As part of the Commission’s four-yearly review of modern awards[1], the Full Bench of the Fair Work Commission (FWC) recently handed down a number of decisions[2] which have the effect of inserting a model casual conversion clause (Model Clause) into 84 Modern Awards[3] from 1 October 2018.  This provides “regular casual” employees the right to request to convert their employment to permanent full-time or part-time.

The other 28 Modern Awards that already contain a casual conversion clause prior to 1 October 2018 will remain unchanged.

Who can request for casual conversion?

The Model Clause provides a framework under which employees are entitled to request to convert their employment from casual to either permanent part-time or full-time, in certain circumstances.

The entitlement arises if the employee is a “regular casual employee” within the definition provided in the Model Clause.  This requires the employee to have, in the preceding 12 months, worked a pattern of hours on an ongoing basis which, without significant adjustment, the employee could continue to perform as a full-time employee or part-time employee under the provisions of the Modern Award.

When can an employer refuse the request?

In the event that an employee is a “regular casual” employee for the purpose of the Model Clause, the employee is not provided with an automatic right to be converted to permanent full-time or part-time employment.  The Model Clause allows employers to refuse a request on “reasonable grounds”, including any of the following:

  • It would require a significant adjustment to the employee’s hours of work in order for the employee to be engaged as a full-time or part-time employee in accordance with the provisions of the Award. That is, the employee is not truly a regular casual employee under the Award.
  • It is known or reasonably foreseeable that the regular casual employee’s position will cease to exist within the next 12 months.
  • It is known or reasonably foreseeable that the hours of work which the regular casual employee is required to perform will be significantly reduced in the next 12 months.
  • It is known or reasonably foreseeable that there will be a significant change in the days and/or times at which the employee’s hours of work are required to be performed in the next 12 months which cannot be accommodated within the days and/or hours during which the employee is available to work.

For any ground of refusal to be reasonable, the employer must base the reason on facts which are known or reasonably foreseeable at the time the decision is made.

Notification requirements

In the event the employer has determined to refuse the request, it must notify the employee in writing of the decision, and the reasons for it, within 21 days of the request being made.

If the employee does not agree with the decision or the reasons for it, the employee is entitled to dispute the decision under the dispute resolution procedure in their applicable Modern Award.  Under that procedure, the employee or the employer may refer the matter to the Fair Work Commission if the dispute cannot be resolved at the workplace level.

In the event the employer grants the request to covert to permanent employment, it must record the conversion in writing, and the conversion will be effective from the next pay cycle.

The Model Clause also requires employers to provide a copy of the clause to all casual employees covered by it who were employed as at 1 October 2018, by 1 January 2019.

Other recent changes of note

Other recent Modern Award changes that employers should be aware of include:

  • On 1 November 2018, 89 Modern Awards[4] were varied to include a requirement that an employer must pay an employee’s final pay by no later than 7 days after the day on which the employment ends.
  • All Modern Awards have now been amended to include a new clause about family and domestic violence, effective from 1 August 2018. For more information regarding these changes, see our prior post  – Australia introduces unpaid domestic and family violence leave into Modern Awards
  • The full bench of the FWC has recently handed down a decision to insert a new model term into all modern awards which complements the flexible working provisions contained in s 65 of the Fair Work Act 2009 (Cth) (Act); and imposes further obligations on employers when responding to an employee’s request for family friendly working arrangements.  For more information regarding the introduction of this model term, see our prior post – Model term for family friendly working arrangements to be included in modern awards

[1] Section 156 of the Fair Work Act 2009 (Cth) (Act).

[2] 4 yearly review of modern awards – Part-time employment and Casual employment [2018] FWCFB 4695

[3] See schedule of determinations by FWC on the 84 Modern Awards inserted with a casual conversion clause: https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am2014196-197-schedule-determinations-210918.pdf

[4] 4 yearly review of modern awards – Payment of wages [2018] FWC 3064

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