workplace experts who are well-placed to help employers navigate all of the above.

If you have any questions or require support, please do not hesitate to contact us directly at [email protected].