In a landmark decision, on 5 July 2017 a 5-member full bench of the Fair Work Commission (FWC) has accepted the primary proposition of the Australian Council of Trade Unions (ACTU) that the “unrestricted use of casual employment without the safeguard of a casual conversion clause may operate to undermine the fairness and relevance of the safety net”. Accordingly, the FWC has found that it is necessary for modern awards to contain a provision by which casual employees may elect to convert to full-time or part-time employment, subject to specified criteria and restrictions, to meet the modern awards’ objective of providing a fair and relevant minimum safety net.
Whilst this aspect of the FWC’s decision has caused concern amongst employer groups that it will lead to reduced flexibility for some employers in some industries, the FWC rejected potentially more restrictive aspects of the ACTU’s claims including that:
- all casual and part-time employees be engaged for a daily minimum period of 4 hours;
- an employer be prohibited from hiring more casual or part-time employees until existing employees were offered more hours; and
- casuals be given an absolute right to convert to permanent employment after six months of regular work with no right for the employer to refuse the conversion.