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Fair Work Act 2009: New National Employment Standard for offering casual conversion
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In March 2021, a new National Employment Standard was inserted into the Fair Work Act 2009 (the Act). The new Standard created obligations for all federal system Members in respect of: » Offers of casual conversion; and » Requests from employees for casual conversion.
Members (other than small business Members) must do the following: 1. Assess whether any of their casual employees are eligible for offers of casual conversion to permanent (full time or part-time) employment; and 2. Either: (a) make a written offer to the eligible casual employee to convert their employment to permanent (full time or parttime employment); or (b) write to the otherwise eligible employee explaining why they won’t be making an offer to convert to permanent employment. Small business Members are exempt from obligations to offer casual conversion. A Member will be a small business Member if it employs 14 or fewer employees. In this headcount of 14, Members should: • include employees of all associated entities (if any); and • exclude all non-regular casual employees. As a result of the Review, the Fair Work Commission may make changes to the GRIA, particularly to casual employment definitions in the GRIA and the casual conversion clauses in the GRIA. The MGA and Legal and IR team will keep members abreast of developments and any changes to the GRIA.
Eligibility criteria for casual conversion – when must Members make an offer?
Members must make an offer to an eligible casual employee to convert to permanent full time or part-time employment if the employee: 1. Has been employed by the Member for a period of at least 12 months; 2. During at least the last 6 months of the 12-month period, the employee has worked a regular pattern of hours on an ongoing basis; and 3. Could continue to work as a full-time employee or a part-time employee without significant adjustment.1
1 Fair Work Act 2009 (Cth), s 66B(1).
Requirements of offer of casual conversion
The offer must be: • made in writing; • be clear as to whether the employee would convert to full-time or part-time employment; and • If the employee was employed after 26 March 2020 – be given to the employee within 21 days after the end of their 12-anniversary2 of commencement; or • If the employee was employed on or before 26 March 2020 – be given to the employee by 16 April 2021.
Fair Work Act 2009 (Cth), s 66B(2).
If Members have not met the above deadlines, it is advisable that the offer be made as soon as possible. The employee must respond to the offer within 21 days and a failure to do so will mean that they are taken to have declined the offer. If you require assistance in preparing the letter of offer, please contact our MGA TMA Legal and IR Team on 1800 888 479
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What if an employee accepts an offer of casual conversion?
Should an employee accept conversion, Members are required to conduct a discussion with the employee on the following, then confirm the following in writing, within the correct timeframe: • whether the conversion is to full or part-time; • what the hours of work are after conversion; and • date that the conversion takes effect. • It is best practice for Members to then issue a new employment contract which formalises the conversion.
When are Members not required to make an offer of
casual conversion?
Members are not required to make an offer of casual conversion if: • the Member is a small business employer; • the employee is not eligible for an offer of casual conversion outlined in the National Employment Standard; • the employee’s position will cease to exist 12 months after the time of deciding not to make the offer; • the hours of work which the employee is required to perform will be significantly reduced in that period; Members may be exempt from the requirement to provide an offer of casual conversion only if there are other reasonable grounds not to make the offer. If a Member decides not to make an offer, they still must notify the employee in writing (i.e. letter) that they won’t be making an offer of casual conversion and the reasons for this. Members should be aware that employees have a residual right to request conversion in some circumstances, even if they have been notified previously that an offer of conversion will not be made.
Next steps: The Legal and IR Team can also assist Members with preparing employment contracts for converting employees, as well as advising on any of the procedural steps mentioned above. Please phone 1800 888 479.
