Casual Employment Changes commencing 26 August 2024
A new definition of “casual employee” has been introduced to the Fair Work Act. Under this new definition, an employee is only a casual employee if:
there isn’t a firm advance commitment to continuing and indefinite work, taking into account a number of factors, including the real substance, practical reality and true nature of the employment relationship; and
they're entitled to receive a casual loading or specific casual pay rate.
Whether there is a firm advance commitment to continuing and indefinite work, needs to be assessed on the real substance, practical reality and true nature of the employment relationship and other factors including:
the employer can offer or not offer work to the employee (and whether this is happening)
the employee can accept or reject work
it’s reasonably likely there will be future work available to the employee
there are full-time or part-time employees performing the same kind of work
the employee has a regular pattern of work.
Employees who were employed casually before 26 August 2024 will stay casuals under the new definition unless they transition to full-time or part-time employment.
Fair Work Australia offers the following example:
Example: Casual employee
Josh starts as a bartender for a new summer pop-up restaurant.
Josh gets a roster each week with the shifts he’s being offered for the following week. He can then decide whether to accept those shifts or let his employer, Angela, know he can’t work them.
Josh also works varying shifts each week during summer, depending on when Angela needs him.
Josh gets paid a casual loading of 25%. All the other employees at the pop-up restaurant are casual too.
Angela isn’t sure whether the restaurant will continue operating after the summer.
Josh is a casual employee because:
there's no firm advance commitment to continuing and indefinite work
he's earning a casual pay rate.
Casual Conversion – changes effective 26 August 2024
A new pathway will be introduced for eligible employees to change to either full-time or part-time employment. These new rules will replace the current rules.
Employees will be able to notify their employer of their intention to change to permanent employment if:
they have been employed for at least 6 months (or 12 months if working for a small business)
they believe they no longer meet the requirements of the new causal employee definition.
An employee cannot notify their employer of their intention to change to permanent employment if they are currently engaged in an ongoing dispute with their employer about casual conversion, or in the last 6 months their employer refused a previous notification.
An employer must respond in writing to the employee within 21 days either accepting or refusing the request. An employer must have reasonable grounds for rejecting a request which may be that the employee still meets the definition of a casual, or there are fair and reasonable operational grounds.
Independent Contractor Changes – effective 26 August 2024
The definition of a contractor from a Fair Work perspective is different to what it is from a tax, superannuation or a Work Cover perspective. There is a new definition added to the Fair Work Act to determine the meaning of an employee.
To determine if a worker is an employee or contractor from a Fair Work perspective, the following must be considered:
The real substance, practical reality and true nature of the working relationship.
All parts of the working relationship between the parties. This includes the terms of the contract and how the contract is performed in practice.
This is a change from the existing test, which focuses mainly on the terms of a contract.
Right to disconnect – effective 26 August 2024 (non-small business) and 26 August 2025 (small business)
Employees will have a new “right to disconnect” outside of work hours. This means employees will have the right to refuse contact from their employer or a third party (customer) outside of their working hours, unless that refusal is unreasonable.
An employee can refuse to monitor, read or respond to contact from their employer outside of hours.
The reason for the contact
Whether the employee is compensated or paid extra for the contact
The nature of the employee’s role and level of responsibility
The employee’s personal circumstances, including family or caring responsibilities
All awards will be required to include a right to disconnect term by 26 August 2024.
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