Casual conversion clause – operative 1 October 2018

More than 12 months ago, the Fair Work Commission (FWC), as part of the 4 yearly review of the Modern Awards, issued a decision confirming their intent to insert a casual conversion clause into 80+ Modern Awards which didn’t contain such a provision. As of 21 September, the model clause has been finalised and became operative from ppc 1 October 2018.

The model clause – available to view here – has now been inserted into over 80 Modern Awards (the FWC determined the Educational Services (Teachers) Award 2010 and the Black Coal Mining Industry Award 2010 will not be affected) and permits casuals who, “in the preceding period of 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 this award” (known as ‘regular casual employees’), the right to request conversion to permanent employment.

Regular casual employees are not compelled to request conversion to permanent just because they achieve 12 months’ (or more) service. Once a regular casual employee achieves the requisite 12 months’ service their right to request conversion remains “continually exercisable” for the duration of their employment. This means, while ever a casual employee meets the definition of a ‘regular casual employee’ (i.e. having worked a regular pattern of hours across the preceding 12-month period) they may exercise their right to request conversion to permanent employment; the right to request conversion does not arise as a one off event during their employment.

An employer may refuse a request to convert to permanent but only on reasonable business grounds and only after there has been consultation with the employee. Examples of ‘reasonable business grounds’ are set out in subclause (g) of the model clause. Where an employer refuses a request to convert, the employer must provide the employee with written reasons within 21 days of the request being made. An employee who does not accept their employer’s refusal may pursue a dispute in accordance with the dispute resolution procedure mapped out in each Modern Award (which permits the employer or employee to refer the matter to the FWC if not resolved at the workplace level).

To comply with the model clause, an employer will be required to furnish every casual employee (whether they are likely to meet the definition of a ‘regular casual employee’ or not) with a copy of the clause within the first 12 months of the employee’s first engagement to perform work. This means an employer could provide a copy of the clause to a casual employee on commencement of employment and this would satisfy the employer’s obligation under the clause. The onus is then on the employee to write to their employer to request conversion if they meet the definition of a ‘regular casual employee’ after 12 months’ (or more) service. The model clause conveys a transition period for casual employees employed as at 1 October 2018; employers will have until 1 January 2019 to furnish such employees with a copy of the conversion clause.

Small adjustments were made to the model clause for a handful of Modern Awards including; Animal Care & Veterinary Services Award 2010; Business Equipment Award 2010; Professional Employees Award 2010 and Real Estate Industry Award 2010. The Meat Industry Award 2010 has also received the casual conversion clause, with some minor adjustments.

A number of Modern Awards which already include a casual conversion provision will not be affected by the introduction of the model clause to the other 80+ Modern Awards. Employer Services clients applying the following Modern Awards had an existing obligation prior to October 2018 to offer conversion to permanent employment to casual employees who achieve six months’ service:

  • Building & Construction General On-site Award 2010;
  • Concrete Products Award 2010;
  • Electrical, Electronic & Communications Contracting Award 2010;
  • Food, Beverage and Tobacco Manufacturing Award 2010;
  • Graphic Arts, Printing and Publishing Award 2010;
  • Joinery and Building Trades Award 2010;
  • Manufacturing and Associated Industries and Occupations Award 2010;
  • Plumbing and Fire Sprinklers Award 2010;
  • Quarrying Award 2010;
  • Textile, Clothing, Footwear and Associated Industries Award 2010;
  • Timber Industry Award 2010; and
  • Vehicle Manufacturing, Repair, Services and Retail Award 2010

Employer Services clients applying the following Modern Awards had an existing obligation prior to October 2018 to offer conversion to permanent employment to casual employees who achieve 12 months’ service:

  • Hospitality Industry (General) Award 2010;
  • Premixed Concrete Award 2010;
  • Registered and Licensed Clubs Award 2010; and
  • Road Transport and Distribution Award 2010

So, what now?

Final determinations to vary each affected Modern Award were issued by the FWC on 21 September. The new casual conversion provisions became operative from ppc 1 October 2018.

Employer Services has updated each Modern Award as necessary and subscribers have been notified by email that updated versions are available online.

Subscribers can also access a convenient new template document titled ‘Model Casual Conversion clause (operative October 2018) Template‘ which must be read in conjunction with our handy PDF reference, ‘Instructions  for Completing Model Casual Conversion clause Template‘. These new resources are available to ES subscribers within your annual subscription service – just login to your online account, go to ‘Templates’ and look for the ‘Casual Conversion’ sub-heading.

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