Casual Conversion Update and FAQs

In March 2021, the Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Act 2021 (Amendment Act) passed both Houses of Federal Parliament, which amended the Fair Work Act 2009 to include reforms to workplace rights and obligations for casual employees. 

Whilst the legislation included transitional provisions, meaning many of the key provisions requiring action by employers did not take effect until September 2021, we are now nearing the first anniversary of the legislation coming into effect, which sees the transitional provisions end and the commencement of employer obligations to offer casual conversion under the legislation to casual employees engaged on or after March 27th, 2021.

The transitional provisions related to offers of casual conversion to eligible employees, with eligible casual employees engaged before the 27th of March 2021 requiring an offer (or non-offer) of casual conversion, to be made by the 27th of September 2021.

For a recap on casual conversion obligations, please see our 2021 article here.

However, the ongoing provisions of the legislation now require casual employees engaged on or after March 27th, 2021 (ongoing) to be assessed for casual conversion and provided an offer, or non-offer, within 21-days of their 12-month anniversary. This means that the first assessments and offers of conversion of these casuals will commence from the 27th of March 2022.

By now, employers of eligible casual employees should be familiar with the process of assessing suitability of conversion, having completed their assessments of their casual staff employed BEFORE March 27th, 2021, as of September 27th, 2021. Employers of eligible casual employees will now need to repeat this process for individual staff members within 21 days of the individual employees’ 12-month anniversary of employment.

Unlike the requirements of the transitional provisions in September 2021, which required a bulk review of all casual staff engaged prior to March 27th 2021, these reviews must occur within 21 days of each individual employee’s 12 month anniversary. This means you cannot select a key date each year to complete a bulk review, and that these reviews must occur on a rolling basis in line with employees’ commencement dates.

ER Strategies recommends the use of an HR Information System (HRIS) that automatically alerts the employer when an employee has reached their 12 months of service, so that the review of eligibility and written offer can be made within 21 days of this date. (We can assist with selection of an HRIS for interested clients).

Alternatively, employers could set a fortnightly reminder to check their staff lists for any casual employees reaching 12-months of service in the fortnight, and conduct an assessment on these employees within that period. Fortnightly reviews would comply with the requirements to make an assessment within 21 days of an employee’s anniversary.

Through our experience with other ER Strategies’ clients, we believe that most employers generally understand these requirements and have already implemented appropriate processes to ensure offers of conversion (or non-offers) are supplied to employees. Whilst our original article takes you through the process of assessing staff and making offers, below we remind readers of ‘what happens next’ after an offer of conversion is made.

Question 1 – I have made an offer of conversion to an eligible casual employee. What does the employee have to do next?

Employees have a few options here. They can:

  • Respond to the offer in writing and within 21 days of receiving the offer, confirming that they accept the offer of conversion, and are interested in progressing to the next stage of the process, or
  • Respond to the offer in writing and within 21 days of receiving the offer, confirming that they are NOT interested in accepting the offer and wish to remain as a casual employee, or

  • Not reply to the offer at all. If the employee does not reply to the offer within 21 days of receiving it, it is taken that the employee has declined the offer.

There is no obligation for employees to accept an offer of permanent employment, and employees who either respond indicating they are not interested, or who choose not to respond to the offer, will still be eligible to request conversion 6 months after the original offer was received.

All of this information is available to casual employees via the Casual Employment Information Statement that employers must provide to them upon engagement.

Question 2 – An employee has received an offer of conversion and has provided written notice that they accept the offer. What do I have to do now?

In line with the requirements of the Act, if an employee responds indicating that they accept the offer, the employer has 21 days from the date the acceptance is received to give written notice to the employee confirming:

  • Whether the conversion is to full-time or part-time employment; and
  • The employee’s hours of work after the conversion takes effect; and
  • The specific date on which the conversion takes effect. Note: this day must be the first day of the next full pay period after the written notice is given to the employee, unless the employer and employee agree to a different day.

However, prior to giving written notice to the employee outlining the above, the employer should set up a formal meeting to discuss the next steps, including the specifics of the conversion, which will form the employee’s new employment conditions.

Once the employee and employer have agreed on the terms of the permanent employment, a new contract should be issued to the employee and the employee will then become a permanent employee on the agreed start date.

Employees can change their minds at any stage of this process if they no longer want to convert to permanent employment, but should preferably withdraw their acceptance in writing for certainty.

Question 3 – Will I have to offer conversion to all employees again?

All casuals (other than casuals of ‘small business employers’ with less than 15 staff), need to be assessed and either provided with a written offer, or a written letter confirming why an offer is not being made, within 21 days of their 12-month anniversary.

Under the Fair Work Act 2009, this is a once-off obligation imposed on employers, and employers are not required to make a formal offer of conversion again, unless required under an applicable award or agreement. There is no requirement under the legislation for offers to be provided again into the future, or on a regular rolling interval, once the first offer of conversion has been made.

All casual employees have the right to make a request for casual conversion (an employee-initiated action) at any time after 6-months of the initial offer or non-offer being made, and at regular 6 monthly intervals thereafter, if they so choose moving forward. Information on this process is included on the Casual Employment Information Statement. 

Summary

If employers are to remember one thing from this article, ER Strategies recommends that it is the following period: 21 days.

Employers are responsible for:

  • Providing an offer to employees within 21 days after their 12-month anniversary date, and,
  • Responding to an employee’s acceptance of an offer, or a request for conversion, within 21 days of receiving the acceptance or request.

Similarly, employees have 21 days from the date in which the offer is received, to respond to their employer should they wish to accept the offer of conversion.

If clients of ER Strategies have any questions about the information covered above, please reach out to the team on 1300 55 66 37 to discuss your specific situation. As a reminder, suitable casual conversion templates are also available for download from our Online HR service.

Subscribers of ER Essentials who are not yet clients can call the team on 1300 55 66 37 to discuss how we can best assist your business.

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