A recent decision by the Fair Work Commission (FWC) to give casual workers the right to request conversion to permanent employment, sought by the Australian Council of Trade Unions (ACTU), has caused a bit of panic on the part of employers. The ACTU has celebrated the move, as the “first small step towards addressing the crisis of insecure work and casualisation in Australia’s workforce”, particularly affecting women and young people.
The draft conversion clause devised by the FWC allows a casual to request conversion to permanent if:
- they have been employed by the employer for 12 months; and
- they have worked a pattern of hours on an ongoing basis over that 12-month period which could continue to be worked on a full-time or part-time basis without significant adjustment.
Does the employer have a choice?
The first thing to note is that at this stage this will (strictly speaking) only apply to casual employees covered by an Award, as the conversion clause is being included in Awards, not in the Fair Work Act or National Employment Standards.
Also, employers will be obliged to ensure their casual (Award covered) employees are provided with a copy of the casual conversion clause for their Award within the first 12 months after their initial engagement.
So it’s fair to say that if a business employs casuals covered by an Award, they’re going to have to deal with this sooner or later. However, an employer can refuse a casual employee’s request to convert to permanent in a number of circumstances. For example, if:
- the employer knows or could reasonably foresee that the casual employee’s position will cease to exist in the near future; or
- if the employee’s hours of work will significantly change or be reduced within the next 12 months; or
- the conversion would require a significant adjustment to the casual’s hours of work to accommodate them in permanent (part-time or full-time) employment, in accordance with the terms of the applicable modern award; or
- on other reasonable grounds based on facts that the employer knows or can reasonably foresee.
For example, if the casual was employed to work on a particular project that the employer knows for certain will last only for 14 months; or if the casual’s work hours are going to significantly change or reduce completely within the next few months due to a product line being discontinued or the introduction of a new technology, those would likely be considered the reasonable requirements of the business and the employer would be able to decline the casual’s request.
If you’d like to know more or get some advice on how to handle this situation if it comes up in your business, get in touch with our friendly team!