Changes to casual conversion laws: what you need to know

Recent amendments to the Fair Work Act (FW Act) ushered in significant changes to the rules concerning the right of casual employees to request conversion to permanent status. The changes make conversion more accessible for casual employees while adjusting the obligations on employers. Here is a breakdown of the key changes and how they could impact employees and employers.

Revised eligibility and the introduction of the ’employee choice’ pathway

One of the most notable changes is the adjustment in eligibility criteria for requesting conversion from casual to permanent employment. Previously, an employee needed to have completed at least 12 months of employment, including a regular pattern of hours in the last six months, to qualify for conversion. Under the new laws, the required employment period has been shortened to six months, although it remains at 12 months for small business employees (those employing fewer than 15 employees).

Further, introducing the ’employee choice’ pathway simplifies the process for employees. Instead of proving a consistent pattern of hours, employees can now notify their employers when they believe they no longer fit the definition of a casual employee under the FW Act. This pathway, however, cannot be accessed within six months of a prior rejected notification, ensuring that requests are spaced reasonably.

Changes in employer obligations

Significantly, commencing 26 August 2024, the obligation for employers to proactively offer conversion to eligible employees ceases (extended to 26 February 2025 for small business employers).

Employers must continue to provide the Casual Employment Information Statement at the start of employment and at regular intervals thereafter—six months, 12 months, and on each anniversary of the employee’s start date. Small business employers are only required to provide this statement at the end of the first 12 months of employment

Enforcement and protections

The Fair Work Commission (FWC) retains a critical role under the new framework. It will have the authority to conduct mandatory arbitration to determine if an employer had reasonable grounds to refuse a casual conversion request.

While the prohibition against misrepresenting employment as casual has been removed, protections against the misuse of casual employment remain robust. These include measures against dismissing permanent employees to hire them back as casuals.

Transitional measures and contractual flexibility

For employees engaged as casuals as of 26 August 2024, the right to request conversion is preserved, ensuring they are not left out as the laws transition. Additionally, while enterprise agreements and employment contracts can set their own terms for casual conversion, they cannot provide conditions less favourable than those stipulated by the Fair Work Act.

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