Casual Conversion Deadline Rapidly Approaching

From 27 September 2021, Australian businesses employing over 15 people will be expected to comply with changes made to the Fair Work Act 2009 (Cth). They must examine whether casual employees hired before 27 March 2021 will be eligible for conversion to part-time or full-time positions.

Employers must remain aware of their legal requirements set out by the Fair Work Commission and their obligations to existing casual employees.

We have prepared this article to help you understand what’s expected of your business and make sure you’re prepared before the 27 September deadline.

Employer Expectations

Following the amendments to the Fair Work Act 2009 (Cth), employers by 27 September will need to assess whether any existing casual employees are eligible to convert to permanent employment types.

Before the deadline, employers must assess, identify and communicate in writing to any eligible employees that they will be making a conversion offer or an explanation as to why they won’t be making an offer. In either instance, this must be accompanied by a copy of the Casual Employment Information Statement.

Eligibility Criteria

Employees are eligible to receive an offer to convert their casual employment status to permanent if:

• They have been employed for 12 months or longer,
• They have worked a regular pattern of hours for an ongoing basis of at least the past 6 months and
• Could continue working these hours as a part-time or full-time employee without significant changes.

How to Make an Offer to Convert?

The offer to convert to a permanent position should be made in a letter that clearly explains and outlines the benefits and entitlements granted to permanent employees, highlighting that the casual loading entitlement will be removed upon acceptance of a permanent offer. If the employee accepts the offer, the employer should clearly outline:

• The employee’s new status,
• Their hours of work and
• The date on which their permanent status comes into effect.

Should an employer have reasonable grounds not to offer a full-time contract to an existing casual employee, they must communicate in writing that the employee is ineligible at this time or that they are eligible, but the employer has reasonable grounds not to make an offer. Employers should explain why the given employee is ineligible or the employer’s grounds not to offer the conversion.

As previously mentioned, employers must also provide employees with a copy of the Casual Employment Information Statement (CEIS), as published by the Fair Work Ombudsman.

This offer must be:

• Communicated by no later than 27 September 2021 if the casual employee commenced employment before 27 March 2021 or,
• Within 21 days of the casual employee’s 12-month anniversary.

Employers will not have to make a conversion offer if the employee does not fit the eligibility requirements set out by the Fair Work Act amendments or if the employer has reasonable grounds not to make an offer. Regardless of whether employers will be making an offer or not, their response must be given to their employee in writing, by or before 27 September 2021. 

What Are Reasonable Grounds for Not Making an Offer?

The Fair Work Act amendment offers a brief summary of examples that constitute reasonable grounds for not making an offer, which includes:

• The employee’s role/position ceasing to exist within 12 months,
• The employee will experience a significant reduction of working hours within the coming 12 months,
• The employee’s days/times of work significantly change in the next 12 months and cannot be accommodated within the employee’s available days or times for work, or
• The employer would have to make a significant adjustment to the employee’s work hours for them to be employed full-time or part-time.

Conversion Offer Deadlines

Casual employees have a period of 21 days to respond to the offer and a further 21 days to discuss and complete employee arrangements. If an employee does not respond to the offer within the 21-day period, the employer can assume that the employee has declined the offer to convert to permanent work.

In Short

• Employers have until 27 September 2021 to offer eligible employees an offer of casual conversion or to communicate an offer will not be made and the reason for the same.
• Employers should explain what entitlements permanent employees receive in addition to changes from casual employment.
• Employers should clearly explain the process for accepting and commencing permanent employment.
• Should employers fail to take these steps, casual employees may have legal options to challenge the employer’s failure to offer conversion through Fair Work or in court.

If your business requires any assistance navigating the changes to the Fair Work Act 2009 (Cth), your obligations, or any further questions, please contact the team at Morrows today.

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