Further to our previous Alert, the Fair Work Commission has now inserted casual conversion clauses into a number of modern awards. It is important to be aware that if a modern award applies to your casual employees, you may be required to notify them of their conversion rights by 1 January 2019.
Casual conversion clauses allow some casual employees to elect to convert their employment status to permanent full-time or part-time. The Commission produced a standard casual conversion clause, however not all awards contain this new clause and other awards include a variation of it.
Notifying casual employees of their conversion rights
Under the standard conversion clause, an employer must provide a casual employee to whom the clause applies with a copy of the clause in the award within the first twelve months of their engagement. For existing casual employees who have worked any shifts since 1 October 2018, their employer must provide them with a copy of the clause by 1 January 2019. This obligation applies regardless of whether the casual employee has been employed on a regular basis.
Converting casual employees to part-time or full-time
While an employer’s obligation to notify extends to a broad category of casuals, not all of those casuals are entitled to convert to permanent employment. Under the standard clause, casuals are only eligible to convert if they have, in the twelve months prior to making an election, worked a pattern of hours on an ongoing basis which they could continue to perform as a permanent employee, without significantly their changing working arrangements.
A conversion request must be provided to the employer in writing. An employer must consult with the employee before agreeing to or refusing their request and can only refuse a request on reasonable grounds. Reasonable grounds include a foreseeable change in requirements of the work to be undertaken, or an expectation that the casual employee’s position will no longer exist within the next twelve months. If an employer refuses a request, they will need to provide the employee with a written explanation of the reasons for their refusal within twenty-one days after the request was made.
If the employer accepts the request, the employer and the employee will need to agree on the terms of the new working arrangement in writing and we recommend that a new employment agreement is drafted and signed.
Other awards and enterprise agreements
The standard conversion clause has not been inserted into all modern awards, and some enterprise agreements contain clauses which will exclude or vary the award casual conversion clause. Where this is the case notification, eligibility requirements, and potential grounds for refusal of conversion requests, may differ. It is therefore important to determine what instruments apply to your employees for compliance with these provisions.
What to do
If a modern award including the standard conversion clause applies to your employees and you have not yet provided them with a copy of clause, it is important that you do so shortly. Russell Kennedy can assist with preparing a covering letter tailored to your business to assist in this process.
If you have any questions about casual employees, modern awards, or complying with notice requirements, please contact our Workplace Relations, Employment and Safety Team.
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