As part of its four year review of awards, the Fair Work Commission has identified a number of “common issues” across the modern awards which it will address through submissions to separate full benches. The common issues thus far identified are: annual leave, apprentice conditions, award flexibility, part-time employment, public holidays, transitional provisions and Casual Employment.

The question of casual employment has been a vexed one for some time. Many modern awards do not define casual employment beyond stating that a casual employee is “an employee engaged as suchand, in some workplaces, the differences between a casual and a permanent employee is hard to distinguish.

Employers need to consider whether the “casual employee,” despite a written contract stating their status, is in fact a casual. This is especially true when working out an employee’s entitlements on termination or redundancy. A “casual employee” who has been working in a regular and systematic fashion for a long time may be “deemed” to be a permanent employee. The Fair Work Ombudsman may well decide a “casual employee” is a full time or part-time employee and require the employer to make payments to the employee for unpaid entitlements such as annual leave.

The Australian Council of Trade Unions has proposed a number of model clauses for modern awards including:

A mandatory casual conversion clause whereby a casual employee who has worked in a regular and systematic way during a qualifying period (six or twelve months)would have the right to elect to be either part-time or full time and an employer would be obliged to inform the employee of their right to do so;
A mandatory casual conversion clause where an employee who has worked in a regular and systematic way during a qualifying period (a suggested six months) would automatically become permanent after the qualifying period unless the employee notified the employer that they did not wish to convert to permanent status.

The ACTU are also seeking

a minimum four hour engagement or payment for casual employees,
that employers be obligated to ask existing staff if they would like to increase their hours before engaging the number of casual or part time employees; and
that employers must inform a casual employee on engagement of the likely number of hours they will be required.
The Fair Work Commission are currently seeking submissions. Any decision may vary across awards on the basis of the industry needs.

Employer planning and action:

Employers should review their current workforce and whether there are “casual employees” who have been working regular and systematic hours for more than 12 months. If so, employers should consider updating the employment contracts for those employees.