In March 2021, the Fair Work Act 2009 (Cth) (FW Act) was amended to insert:

• a definition of casual employment; and
• minimum rights to request conversion from casual to permanent employment.

New FW Act amendments will mean these provisions will change effective 26 August 2024.

How will the definition of casual employment change?

The new definition retains the current approach of distinguishing casual from permanent employment by the fact the employer does not give a casual a firm advance commitment to offer continuing and indefinite work. However, it makes this assessment objective and broadens the various factors that are relevant.

Relevant factors would include:

• whether there is a mutual understanding or expectation between the employer and employee;
• whether the employee can elect to accept or reject work;
• the future availability of continuing work;
• whether there are other employees performing the same work who are part-time or full-time employees; and
• whether there is a regular pattern of work.

The assessment should consider the real substance, practical reality and true nature of the employment relationship, not a single factor in isolation.

A casual employee who has a regular pattern of work may still be a casual employee if there is no firm advance commitment to continuing and indefinite work.

For example, an employee might indicate she can only accept casual shifts on Friday and Saturday nights, and in fact is only offered shifts at these times. However, if the employer makes it clear in the contract that there is no firm advance commitment to continuing and indefinite work in the business, then the employee is correctly classified as a casual within the meaning of the FW Act.

How are casual conversion rights changing?

Under current laws, the right to request conversion requires the employee to have been employed for at least 12 months and in the last 6 months worked a regular pattern of hours on an ongoing basis which, without significant adjustment, the employee could work as a full-time or part-time employee. In the new test, the employee needs at least 6 months’ employment to exercise this right (12 months for employees of a small business). They will not be able to exercise this right within 6 months of having a prior notification rejected. The employee will simply need to notify their employer that they no longer believe they are a casual employee under the FW Act definition (this is called the new ‘employee choice’ pathway).

The positive obligation on employers to offer conversion to eligible employees will cease to operate on 26 August 2024 (26 February 2025 for small business employers).

The Fair Work Commission (FWC) will have the power to determine, by mandatory arbitration, whether an employer had reasonable grounds to refuse a request for casual conversion.

Employers will still need to provide the Casual Employment Information Statement to casual employees at the start of their employment – but also at 6 and 12 months and the anniversary of the employee’s start date thereafter. Small business employers only need to give the statement at the end of the first 12 months.

The prohibition against misrepresenting employment as casual employment is removed. However, employees will still have protections against the intentional misuse of casual employment, including against them being dismissed to be re-engaged as a casual employee (to break the service period qualifying them for conversion to permanent employment) and knowingly making false statements to engage a person as a casual employee.

Any period of employment that occurred before these changes take effect will not count for the purposes of determining whether an employee has met the eligibility requirements.

The right to request casual conversion for employees who are engaged as casual employees as at 26 August 2024 will be preserved to ensure that existing casual employees retain a mechanism in the FW Act to request conversion to full-time or part-time employment, until such time as they are able to access the new employee choice pathway. The employee choice pathway will become available 31 December 2024 or 1 July 2025 for casual employees employed by a small business.

Enterprise agreements and employment contracts may make different provisions for casual conversion; however, they cannot undercut the FW Act provisions.