Changes to the Fair Work Act in March this year gave rise to a new National Employment Standard (NES) which provides a mandated pathway for converting an eligible casual employee to a permanent employee.
Previously, ‘casual conversion’ only applied in certain Awards (such as the Educational Services (Schools) General Staff Award, but not the Teachers Award) and in some enterprise agreements, and usually related to an eligible casual employee having a right to request permanency after a certain period. If an employer did not wish to accept this request, then they could only reject the request on specified grounds, which were to be communicated in writing to the employee.
The NES adopts what was available in the Awards that contained casual conversion clauses except that, in addition, an employer is now required to offer conversion to a casual employee if they meet the eligibility requirements on their 12-month commencement of work anniversary, unless certain conditions apply.
The Fair Work Commission has now updated the provisions in those Awards that contained casual conversion clauses so that they are now consistent with the NES.
Under the NES, a casual employee becomes eligible to be considered for permanency, whether initiated by an employee’s request or by an employer’s offer, if the employee:
A casual employee is eligible to be considered for conversion to:
A school may reject an employee’s request or decide not to offer permanency but only if this is on “reasonable grounds” which are “based on facts that are known or reasonably foreseeable”. Reasonable grounds include that:
A school must respond in writing to an employee’s request within 21 days, or if not making an offer, give the relevant reason within 21 days of the casual employee’s 12-month commencement of work anniversary.
The NES also provides for limiting a casual employee’s entitlement to make further requests for permanency if rejected, and other procedural steps.
Where a school has an Enterprise Agreement (EA), this becomes more complex. An NES overrides a provision in an EA to the extent that the EA provides a lesser entitlement than the NES. Typically, the EAs that contain casual conversion clauses entitle casual employees to request conversion to permanency after only 26 weeks, rather than the 12 months employment and six months of a regular pattern of work in the NES. As this appears to be more generous than the NES, the advice from the Fair Work Ombudsman is to seek legal advice to clarify a school’s obligations in relation to the application of the whole, or part of, the NES.
Firstly, all current and new casual employees must have been provided with a Casual Employment Information Statement from the Fair Work Ombudsman. This sets out the entitlements of conversion from casual to permanent employment. Like the requirement to provide new employees with the Fair Work Information Statement (which must also be provided to casual employees), failure to provide a casual employee with a Casual Employment Information Statement carries penalties for non-compliance.
Secondly, schools should have assessed the employment of all existing casual employees who were employed before 27 March 2021 and determined the length of their employment and whether they had worked a regular pattern of hours.
Employers were required to make the offer of permanency (or communicate why they were not making an offer of permanency) by 27 September 2021 to existing casual employees who had been:
Employers were required to respond to any requests for permanency from casual employees made after 27 September 2021, within 21 days of the request being made, and either accept or respond in writing explaining why their request was being rejected.
It is evident that managing a school’s obligations in relation to casual conversion requires good record keeping and processes to trigger time-based actions such as offers (or not) of permanency.
To comply with the casual conversion requirements, schools must have a system in place to provide an alert when a casual employee is coming up to a 12-month anniversary of their initial engagement with the school. In addition, it is clear that schools must retain accurate records:
Schools should also maintain records of:
Svetlana is a Principal Consultant (NFP) at CompliSpace. She has over 20 years of experience in strategic and operational human resource management, occupational health and safety, and design and implementation of policies and change management programs. She has held national people management responsibility positions in the public and private sectors. Svetlana holds a LLB, Masters in Management (MBA), Master of Arts in Journalism, and a Certificate in Governance for not-for-profits.